[Federal Register Volume 63, Number 132 (Friday, July 10, 1998)]
[Notices]
[Pages 37339-37344]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-18301]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-601]
Tapered Roller Bearings and Parts Thereof, Finished and
Unfinished, From the People's Republic of China; Preliminary Results of
1996-1997 Antidumping Duty Administrative Review and New Shipper Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of preliminary results of 1996-1997 antidumping duty
administrative review and new shipper review of tapered roller bearings
and parts thereof, finished and unfinished, from the People's Republic
of China.
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SUMMARY: In an administrative review, we preliminarily determine that
sales of tapered roller bearings and parts thereof, finished and
unfinished, from the People's Republic of China, were made below normal
value during the period June 1, 1996, through May 30, 1997. In a new
shipper review, we preliminarily determine that sales of tapered roller
bearings and parts thereof, finished and unfinished, from the People's
Republic of China, were not made below normal value during the period
June 1, 1996, through May 30, 1997. Interested parties are invited to
comment on these preliminary results.
EFFECTIVE DATE: July 10, 1998.
FOR FURTHER INFORMATION CONTACT: Zak Smith or Cynthia Thirumalai,
Import Administration, International Trade Administration, U.S.
Department of Commerce, 14th Street and Constitution Avenue, NW,
Washington DC 20230; telephone (202) 482-1279 and (202) 482-4087,
respectively.
SUPPLEMENTARY INFORMATION:
Applicable Statute
Unless otherwise indicated, all citations to the Tariff Act of
1930, as amended (``the Act''), are references to the provisions
effective January 1, 1995, the effective date of the amendments made to
the Act by the Uruguay Round Agreements Act (``URAA''). In addition,
all references to the Department's regulations are to 19 CFR 353 (April
1997).
Background
On May 27, 1987, the Department of Commerce (``the Department'')
published in the Federal Register (52 FR 19748) the antidumping duty
order on tapered roller bearings and parts thereof, finished and
unfinished (``TRBs''), from the People's Republic of China (``PRC'').
The Department notified interested parties of the opportunity to
request an administrative review of this order on June 11, 1997 (62 FR
31786). The petitioner, The Timken Company, and one of the respondents,
Luoyang Bearing Factory (``Luoyang''), requested that the Department
conduct an administrative review. These requests were received on June
30, 1997. Thus, in accordance with 19 CFR 353.22(c), we published a
notice of initiation of this antidumping duty administrative review on
August 1, 1997 (62 FR 41339).
In addition to the administrative review, on May 30, 1997, Zhejiang
Changshan Bearing (Group) Co., Ltd. (``ZX'') requested that we conduct
a new shipper review. We published a notice of initiation of this new
shipper administrative review on August 14, 1997 (62 FR 43514). This
new shipper review covers the same period as the normal administrative
review: June 1, 1996, through May 30, 1997.
On September 23, 1997, we sent a questionnaire to the Secretary
General of the Basic Machinery Division of the Chamber of Commerce for
Import & Export of Machinery and Electronics Products and requested
that the questionnaire be forwarded to all PRC companies identified in
our initiation notice and to any subsidiary companies of the named
companies that produce and/or export the subject merchandise. In this
letter we also requested information relevant to the issue of whether
the companies named in the initiation request are independent from
government control. See the Separate Rates section, below. Courtesy
copies of the questionnaire were also sent to companies with legal
representation and to companies listed in the initiation notice for
which we were able to obtain addresses.
We received responses to the questionnaire from the following ten
companies: Peer Bearing Company/Chin Jun Industrial, Ltd. (``Chin
Jun''), Wafangdian Bearing Factory (``Wafangdian''), China National
Machinery Import & Export Corporation (``CMC''), Liaoning MEC Group
Company (``Liaoning''), Luoyang, Zhejiang Machinery Import & Export
Corporation (``Zhejiang''), Wanxiang Group Corporation (``Wanxiang''),
Premier Bearing & Equipment (``Premier''), and Xiangfan Machinery
Foreign Trade Corporation (``Xiangfan''), as respondents in the
administrative review, and ZX, as the respondent in the new shipper
review.
