[Federal Register Volume 64, Number 145 (Thursday, July 29, 1999)]
[Notices]
[Pages 41082-41085]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-19445]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-549-601]


Preliminary Results of Full Sunset Review: Malleable Cast Iron 
Pipe Fittings From Thailand

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

ACTION: Notice of preliminary results of Full Sunset Review: Malleable 
cast iron pipe fittings from Thailand.

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SUMMARY: On January 4, 1999 the Department of Commerce (``the 
Department'') initiated a sunset review of the antidumping duty order 
on malleable cast iron pipe fittings from Thailand (64 FR 364) pursuant 
to section 751(c) of the Tariff Act of 1930, as amended (``the Act''). 
On the basis of a notice of intent to participate filed on behalf of 
domestic interested parties and adequate substantive comments filed on 
behalf of both domestic and respondent interested parties, the 
Department is conducting a full review. As a result of this review, the 
Department preliminarily finds that revocation of the antidumping duty 
order would be likely to lead to continuation or recurrence of dumping 
at the levels indicated in the Preliminary Results of Review section of 
this notice.

FOR FURTHER INFORMATION CONTACT: Scott E. Smith or Melissa G. Skinner, 
Office of Policy for Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th & Constitution, 
Washington, D.C. 20230; telephone: (202) 482-6397 or (202) 482-1560, 
respectively.

EFFECTIVE DATE: July 29, 1999.

Statute and Regulations

    This review is being conducted pursuant to sections 751(c) and 752 
of the Act. The Department's procedures for the conduct of sunset 
reviews are set forth in Procedures for Conducting Five-year 
(``Sunset'') Reviews of Antidumping and Countervailing Duty Orders, 63 
FR 13516 (March 20, 1998) (``Sunset Regulations'') and 19 CFR 351

[[Page 41083]]

(1998) in general. Guidance on methodological or analytical issues 
relevant to the Department's conduct of sunset reviews is set forth in 
the Department's Policy Bulletin 98:3--Policies Regarding the Conduct 
of Five-year (``Sunset'') Reviews of Antidumping and Countervailing 
Duty Orders; Policy Bulletin, 63 FR 18871 (April 16, 1998) (``Sunset 
Policy Bulletin'').

Scope

    Imports covered by this review are shipments of certain malleable 
cast iron pipe fittings, other than grooved, from Thailand. In the 
original order, these products were classified in the Tariff Schedules 
of the United States, Annotated, (TSUSA) under item numbers 610.7000 
and 610.7400. These products are currently classifiable under item 
numbers 7307.19.90.30, 7307.19.90.60, and 7307.19.90.80 of the 
Harmonized Tariff Schedule of the United States (HTSUS). The HTSUS item 
numbers are provided for convenience and customs purposes. The written 
description remains dispositive.
    This order applies to all imports of certain malleable cast iron 
pipe fittings from Thailand.

History of the Order

    The Department issued a final determination of sales at less than 
fair value on July 6, 1989, finding a weighted-average margin of 1.70 
percent for Siam Fittings Ltd. (``Siam'') and for all others (52 FR 
25282). The antidumping duty order on malleable cast iron pipe fittings 
from Thailand was published in the Federal Register on July 6, 1987 (52 
FR 25282), as amended (52 FR 37351, October 6, 1987). Since that time 
the Department has not conducted an administrative review of this 
order.

