[Federal Register Volume 64, Number 129 (Wednesday, July 7, 1999)]
[Notices]
[Pages 36667-36671]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-17222]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-401-040]
Stainless Steel Plate From Sweden: Notice of Preliminary Results
of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of preliminary results of antidumping duty
administrative review.
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SUMMARY: In response to a request from the petitioners, the Department
of Commerce (``the Department'') is conducting an administrative review
of the antidumping finding on stainless steel plate from Sweden. The
review covers two manufacturer/exporters of the subject merchandise to
the United States, Avesta Sheffield AB (``Avesta'') and Uddeholm
Tooling AB and its sales subsidiaries (collectively, ``Uddeholm'').
Uddeholm's sales affiliate in the United States is Bohler-Uddeholm
Corporation (``BUS'') and its sales affiliate in Canada is Uddeholm
Limited, Canada (``BCA''). The period of review is June 1, 1997 through
May 31, 1998. We preliminarily determine that sales have been made
below normal value (``NV''). If these preliminary results are adopted
in our final results of administrative review, we will instruct U.S.
Customs to assess antidumping duties based on the difference between
constructed export price (``CEP'') and NV.
Interested parties are invited to comment on these preliminary
results. Parties which submit argument in this proceeding are requested
to submit with the argument: (1) A statement of the
[[Page 36668]]
issue, and (2) a brief summary of the argument (no longer than five
pages, including footnotes).
EFFECTIVE DATE: July 7, 1999.
FOR FURTHER INFORMATION CONTACT: Nithya Nagarajan or Jonathan Lyons,
Import Administration, International Trade Administration, U.S.
Department of Commerce, 14th Street and Constitution Avenue, NW.,
Washington, D.C. 20230; telephone (202) 482-4243 or 482-0374,
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,
unless otherwise indicated, all citations to the Department's
regulations are references to the provisions codified at 19 CFR part
351 (1998).
Background
The Department of the Treasury published an antidumping finding on
stainless steel plate from Sweden on June 8, 1973 (38 FR 15079). The
Department of Commerce published a notice of ``Opportunity To Request
Administrative Review'' of the antidumping finding for the 1997-1998
review period on June 10, 1998 (63 FR 31717). On June 10, 1998, the
petitioners, Allegheny Ludlum Steel Corp., G.O. Carlson, Inc., and
Lukens, Inc., filed a request for review of Uddeholm and Avesta. We
initiated the review on July 28, 1998 (63 FR 40258). On October 8,
1998, December 1, 1998, February 22, 1999, and April 12, 1999, we
received responses from Uddeholm to the Department's original and
supplemental questionnaires.
The review covers the period June 1, 1997 through May 31, 1998. The
Department is conducting this review in accordance with section 751 of
the Act, as amended. Section 751(a)(3) provides that the Department may
extend the deadline for issuing its preliminary results of an
administrative review if it determines that it is not practicable to
complete the preliminary results within the statutory time limit of 245
days. See also 19 CFR 351.213(h)(2). On January 11, 1999, the
Department extended the time limit for these preliminary results to
June 30, 1999. See Stainless Steel Plate from Sweden; Extension of Time
Limits for Antidumping Duty Administrative Review, 64 FR 3683 (January
25, 1999).
Scope of the Review
Imports covered by this review are shipments of stainless steel
plate which is commonly used in scientific and industrial equipment
because of its resistance to staining, rusting and pitting. Stainless
steel plate is classified under Harmonized Tariff Schedule of the
United States (HTSUS) item numbers 7219.11.00.00, 7219.12.00.05,
1209.12.00.15, 7219.12.00.45, 7219.12.00.65, 7219.12.00.70,
7219.12.00.80, 8219.21.00.05, 7219.21.00.50, 7219.22.00.05,
7219.22.00.10, 7219.22.00.30, 7219.22.00.60, 7219.31.00.10,
7219.31.00.50, 7220.11.00.00, 7222.30.00.00, and 7228.40.00.00.
Although the subheadings are provided for convenience and customs
purposes, the written description of the merchandise is dispositive.
Facts Available
On September 2, 1998, Avesta informed the Department that it was
unable to participate in the 1997-1998 administrative review. Avesta
claimed that, because a key facility had closed and staff that had
participated in prior reviews were no longer employed by the company,
it would not be ``feasible, financially or practically,'' for the
company to participate.
