[Federal Register Volume 64, Number 152 (Monday, August 9, 1999)]
[Notices]
[Pages 43166-43170]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-20452]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-580-811]
Final Results of Expedited Sunset Review: Steel Wire Rope From
the Republic of Korea
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of final results of expedited sunset review: steel wire
rope from the Republic of Korea.
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SUMMARY: On January 4, 1999, the U.S. Department of Commerce (``the
Department'') initiated a sunset review of the antidumping duty order
on steel wire rope from the Republic of Korea (``Korea'') 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 and an adequate response
filed on behalf of a domestic interested party and inadequate response
from respondent interested parties, the Department conducted an
expedited sunset review. As a result of this review, the Department
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 Final Result of Review section of this notice.
FOR FURTHER INFORMATION CONTACT: Martha V. Douthit or Melissa G.
Skinner, Office of Policy for Import Administration, International
Trade Administration, U.S. Department of Commerce, 14th St. &
Constitution Ave., NW, Washington, DC 20230; telephone (202) 482-3207
or (202) 482-1560, respectively.
EFFECTIVE DATE: August 9, 1999.
Statute and Regulations
This review was 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''). 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
The product covered by this order is steel wire rope from Korea.
Steel wire rope encompasses ropes, cables, and cordage of iron or
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, i.e., ropes, cables and cordage other than stranded
wire, of stainless steel, not fitted with fittings or made up into
articles, which is classifiable under HTS subheading 7312.10.6000.
Although HTS subheadings are provided for convenience and customs
purposes, the written description of the scope of this order is
dispositive.
History of the Order
On February 23, 1993, the Department published in the Federal
Register the final determination of sales at less than fair value on
steel wire rope from Korea (see 58 FR 11029). In the original
investigation, three companies were investigated and found to be
dumping at the following weighted-average dumping margins: Korean Iron
& Steel Wire, Ltd., (now KISWIRE, Ltd. (``KIS'')), 0.23 percent; Young
Heung Iron & Steel Co., Ltd., (``YHC''), 0.10
[[Page 43167]]
percent; and Manho Mfg., Ltd. (``Manho''), 1.51 percent. In addition an
``all others'' rate of 1.51 percent was established. On March 26, 1993,
the Department's antidumping duty order on steel wire rope from Korea
was published in the Federal Register (see 58 FR 16397). As a result of
the de minimis margins, entries of steel wire rope produced and sold by
KIS and entries produced either by YHC or Dae Heung Industrial Co.,
Ltd. and sold by YHC were excluded from the application of the
antidumping duty order.
The Department has conducted several administrative reviews of this
antidumping duty order.1 The antidumping duty order was
subsequently revoked for Manho Rope Mfg., Ltd., and Chun Kee Steel &
Wire Rope Co., Ltd., effective March 1, 1996 (see 62 FR 17171 (April 9,
1997)). The antidumping duty order was revoked for Chung Woo Rope Co.,
Ltd., Ssang Yong Cable Manufacturing Co., Ltd. and Sung Jin Co.,
effective March 1, 1997 (see 63 FR 17986 (April 13, 1998)).
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\1\ See Steel Wire Rope from the Republic of Korea; Final
Results of Antidumping Duty Administrative Review; 60 FR 63499
(December 11, 1995), Steel Wire Rope from the Republic of Korea;
Final Results of Antidumping Duty Administrative Review; 61 FR 55965
(October 30, 1996), Steel Wire Rope from the Republic of Korea;
Final Results of Antidumping Duty Administrative Review; 62 FR 17171
(April 9, 1997), Steel Wire Rope from the Republic of Korea; Final
Results of Antidumping Review and Revocation in Part of Antidumping
Duty Order; 63 FR 17986 (April 13, 1998); and Steel Wire Rope From
the Republic of Korea; Final Results of Antidumping Duty
Administrative Review and Partial Rescission of Antidumping Duty
Administrative Review, 64 FR 17995 (April 13, 1999).
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To date, no duty absorption findings have been made with respect to
this case.
