[Federal Register Volume 64, Number 238 (Monday, December 13, 1999)]
[Notices]
[Pages 69488-69491]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-32228]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-583-008]


Certain Circular Welded Carbon Steel Pipes and Tubes From Taiwan: 
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 June 7, 1999, the Department of Commerce (the Department) 
published the preliminary results of review of the antidumping duty 
order on certain circular welded carbon steel pipes and tubes from 
Taiwan (64 FR 30306). The review covers four manufacturer/exporters of 
the subject merchandise to the United States and the period May 1, 1997 
through April 30, 1998. The manufacturers covered are Yieh Hsing 
Enterprise Co. Ltd. (Yieh Hsing), Yieh Loong Co., Ltd. (Yieh Loong), 
Kao Hsing Chang Iron & Steel Corporation (KHC) and Yun Din Steel Co., 
Ltd. (Yun Din).

EFFECTIVE DATE: December 13, 1999.

FOR FURTHER INFORMATION CONTACT: Thomas Killiam or Michael J. Heaney, 
Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue, NW, 
Washington, DC 20230; telephone (202) 482-3019 or 482-4475, 
respectively.
    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 to the regulations, codified at 19 CFR 
Part 351 (1998).

SUPPLEMENTARY INFORMATION:

Background

    On June 7, 1999 the Department published the preliminary results of 
the administrative review, and rescinded the review with respect to Far 
East Machinery Co., Ltd., Sheng Yu Steel Co., Ltd., and Tai Feng 
Industries. Certain Circular Welded Carbon Steel Pipes and Tubes From 
Taiwan: Preliminary Results of Antidumping Duty Administrative Review 
and Partial Recission of Review 64 FR 30306 (``Preliminary Results''). 
We received comments from petitioners and respondents Yieh Hsing and 
KHC. We received rebuttal comments from the petitioners and KHC. The 
Department has now completed this review in accordance with section 751 
of the Act.

Scope of the Review

    Imports covered by this review are shipments of certain circular 
welded carbon steel pipes and tubes. The Department defines such 
merchandise as welded carbon steel pipes and tubes of circular cross 
section, with walls not thinner than 0.065 inch and 0.375 inch or more 
but not over 4\1/2\ inches in

[[Page 69489]]

outside diameter. These products are commonly referred to in the 
industry as ``standard pipe'' and are produced to various American 
Society for Testing Materials specifications, most notably A-53, A-120, 
or A-135. Standard pipe is currently classified under Harmonized Tariff 
Schedule of the United States (HTSUS) item numbers 7306.30.5025, 
7306.30.5032, 7306.30.5040, and 7306.30.5055. Although the HTSUS 
subheading is provided for convenience and customs purposes, the 
written description of the merchandise under investigation is 
dispositive.

Non-Responding Companies

    Yun Din and Yieh Loong did not respond to our requests for 
information. For the reasons discussed in the notice of preliminary 
results, we have assigned these companies, as facts available, the 
highest rate in any review of this order, 14.08%. See Preliminary 
Results at 64 FR 30307.

Methodology

    Except for the corrections of clerical errors discussed below we 
did not change our method of analysis from the preliminary results. See 
id. at 30307-30309. Thus, we applied the same methods with regard to 
price and cost, and observed the requirements of section 
773(a)(1)(B)(i) of the Act concerning level-of-trade analysis.