Section 776(a)(2)(A) of the statute and 19 CFR 351.308 mandate use
of facts available in several circumstances, including when a
respondent withholds requested information. Further, section 776(b) of
the Act authorizes the Department to use an adverse inference in
selecting from the facts otherwise available where the respondent has
``not acted to the best of its ability to comply with a request for
information.''
Because Avesta has declined to respond to the Department's
questionnaire, we must rely on the facts otherwise available. Further,
the Department finds that an adverse inference is warranted because
Avesta has not acted to the best of its ability in responding to the
Department's request for information. Avesta failed to provide any
explanation as to why the loss of employees or the closing of a
facility prevents its responding to the Department's questionnaire.
Moreover, Avesta failed to identify specific problems in complying with
our request, to seek the Department's assistance or to suggest
alternatives that would allow the Department to collect the necessary
information, as required by section 782(c)(1). Rather, the company
appears to have made a business decision not to devote the necessary
resources to provide the Department with the information needed to
conduct the review.
Section 776(b) of the Act 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. In accordance with section 776(b)(3)
of the Act, we have selected as facts available the highest previous
margin in this case from segments conducted by the Department, which is
Avesta's margin from the 1995-1996 administrative review.
Information from prior segments of the proceeding constitutes
secondary information. Section 776(c) of the Act provides that the
Department shall, to the extent practicable, corroborate secondary
information from independent sources reasonably at its disposal. The
Statement of Administrative Action (SAA) explains 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. The only source for margins is
administrative determinations. 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 not
relevant. 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 Fresh Cut Flowers
from Mexico; Final Results of Antidumping Duty Administrative Review,
61 FR 6812 (February 22, 1996), where the Department disregarded the
highest margin as adverse BIA because the margin was based on another
company's uncharacteristic business expense resulting in an unusually
high margin).
The dumping margin we have selected for Avesta as facts available
in this review is a rate calculated in a prior
[[Page 36669]]
segment of the proceeding; therefore, we deem it to be reliable.
Moreover, because the margin selected was actually calculated for
Avesta based on information submitted by the company in the prior
review, we deem it to be relevant. Therefore, the requirements of
section 776(c) of the Act have been met.
Because we have based Avesta's dumping margin entirely on facts
available, the analysis below addresses only sales made by Uddeholm.
Verification
As provided in section 782(i) of the Act, we verified information
provided by Uddeholm using standard verification procedures, including
on-site examination of relevant sales and financial records and
selection of original documentation containing relevant information.
Our verification results are outlined in the proprietary and public
versions of the verification report.
Date of Sale
For both its third-country market and U.S. sales, Uddeholm reported
the earlier of either the date of invoice or the date of shipment as
the date of sale. Uddeholm stated that this methodology best reflects
the date on which the material terms of sale are established. In the
normal course of business, invoices are issued upon shipment of
merchandise to the customer. In rare instances, merchandise is shipped
prior to invoicing. Invoices on these shipments are issued on the next
business day. Due to the unique nature of the subject merchandise and
its applications, orders for merchandise are processed and shipped
within a week of the customer's order, and in many instances within 1-2
business days. Orders are primarily placed via phone or fax to the
sales departments, and usually result in Uddeholm's generating a work
order for their merchandise processing and operations division. Most
orders are immediately filled from inventory and sized to the
customer's specifications. Uddeholm records the terms of sale (price
and quantity) when the merchandise is shipped and the invoice is
issued, which generally occurs on the same day. In addition, the
Department verified that there are no sales contracts, long-term
orders, or extended delivery agreements between Uddeholm and its
customers. Therefore, we preliminarily determine that invoice date is
the most appropriate date of sale in accordance with Sec. 351.401(i) of
the Department's regulations.
Product Comparisons
In accordance with section 771(16) of the Act, all products
produced by the respondents, covered by the description in the Scope of
Investigation section, above, and sold in Canada during the period of
review (POR) are considered to be foreign like products for purposes of
determining appropriate product comparisons to U.S. sales. We have
relied on five characteristics to match U.S. sales of subject
merchandise to comparison market sales of the foreign like product:
specification, process, thickness, finish, and form. We used thickness
ranges reported by the respondent, as requested by the Department.
Where there were no sales of identical merchandise in the third-country
market to compare to U.S. sales, we compared U.S. sales to the next
most similar foreign like product on the basis of the characteristics
listed in the antidumping questionnaire and reporting instructions.
