[Federal Register Volume 63, Number 174 (Wednesday, September 9, 1998)]
[Notices]
[Pages 48184-48187]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-24168]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-533-808]


Certain Stainless Steel Wire Rod From India; Preliminary Results 
of Antidumping Duty Administrative and New Shipper Reviews

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

ACTION: Notice of preliminary results of antidumping duty 
administrative and new shipper reviews.

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SUMMARY: In response to a request by Mukand, Ltd. (``Mukand''), 
respondent, the Department of Commerce (``the Department'') is 
conducting an administrative review of the antidumping duty order on 
stainless steel wire rod (``SSWR'') from India. In addition, new 
shipper reviews were requested by respondents Viraj Group (``Viraj'') 
and Panchmahal Steel Ltd. (``Panchmahal''). The period of review (POR) 
is December 1, 1996, through November 30, 1997. At the request of both 
Viraj and Panchmahal (May 11, 1998), the schedules for the new shipper 
reviews have been aligned to those of the administrative review of 
Mukand. See Letter to Mr. Peter Koenig of Ablondi, Foster, Sobin & 
Davidow (May 12, 1998).
    We have preliminarily determined that respondents Mukand, Viraj, 
and Panchmahal have not sold subject merchandise at less than normal 
value (NV) during the POR. If these preliminary results are adopted in 
our final results of this administrative review and new shipper 
reviews, we will instruct U.S. Customs not to assess antidumping 
duties.
    We invite interested parties to comment on these preliminary 
results. Parties who submit arguments in this proceeding should also 
submit with the argument (1) a statement of the issue, and (2) a brief 
summary of the argument.

EFFECTIVE DATE: September 9, 1998.

FOR FURTHER INFORMATION CONTACT: Maria Dybczak (Mukand), Carrie Blozy 
(Viraj), N. Gerard Zapiain (Panchmahal) or Rick Johnson, AD/CVD 
Enforcement Group III, Office 9, Import Administration, International 
Trade Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
1398 (Dybczak), (202) 482-0165 (Blozy), (202) 482-1395 (Zapiain), or 
(202) 482-3818 (Johnson).

SUPPLEMENTARY INFORMATION:

The 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 by the 
Uruguay Rounds Agreements Act (URAA). In addition, unless otherwise 
indicated, all citations to the Department's regulations are to the 
regulations codified at 19 CFR Part 351 (62 FR 27296; May 19, 1997).

Background

    On October 20, 1993, the Department published in the Federal 
Register the antidumping duty order on certain stainless steel wire 
rods from India (58 FR 54110). On December 5, 1997, the Department 
published in the Federal Register a notice of opportunity to request an 
administrative review of this antidumping duty order (62 FR 64353). On 
December 22, respondent Mukand requested that we conduct an 
administrative review in accordance with 19 CFR 351.213(b). We 
published the notice of initiation of this antidumping duty 
administrative review

[[Page 48185]]

on January 26, 1998 (62 FR 3702). On December 24, 1997, and December 
31, 1997, Panchmahal and Viraj, respectively, submitted requests for 
new shipper administrative reviews. On February 5, 1998, the notice of 
initiation of these new shipper administrative reviews was published in 
the Federal Register (63 FR 5930).
    The Department is conducting these reviews in accordance with 
section 751 of the Act.

Scope of the Review

    Imports covered by this review are shipments of SSWR from India. 
SSWR are products which are hot-rolled or hot-rolled annealed and/or 
pickled rounds, squares, octagons, hexagons or other 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 are currently classifiable under 
subheadings 7221.00.0005, 7221.00.0015, 7221.00.0020, 7221.00.0030, 
7221.00.0040, 7221.00.045, 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 merchandise under review is 
dispositive.
    The administrative review covers one company, Mukand, while both 
Viraj and Panchmahal are reviewed as new shippers. The period of review 
for all three companies is December 1, 1996 through November 30, 1997.