Comments: KHC

    Comment 1: Petitioners argue with respect to KHC that the 
Department should reject the cost-of-production (COP) offset claimed by 
KHC unless ``heads and tails'' (pipe-end trimmings) were included in 
the cost of raw input submitted by KHC. KHC counters that these items 
were in fact included in its submitted costs.
    Department's Position: There is no record evidence to indicate that 
KHC omitted ``head and tails'' from its cost calculations. Accordingly, 
we have allowed KHC's claimed offset.
    Comment 2: KHC argues that the Department's application of facts 
available in the preliminary results to COP and CV data for certain 
product models which KHC did not produce during the POR is 
inappropriate. KHC contends that it submitted data for alternate models 
which are similar, and that the Department can and should use this 
alternate data, rather than resorting to facts available. In its case 
brief, KHC argues that it did not submit costs data for the sales in 
question because ``* * * it would have been virtually impossible, given 
the schedule, for KHC to use pre-POR cost data to determine actual 
costs; * * *.'' KHC argues that the Department intended to use the 
costs of similar home market models, and stated this intention in its 
analysis memorandum. KHC argues that the Department accepted similar 
substitute model data numbers from the other respondent in the case. 
KHC also argues that the Department is incorrect to conclude that KHC 
``failed to provide any costs of certain models'' since it provided 
costs data of similar products.
    KHC further argues that, assuming the use of facts available is 
appropriate, the Department should not use as facts available the 
highest reported costs among all costs reported for all categories of 
products, because to do so results in the unintended use of adverse 
facts available. The Department should, KHC argues, revise its 
calculation programs in the final results to ensure that no adverse 
facts available are applied to KHC's cost data.
    Petitioners argue that if the Department recalculates the margin 
applicable to KHC it should use values which petitioners put forward as 
facts available data for material, labor, fixed and variable overhead, 
interest and general & administrative expenses.
    Department's Position: Where KHC failed to provide cost data, we 
used the highest average costs of models for which KHC did provide 
data. The facts which we used constitute partial adverse facts 
available, and are also the least adverse facts available on the 
record. We did not use petitioners' suggested alternative values 
because petitioners did not provide any supporting calculations or 
rationales, and because we were in possession of verified average cost 
data from KHC's submission. For the reasons below we disagree with each 
of respondent's arguments.
    KHC withheld information requested by the Department, then 
belatedly offered different information, which did not fulfill the 
request, in an unacceptable format. Section 776(a)(2) of the Act 
provides in part that if an interested party withholds information that 
has been requested or fails to provide such information in a timely 
manner or in the form or manner requested, subject to section 782 (d) 
and (e), the Department shall use facts otherwise available in reaching 
the applicable determination.
    The Department's July 10, 1998 questionnaire stated at D-IV-A that 
``(t)he COP file should contain unit cost information for the foreign 
like product manufactured for sale in the foreign market.'' Section D 
also contained the instruction: ``If you have any questions regarding 
the appropriate cost calculation period for the merchandise under 
review, notify the Department in writing before preparing your response 
to this section of the questionnaire'' (emphasis in original). Appendix 
II of the questionnaire specified the computer-readable format 
required. The cover letter for the questionnaire further stated: ``If 
you have any questions about these or any other matters, please contact 
the official in charge.'' See Letter from Department to KHC, July 10, 
1998, page 1.
    Both supplemental cost questionnaires (January 21 and February 17, 
1999) requested information concerning models with missing product 
quantity data, which are the same models as those with missing costs. 
KHC did not consult the Department on this matter, and did not explain 
its omission of quantity or cost data until its April 13, 1999 addendum 
to its April 12, 1999 supplemental response, where it mentioned in 
passing that the models were not produced during the POR.
    KHC was in a position either to provide the requested data or 
consult with the Department on acceptable alternative approaches, but 
did neither. By repeatedly choosing not to respond adequately to 
repeated requests for the data, as outlined below, KHC failed to 
cooperate to the best of its ability. The Department may therefore use 
an inference that is adverse to the interests of KHC in selecting among 
the facts otherwise available, per section 776(b) and well-established 
Department practice. See, for example, Notice of Final Determination of 
Sales at Less Than Fair Value: Hot-Rolled Flat-Rolled Carbon-Quality 
Steel Products From Japan (64 FR 24329, 24348, May 6, 1999).
    KHC's April 13, 1999 list of alternates was unusable for four main 
reasons. First, it was not the information that we requested. Second, 
KHC provided no supporting documentation or worksheets to establish 
that its suggested alternate models were indeed the most similar, and 
were not models the use of which would result in a lower margin. This 
was a significant omission since the codes are complex, covering five 
product attributes and extending to well over 100 pairs of sixteen-
digit model numbers. Many different models could potentially represent 
similar models to those for which KHC failed to provide quantity and 
cost information. Third, even assuming the Department determined that 
it should use the list KHC proffered, the list did not include a 
computer-compatible version, as required by the Department's 
questionnaire, but merely an unclear set