Fair Value Comparisons
To determine whether sales of stainless steel plate from Sweden to
the United States were made at less than normal value, we compared NV
to the CEP, as described in the ``Constructed Export Price'' and
``Normal Value'' sections of this notice.
Constructed Export Price (CEP)
In accordance with section 772 (b) of the Act, we treated all of
Uddeholm's sales to the United States as CEP sales because the
merchandise was first sold to unaffiliated U.S. purchasers, after
importation, by an affiliated seller in the United States. There were
no export price sales during the period of review.
We based CEP on the packed ex-warehouse or delivered price to
unaffiliated customers in the United States. In accordance with section
772 (c)(2) of the Act, we made adjustments, where applicable, for
international and ocean freight, U.S. inland freight, U.S. brokerage
and handling expenses, U.S. customs duties, early payment discounts,
rebates, warehousing, and marine insurance. In accordance with sections
772(d)(1) and (2) of the Act, we made deductions for selling expenses,
warranty expenses, credit expenses, and cutting and grinding expenses.
To arrive at the CEP, the gross unit price was further reduced by
an amount for profit pursuant to section 772(d)(3) of the Act. In
accordance with section 772 (f) of the Act, we computed profit based on
total revenues realized on sales in both the U.S. and third-country
markets, less all expenses associated with those sales. We then
allocated profit to the expenses deducted under sections 772(d)(1) and
(2), based on the ratio of total U.S. expenses to total expenses for
both the U.S. and third-country markets.
Normal Value
A. Home Market Viability
In order to determine whether there were sufficient sales of
stainless steel plate in the home market to serve as a viable basis for
calculating NV, we compared the volume of home market sales of subject
merchandise to the volume of subject merchandise sold in the United
States, in accordance with section 773(a)(1)(C) of the Act. Since
Uddeholm's aggregate volume of home market sales was less than five
percent of its U.S. sales of the subject merchandise, we did not base
NV for Uddeholm on its home market sales.
B. Comparison Market Selection
In selecting the appropriate third-country market on which to base
NV for Uddeholm, we analyzed sales to Uddeholm's three largest third-
country markets. In accordance with Sec. 351.404(e) of the Department's
regulations, we chose the Canadian market as the most appropriate
comparison market for NV. Canada constituted Uddeholm's largest third-
country market, and merchandise sold in the Canadian market was
identical to the subject merchandise sold in the United States. For a
more detailed discussion of third-country market selection, see
Analysis Memorandum for 3rd Country Comparison Market, dated May 28,
1999.
We calculated NV based on sales to unaffiliated third-country
market customers. We made adjustments for physical differences in the
merchandise, where necessary, in accordance with section
773(a)(6)(C)(ii) of the Act. In accordance with section
773(a)(6)(B)(ii) of the Act, we made adjustments to NV for
international freight, third-country inland freight, third-country
inland insurance, third-country customs duties, and warehousing
expenses. We also adjusted NV for direct selling expenses, including
imputed credit expenses, in accordance with section 773(a)(6)(C)(iii)
of the Act. Finally, we made an adjustment to NV for early payment
discounts, in accordance with Sec. 351.401(c) of the Department's
regulations.
Price-to-Price Comparisons
We performed price-to-price comparisons where there were sales of
comparable merchandise in the third-country market.
[[Page 36670]]
In accordance with section 777(A) of the Act, we calculated monthly
weighted-average prices for NV and compared these to individual U.S.
transactions.
Level of Trade
In accordance with section 773(a)(7) 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 CV, that of the sales from which we derive selling,
general, and administrative (SG&A) expenses and profit. For EP sales,
the U.S. LOT is also the level of the starting-price sale, which is
usually from exporter to importer. For CEP sales, it is the level of
the constructed sale from the exporter to the importer.
To determine whether NV sales are at a different level of trade
than EP or CEP sales, we examine the stages in the marketing process
and selling functions along with 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 a 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).
The Department requested information concerning the selling
functions associated with each phase of marketing, or the equivalent,
in Uddeholm's Canadian and U.S. markets. The NV level of trade is based
on sales by Uddeholm's affiliate, BCA, to unaffiliated customers in
Canada. The information submitted by Uddeholm indicates that BCA
performs the same selling functions for all customers in the Canadian
market. Therefore, we preliminarily determine that the Canadian sales
were made at a single level of trade. The CEP level of trade is based
on the constructed sales to Uddeholm's affiliate, BUS, i.e., after the
deductions required under 772(d) of the Act. The information submitted
indicates that at the CEP level of trade Uddeholm performs fewer and
different selling functions than it does at the NV level of trade.