Fair Value Comparisons

    To determine whether sales of subject merchandise to the United 
States were made at less than fair value, we compared the Export Price 
(``EP'') to the NV, as described in the ``Export Price'' and ``Normal 
Value'' sections of this notice. In accordance with section 777A(d)(2) 
of the Act, we calculated monthly weighted-average prices for NV and 
compared these to individual U.S. transactions.

Product Comparisons

    In accordance with section 771(16) of the Act, we considered all 
products covered by the Scope of the Review, which were produced and 
sold by the respondent in the home market or a third country market 
during the POR, to be foreign like products for purposes of product 
comparisons to U.S. sales. For all U.S. sales of Mukand, Viraj, and 
Panchmahal, there were identical sales in the home or third market on 
which to make a comparison.

Export Price

Mukand

    For Mukand, we used EP as defined in section 772(a) of the Act 
because the subject merchandise was first sold by Mukand to an 
unaffiliated purchaser in the United States before the date of 
importation and CEP treatment was not otherwise indicated. We 
calculated EP based on packed, delivered prices to the first 
unaffiliated purchaser in the United States. We made deductions to the 
starting price for movement expenses (Indian and U.S. inland freight, 
ocean freight, insurance, brokerage and handling) pursuant to section 
772(c)(2) of the Act. Additionally, we added to the U.S. price an 
amount for duty drawback pursuant to section 772 (c)(1)(B) of the Act. 
For a further discussion of this issue, see Memorandum to the File: 
Analysis Memo for the Preliminary Results of Review for Mukand, Ltd., 
pp. 2-3, September 2, 1998. We used Mukand's date of invoice as the 
date of sale for the U.S. in accordance with 19 CFR 351.401(i).

Viraj

    For calculation of the price to the United States, we used EP, in 
accordance with section 772(a) of the Act because the subject 
merchandise was first sold by Viraj to an unaffiliated purchaser in the 
United States prior to importation and CEP treatment was not otherwise 
indicated. The Department calculated EP for Viraj based on packed, 
delivered prices to customers in the United States. We made deductions 
to the starting price for movement expenses (Indian inland freight, 
ocean freight, insurance, and brokerage and handling) in accordance 
with section 772(c)(2) of the Act. Additionally, we added to the U.S. 
price an amount for duty drawback pursuant to section 772 (c)(1)(B) of 
the Act. For a further discussion of this issue, see Memorandum to the 
File: Analysis Memorandum for the Preliminary Results of Review for 
Viraj, pp. 3-5, September 2, 1998. We used Viraj's date of invoice as 
the date of sale for the U.S. in accordance with 19 CFR 351.401(i).

Panchmahal

    For Panchmahal, we used EP as defined in section 772(a) of the Act 
because the subject merchandise was first sold by Panchmahal to an 
unaffiliated purchaser in the United States prior to the date of 
importation and CEP treatment was not otherwise indicated. We 
calculated EP based on packed, delivered prices to the first 
unaffiliated purchaser in the United States. We made deductions to the 
starting price for movement expenses (foreign inland freight, 
international freight, and marine insurance) pursuant to section 
772(c)(2) of the Act. We denied Panchmahal's claim for a duty drawback 
adjustment, as Panchmahal failed to provide evidence that illustrated 
either a claim for the rebate or actual payment of the rebate on the 
exported product. For a further discussion of this issue, see 
Memorandum to the File: Analysis Memorandum for the Preliminary Results 
of Review for Panchmahal, pp. 3-4, September 2, 1998. We used 
Panchmahal's date of invoice as the date of sale for its U.S. sale of 
subject merchandise in accordance with 19 CFR 351.401(i).