The Department is conducting this administrative review and new
shipper review in accordance with section 751 of the Act.
Scope of Review
Merchandise covered by this review includes TRBs and parts thereof,
finished and unfinished, from the PRC; flange, take up cartridge, and
hanger units incorporating tapered roller bearings; and tapered roller
housings (except pillow blocks) incorporating tapered rollers, with or
without spindles, whether or not for automotive use. This merchandise
is classifiable under the Harmonized Tariff Schedule of the United
States (``HTSUS'') item numbers 8482.20.00, 8482.91.00.50, 8482.99.30,
8483.20.40, 8483.20.80, 8483.30.80, 8483.90.20, 8483.90.30, 8483.90.80,
8708.99.80.15, and 8708.99.80.80. Although the HTSUS item numbers are
provided for convenience and customs purposes, the written description
of the scope of the order and this review is dispositive.
[[Page 37340]]
Verification
As provided in section 782(i) of the Act, we verified information
provided by Wafangdian, CMC, Xiangfan, ZX and Luoyang as well as
certain subcontractors, using standard verification procedures,
including on-site inspection of manufacturers' facilities, the
examination of relevant cost data and financial records, and selection
of original documentation containing relevant information. Our
verification results are outlined in the public and business
proprietary versions of the verification reports.
Separate Rates Determination
To establish whether a company operating in a state-controlled
economy is sufficiently independent to be entitled to a separate rate,
the Department analyzes each exporting entity under the test
established in the Final Determination of Sales at Less Than Fair
Value: Sparklers from the People's Republic of China, 56 FR 20588 (May
6, 1991) (``Sparklers''), as amplified by the Final Determination of
Sales at Less Than Fair Value: Silicon Carbide from the People's
Republic of China, 59 FR 22585 (May 2, 1994) (``Silicon Carbide'').
Under this policy, exporters in non market economies (``NMEs'') are
entitled to separate, company-specific margins when they can
demonstrate an absence of government control, both in law and in fact,
with respect to export activities. Evidence supporting, though not
requiring, a finding of de jure absence of government control over
export activities includes: (1) an absence of restrictive stipulations
associated with the individual exporter's business and export licenses;
(2) any legislative enactments decentralizing control of companies;
and, (3) any other formal measures by the government decentralizing
control of companies. De facto absence of government control over
exports is based on four factors: (1) whether each exporter sets its
own export prices independently of the government and without the
approval of a government authority; (2) whether each exporter retains
the proceeds from its sales and makes independent decisions regarding
the disposition of profits or financing of losses; (3) hether each
exporter has the authority to negotiate and sign contracts and other
agreements; and, (4) whether each exporter has autonomy from the
government regarding the selection of management (see, Silicon Carbide,
59 FR at 22587 and Sparklers, 56 FR at 20589).
In previous administrative reviews of the antidumping duty order on
TRBs from the PRC we determined that Wafangdian, CMC, Liaoning,
Luoyang, Zhejiang, Wanxiang, and Xiangfan merited separate rates (see,
e.g., Tapered Roller Bearings and Parts Thereof, Finished and
Unfinished, From the People's Republic of China; Final Results of
Antidumping Administrative Review, 62 FR 61276 (November 17, 1997)
(``TRBs 95-96 Review'')). We preliminarily determine that the evidence
on the record of this review also demonstrates an absence of government
control, both in law and in fact, with respect to these companies'
exports according to the criteria identified in Sparklers and Silicon
Carbide. Therefore, we have continued to assign each of these companies
a separate rate.
Premier and Chin Jun are privately owned Hong Kong trading
companies. Because we have determined that these firms, rather than
their PRC-based suppliers, are the proper respondents with respect to
their sales of TRBs to the United States, no separate-rates analyses of
Premier's and Chin Jun's suppliers are necessary. See the United States
Sales section, below.
Finally, as discussed below, the new shipper, ZX, also meets both
the de jure and de facto criteria. Accordingly, we preliminarily
determine to apply a separate rate to ZX.