[[Page 69490]]

of hand-written notes which had been faxed and photocopied multiple 
times. Fourth, it is the responsibility of the respondent to submit its 
cost data in a useable format to the Department and with the specified 
documentation and worksheets. See Sugiyama Chain Co. Ltd. et v. United 
States, 797 F. Supp. 989, 994-995 (CIT 1992). KHC's tactics amounted to 
an improper attempt to shift the task of compiling and categorizing its 
alternate home market models to the Department.
    KHC's argument that it would have been ``impossible'' to supply the 
requested data is unpersuasive: KHC never asked for assistance or for 
more time to collect and report the cost data in question. Instead, KHC 
chose to ignore both the instructions in the questionnaire, already 
cited, and basic statutory guidelines: section 782(c)(1) of the Act 
requires that an interested party promptly notify the Department if it 
is unable to submit information in the form and manner requested, and 
that it provide a ``full explanation and suggested alternate forms'' in 
which it is able to provide the information. KHC provided no such 
notification or explanation.
    KHC's belated claim concerning lack of time is in any case belied 
by the facts. The Department extended this review by 4 months on 
January 6, 1999 (64 FR 860), granted each of KHC's four requests for 
extensions of deadlines to submit responses pertaining in whole or in 
part to the cost section of our questionnaire, and accepted KHC's April 
13, 1999 addendum to its second supplemental cost response, the due 
date for which was April 12. See letters from the Department to KHC, 
granting extensions, November 17, 1998 (Section D Cost Response 
deadline moved from November 19 to December 4), February 3, 1999 
(supplemental cost response deadline moved from February 5 to February 
16), March 29, 1999 (second supplemental cost response deadline moved 
from April 1 to April 9), and April 8, 1999 (second supplemental cost 
response deadline moved again, from April 9 to April 12). KHC thus 
received approximately six additional weeks in which to file its cost 
responses. During this time KHC never mentioned the need to retrieve 
pre-POR cost data. KHC only raised the timing problem in its case 
brief, after the period for submission of new factual information had 
closed. Moreover, KHC has failed to demonstrate why providing actual 
cost data from a few months prior to the POR would be unreasonably 
burdensome. The Department routinely requests and receives sales and 
cost data from the months preceding a POR (see Antidumping 
Questionnaire I-3, I-4, ``Contemporaneous Sales'').
    Concerning the Department's use of alternate model data from 
another respondent, the facts are not analogous. Yieh Hsing's 
alternative model codes were only 4 in number, and were submitted in a 
clear, timely, coherent response, duly accompanied by a computer-
readable version.
    We also disagree with KHC's assertions that use of its highest 
product cost is unduly punitive and that the Department intended to 
apply some other less adverse facts available. KHC misreads the 
analysis memo, which simply states, ``For models in which KHC failed to 
provide the material, labor, fixed factory overhead, variable factory 
overhead information, interest expenses, and general and administrative 
expenses, necessary to complete our analysis, we used the costs of 
similar home market models.'' This statement accurately describes the 
Department's methodology. The Preliminary Results notice was more 
specific in this regard, stating: ``Because KHC failed to provide any 
costs for certain models, as facts available we used the highest 
average cost for the same category of product.'' Thus, the Department 
clearly stated its exact intent with respect to which facts available 
it intended to apply for the unreported data.
    We note that the facts we used are only partial adverse facts 
available and are the least adverse verified facts available on the 
record which would not reward non-compliance. Rather than applying the 
highest calculated margin for the sales with unreported cost data, we 
simply inserted the highest costs in order to complete the costs test 
and leave the price-to-price analysis intact. We have relied upon KHC's 
own verified data as our source of facts available. Use of costs other 
than those we have used, such as KHC's overall, non-product specific 
average costs, could reward KHC for failure to fully cooperate in this 
review because use of such data could potentially result in a lower 
margin than would have resulted from use of KHC's actual costs. Our 
application of partial adverse facts available in this manner is 
consistent with established practice because it is based on verified 
data and is sufficiently adverse to induce KHC's cooperation in future 
reviews. Accordingly, for these final results, we have continued to use 
as partial facts available KHC's highest costs where KHC failed to 
report actual costs.
    Comment 3: KHC argues that although the verification report 
suggests, on the basis of statements by KHC officials, that certain 
packing costs were underreported, a close review of the data on the 
record show that the costs in question were fully reported. Petitioners 
did not comment on this issue.
    Department's Position: Notwithstanding the doubts and confusion 
raised at verification, the evidence indicates that the costs in 
question were not underreported. Therefore we have not altered the 
packing costs for these final results.