Background
On January 4, 1999, the Department initiated a sunset review of the
antidumping duty order on steel wire rope from Korea, pursuant to
section 751(c) of the Act, as amended. On January 19, 1999, the
Department received a Notice of Intent to Participate from the
Committee of Domestic Steel Wire Rope and Specialty Cable Manufacturers
(``the Committee''), within the deadline specified in
Sec. 351.218(d)(1)(i) of the Sunset Regulation.
On February 3, 1999, the Department received a complete substantive
response from the Committee within the deadline specified in the Sunset
Regulations under Sec. 351.218(d)(3)(i). The Committee claimed
interested party status under section 19 U.S.C. 1677(9)(C) and (F). The
Committee asserts that it was the petitioner in the original
investigation and has actively participated in the administrative
reviews conducted by the Department since that time.
On February 3, 1999 the Department received a substantive response
from respondent, Kumho Wire Rope Manufacturer Co., Ltd. (``Kumho''),
within the 30-day deadline specified in the Sunset Regulations under
Sec. 351.218(d)(3)(i). Kumho asserts that it is a foreign manufacturer
and exporter of the subject merchandise and is therefore, an interested
party within the meaning of section 771(9)(A) of the Act. Kumho asserts
that it was not a participant in the Department's original
investigation, although it has participated in the four completed
administrative reviews and is currently participating in the on-going
fifth administrative review.
On February 23, 1999, the Department informed the Commission that,
on the basis of inadequate response from respondent interested parties,
we were conducting an expedited sunset review of this order consistent
with 19 CFR 351.218(e)(1)(ii)(C)(2). (See Letter to Lynn Featherstone,
Director, Office of Investigations from Barbara E. Tillman, Director
for Policy and Analysis.) On March 12, 1999, we extended the deadline
for filing comments on our adequacy determination. On March 18, 1999,
we received comments from Kumho and the Committee regarding our
adequacy determination. The Department determined on May 7, 1999, that
the sunset review of the antidumping duty order on steel wire rope from
Korea is extraordinarily complicated. In accordance with section
751(c)(5)(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, the Department extended the time
limit for completion of the final results of this review until not
later than August 2, 1999, in accordance with section 751(c)(5)(B) of
the Act. 2
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\2\ See Steel Wire Rope From Japan, et. al.: Extension of Time
Limit for Final Results of Five-Year Reviews, 64 FR 24573 (May 7,
1999).
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Adequacy
Kumho argues that despite the fact that it accounts for
significantly less than 50 percent of total imports from Korea of steel
wire rope, Kumho accounts for significantly more than 50 percent of
covered merchandise. Kumho asserts that the Department failed to
consider that seven of the largest producers/exporters have already
been excluded from the order. As a result, total import statistics
overstate the volume and value of imports of subject merchandise.
In its comments, the Committee agrees with the Department's
original adequacy determination. The Committee argues that the
Department's calculation of adequacy is correctly based on total
imports of steel wire rope from Korea. The Committee asserts that
companies that were excluded from the order, or for which the order has
been revoked, may be brought back within the scope of the order if they
were subsequently found to be selling at less than fair value (or below
normal value) so long as the order continues to exist.
The Department continues to find that Kumho's response does not
form an adequate basis for conducting a full review, i.e., because
Kumho does not account for enough of the total exports of subject
merchandise (see 19 CFR 351.218(e)(1)(ii)(A)). However, we disagree
with the Committee that the determination should be based on total
imports of steel wire rope from Korea. We agree with Kumho that the
total value of imports used in our determination of adequacy should not
include imports from revoked or excluded companies. The U.S. Customs
Service, in its annual reports to Congress on the administration of the
antidumping and countervailing duty, reports the value of entries
subject to orders on an order-specific basis. 3 As noted
above, on May 12, 1997, the order was revoked with respect to two
companies and on April 13, 1998, the order was revoked with respect to
an additional three companies. Therefore, the value of imports reported
by Customs for the fiscal years 1993 through 1997 include the value of
imports from companies for which the order has been revoked. The fiscal
year 1998 import values reported by Customs would, however, include
only half-year imports from the three companies for which revocation
notice was published in April 1998. We note that the value of imports
on which Customs was collecting antidumping duty deposits in fiscal
1998 (approximately $16 million) declined by approximately five million
dollars from the value in fiscal 1997 (approximately $21 million). We
therefore considered that decline could be attributed to the April 1998
revocation of the order with respect to three companies. We doubled the
five
[[Page 43168]]
million dollar decline to take into account full year imports from the
three companies for which the order was revoked in 1998, and,
therefore, determine that entries subject to the order during fiscal
1998 were approximately $10 million. Comparing the value of Kumho's
exports 4 and the estimated value of imports subject to the
antidumping duty order on steel wire rope from Korea in fiscal 1998, we
continue to find that Kumho accounted for significantly less than 50
percent of the value of imports of subject merchandise.