ZX: De Jure Analysis
Information submitted during this review indicates that ZX is owned
``by all the people of the People's Republic of China.'' In Silicon
Carbide (59 FR at 22586), we found that the PRC government had devolved
control of state-owned enterprises, i.e., enterprises owned ``by all of
the people.'' As a result, we determined that companies owned ``by all
of the people'' were eligible for individual rates if they met the
criteria developed in Sparklers and Silicon Carbide.
The following laws, which have been placed on the record in this
case, indicate a lack of de jure government control over these
companies, and establish that the responsibility for managing companies
owned by ``all of the people'' has been transferred from the government
to the enterprises themselves. These laws include: ``Law of the PRC on
Industrial Enterprises Owned by the Whole People,'' adopted on April
13, 1988 (``1988 Law''); ``Regulations for Transformation of
Operational Mechanism of State-Owned Industrial Enterprises,'' approved
on August 23, 1992 (``1992 Regulations''); and the ``Temporary
Provisions for Administration of Export Commodities,'' approved on
December 21, 1992 (``Export Provisions''). The 1988 Law states that
enterprises have the right to set their own prices (see Article 26).
This principle was restated in the 1992 Regulations (see Article IX).
Finally, the 1992 ``Temporary Provisions for Administration of Export
Commodities'' lists those products subject to direct government
control. TRBs do not appear on this list and therefore are not subject
to the constraints of these provisions.
Consistent with Silicon Carbide, we preliminarily determine that
the existence of these laws demonstrates that ZX, a company owned by
``all of the people,'' is not subject to de jure government control
with respect to export activities. In light of reports indicating that
laws shifting control from the government to the enterprises themselves
have not been implemented uniformly 1, an analysis of de
facto control is critical in determining whether respondents are, in
fact, subject to government control with respect to export activities.
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\1\ ``PRC Government Findings on Enterprise Autonomy,'' in
Foreign Broadcast Information Service--China--93-133 (July 14,
1993), and 1992 Central Intelligence Agency Report to the Joint
Economic Committee, Hearings on Global Economic and Technological
Change: Former Soviet Union and Eastern Europe and China, Pt. 2 (102
Cong., 2d Sess.).
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ZX: De Facto Analysis
According to information provided by ZX, the company's pricing and
export strategy decisions with respect to the subject merchandise are
not subject to any entity's review or approval and there are no
government policy directives that affect these decisions. ZX further
claims that there are no restrictions on the use of its revenues or
profits, including export earnings.
ZX further states that its general manager is selected by the
company's board of directors. While the results of ZX's management
selections are recorded with the Foreign Trade and Economic Cooperation
Commission, there is no evidence that this commission controls the
selection process or that it has rejected a general manager selected
through the election process. ZX's general manager has the right to
contractually bind the company in making sales of TRBs.
ZX also states that its sources of funds are its own revenues or
bank loans. It has sole control over, and access to, its bank accounts,
which are held in ZX's own name.
Based on our analysis of the foregoing evidence on the record, we
find neither
[[Page 37341]]
de jure nor de facto government control over the export activities of
ZX. Accordingly, we preliminarily determine that ZX is not part of the
``PRC enterprise'' under review and is entitled to a separate rate.
Separate-Rate Determinations for Non-Responsive Companies
We have determined that those companies for which we initiated a
review and which did not respond to the questionnaire do not merit
separate rates. See the Use of Facts Otherwise Available section,
below.
Use of Facts Otherwise Available
We preliminarily determine that, in accordance with sections 776(a)
and (b) of the Act, the use of adverse facts available is appropriate
for all companies which did not respond to our requests for
information. Furthermore, we preliminarily determine that Premier did
not demonstrate that it cooperated to the best of its ability in
providing certain information, and we have applied adverse facts
available to calculate a portion of Premier's margin. Finally, we
preliminarily determine that Chin Jun, CMC and Xiangfan cooperated to
the best of their ability in providing information. Thus, for these
companies, although we are using facts available, we have not relied on
adverse information to calculate antidumping margins (for a complete
discussion of the company specific facts available decisions see the
Memorandum to Susan Kuhbach: ``Facts Available,'' dated June 30, 1998).
