[Federal Register Volume 64, Number 143 (Tuesday, July 27, 1999)]
[Notices]
[Pages 40549-40553]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-19166]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-201-806]
Carbon Steel Wire Rope From Mexico: Final Results of Antidumping
Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of Final Results of Antidumping Duty Administrative
Review.
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SUMMARY: On March 8, 1999, the Department of Commerce (the Department)
published in the Federal Register the preliminary results of its
antidumping duty administrative review of the antidumping duty order on
carbon steel wire rope from Mexico (64 FR 10979). This review covers
one manufacturer/exporter of the subject merchandise to the United
States, Aceros Camesa S.A. de C.V. (Camesa), and the period of March 1,
1997 through February 28, 1998. We gave interested parties an
opportunity to comment on the preliminary results of review. We
received comments from Camesa and from the Committee of Domestic Steel
Wire Rope and Specialty Cable
[[Page 40550]]
Manufacturers (the petitioner). We have not changed the results from
those presented in the preliminary results of review.
EFFECTIVE DATE: July 7, 1999.
FOR FURTHER INFORMATION CONTACT: Mark Hoadley or Laurel LaCivita,
Import Administration, International Trade Administration, U.S.
Department of Commerce, 14th Street and Constitution Avenue, NW,
Washington DC 20230; telephone (202) 482-0666, (202) 482-4236,
respectively.
SUPPLEMENTARY INFORMATION:
Applicable Statute
Unless otherwise indicated, all citations to the statute are
references to the provisions effective January 1, 1995, the effective
date of the amendments made to the Tariff Act of 1930 (the Act) by the
Uruguay Round Agreements Act. In addition, unless otherwise indicated,
all citations to the Department's regulations are to the provisions
codified at 19 CFR part 351 (April 1998).
Background
On March 8, 1999, the Department published in the Federal Register
the preliminary results of the review of the antidumping duty order on
carbon steel wire rope from Mexico (64 FR 10979). On April 7, 1999, we
received comments from the petitioner and Camesa. The petitioner and
Camesa submitted rebuttal comments on April 12, 1998.
The Department has now completed this antidumping duty
administrative review in accordance with section 751(b) of the Act.
Scope of Review
The product covered by this review is steel wire rope. Steel wire
rope encompasses ropes, cables, and cordage of carbon steel, other than
stranded wire, not fitted with fittings or made up into articles, and
not made up of brass-plated wire. Imports of these products are
currently classifiable under the following Harmonized Tariff Schedule
(HTS) subheadings: 7312.10.9030, 7312.10.9060, and 7312.10.9090.
Excluded from this review is stainless steel wire rope, which is
classifiable under HTS subheading 7312.10.6000, and all forms of
stranded wire, with the following exception.
In the final affirmative determination of circumvention of
antidumping duty order, 60 FR 10831 (February 28, 1995), the Department
determined that steel wire strand, when manufactured in Mexico by
Camesa and imported into the United States for use in the production of
steel wire rope, falls within the scope of the antidumping duty order
on steel wire rope from Mexico. Such merchandise is currently
classifiable under subheading 7312.10.3020 of the HTS.
Although HTS subheadings are provided for convenience and for
Customs purposes, our own written description of the scope of this
review remains dispositive.
This review covers one manufacturer/exporter, Camesa, and the
period March 1, 1997 through February 28, 1998.
Analysis of the Comments Received
We gave interested parties an opportunity to comment on the
preliminary results of review. We received case and rebuttal briefs
from both petitioner and Camesa.
Comment 1: Whether Camesa's Sales to the United States Constitute Bona
Fide Transactions
The petitioner contends that the timing and nature of Camesa's
sales to the United States during the period of review (POR) indicate
that they were not bona fide transactions. The petitioner claims that
the sales were contrived for the purpose of orchestrating an export
scheme to serve as the basis for an administrative review and
adjustment of the antidumping duty deposit requirement. Consequently,
the petitioner contends, the Department must disregard these sales and
determine that no proper basis existed for an administrative review of
the March 1, 1997 through February 28, 1998 period.
The petitioner argues that the circumstances of the sales indicate
that they were contrived for purposes of manipulating the Department's
antidumping analysis. In this regard, the petitioner points to the
small number of sales and the late date of the sales, occurring at the
end of the POR, as evidence that these sales were concocted by Camesa
solely for purposes of justifying an administrative review and
obtaining a zero margin.