Background

    On January 4, 1999, the Department initiated a sunset review of the 
antidumping duty order on malleable cast iron pipe fittings from 
Thailand (64 FR 364) pursuant to section 751(c) of the Act. On January 
19, 1999, the Department received a Notice of Intent to Participate on 
behalf of the Cast Iron Pipe Fittings Committee and its members, 
Grinnell Corporation and Ward Manufacturing (collectively ``CIPFC''), 
within the applicable deadline specified in section 351.218(d)(1)(i) of 
the Sunset Regulations. The CIPFC claimed interested party status under 
section 771(9)(F) of the Act as an ad hoc trade association consisting 
entirely of U.S. manufacturers of malleable cast iron pipe fittings.
    We received a complete substantive response to the notice of 
initiation on February 3, 1999, on behalf of CIPFC. In its substantive 
response, CIPFC stated that both itself and its two current members 
have been participants in this proceeding since the Department's 
original investigation. We received a complete substantive response on 
behalf of Thai Malleable Iron and Steel Co., Ltd, BIS Pipe Fitting 
Industry Co., Ltd., and Siam (collectively respondent interested 
parties) on February 3, 1999. In their substantive response, each 
company claimed interested party status under section 771(9) of the 
Act, as a foreign manufacturer of malleable cast iron pipe fittings. 
Further, respondent interested parties claimed that although only Siam 
participated in the Department's original investigation, each company 
participated in the injury determination conducted by the International 
Trade Commission (``the Commission'').
    On February 8, 1999, we received rebuttal comments from CIPFC and 
respondent interested parties.
    Respondent interested parties stated that they are the only known 
exporters of subject merchandise from Thailand to the United States and 
they claimed to account for more than 50 percent of imports of the 
subject merchandise over the most recent five years. Because the 
Department determined that respondent interested parties accounted for 
significantly more than 50 percent of the value of total exports of the 
subject merchandise over the five calendar years preceding the 
initiation of the sunset review, their response constituted an adequate 
response to the notice of initiation. Thus, the Department is 
conducting a full (240 day) review in accordance with section 
351.218(e)(2)(i) of the Sunset Regulations.
    The Department determined that the sunset review of the antidumping 
duty order on malleable cast iron pipe fittings from Thailand is 
extraordinarily complicated. In accordance with section 751(c)(6)(C)(v) 
of the Act, the Department may treat a review as extraordinarily 
complicated if it is a review of a transition order (i.e., an order in 
effect on January 1, 1995). (See section 751(c)(6)(C) of the Act.) 
Therefore, on May 3, 1999, the Department extended the time limit for 
completion of the preliminary results of this review until not later 
than July 23, 1999, in accordance with section 751(c)(5)(B) of the 
Act.1
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    \1\ See Malleable Cast Iron Pipe Fittings From Brazil and 
Thailand: Extension of Time Limit for Preliminary Results of Five-
Year Reviews, 64 FR 23598 (May 3, 1999).
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Determination

    In accordance with section 751(c)(1) of the Act, the Department is 
conducting this review to determine whether revocation of the 
antidumping duty order would be likely to lead to continuation or 
recurrence of dumping. Section 752(b) of the Act provides that, in 
making this determination, the Department shall consider the weighted-
average dumping margins determined in the original investigation and 
subsequent reviews and the volume of imports of the subject merchandise 
for the period before and the period after the issuance of the 
antidumping duty order, and shall provide to the Commission the 
magnitude of the margin of dumping likely to prevail if the order is 
revoked.
    The Department's preliminary determinations concerning continuation 
or recurrence of dumping and magnitude of the margin likely to prevail 
are discussed below. In addition, parties' comments with respect to 
continuation or recurrence of dumping and the magnitude of the margin 
likely to prevail are addressed within the respective sections below.

Continuation or Recurrence of Dumping

Party Comments

    In its substantive response, CIPFC argued that revocation of the 
antidumping duty order would likely result in the continuation or 
resumption of dumping of malleable cast iron pipe fittings from 
Thailand. CIPFC asserted that, in accordance with the Sunset Policy 
Bulletin, the Department normally will determine that revocation of an 
antidumping duty order is likely to lead to continuation or recurrence 
of dumping where dumping continued at any level above de minimis after 
the issuance of the order. Further, CIPFC cited to the SAA and noted 
that continuation of dumping at any level above de minimis after the 
issuance of the order is highly probative of the likelihood of 
continuation or recurrence of dumping. Based on these policies, the 
CIPFC asserts that the estimated weighted-average dumping margin of 
1.70 percent as determined in the original investigation has remained 
unchanged since the imposition of the antidumping duty order.