1. Companies that did not respond to the questionnaire: Where the
Department must base its determination on facts available because a
respondent failed to cooperate by not acting to the best of its ability
to comply with a request for information, section 776(b) of the Act
authorizes the Department to use inferences adverse to the interests of
that respondent in choosing facts available. Section 776(b) of the Act
also authorizes the Department to use as adverse facts available
information derived from the petition, the final determination, a
previous administrative review, or other information placed on the
record. Information from prior segments of the proceeding constitutes
secondary information and section 776(c) of the Act provides that the
Department shall, to the extent practicable, corroborate that secondary
information 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 to be used. However, unlike other types of information,
such as input costs or selling expenses, there are no independent
sources for calculated dumping margins. 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
inappropriate. 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, e.g.,
Fresh Cut Flowers from Mexico; Final Results of Antidumping Duty
Administrative Review, 61 FR 6812, 6814 (Feb. 22, 1996) (where the
Department disregarded the highest margin as adverse facts available
because the margin was based on another company's uncharacteristic
business expense resulting in an unusually high margin)).
We have preliminarily assigned a margin of 29.40 percent to those
companies for which we initiated a review and which did not respond to
the questionnaire. This margin, calculated for sales by Wafangdian
Bearing Factory during the 1994-95 review, represents the highest
overall margin calculated for any firm during any segment of this
proceeding. As discussed above, it is not necessary to question the
reliability of a calculated margin from a prior segment of the
proceeding. Further, there are no circumstances indicating that this
margin is inappropriate as adverse facts available. Therefore, we
preliminarily find that the 29.40 percent rate is corroborated. As
noted in the Separate Rates Determination section above, we have also
preliminarily determined that the non-responsive companies do not merit
separate rates. Therefore, the facts available for these companies
forms the basis for the PRC rate, which is 29.40 percent for this
review.
2. Premier: Premier, a Hong Kong-based reseller of TRBs, claims
that it attempted to get factors of production data from its suppliers.
One supplier provided data, but the overwhelming majority did not. A
second PRC bearing manufacturer, that was not a supplier of Premier,
but produced certain models sold by Premier, agreed that Premier could
submit its factors of production data. For the remaining models sold in
the United States by Premier, no factors data was reported.
We have preliminarily determined that Premier has not demonstrated
that it cooperated to the best of its ability to respond to our
antidumping duty questionnaire. This preliminary finding is based on
the fact that, while Premier has stated that it attempted to obtain
factors data from its PRC-based suppliers, it has not provided evidence
of these attempts or corresponding documentation of its suppliers'
refusal to provide the requested information. Prior to the final
results of review, we intend to seek documentation of Premier's claim
that it attempted to solicit from all of its PRC-based suppliers the
information requested in the questionnaire and to make a judgement as
to whether Premier has acted to the best of its ability.
As in prior reviews, we have also preliminarily determined that
there is little variation in factor utilization rates among the TRB
producers from which we have received factors of production data (see,
e.g., TRBs 95-96 Review). Therefore, as facts available, we have used
the factors data provided by Premier, including information from
manufacturers which did not supply Premier during the POR, when
calculating normal value for those sales without supplier specific
factors data. With respect to Premier's U.S. sales for which no factors
data were reported, we are applying, as adverse facts available, a
margin of 25.56 percent, the highest overall margin ever applicable to
Premier. This approach is consistent with our final results in the
prior review (see, TRBs 95-96 Review). As discussed above, it is not
necessary to question the reliability of a calculated margin from a
prior segment of the proceeding. Further, there are no circumstances
indicating that this margin is inappropriate as adverse facts
available. Therefore, we preliminarily find that the 25.56 percent rate
is corroborated.
3. Chin Jun: Chin Jun, another Hong Kong-based reseller of TRBs,
provided factors data from three of its PRC-based suppliers covering a
substantial majority of its U.S. sales during the POR. For certain
other models it sold to the United States, Chin Jun provided factors
data from other PRC suppliers that did not supply Chin Jun during the
POR. For the remainder of the models it sold
[[Page 37342]]
in the United States Chin Jun reported no factors data.