The petitioner also contends that Camesa's one customer during the
POR was not sincerely interested in purchasing general purpose steel
wire rope from Camesa. According to the petitioner, Camesa's sole U.S.
purchaser during the POR had been, up until approximately one month
before the date of the U.S. sales, a purchaser of fishing ropes,
exclusively. Because these fishing ropes were entered in-bond for
subsequent export to foreign destinations, they were not subject to
review. The petitioner argues that the customer's sudden switch,
shortly before the end of the review period, to the general purpose
ropes subject to the current review is evidence that the sales were
contrived for the purpose of manipulating Camesa's dumping margin.
Finally, the petitioner contends that Department precedent equates
the term bona fide with commercially reasonable, and points to U.S.
Customs data to demonstrate that Camesa's sales were not made at
commercially reasonable prices. These customs figures indicate that,
for the month of Camesa's sales to the United States, the average price
of all goods falling under the tariff schedule subheading that includes
the products sold by Camesa during the POR is less than the prices
charged by Camesa.
Camesa contends that the petitioner has not provided any evidence
beyond its own speculation that the sales in question were not bona
fide. Camesa argues that the relatively small number and the late
timing of the sales to the United States during the POR were the result
of Camesa's difficulty in finding U.S. customers in the face of the
high cash deposit rate (111.68 percent) in effect during the POR for
imports of its steel wire rope products, not the result of an attempt
to manipulate the dumping margin.
Similarly, Camesa argues, there is no basis for questioning the
genuineness of Camesa's U.S. customer's need for steel wire rope. The
only evidence on the record regarding that customer's need for subject
merchandise suggests a legitimate business motivation.
Finally, Camesa has three responses to the customs figures
submitted by the petitioner. First, Camesa contends that petitioner's
submission was untimely, having been filed with the Department after
the deadline stipulated in 19 CFR 351.301(b)(2). Second, Camesa claims
that it is unreasonable to compare the prices of its products sold to
the United States with the average price of all imported products
falling within a tariff schedule subheading. Camesa claims that
products within this subheading vary greatly in important
characteristics that significantly affect price, and, as support,
Camesa demonstrates how the catalog prices for its own products falling
within this subheading vary greatly. Thus, argues Camesa, the average
price of all products within this subheading imported into the United
States will vary greatly according to the composition of the products
imported. Third, Camesa argues that even if the Department were to
accept the figures as timely and find them significant in judging the
commercial reasonableness of Camesa's U.S. sales prices, the
[[Page 40551]]
petitioner has misinterpreted the law regarding the importance of a
sale's commercial reasonableness. According to Camesa, in order to
prove that sales are not bona fide it is not enough to show that their
sales terms are commercially unreasonable. Camesa cites Silicon Metal
from Brazil: Notice of Final Results of Antidumping Duty Administrative
Review: ``[T]he Department only disregards U.S. sales in exceptional
circumstances where the sale is commercially unreasonable and other
facts and circumstances indicate an attempt to manipulate the dumping
margins.'' 64 FR 6305, 6317 (Feb. 9, 1999) (Silicon Metal from Brazil).
DOC Position: We agree with Camesa. While the Department's
authority to disregard U.S. sales in administrative reviews as non-bona
fide transactions has been recognized by the Court of International
Trade (CIT), see, e.g., PQ Corp. v. United States, 652 F. Supp. 724,
729 (CIT 1987), there is no express statutory or regulatory provision
that addresses or guides the exclusion of U.S. sales. Nevertheless, the
Department has the ``authority to prevent fraud upon its proceedings.''
Chang Tieh Indust. Co., Ltd. v. United States, 840 F.Supp. 141, 146
(CIT 1993). Thus, the Department has the discretion to exclude certain
U.S. sales where those sales are clearly ``distorting or
unrepresentative.'' American Permac, Inc. v. United States, Slip Op.
92-8 (Feb. 4, 1992).
In order to determine whether sales should be excluded as non-bona
fide transactions, the Department in the past has looked at a variety
of factors indicating ``whether the transaction has been so
artificially structured as to be commercially unreasonable.'' Certain
Cut-to-Length Carbon Steel Plate from Romania: Notice of Rescission of
Antidumping Duty Administrative Review, 63 FR 47232 (Sep. 4, 1998)
(Steel Plate from Romania); see also Silicon Metal from Brazil, 64 FR
at 6317 (noting that the Department will exclude U.S. sales where
exceptional circumstances demonstrate commercially unreasonable sales
terms and an attempt to manipulate the margin calculations).