[[Page 41084]]

    In their substantive response, respondent interested parties 
asserted that the likely effects of revocation are that the trade will 
continue as it has for the last ten years, with the Thai exporters 
shipping to the United States when there is sufficient demand. Further, 
respondent interested parties argued that exports of pipe fittings from 
Thailand have fluctuated during the last five years while the dumping 
margin has remained constant. In conclusion, the respondent interested 
parties asserted that the fact that revocation is unlikely to have any 
effect is supported by the fact that no member of the domestic industry 
has requested an administrative review of the order.
    In its rebuttal comments CIPFC argued that the respondent 
interested parties failed to apply, or even identify, the test used by 
the Department to determine whether revocation of an order is likely to 
lead to continuation or recurrence of dumping. Rather, respondent 
interested parties proffered arguments that speak to the issues that 
may be relevant to the Commission. CIPFC asserted that dumping was not 
eliminated after the issuance of the order and, based on statistics 
provided by respondent interested parties, exports over the past five 
years have decreased. Therefore, CIPFC asserted that the evidence on 
the record justifies a determination that revocation would be likely to 
lead to continuation or recurrence of dumping.
    In their rebuttal comments, respondent interested parties referred 
to the language of the SAA that specifies that declining (or no) 
dumping margins accompanied by steady or increasing imports may 
indicate that foreign companies do not have to dump to maintain market 
share in the United States and that dumping is less likely to continue 
or recur if the order were revoked. Citing to the volume of exports 
prior to the issuance of the order, as reported in their substantive 
response, and using import statistics CIPFC relied on in 
contemporaneous sunset reviews of other antidumping duty orders on pipe 
fittings, respondent interested parties argued that exports from 
Thailand after the issuance of the dumping order actually increased 
over three-fold. In conclusion, respondent interested parties argued 
that the Department must conclude that dumping is not likely to resume 
if the order were revoked given that exports from Thailand to the 
United States increased after the issuance of the order, that the 1.70 
percent ad valorem margin would be deemed de minimis under the 1995 WTO 
standards, and that the domestic industry never requested an 
administrative review of the order.

Department's Determination

    Drawing on the guidance provided in the legislative history 
accompanying the Uruguay Round Agreements Act (``URAA''), specifically 
the Statement of Administrative Action (``the SAA''), H.R. Doc. No. 
103-316, vol. 1 (1994), the House Report, H.R. Rep. No. 103-826, pt. 1 
(1994), and the Senate Report, S. Rep. No. 103-412 (1994), the 
Department issued its Sunset Policy Bulletin providing guidance on 
methodological and analytical issues, including the basis for 
likelihood determinations. The Department clarified that determinations 
of likelihood will be made on an order-wide basis (see section II.A.3 
of the Sunset Policy Bulletin). Additionally, the Department normally 
will determine that revocation of a antidumping duty order is likely to 
lead to continuation or recurrence of dumping where (a) dumping 
continued at any level above de minimis after the issuance of the 
order, (b) imports of the subject merchandise ceased after the issuance 
of the order, or (c) dumping was eliminated after the issuance of the 
order and import volumes for the subject merchandise declined 
significantly (see section II.A.3.a of the Sunset Policy Bulletin).
    Although respondent interested parties argue that the 2.0 percent 
is the de minimis standard of Article 5.8 of the Antidumping Agreement 
should apply, we disagree. Both the statute and regulations clearly 
provide that in reviews of orders, the Department will treat as de 
minimis any weighted average dumping margin that is less than 0.5 
percent ad valorem (see section 752(c)(4)(B) of the Act and 19 CFR 
351.106(c)(1)). Further, the SAA specifies that the requirements of 
Article 5.8 apply only to investigations, not to reviews of antidumping 
duty orders or suspended investigations (see SAA at 845).
    As discussed in section II.A.3 of the Sunset Policy Bulletin, the 
SAA at 890, and the House Report at 63-64, the existence of dumping 
margins after the order is highly probative of the likelihood of 
continuation or recurrence of dumping. If companies continue to dump 
with the discipline of an order in place, it is reasonable to assume 
that dumping would continue if the discipline were revoked. Deposit 
rates above de minimis remain in effect for exports of malleable cast 
iron pipe fittings from Thailand.
    Therefore, since dumping margins have continued over the life of 
the order, the Department preliminarily determines that dumping is 
likely to continue if the order were revoked.