We preliminarily determine that Chin Jun has demonstrated that it
cooperated to the best of its ability to respond to our antidumping
duty questionnaire. This preliminary finding is based on the fact that
Chin Jun has stated that it attempted to obtain from its PRC-based
suppliers factors data for the remaining U.S. sales and has provided
documentary evidence of such attempts. However, we intend to seek
further clarification from Chin Jun about its actions to obtain factors
data and to make a judgement as to whether its efforts were to the best
of its ability.
As in prior reviews, we have also preliminarily determined that
there is little variation in factor utilization rates among the TRB
producers from which we have received factors of production data (see,
e.g., TRBs 95-96 Review). Therefore, as facts available, we have used
the factors data provided by the companies that supplied Chin Jun
during the POR to Chin Jun's sales of models for which no supplier and
model match was available. With respect to Chin Jun's U.S. sales for
which no factors data were reported, because we have preliminarily
determined that Chin Jun has cooperated to the best of its ability, we
are applying, as facts available, the weighted-average margin
calculated for those U.S. sales for which acceptable data were
reported.
4. CMC: CMC did not report packing factors for bearings supplied by
one of its suppliers. For these sales, we are applying, as facts
available, the packing factors used for other CMC sales.
5. Xiangfan: At verification, we learned that Xiangfan had
calculated its labor input using standard process time rather than the
actual hours of employee time, and that this resulted in substantial
under reporting of the labor factor. In addition, Xiangfan failed to
report electricity consumed at one stage of the manufacturing process.
As facts available, we used information collected at verification to
recalculate the labor input and to increase the amount of electricity
factor.
United States Sales
Both Chin Jun and Premier reported that they maintain inventories
of TRBs in Hong Kong and sell TRBs worldwide. Therefore, their PRC-
based suppliers have no knowledge when they sell to these firms that
the shipments are destined for the United States. Accordingly, Chin Jun
and Premier are the first parties to sell the merchandise to the United
States and we have calculated United States price based on their sales.
For sales made by Chin Jun, we based the U.S. sales on CEP in
accordance with section 772(b) of the Act because the first sale to an
unaffiliated purchaser occurred after importation of the merchandise
into the United States. For sales made by Wafangdian, Liaoning,
Luoyang, Zhejiang, Wanxiang, Premier, Xiangfan, and ZX (the new
shipper), we based the U.S. sales on EP, in accordance with section
772(a) of the Act, because the subject merchandise was sold to
unaffiliated purchasers in the United States prior to importation into
the United States and because the CEP methodology was not indicated by
other circumstances. CMC made both EP and CEP sales.
We calculated EP based on the FOB, CIF, or C&F port price to
unaffiliated purchasers. From these prices we deducted amounts, where
appropriate, for brokerage and handling, foreign inland freight, ocean
freight, and marine insurance. We valued the deduction for foreign
inland freight using surrogate data based on Indian freight costs. (We
selected India as the surrogate country for the reasons explained in
the Normal Value section of this notice.) When marine insurance and
ocean freight were provided by PRC-owned companies, we valued the
deductions using the surrogate data of international providers. When
marine insurance and ocean freight were provided by market economy
companies, we deducted the actual expense values reported by the
respondents for these services.
We calculated CEP based on the packed, ex-warehouse price from the
U.S. subsidiary to unaffiliated customers. We made deductions, where
appropriate, from the starting price for CEP for international freight,
foreign brokerage and handling, foreign inland freight, marine
insurance, customs duties, U.S. brokerage, U.S. inland freight
insurance and U.S. inland freight. In accordance with section 772(d)(1)
of the Act, we made further deductions from the starting price for CEP
for the following selling expenses that related to economic activity in
the United States: commissions to unaffiliated resellers; credit
expenses; indirect selling expenses, including inventory carrying
costs; and repacking in the United States. In accordance with section
772(d)(3) of the Act, we have deducted from the starting price an
amount for profit.