Normal Value

Mukand

    We compared the aggregate volume of Mukand's home market sales of 
the foreign like product and U.S. sales of the subject merchandise to 
determine whether the volume of the foreign like product Mukand sold in 
India was sufficient, pursuant to section 773(a)(1)(C) of the Act, to 
form a basis for NV. Because Mukand's volume of home-market sales of 
foreign like product was greater than five percent of its U.S. sales of 
subject merchandise, in accordance with section 773(a)(1)(B)(i) of the 
Act, we based NV on the prices at which the foreign like products were 
first sold for consumption in India.
    We based home-market prices on the packed, delivered prices to 
unaffiliated purchasers in the home market. We made adjustments for 
discounts and rebates. Where applicable, we made adjustments for 
packing and movement expenses in accordance with section 773(a)(6)(B) 
of the Act. In accordance with section 773(a)(6)(C)(iii) of the Act and 
19 CFR 351.410, if appropriate, we made circumstance of sale 
adjustments by deducting home market direct selling expenses and adding 
U.S. direct selling expenses (credit). We offset home market 
commissions by the amount of indirect selling expenses incurred on the 
U.S. sale, up to the amount of the home market commission.

[[Page 48186]]

Viraj

    Because Viraj had no sales of the subject merchandise in the home 
market during the POR, we compared the aggregate volume of sales of the 
foreign like product to Turkey (the only other market outside the U.S. 
to which Viraj sold) and U.S. sales of the subject merchandise to 
determine whether the volume of the foreign like product Viraj sold in 
Turkey was sufficient, pursuant to section 773(a)(1)(B)(ii)(II) of the 
Act, to form a basis for NV. Because Viraj's volume of third country 
market sales of foreign like product was greater than five percent of 
its U.S. sales of subject merchandise, in accordance with section 
773(a)(1)(B)(ii) of the Act, we based NV on the prices at which the 
foreign like products were first sold for consumption in Turkey.
    We based third country market prices on the packed, delivered 
prices to unaffiliated purchasers in the third country market. Where 
applicable, we made adjustments for packing and movement expenses in 
accordance with section 773(a)(6)(B) of the Act. Additionally, we added 
to the third country market price an amount for duty drawback. For a 
further discussion of this issue, see Memorandum to the File: Analysis 
Memorandum for the Preliminary Results of Review for Viraj, pp. 3-5, 
September 2, 1998. In accordance with section 773(a)(6)(C)(iii) of the 
Act and 19 CFR 351.410, if appropriate, we made circumstance of sale 
adjustments by deducting third country direct selling expenses and 
adding U.S. direct selling expenses.

Panchmahal

    For Panchmahal we compared the aggregate volume of the company's 
comparison market sales of the foreign like product and U.S. sales of 
the subject merchandise to determine whether the volume of the foreign 
like product Panchmahal sold in India was sufficient, pursuant to 
section 773(a)(1)(C) of the Act, to form a basis for NV. Because 
Panchmahal's volume of comparison market sales of foreign like product 
was greater than five percent of its U.S. sales of subject merchandise, 
in accordance with section 773(a)(1)(B)(i) of the Act, we based NV on 
the prices at which the foreign like products were first sold for 
consumption in India.
    We based comparison market prices on the packed, delivered prices 
to unaffiliated purchasers in the comparison market. Where applicable, 
we made adjustments for packing and movement expenses in accordance 
with section 773(a)(6)(B) of the Act. In accordance with section 
773(a)(6)(C)(iii) of the Act and 19 CFR 351.410, if appropriate, we 
made circumstance of sale adjustments by deducting comparison market 
direct selling expenses and adding U.S. direct selling expenses (credit 
and other direct selling expenses). We offset home market commissions 
by the amount of indirect selling expenses incurred on the U.S. sales, 
up to the amount of the home market commission.