However, a sale will not be excluded simply because it was made for
the purpose of obtaining a smaller margin, ``as long as the sale itself
is at least arguably commercially reasonable.'' Steel Plate from
Romania, 63 FR at 47234; see also P.Q. Corp., 652 F. Supp. at 729
(explaining that an overpriced transaction created solely for the
purpose of lowering the margin may be acceptable if the transaction was
in fact sold at arm's length). Rather, the Department looks at the
totality of the circumstances to determine whether the transactions in
question are artificial, and thus, would not provide an appropriate
basis for determining the respondent's U.S. pricing behavior. See
Manganese Metal from the PRC, 60 FR 56,045 (Nov. 6, 1995) (``Based on
the totality of the circumstances, . . . the Department determines, . .
. that these were not bona fide sales for commercial purposes and,
therefore, would not provide an appropriate basis for determining
[respondent's] pricing behavior for sales to the United States.
Therefore, these sales have been disregarded.''); see also Steel Plate
from Romania (``Based on the cumulative weight of these factors, we
determine that this sale was not bona fide because it was not a
commercially reasonable transaction and involved selling procedures
atypical of (the exporter's and importer's) normal business
practices.'')
We agree that the facts cited by the petitioner to prove that the
sale was artificially structured, namely the small number of sales, the
single customer, and the late sale date, could be, as Camesa argues,
simply the result of the high cash deposit rate on steel wire rope from
Mexico in effect during the POR. Additionally, while the number of
sales made by Camesa during the POR was small, the quantity of goods
sold was substantial. Finally, nothing in the record suggests that the
documentation for the transactions was fabricated, see Sulfanic Acid
from Hungary, 58 FR 8256, 8257 (Feb. 12, 1993) (the Department applied
BIA where documents discovered at verification indicated that
information might have been fabricated for the purpose of the
investigation); compare Salmon from Norway, 62 FR 1430 (Jan. 10, 1997)
(sales were included where there was no evidence of fabricated
documents or other suspicious activity), or that the sales were not
made at arm's length. Although Customs data generally provides a good
basis for determining whether sales have been made at commercially
reasonable prices we agree with Camesa in this instance that the price
figure provided by the petitioner covers a range of products so broad
that it cannot be meaningfully compared with Camesa's sales prices
during the POR.
The petitioner's questioning of Camesa's customer's genuine
interest in purchasing steel wire rope is not supported by the record.
The only evidence on the record indicating the customer's motive for
its purchase, while not elaborate, nevertheless indicates a genuine
desire to become a customer of Camesa's and a purchaser of steel wire
rope within the scope of the order. Please see Camesa's June 5, 1998
response, appendix A-6-B, document 1 for another explanation of the
customer's motive, due to the proprietary nature of the explanation.
Because the petitioner has not provided sufficient evidence to
demonstrate that the sales involved were fabricated or otherwise
commercially unreasonable, and we have found no other evidence
demonstrating that the sales were not bona fide transactions, we have
continued to include these sales in our margin calculation in these
final results of review.
Comment 2: Whether the Department Should Reject Camesa's Home Market
Sales Data as Inaccurate and Inherently Unreliable and Instead Use
Adverse Facts Available
In the Department's preliminary results of review, we rejected
Camesa's second home market sales database, submitted on October 20,
1998, noting that it contained discrepancies with the original
database, submitted on July 7, 1998. We concluded that these
discrepancies constituted new information not requested by the
Department. \1\ Because this new information was not requested and was
not submitted within the time period stipulated by 19 CFR
351.301(b)(2), we rejected the second database as untimely.
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\1\ On October 20, 1998, Camesa submitted its second home market
sales database in response to our supplemental questionnaire, which
requested that Camesa submit information on product characteristics
and additional sales. In doing so, however, it did not simply submit
an addendum to the first database, but instead, resubmitted the
entire home market sales database; i.e., all data regarding home
market sales were resubmitted. Some of the fields in this second
database contained information conflicting with the first database,
even though we had not requested Camesa to revise any of the
previously submitted fields. We had only requested the inclusion of
additional fields; i.e., product characteristics, and the inclusion
of additional sales observations.