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\3\ As reported in Kumho's substantive response, exhibit 2. As
a courtesy we make these statistics available to the public on the
Import Administration sunset website at ``http://www.ita.doc.gov/
import_admin/records/sunset''.
\4\ As reported in Kumho's substantive response, exhibit 2.
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Determination
In accordance with section 751(c)(1) of the Act, the Department
conducted this review to determine whether revocation of the
antidumping order would be likely to lead to continuation or recurrence
of dumping. Section 752(c) of the Act provides that, in making this
determination, the Department shall consider the weighted-average
dumping margins determined in the 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 order and
it shall provide to the International Trade Commission (``the
Commission'') the magnitude of the margin likely to prevail if the
order is revoked.
The Department's determinations concerning continuation or
recurrence of dumping and magnitude of the margin are discussed below.
In addition, the parties' comments with respect to the continuation or
recurrence of dumping and the magnitude of the margin are addressed
within the respective sections below.
Continuation or Recurrence of Dumping
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. In its Sunset Policy Bulletin, the
Department indicated that determinations of likelihood will be made on
an order-wide basis (see section II.A.2). In addition, the Department
indicated that normally it will determine that revocation of an
antidumping 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).
In its substantive response, the Committee argues that revocation
of the antidumping duty order of the subject merchandise would be
likely to lead to continuation or recurrence of dumping. The Committee
asserts that as many as 20 companies remain subject to the order.
Further, the Committee argues that most of these companies have failed
to respond to the Department's questionnaires in any of the
administrative reviews to which they were subject. In addition, the
Committee argues that most of the Korean companies that are presently
subject to the order have been assigned dumping margins based on the
best information available (or facts otherwise available). Because the
Department assigned dumping margins to these non-responding companies,
the Committee argues that, in the instant proceeding, the Department
must assume that these companies will continue to sell at dumped prices
if the order is revoked.
Additionally, the Committee argues that Korea is by far the largest
foreign supplier of carbon steel wire rope to the U.S. market.
Specifically, based on U.S. Department of Commerce, Bureau of the
Census, Report IM 146, the Committee asserts that for the period
January through November 1998, imports from Korea accounted for nearly
48 percent of the total imports of carbon steel wire rope. The
Committee further asserts that the companies that remain subject to the
order account for upwards of one third of the total volume of carbon
steel wire rope imports from Korea.
The Committee notes that the Korean won appreciated 24 percent
against the U.S. dollar between the beginning of the second quarter of
1998 and the present, and argues that current exchange rate trends give
rise to the probability that revocation of the order is likely lead to
continuation or recurrence of dumping. The Committee argues that the
marked appreciation of the Korean won over the past several months
makes it likely that Korean companies will sell subject merchandise in
the United States at dumped prices since the strengthening won will
make home market prices in Korea higher relative to U.S. prices. Using
import volume and value statistics, the Committee asserts that over the
past several months the average unit value of imports from Korea
classified under one of the covered HTSUS item numbers has decreased
from $1,020 per net ton in January 1998 to $818 per net ton in November
1998.
In its substantive response, Kumho argues that revocation of the
order would not likely lead to a recurrence of material injury or
dumping. Kumho asserts that it is the only Korean company subject to
the order actively shipping steel wire rope to the United States and it
has never been found to sell the subject merchandise at less than fair
value. Kumho further argues that since the major Korean wire rope
companies have already been excluded from the order, and Kumho has
never been found to be dumping, there are no grounds to believe that
revocation would likely to lead to a continuation of injury or a
recurrence of dumping. Additionally, Kumho argues that there is no
evidence that any other Korean company subject to the order is actively
shipping subject merchandise or, indeed, would be likely to ship
subject merchandise in the event of revocation. Kumho argues that, of
the 19 companies (including Kumho) for which petitioners requested
administrative reviews in March 1998, three had previously been
excluded from the order, five did not ship subject merchandise, four
had gone out of business, and Kumho responded. While the remaining six
companies did not respond to the Department's questionnaire, Kumho
asserts that two had ceased operations, two had no shipments to the
United States, and one had only one shipment to the United States and
is not actively producing and shipping subject merchandise to the
United States. As to the sixth company, Kumho asserts that it has no
reason to believe that this company has ever shipped subject
merchandise to the United States. In conclusion, Kumho argues that it
is the only company that would be affected by the revocation of the
order.