Level of Trade

    In accordance with section 773(a)(1)(B) of the Act, to the extent 
practicable, we determine NV based on sales in the comparison market at 
the same level of trade (``LOT'') as the EP or CEP transaction. The NV 
LOT is that of the starting-price sales in the comparison market or, 
when NV is based on constructed value (``CV''), that of the sales from 
which we derive selling, general and administrative (``SG&A'') expenses 
and profit. For EP, the U.S. LOT is also the level of the starting-
price sale, which is usually from exporter to importer. For CEP, it is 
the level of the constructed sale from the exporter to the importer.
    To determine whether NV sales are at a different LOT than EP or 
CEP, we examine stages in the marketing process and selling functions 
along the chain of distribution between the producer and the 
unaffiliated customer. If the comparison market sales are at a 
different LOT, and the difference affects price comparability, as 
manifested in a pattern of consistent price differences between the 
sales on which NV is based and comparison-market sales at the LOT of 
the export transaction, we make an LOT adjustment under section 
773(a)(7)(A) of the Act. Finally, for CEP sales, if the NV level is 
more remote from the factory than the CEP level and there is no basis 
for determining whether the difference in the levels between NV and CEP 
affects price comparability, we adjust NV under section 773(a)(7)(B) of 
the Act (the CEP offset provision). See Notice of Final Determination 
of Sales at Less Than Fair Value: Certain Cut-To-Length Carbon Steel 
Plate from South Africa, 62 FR 61731 (November 19, 1997).
    In the present review, none of the respondents requested a level of 
trade (LOT) adjustment. To ensure that no such adjustment was 
necessary, in accordance with the principles discussed above, we 
examined information regarding the distribution systems in both the 
United States and Indian markets, including the selling functions, 
classes of customer, and selling expenses for each respondent.

Mukand

    In both the home market and the United States, Mukand reported two 
levels of trade: sales made directly to end-users and sales made 
through agents/resellers. Agents/resellers are further distinguished 
between consignment agents and marketing/``Del Credre'' agents. 
Consignment agents hold stock of Mukand's products, can make and accept 
offers, conduct negotiations, make arrangements for shipping, and 
collect payments for Mukand. A marketing agent markets and books orders 
only, while a ``Del Credre'' agent is defined as a marketing agent that 
also collects customer payments for Mukand. We examined the selling 
functions performed at each claimed level and found that there was a 
significant difference in selling functions offered between sales to 
end-users and sales made through agents/resellers. We noted that both 
quantitatively and qualitatively, the selling functions performed for 
sales to end-user customers in both the U.S. and the home market 
involve significantly greater resources and thus represent a distinct 
stage of marketing. Specifically, of the nine selling functions 
reported, Mukand claims regularly to have performed negotiations, 
shipping arrangements, and accounts receivable collections (and in some 
cases, made offers) for sales to end users, but not for sales involving 
agents/resellers. Therefore, given these differences, we preliminarily 
conclude that end-users and agents/resellers constitute separate levels 
of trade. However, there was not a significant difference in selling 
functions between sales made through consignment agents and marketing/
``Del Credre'' agents, and as such we have made no level of trade 
distinction between sales made through agents.
    Although two levels of trade exist, all home market sales that 
matched to the U.S. sale were made to end-users, the same level of 
trade as the U.S. sale used to determine export price. Thus, because 
there is no difference in LOT, no level of trade adjustment was 
necessary.
    For a further discussion of the Department's LOT analysis with 
respect to Mukand, see Memorandum to the File: Analysis Memorandum for 
the Preliminary Results of Review for Mukand, pp. 1-2, September 2, 
1998.

Viraj

    In both the third country comparison market and the United States, 
Viraj reported one LOT and one distribution system with one class of 
customer (distributors). Viraj stated that it

[[Page 48187]]

manufactures the merchandise after receipt of a final confirmed order 
and sells directly to its customers in the comparison market and in the 
United States on a CIF basis. Viraj reported that it performs identical 
selling functions in both the third country comparison market and the 
United States. These selling functions include soliciting inquiries 
from customers, negotiating with customers, and procurement of export 
orders. Further, Viraj reported that it did not provide other sales-
related services on any of its sales, such as inventory maintenance, 
technical advice, warranty services, or advertising. Therefore, we 
preliminarily conclude that Viraj performs identical selling functions 
in the comparison market and the United States and that a LOT 
adjustment is not warranted.
    For a further discussion of the Department's LOT analysis with 
respect to Viraj, see Memorandum to the File: Analysis Memorandum for 
the Preliminary Results of Review for Viraj, pp. 1-2, September 2, 
1998.