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The petitioner argues that these discrepancies, which the
Department described as ``significant and unexplained,'' see Memorandum
to the File from Case Analyst (March 2, 1999) at 2, raise serious
questions about the accuracy of all home market data submitted by
Camesa during the POR. The petitioner further argues that, by
submitting new information in its second database, Camesa was admitting
that its first submission was inaccurate. According to the petitioner,
``submission of such significant adjustments in its supplemental filing
is an overt and explicit admission that its
[[Page 40552]]
initial database was inaccurate.'' The petitioner notes that the
discrepancies affected the reporting of all sales that were contained
in both databases and affected numerous fields reported for these
sales, including gross unit price and several adjustments used by the
Department in calculating normal value. The petitioner concludes that
the Department should reject Camesa's home market data in favor of
facts otherwise available.
Camesa argues that the discrepancies between its first and second
databases do not constitute an admission that Camesa's first submission
is inaccurate, but merely were the result of mistakes made under the
pressure of meeting the Department's filing deadline. Camesa argues
that these discrepancies are a result of mistakes made in compiling the
second database, not a result of an attempt by Camesa to revise the
data it reported in its first submission. These discrepancies, Camesa
claims, do not call into question the accuracy of the underlying data.
Moreover, Camesa points to several expenses for which, in its July
7, 1998 response to the Department's first questionnaire, Camesa
provided worksheets and other documents to explain and support the data
reported in the July 7, 1998 database. Camesa attempts to explain some
of the discrepancies found in three of the fields reported in its home
market database. It argues that it could not resolve all of the
discrepancies without placing new information on the record, which had
been closed per Sec. 351.301(b)(2). \2\ The petitioner contends that
Camesa's attempts at resolving the discrepancies are inadequate.
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\2\ The petitioner did not argue that Camesa submitted untimely
information in the attempts, in its April 8, 1999 case brief, it
made to resolve the discrepancies.
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Finally, Camesa contends that, even if it had conceded there were
errors in its initial sales listing, that fact alone would not justify
the resort to an adverse inference, as Camesa has cooperated fully in
this review.
DOC Position: We agree with Camesa. The record does not indicate
that the original database is inaccurate or unreliable, and we do not
find that Camesa failed to act to the best of its ability.
Under section 776(a) of the Act and 19 CFR 351.308, the Department
will only rely on facts otherwise available when: (1) Necessary
information is not on the record; or (2) the respondent has withheld
information, fails to provide requested information, significantly
impedes a proceeding, or provides information that cannot be verified.
Furthermore, in accordance with section 776(b) of the Act, the
Department will rely on adverse inferences only where the respondent
has failed to cooperate by not acting to the best of its ability to
comply with the Department's requests for information.
Although the Department did not conduct a verification of Camesa
during the POR, we did, per Department policy, issue an extensive
questionnaire to Camesa requesting support for all sales data provided
to us. We found some deficiencies in Camesa's response to this initial
questionnaire and thus issued a supplemental questionnaire. Camesa's
responses to both questionnaires, in combination, provided the
Department with sufficient explanations of how Camesa calculated the
data it reported, along with support for the raw numbers underlying its
response. Thus, the respondent did not withhold information or fail to
provide requested information. As such, Camesa's responses were
complete and provided all of the information necessary for margin
calculations. We note that the petitioner did not comment on Camesa's
response to either of our questionnaires or otherwise indicate that it
was concerned with the quality of Camesa's reported data, until we had
issued our preliminary results of review.
Moreover, it is important to note that we did not request the
second database as the result of having found errors in the
calculations or data used by Camesa in compiling the first database. We
requested the second database because we had determined that Camesa
needed to report a larger number of sales of similar merchandise, and
to report physical characteristics for all sales. \3\ Thus, our
rejection of the second database did not leave unanswered concerns
about the quality of Camesa's previously submitted data or
calculations.
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\3\ The Department was able to reach its preliminary conclusions
without the use of this expanded sales information. The initial,
more limited sales information provided by Camesa included above-
cost sales of identical products that were contemporaneous with all
sales in the United States. We therefore did not need to examine
sales of similar merchandise, and the necessary physical
characteristics were taken from an appendix attached to the written,
narrative portion of Camesa's October 20, 1998 submission. Thus, the
second sales database was not ultimately necessary for our
calculations.