In its rebuttal comments the Committee argues that Kumho's
assertion that it is the only exporter of steel wire rope from Korea
still subject to the order is mere conjecture. The Committee asserts
that Kumho would like the Department to believe that Kumho is the only
company subject to the order because, under the sunset mechanism, an
order cannot be revoked on a company-specific basis. The Committee
argues that, during the fifth administrative review, the Department
found that both Kwangshin Rope and
[[Page 43169]]
Sungsan Special Steel Processing shipped subject merchandise to the
United States. In addition, the Committee argues that the Department
applied adverse facts available to four additional Korean companies
that received, but did not respond to the Department's questionnaire.
Thus the Committee concludes that the Department must find at least
seven Korean companies remain subject to the order. Further, the
Committee argues that the fact that some companies did not ship subject
merchandise during the most recent administrative review, or declared
bankruptcy, does not mean that these companies cannot or will not again
sell subject merchandise to the United States.
Finally, the Committee argues that a zero or de minimis dumping
margin shall not by itself require the Department to determine that
revocation of the order would not likely lead to continuation or
recurrence of dumping. Rather, in many instances, a zero or de minimis
dumping margin is likely a result of the antidumping duty order.
Therefore, the Committee submits that the recent zero and de minimis
margins are a testament to the remedial purpose of the antidumping duty
order.
In its rebuttal comments Kumho argues that the Committee's
assertion that several Korean companies remain subject to the order is
not supported by any evidence whatsoever in the history of this case.
With respect to the two companies identified by the Committee as having
exported during the most recent completed administrative review, Kumho
argues that in the preliminary determination of that administrative
review, the Department found that Sungsan had sold a quantity of
merchandise purchased from another producer and that Kwangshin had some
shipments during the period of review. Kumho asserts that with respect
to the remaining companies that have recently received adverse facts
available margins, the Committee has not provided any evidence that
these companies actually exist, that they produce subject merchandise,
that they ship merchandise, or that they would ship merchandise in the
event of revocation. Kumho argues that it would be wrong for the
Department to place on Kumho an affirmative burden of establishing that
the companies named in the Committee's requests for administrative
reviews do not ship to the United States. Kumho further argues that,
given that the Department's role in the sunset review process is to
determine whether dumping margins would exist in the event of
revocation, such a determination must be based on actual and projected
shipments rather than conjecture or automatic inferences regarding
companies that may not even exist.
Additionally, with respect to the Committee's arguments related to
exchange rates, Kumho asserts that the Committee ignores the fact that
Kumho and other respondents were nonetheless found to be selling at
zero or de minimis dumping margins in the Department's recent
administrative reviews. Finally, Kumho argues that the Committee's
reliance on import statistics is misplaced. Specifically, Kumho asserts
that its exports enter the United States under a different HTSUS item
number than that relied on by the Committee and, that the unit values
for the HTSUS item number under which Kumho imports have remained
relatively stable.
In compliance with section 752(c) of the Act, the Department
examined the volume of imports before and after the issuance of the
antidumping duty order on steel wire rope from Korea. Import data
provided by Kumho, for the period covering 1992 through 1998, and
confirmed by the Department's U.S. Census data, demonstrate that
imports of steel wire rope from Korea have remained relatively steady.
As discussed in section II.A.3 of the Sunset Policy Bulletin, the
SAA at 890, and the House Report at 63-64, 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, the Department may reasonably infer
that dumping would continue if the discipline of the order were
removed.