Panchmahal

    In both the home market and the United States, Panchmahal reported 
one level of trade. Panchmahal reported that in the home market, it 
made sales from its plant directly to end users and to retailers. The 
company also stated that it made sales in the home market through 
consignment agents and branch offices to end users and retailers. Its 
sole sale to the United States was to a reseller. Panchmahal stated 
that it sells directly to its buyers in the comparison market and in 
the United States on a CIF basis on the receipt of a confirmed order. 
We examined the company's selling functions and saw that it did not 
provide any sales-related services on any of its sales, other than 
transporting the merchandise to the Indian port. Because there are no 
differences between the selling functions on sales made to either end 
users or retailers in the home market, sales to both of these customer 
categories represent a similar stage of marketing. Therefore, we 
preliminarily conclude that end users and retailers constitute one 
level of trade in the home market. Furthermore, because Panchmahal's 
sale to the United States involved the identical selling functions as 
those in the comparison market, we consider it to be made at the same 
level of trade. Therefore, no LOT adjustment for Panchmahal is 
appropriate. For a further discussion of the Department's LOT analysis 
with respect to Panchmahal, see Memorandum to the File: Analysis 
Memorandum for the Preliminary Results of Review for Panchmahal, pg. 2, 
September 2, 1998.

Preliminary Results of Review

    As a result of our review, we preliminarily determine that the 
following weighted-average dumping margins exist for the period 
December 1, 1996, through November 30, 1997:

------------------------------------------------------------------------
                                                                Margin  
                   Manufacturer/exporter                      (percent) 
------------------------------------------------------------------------
Mukand, Ltd................................................         0.00
Viraj......................................................         0.00
Panchmahal.................................................         0.00
------------------------------------------------------------------------

    The Department will disclose calculations performed in connection 
with this preliminary determination within five days of the date of 
publication of this notice. Any interested party may request a hearing 
within 30 days of publication. Any hearing, if requested, will be held 
2 days after the scheduled date for submission of rebuttal briefs. 
Issues raised in the hearing will be limited to those raised in the 
case briefs. Case briefs from interested parties may be submitted not 
later than 30 days after the date of publication of this notice in the 
Federal Register; rebuttal briefs may be submitted not later than five 
days thereafter. The Department will publish the final results of this 
administrative review, including its analysis of issues raised in any 
written comments or at a hearing, not later than 120 days after the 
date of publication of this notice.
    Upon issuance of the final results of this review, the Department 
shall determine, and the U.S. Customs Service shall assess, antidumping 
duties on all appropriate entries. If these preliminary results are 
adopted in our final results, we will instruct the Customs Service not 
to assess antidumping duties on the merchandise subject to review. Upon 
completion of this review, the Department will issue appraisement 
instructions directly to the Customs Service. If applicable, we will 
calculate an importer-specific ad valorem duty assessment rate based on 
the ratio of the total amount of antidumping duties calculated for the 
examined sales made during the POR to the total customs value of the 
sales used to calculate those duties. This rate will be assessed 
uniformly on all entries of that particular importer made during the 
POR. This is equivalent to dividing the total amount of antidumping 
duties, which are calculated by taking the difference between statutory 
NV and statutory EP, by the total statutory EP value of the sales 
compared, and adjusting the result by the average difference between EP 
and customs value for all merchandise examined during the POR.
    Furthermore, the following deposit requirements will be effective 
for all shipments of the subject merchandise entered, or withdrawn from 
warehouse, for consumption on or after the publication date of the 
final results of these administrative reviews, as provided by section 
751(a)(1) of the Act: (1) for Mukand, Viraj, and Panchmahal, no deposit 
will be required; (2) if the exporter is not a firm covered in this 
review, a prior review, or the original investigation, but the 
manufacturer is, the cash deposit rate will be the rate established for 
the most recent period for the manufacturer of the merchandise; and (3) 
the cash deposit rate for all other manufacturers or exporters will 
continue to be 48.80 percent, the ``All Others'' rate made effective by 
the original investigation.
    These deposit requirements, when imposed, shall remain in effect 
until publication of the final results of the next administrative 
review.
    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 351.402(f)(2) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    This determination is issued and published in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Date: August 28, 1998.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 98-24168 Filed 9-8-98; 8:45 am]
BILLING CODE 3510-DS-P