Normal Value
Section 773(c)(1) of the Act provides that the Department shall
determine normal value (``NV'') using a factors-of-production
methodology if: (1) the merchandise is exported from an NME, and (2)
the information does not permit the calculation of NV under section
773(a) of the Act. The Department has treated the PRC as an NME in all
previous antidumping cases. In accordance with section 771(18)(C)(i) of
the Act, any determination that a foreign country is an NME shall
remain in effect until revoked by the administering authority. None of
the parties to this proceeding has contested such treatment in this
review. Moreover, parties to this proceeding have not argued that the
PRC tapered roller bearing industry is a market-oriented industry.
Consequently, we have no basis to determine that the information would
permit the calculation of NV using PRC prices or costs. Therefore,
except as noted below, we calculated NV based on factors of production
in accordance with sections 773(c)(3) and (4) of the Act and 19 CFR
351.408(c).
Although Premier and Chin Jun are Hong Kong companies, we also
calculated NV for them based on factors-of-production data. We did not
use these respondents' third-country sales in calculating NV because
their PRC-based suppliers knew at the time of sale that the subject
merchandise was destined for exportation. Section 773(a)(3)(A) of the
Act provides that under such conditions NV may be determined in the
country of origin of the subject merchandise.
Accordingly, we calculated NV for Premier and Chin Jun on the basis
of PRC production inputs and surrogate country factor prices.
Under the factors of production methodology, we are required to
value the NME producer's inputs in a comparable market economy country
that is a significant producer of comparable merchandise. We chose
India as the most comparable surrogate on the basis of the criteria set
out in 19 CFR 353.52(b). See the Memorandum to Susan Kuhbach from Jeff
May: ``Tapered Roller Bearings (``TRBs'') from the PRC: Non Market
Economy Status and Surrogate Country Selection,'' dated December 5,
1997, for a further discussion of our surrogate selection. We chose
Indonesia as a second-choice surrogate based on the same criteria.
Also, information on the record indicates that both India and Indonesia
are significant producers of TRBs.
We used publicly available information from India to value the
various factors of production with the exception of the following: hot-
rolled alloy steel bars for the production of cups and cones, and steel
scrap from the production of cups and cones. For these
[[Page 37343]]
values we used publicly available information from Indonesia because we
found the Indian data for those inputs unreliable (see, Memorandum to
Susan Kuhbach: ``Selection of a Surrogate Country and Steel Value
Sources,'' dated June 30, 1998).
We valued the factors of production as follows (for a complete
description of the factor values used, see the Memorandum to Susan
Kuhbach: ``Factors of Production Values Used for the Preliminary
Results,'' dated June 30, 1998):
1. Steel Inputs. For hot-rolled alloy steel bars used in the
production of cups and cones, we used import prices from the Harmonized
Tariff Schedule (``HTS'') category 7228.3000 obtained from the Foreign
Trade Statistical Bulletin (January-October 1997), Imports, Jakarta,
Indonesia. For cold-rolled steel rods used in the production of rollers
and cold-rolled steel sheet for the production of cages, we used Indian
import data under Indian tariff subheading 7228.50 and 7209.42
respectively. This data was obtained from the Monthly Statistics of the
Foreign Trade of India, Vol. II--Imports (April 1995-March 1997). As in
previous administrative reviews, we eliminated from our calculation
steel imports from NME countries and imports from market economy
countries that were made in small quantities. For steel used in the
production of cups, cones, and rollers, we also excluded imports from
countries that do not produce bearing quality steel (see, e.g., TRBs
95-96 Review). We made adjustments to include freight costs incurred
using the shorter of the reported distances from either the closest PRC
port to the TRBs factory, or from the domestic supplier to the TRBs
factory (see, Notice of Final Determination of Sales at Less Than Fair
Value: Collated Roofing Nails From the People's Republic of China, 62
FR 51410 (October 1, 1997) and Sigma Corporation v. United States, 117
F. 3d 1401 (Fed. Cir. 1997)).
With the exception of data for steel used in the production of
cages, the data obtained for steel inputs was from a period
contemporaneous with the POR, thus no further adjustments were
necessary. For the steel data used in the production of cages we
inflated the weighted average per kilogram value by the Indian
wholesale price index (``WPI'') as published by the International
Monetary Fund (``IMF'').