In the instant proceeding, although the order has been revoked with
respect to imports from several Korean producers/exporters of steel
wire rope, and Kumho has maintained a zero or de minimis margin in each
of the four completed administrative reviews, deposit rates above de
minimis continue in effect for several producers/exporters of steel
wire rope from Korea. Therefore, given that dumping has continued over
the life of the order, the Department determines that dumping is likely
to continue if the order were revoked.
Because the Department has based this determination on the fact
that dumping continued at levels above de minimis, we have not
addressed the Committee's and Kumho's arguments concerning factors
other than previously calculated margins and import volumes.
Magnitude of the Margin
In the Sunset Policy Bulletin, the Department stated that,
consistent with 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 or exporters
without the discipline of an order 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. (See
sections II.B.2 and 3 of the Sunset Policy Bulletin.)
The Committee argues that, in this case, where the Department has
applied adverse facts available to uncooperative respondents in a
recent administrative review (1996/1997 review (see 63 FR 17986 (April
13, 1998)), the use of the more recently calculated margin is
appropriate. As it did in the fifth administrative review, however, the
Committee asserts that rate is likely to be much higher.
Kumho argues that the magnitude of the margin likely to prevail is
zero. Kumho asserts that its margin has been de minimis for five
consecutive administrative reviews. Therefore, Kumho argues that there
is no reasonable basis to conclude that the dumping margin would
increase in the event of revocation of the order.
The Department disagrees with the Committee's argument that we
should select the margin from the most recently completed
administrative review as the margin likely to prevail if the order is
revoked. As noted above, the Department normally will provide a margin
from the original investigation because that is the rate that reflects
the behavior of exporters absent the discipline of the order. The
Sunset Policy Bulletin suggests that the Department select, as one
alternative, a recently calculated rate, in cases where companies
choose to increase dumping in order to maintain or increase market
share. However, in the instant case, the Committee did not argue or
provide evidence that the uncooperative exporters from the
administrative reviews have increased dumping in order to maintain or
increase market share. Review of import statistics complied from tariff
and trade data from the U.S. Department of Commerce, the U.S. Treasury,
and the Commission demonstrate that imports of steel wire rope from
Korea have remained relatively stable over the life of the
[[Page 43170]]
order. Therefore, we find no reason to deviate from our policy of
selecting margins from the original investigation as probative of the
behavior of absent the discipline of the order.
With respect to the magnitude of the margin likely to prevail on
exports by Kumho, we agree with Kumho. Although Kumho was not a
participant in the original investigation, Kumho has participated in
each of the administrative reviews of this order conducted by the
Department. In each review, Kumho received a zero or de minimis margin.
Although we acknowledge the Committee's assertion that the discipline
of an order will, in many instances, lead to a zero or de minimis
margin, we are not persuaded that Kumho is likely to begin dumping were
the order revoked.
Based on the above analysis, we will report to the Commission the
margins indicated in the Final Results of the Review section of this
notice.
Final Results of Review
As a result of this review, the Department finds that revocation of
the antidumping order would be likely to lead to continuation or
recurrence of dumping at the margins listed below:
------------------------------------------------------------------------
Margin
Manufacturers/exporters (percent)
------------------------------------------------------------------------
Kumho Wire Rope Manufacturer Co., Ltd...................... 0
All Korean Manufacturers/Exporters......................... 1.51
------------------------------------------------------------------------
In addition, as noted above, entries of steel wire rope produced
and sold by Korean Iron & Steel Wire, Ltd. (KIS) were excluded from the
scope of the order, as were entries produced by either Young Heung Iron
& Steel Co., Ltd., (YHC) or Dae Heung Industrial Co., Ltd. and sold by
YHC. Finally, the order has been revoked with respect to Manho Rope
Mfg., Ltd.; Chun Kee Steel & Wire Rope Co., Ltd.; Chung Woo Rope Co.,
Ltd.; Ssang Yong Cable Manufacturing Co., Ltd.; and Sung Jin Co.
This notice 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 section 19 CFR 351.305 of the Department's
regulation. 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 sanctionable
violation.
This five-year (``sunset'') review and notice are published in
accordance with sections 751(c) and 777(i)(1) of the Act.
Dated: August 2, 1999.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 99-20452 Filed 8-6-99; 8:45 am]
BILLING CODE 3510-DS-P