Therefore, we preliminarily determine that there is a single level of
trade in the United States--the CEP level of trade--which is different
from the level of trade in Canada. For a more detailed discussion of
level of trade see Analysis Memorandum to the File regarding Level of
Trade for Uddeholm, dated June 22, 1999.
As evidenced by the record, the U.S. and Canadian sales are at
different levels of trade and the Canadian level of trade--sales by an
affiliated distributor--is at a more advanced stage of distribution
than the U.S. CEP level of trade--sales by the producer to an
affiliated distributor. However, we do not have data available that
would be an appropriate basis for calculation of a level of trade
adjustment. Therefore, in accordance with section 773(a)(7)(B) of the
Act, we have preliminarily determined to make a CEP offset.
Currency Conversion
We made currency conversions into U.S. dollars in accordance with
section 773A(a) of the Act based on the exchange rates in effect on the
dates of the U.S. sales, as certified by the Federal Reserve Bank.
Preliminary Results of Review
We preliminarily determine that the following margins exist for the
period June 1, 1997 through May 31, 1998:
Uddeholm--7.30 percent
Avesta--29.36 percent
Parties to this proceeding may request disclosure within five days
of publication of this notice and any interested party may request a
hearing within 30 days of publication. Any hearing, if requested, will
be held 37 days after the date of publication, or the first working day
thereafter. Interested parties may submit case briefs and/or written
comments no later than 30 days after the date of publication. Rebuttal
briefs and rebuttals to written comments, limited to issues raised in
such briefs or comments, may be filed no later than 35 days after the
date of publication. The Department will publish the final results of
this administrative review, which will include the results of its
analysis of issues raised in any such written comments or at a hearing,
within 120 days after the publication of this notice.
The Department shall determine, and Customs shall assess,
antidumping duties on all appropriate entries. In accordance with
Sec. 351.212(b) of the Department's regulations, we have calculated an
importer-specific ad valorem assessment rate for the merchandise based
on the ratio of the total amount of antidumping duties calculated for
the examined sales made during the POR to the total entered value of
the sales used to calculate these duties. This rate will be assessed
uniformly on all entries of that particular importer made during the
POR. The Department will issue appraisement instructions directly to
Customs. The final results of this review shall be the basis for the
assessment of antidumping duties on entries of merchandise covered by
the determination and for future deposits of estimated duties.
Furthermore, the following deposit requirements will be effective
upon completion of the final results of these administrative reviews
for all shipments of stainless steel plate from Sweden 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) The cash deposit rate for reviewed
firms will be the rates established in the final results of
administrative review, except if the rate is less than 0.50 percent,
and therefore, de minimis within the meaning of 19 CFR 351.106, in
which case the cash deposit rate will be zero; (2) for merchandise
exported by manufacturers or exporters not covered in this review but
covered in the original less-than-fair-value (LTFV) investigation or a
previous review, the cash deposit will continue to be the most recent
rate published in the final determination or final results for which
the manufacturer or exporter received a company-specific rate; (3) if
the exporter is not a firm covered in this review, a previous review,
or the original investigation, but the manufacturer is, the cash
deposit rate will be that established for the most recent period for
the manufacturer of the merchandise; and (4) if neither the exporter
nor the manufacturer is a firm covered in this or any previous review
or the original fair value investigation, the cash deposit rate will be
4.46%.
This notice also serves as a preliminary reminder to importers of
their responsibility under 19 CFR 351.402(f) to file a certificate
regarding the reimbursement of antidumping duties prior to liquidation
of the relevant entries during these review periods. Failure to comply
with this requirement could result in the Secretary's presumption that
reimbursement of antidumping duties
[[Page 36671]]
occurred and the subsequent assessment of double antidumping duties.
This determination is issued in accordance with sections 751(a)(1)
and 777(i)(1) of the Act.
Dated: June 29, 1999.
Richard W. Moreland,
Acting Assistant Secretary for Import Administration.
[FR Doc. 99-17222 Filed 7-6-99; 8:45 am]
BILLING CODE 3510-DS-P