Several companies in this review purchased steel from market
economy suppliers and paid for the steel with market economy
currencies. In these instances we valued the steel input using the
actual prices reported for imported inputs from a market economy (see,
Memorandum to Richard Moreland: ``Market Economy Inputs,'' dated June
30, 1998). Where the TRB producer purchased the steel from a PRC
trading company and paid for the steel in Renminbi, we did not use the
market economy price to the trading company and instead used surrogate
data. This is consistent with Department policy. We note, however, that
this policy has been challenged in the CIT and the Department is
currently addressing it on remand (see, Olympia Industrial, Inc. v.
United States, Slip-Op. 98-49 (CIT 1998)). In light of this, we will
reexamine this issue prior to the final results of this review. We
invite interested parties to comment.
We valued scrap recovered from the production of cups and cones
using Indonesian import statistics from HTS category 7204.2900. Scrap
recovered from the production of rollers and cages was valued using
import data from the Indian tariff subheading 7204.29 and 7204.4100
respectively.
2. Labor. We calculated the labor input using wage information from
the United Nations' 1996 Yearbook of Labour Statistics (``YLS''). We
adjusted these wages to reflect inflation through the POR using an
Indian consumer price index (``CPI'') published by the IMF. We used the
CPI, rather than the WPI, for calculating the inflation adjustment to
labor because the Department views the CPI as more representative of
changes in wage rates, while the WPI is more representative of prices
for material goods (see, e.g., Heavy Forged Hand Tools From the
People's Republic of China; Final Results of Antidumping Duty
Administrative Reviews, 62 FR 11813, 11816 (March 13, 1997) and
Manganese Metal from the People's Republic of China; Final Results and
Partial Rescission of Antidumping Duty Administrative Review, 63 FR
12440, 12446 (March 13, 1998); see also, Memorandum to Susan Kuhbach:
``Selection of surrogate labor wage rates for preliminary results of
review,'' dated June 30, 1998).
3. Overhead, SG&A Expenses, and Profit. For factory overhead, we
used information obtained from the fiscal year 1996-97 annual reports
of eight Indian bearing producers. We calculated factory overhead and
SG&A expenses (exclusive of labor and electricity) as percentages of
direct inputs (also exclusive of labor) and applied it to each
producer's direct input costs. For profit, we totaled the reported
profit before taxes for the eight Indian bearing producers and divided
it by the total calculated cost of production (``COP'') of goods sold.
This percentage was applied to each respondent's total COP to derive a
company-specific profit value (see, Memorandum to Susan Kuhbach:
``Selection of overhead, SG&A and profit surrogate values for
preliminary results of review,'' dated June 30, 1998).
4. Packing. For export packing, we used surrogate values for each
packing material using values obtained from the Monthly Statistics of
the Foreign Trade of India, Vol. II--Imports by Commodity (April 1996
through May 1997).
5. Electricity. For electricity costs, we used a simple average of
1995 regional electricity prices in India for large industries as
reported in India's Energy Sector, September, 1996, published by the
Centre for Monitoring Indian Economy Pvt. Ltd. We adjusted the value to
reflect inflation through the POR using the WPI (see, also the
Overhead, SG&A Expenses, and Profit section, above).
6. Inland Freight. We valued truck freight using a rate derived
from the April 20, 1994 issue of The Times of India. We adjusted the
rate to reflect inflation through the POR using the WPI. We valued rail
freight using rates published by the Indian Railway Conference
Association in 1995. We calculated an average rate per kilometer and
adjusted the rate to reflect inflation through the POR using the WPI.
7. Ocean Freight. We calculated a value for ocean freight based on
1996 rate quotes from Maersk Inc. Because the information obtained was
from a period contemporaneous with the POR, no further adjustments were
necessary.
8. Marine Insurance. We calculated a value for marine insurance
based on the CIF value of the TRBs shipped. We obtained the rate used
through queries made directly to an international marine insurance
provider.