Yieh Hsing

    Comment 4: With regards to Yieh Hsing, petitioners argue that the 
Department should convert the reported per-ton packing expense for U.S. 
sales to a per-kilo basis prior to its inclusion in constructed value, 
and also that the Department should put constructed value on a per-ton 
basis prior to the calculation of foreign unit price in dollars.
    Department's Position: We agree with petitioners and have adjusted 
our final results accordingly.
    Comment 5: Yieh Hsing argues that the margin announced in the 
preliminary results contains an incorrectly located decimal point.
    Department's Position: This is a moot point, because the margin has 
changed.

Yun Din

    Comment 6: Concerning Yun Din, petitioners argue that, as it did in 
the preliminary results, the Department should continue to apply the 
highest rate available to this company because of the company's failure 
to cooperate with the Department to the best of its ability following 
the Department's requests for information.
    Department's Position: With regard to Yun Din, we agree with 
petitioners and have maintained our methodology from the preliminary 
results.

Final Results of Review

    As a result of this review, we determine that the following margins 
exist:

[[Page 69491]]



------------------------------------------------------------------------
                                                                Margin
         Manufacturer/exporter                 Period         (percent)
------------------------------------------------------------------------
Yieh Hsing.............................      5/1/97-4/30/98         1.40
KHC....................................      5/1/97-4/30/98        14.08
Yun Din................................      5/1/97-4/30/98        14.08
Yieh Loong.............................      5/1/97-4/30/98        14.08
------------------------------------------------------------------------

    The Department shall determine, and the U.S. Customs Service shall 
assess, antidumping duties on all appropriate entries. The Department 
shall issue appraisement instructions directly to the Customs Service. 
For assessment purposes, we have calculated importer-specific duty 
assessment rates for the merchandise based on the ratio of the total 
amount of antidumping duties calculated for the examined sales to the 
total entered value of sales examined. The Department will issue 
appraisement instructions directly to the U.S. Customs Service.
    Furthermore, the following deposit requirements will be effective 
for all shipments of certain circular welded carbon steel pipes and 
tubes from Taiwan entered, or withdrawn from the warehouse, for 
consumption on or after the publication date of the final results of 
these administrative reviews, as provided by section 751(a)(1) of the 
Act: (1) For the companies named above, the cash deposit rates will be 
the rates listed above; (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 or the original investigation, but the 
manufacturer is, the cash deposit rate will be that established for the 
manufacturer of the merchandise in the final results of these reviews 
or the LTFV investigation; and (4) if neither the exporter nor the 
manufacturer is a firm covered in this or any previous reviews or the 
original fair value investigation, the cash deposit rate will be 9.7%, 
the ``all others'' rate established in the LTFV investigation.
    This notice also serves as a reminder to importers of their 
responsibility under 19 CFR 351.402(f)(2) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during these review periods. 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 a reminder to parties subject to 
administrative protective orders (APOs) of their responsibility 
concerning the disposition of proprietary information disclosed under 
APO in accordance with sections 351.305 and 351.306 of the Department's 
regulations. Timely written notification of the return/destruction of 
APO materials or conversion to judicial protective order is hereby 
requested. Failure to comply with the regulations and terms of an APO 
is a violation which is subject to sanction.
    This administrative review and notice are in accordance with 
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and 19 CFR 353.22.

    Dated: December 6, 1999.
Richard W. Moreland,
Acting Assistant Secretary for Import Administration.
[FR Doc. 99-32228 Filed 12-10-99; 8:45 am]
BILLING CODE 3510-DS-P