Magnitude of the Margin

Party Comments

    In its substantive response, CIPFC argued that the Department 
should determine that the margin likely to prevail if the antidumping 
duty order were to be revoked is the Siam-specific and all other rates 
from the original investigation, 1.70 percent. CIPFC asserted that they 
would be consistent with the provisions of the statute, SAA, and Sunset 
Policy Bulletin.
    In their substantive response, the respondent interested parties 
asserted that Article 5.8 of the Antidumping Agreement approved by the 
WTO in 1995 provides that any dumping margin of less than 2 percent ad 
valorem is to be treated as de minimis. Further, respondent interested 
parties asserted that de minimis margins are regarded as zero margins 
and referred to the language of the SAA (at 844) for support. In 
conclusion, the respondent interested parties argued that given that 
the only margin ever calculated was 1.70 percent ad valorem, there has 
never been any sales in the United States with dumping margins. 
Further, because there is no factual information available upon which 
to forecast a dumping margin were the order to be revoked, the 
Department should assume a margin of zero.
    In its rebuttal comments, CIPFC argued that respondent interested 
parties' reliance on the Antidumping Agreement Article 5.8 de minimis 
standard of 2 percent ad valorem is misplaced. CIPFC noted that 19 
U.S.C. 1675a(c)(4)(B) and 19 CFR 351.106(c)(1) provide that the de 
minimis standard in sunset reviews is margins less than 0.5 percent ad 
valorem. Thus, CIPFC argued that the Department should provide the 
Commission with a magnitude of dumping margin of 1.7 percent for all 
Thai producers.
    As noted above, in their rebuttal comments, the respondent 
interested parties asserted that the margin determined by the 
Department in the original investigation was only 1.70 percent ad 
valorem, a rate that would be deemed de minimis under the 1995 WTO 
standards. As such, respondent interested parties asserted that the 
Department must conclude that dumping is not likely to resume if the 
order were to be revoked.

Department's Determination

    In the Sunset Policy Bulletin, the Department stated that, 
consistent with

[[Page 41085]]

the SAA and House Report, the Department normally will provide to the 
Commission a margin from the investigation, because that is the only 
calculated rate that reflects the behavior of exporters without the 
discipline of an order or suspension agreement in place. Further, for 
companies not specifically investigated or for companies that did not 
begin shipping until after the order was issued, the Department 
normally will provide a margin based on the ``all others'' rate from 
the investigation. See Section II.B.1 of the Sunset Policy Bulletin. 
Exceptions to this policy include the use of a more recently calculated 
margin, where appropriate, and consideration of duty absorption 
determinations.
    As noted above, in its final determination, the Department 
published a weighted-average dumping margin of 1.70 percent for SIAM 
and applied that same rate to all other producers/exporters of 
malleable cast iron pipe fittings from Thailand. This is the only 
margin of dumping determined by the Department over the life of this 
order. For the reasons stated above, we agree with CIPFC that 
respondent interested parties' reliance on a 2 percent de minimis 
standard is misplaced. Therefore, the Department preliminarily 
determines that the weighted-averaged dumping margin likely to prevail 
if the order were to be revoked is 1.70 percent margin from the 
original investigation.

Preliminary Results of Review

    As a result of this review, the Department preliminarily finds that 
revocation of the antidumping duty order would be likely to lead to 
continuation or recurrence of dumping. The magnitude of the margin that 
is likely to prevail is 1.70 percent for Siam and all others.
    Any interested party may request a hearing within 30 days of 
publication of this notice in accordance with 19 CFR 351.310(c). Any 
hearing, if requested, will be held on September 22, 1999. Interested 
parties may submit case briefs no later than September 13, 1999, in 
accordance with 19 CFR 351.309(c)(1)(i). Rebuttal briefs, which must be 
limited to issues raised in the case briefs, may be filed not later 
than September 20, 1999. The Department will issue a notice of final 
results of this sunset review, which will include the results of its 
analysis of issues raised in any such comments, no later than November 
30, 1999.
    This five-year (``sunset'') review and notice are in accordance 
with sections 751(c), 752, and 777(i)(1) of the Act.

    Dated: July 23, 1999.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 99-19445 Filed 7-28-99; 8:45 am]
BILLING CODE 3510-DS-P