Partial Termination of Review
The petitioner requested reviews for Far East Enterprising Company,
Scanwell Consolidators, Ltd., Triumph Express Service Int'l Limited,
Zhong Shan Transportation Co., Ltd., China Travel Service Limited, and
Kenwa Shipping Co., Ltd. On October 6, 7, 17, 23, 30, and November 11,
1997, respectively, they reported no shipments of subject merchandise
to the United States during the POR. We independently confirmed with
U.S. Customs that there were no shipments from these companies.
Therefore, we have terminated the review with respect to these
companies (see, Calcium Hypochlorite From Japan: Termination of
Antidumping Duty Administrative Review, 62 FR 18086 (April 14, 1997)).
[[Page 37344]]
Preliminary Results of the Review
We preliminarily determine that the following dumping margins exist
for the period June 1, 1996, through May 30, 1997:
------------------------------------------------------------------------
Margin
Manufacturer/exporter (percent)
------------------------------------------------------------------------
Wafangdian................................................... 0.00
Luoyang...................................................... 1.82
CMC.......................................................... 0.02
Xiangfan..................................................... 14.93
Zhejiang..................................................... 2.27
Wanxiang..................................................... 0.00
Liaoning..................................................... 0.68
Premier...................................................... 3.99
Chin Jun..................................................... 0.21
ZX (the new shipper)......................................... 0.00
PRC Rate..................................................... 29.40
------------------------------------------------------------------------
Parties to the proceeding may request disclosure within five days
of the date of publication of this notice. Interested parties may also
request a hearing within thirty days of publication. If requested, a
hearing will be held 37 days after publication. Interested parties may
submit case briefs within thirty days of publication. Rebuttal briefs,
which must be limited to issues raised in the case briefs, may be filed
not later than five days after the case briefs. The Department will
issue a notice of the final results of this administrative review,
which will include the results of its analysis of issues raised in any
such briefs, within 120 days from the publication of these preliminary
results.
The Department shall determine, and the Customs Service shall
assess, antidumping duties on all appropriate entries. With respect to
EP sales for these preliminary results, we divided the total dumping
margins (calculated as the difference between NV and EP) for each
importer/customer by the total number of units sold to that importer/
customer. If these preliminary results are adopted in our final results
of administrative and new shipper review, we will direct Customs to
assess the resulting per-unit dollar amount against each unit of
merchandise in each of that importer's/customer's entries under the
order during the review period. Although this will result in assessing
different percentage margins for individual entries, the total
antidumping duties collected for each importer/customer under the order
for the review period will be almost exactly equal to the total dumping
margins.
For CEP sales, we divided the total dumping margins for the
reviewed sales by the total entered value of those reviewed sales for
each importer/customer. If these preliminary results are adopted in our
final results of administrative review, we will direct Customs to
assess the resulting percentage margin against the entered Customs
values for the subject merchandise on each of that importer's/
customer's entries during the review period. While the Department is
aware that the entered value of sales during the POR is not necessarily
equal to the entered value of entries during the POR, use of entered
value of sales as the basis of the assessment rate permits the
Department to collect a reasonable approximation of the antidumping
duties which would have been determined if the Department had review
those sales of merchandise actually entered during the POR.
The following cash deposit requirements will be effective upon
publication of the final results of this administrative review for all
shipments of the subject merchandise entered, or withdrawn from
warehouse, for consumption on or after the publication date, as
provided for by section 751(a)(1) of the Act: (1) for the PRC companies
named above the cash deposit rates will be the rates for these firms
established in the final results of this review, except that for
exporters with de minimis rates, i.e., less than 0.50 percent, no
deposit will be required; (2) for all remaining PRC exporters, all of
which were found not to be entitled to separate rates, the cash deposit
will be 29.40 percent; and (3) for non-PRC exporters Premier and Chin
Jun the cash deposit rates will be the rates established in the final
results of this review; (4) for non-PRC exporters of subject
merchandise from the PRC, other than Premier and Chin Jun, the cash
deposit rate will be the rate applicable to the PRC supplier of that
exporter. 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 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 thisrequirement 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
sections 751(a)(1) and 771(i)(1) of the Act.
Dated: June 30, 1998.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 98-18301 Filed 7-9-98; 8:45 am]
BILLING CODE 3510-DS-P