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Finally, after having rejected Camesa's second database in our
preliminary results of review, and thus having removed it from
consideration, we cannot now use it for purposes of impugning the first
database. Even if, however, the second database were available for our
current analysis, we could not conclude that because the first database
contained some inaccuracies, all of Camesa's submitted home market data
must also be inaccurate. As explained above, the submissions on the
record were timely filed and are complete and supported by
documentation in the record. Therefore, we did not reject Camesa's home
market sales data. As such, it is not necessary to rely on adverse
facts available.
Comment 3: Whether The Department Must Affirm Its Preliminary
Determination That Camesa Sold Products in the Home Market at Below
Cost of Production
The petitioner argues that the Department correctly applied the
sales-below-cost test to all products ``under the consideration for the
determination of normal value.'' The petitioner also argues that sales
``under consideration for the determination of normal value'' should
include all home market sales reported.
Respondents did not comment on this issue.
DOC Position: We agree with the petitioner that a sales-below-cost
test must be conducted on all home market sales reported, and affirm
our preliminary finding that Camesa made sales below cost in its home
market during the POR.
Comment 4: Whether the Department Should Summarily Reject All of the
Petitioner's Contentions
In its rebuttal brief, Camesa argues that the petitioner did not
raise its objections in a timely manner. Camesa notes that the
petitioner did not submit comments on any of Camesa's questionnaire
responses, and did not, until after publication of our preliminary
results of review, indicate it had concerns with the bona fide nature
of Camesa's sales to the United States or with the suitability of
Camesa's home market data for review.
DOC Position: The Department disagrees with Camesa. Section
351.309(b) of the Department's regulations states that the Department
will consider case and rebuttal briefs filed within stated time limits.
An interested party is under no burden to provide another party with
advance warning of the issues it plans to raise in its case brief. In
fact, an interested party might very well have no idea what arguments
it will need to make until the Department has issued its preliminary
results of review. In this case, for example, the petitioner had no
advance
[[Page 40553]]
warning that the Department would reject Camesa's second submission of
home market sales data (see the above discussion of Comment 2) until
our preliminary results were issued.
Interested parties were given five days after the filing of case
briefs in which to respond to the arguments of other parties, in
accordance with Sec. 351.309(d) of the Department's regulations.
Finally, the petitioner's comments did not raise unusually complex
issues. Camesa did not indicate to the Department, prior to its April
13th submission, that it was having difficulty responding to the
petitioner's arguments within the allotted time period, nor has it
explained how in particular it was overburdened or denied a reasonable
opportunity for responding.
We determine that the following dumping margins exist:
------------------------------------------------------------------------
Margin
Manufacturer/exporter Period (percent)
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Aceros Camesa, S.A. de C.V................ 3/1/97-2/28/98 0.00
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The Department shall determine, and the customs service shall
assess, antidumping duties on all appropriate entries. We will instruct
customs to liquidate the entries made during the POR without regard to
antidumping duties since no margins were determined to exist in this
review. The Department will issue appraisement instructions directly to
the U.S. Customs Service.
Furthermore, the following deposit requirements will be effective,
upon publication of this notice of final results of review, for all
shipments of steel wire rope from Mexico 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) The cash deposit rate
for Camesa will be the rate stated above; (2) for previously
investigated companies not listed above, the cash deposit rate will
continue to be the company-specific rate published for the most recent
period; (3) if the exporter is not a firm covered in this review, 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, (4) the cash deposit rate for all
other manufacturers or exporters will continue to be 111.68 percent,
the all others rate established in the less-than-fair-value (LTFV)
investigation.
These deposit requirements, when imposed, shall remain in effect
until publication of the final results of the next administrative
review.
This notice serves as a final 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 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 notice also serves as the only reminder to parties subject to
administrative protective order (APO) of their responsibility
concerning the disposition of proprietary information disclosed under
APO in accordance with Sec. 351.306 of the Department's regulations.
Timely notification of return/destruction of APO materials or
conversion to judicial protective order is hereby requested. Failure to
comply with the regulations and the terms of an APO is a sanctionable
violation.
This administrative review and notice are in accordance with
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)), section 771(i) of
the Act (19 U.S.C. 1677f(i)), and 19 CFR 351.213.
Dated: July 6, 1999.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 99-19166 Filed 7-26-99; 8:45 am]
BILLING CODE 3510-DS-P