[Federal Register Volume 64, Number 244 (Tuesday, December 21, 1999)]
[Notices]
[Pages 71411-71423]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-32673]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-588-823]
Professional Electric Cutting Tools From Japan: Final Results of
the Fifth Antidumping Duty Administrative Review and Revocation of the
Antidumping Duty Order, in Part
AGENCY: Import Administration, International Trade Administration, U.S.
Department of Commerce.
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SUMMARY: On August 10, 1999, the U.S. Department of Commerce published
in the Federal Register the preliminary results of the fifth
administrative review of the antidumping duty order on professional
electric cutting tools from Japan (64 FR 43346). This review covers
Makita Corporation Incorporated, a manufacturer and exporter of the
subject merchandise to the United States. The period of review is July
1, 1997, through June 30, 1998.
We gave interested parties an opportunity to comment on our
preliminary results. Our analysis of the comments received as well as
our discussion of the issues related to revocation of the antidumping
duty order are described below in the ``Revocation'' and ``Interested
Party Comments'' sections of this notice. After review of the comments,
we have not changed the preliminary results, including the
determination to revoke the antidumping duty order, in part, with
respect to professional electric cutting tools that are produced by
Makita Corporation Incorporated and that are also exported by Makita
Corporation Incorporated. The final results are listed below in the
section ``Final Results of Review.''
EFFECTIVE DATE: December 21, 1999.
FOR FURTHER INFORMATION CONTACT: Brian Ledgerwood at (202) 482-3836 or
Brian Smith at (202) 482-1766, Import Administration, International
Trade Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, N.W., Washington, D.C. 20230.
SUPPLEMENTARY INFORMATION:
Background
On August 10, 1999, the U.S. Department of Commerce (``the
Department'') published in the Federal Register preliminary results of
the 1997-1998 administrative review of the antidumping duty order on
professional electric cutting tools (``PECTs'') from Japan (64 FR
43346) (``preliminary results'') and its preliminary intent to revoke
the antidumping duty order, in part, with respect to PECTs that are
produced by Makita Corporation Incorporated and that are also exported
by Makita Corporation Incorporated (``Makita Japan''). The period of
review (``POR'') for this administrative review is July 1, 1997,
through June 30, 1998.
The petitioner, Black & Decker (U.S.) Inc. (``Black & Decker''),
and respondent Makita Japan (along with Makita Japan's affiliated
selling agent in the United States, Makita U.S.A. Inc. (``Makita
USA'')), requested a hearing in this case on September 9, 1999. The
petitioner and Makita Japan/Makita USA (hereafter collectively
referenced as ``Makita'') submitted case briefs and rebuttal briefs on
September 10, 1999 and September 17, 1999, respectively. On October 8,
1999, based on the petitioner's and Makita's timely requests, the
Department conducted a public hearing. Also, based on the petitioner's
timely request, the Department conducted a non-public hearing in which
counsel for the interested parties discussed proprietary information
protected under an administrative protective order (``APO'').
The Department has now completed this administrative review, in
accordance with section 751(a) of the Act.
Applicable Statute and Regulations
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 (``URAA''). In addition, unless
otherwise indicated, all references to regulation are to the
Department's regulations at 19 CFR Part 351 (1998).
Scope of Review
Imports covered by this review are shipments of PECTs from Japan.
PECTs may be assembled or unassembled, and corded or cordless.
The term ``electric'' encompasses electro-mechanical devices,
including tools with electronic variable speed features. The term
``assembled'' includes unfinished or incomplete articles, which have
the essential characteristics of the finished or complete tool. The
term ``unassembled'' means components which, when taken as a whole, can
be converted into the finished or unfinished or incomplete tool through
simple assembly operations (e.g., kits).
PECTs have blades or other cutting devices used for cutting wood,
metal, and other materials. PECTs include chop saws, circular saws, jig
saws, reciprocating saws, miter saws, portable bank saws, cut-off
machines, shears, nibblers, planers, routers, joiners, jointers, metal
cutting saws, and similar cutting tools.
The products subject to this order include all hand-held PECTs and
certain bench-top, hand-operated PECTs. Hand-operated tools are
designed so that only the functional or moving part is held and moved
by hand while in use, the whole being designed to rest on a table top,
bench, or other surface. Bench-top tools are small stationary tools
that can be mounted or placed on a table or bench. These are generally
distinguishable from other stationary tools by size and ease of
movement.
The scope of the PECTs order includes only the following bench-top,
hand-operated tools: cut-off saws; PVC saws; chop saws; cut-off
machines, currently classifiable under subheading 8461 of the
Harmonized Tariff Schedule of the United States (``HTSUS''); all types
of miter saws, including slide compound miter saws and compound miter
saws, currently classifiable under subheading 8465 of the HTSUS; and
portable band saws with detachable bases, also currently classifiable
under subheading 8465 of the HTSUS.
This order does not include: professional sanding/grinding tools;
professional electric drilling/fastening tools; lawn and garden tools;
heat guns; paint and wallpaper strippers; and chain saws, currently
classifiable under subheading 8508 of the HTSUS.
[[Page 71412]]
Parts or components of PECTs when they are imported as kits, or as
accessories imported together with covered tools, are included within
the scope of this order.
``Corded'' and ``cordless'' PECTs are included within the scope of
this order. ``Corded'' PECTs, which are driven by electric current
passed through a power cord, are, for purposes of this order, defined
as power tools which have at least five of the following seven
characteristics:
1. The predominate use of ball, needle, or roller bearings (i.e., a
majority or greater number of the bearings in the tool are ball,
needle, or roller bearings);
2. Helical, spiral bevel, or worm gearing;
3. Rubber (or some equivalent material which meets UL's
specifications S or SJ) jacketed power supply cord with a length of 8
feet or more;
4. Power supply cord with a separate cord protector;
5. Externally accessible motor brushes;
6. The predominate use of heat treated transmission parts (i.e., a
majority or greater number of the transmission parts in the tool are
heat treated); and
7. The presence of more than one coil per slot armature.
If only six of the above seven characteristics are applicable to a
particular ``corded'' tool, then that tool must have at least four of
the six characteristics to be considered a ``corded'' PECT.
``Cordless'' PECTs, for the purposes of this order, consist of
those cordless electric power tools having a voltage greater than 7.2
volts and a battery recharge time of one hour or less.
PECTs are currently classifiable under the following subheadings of
the HTSUS: 8508.20.00.20, 8508.20.00.70, 8508.20.00.90, 8461.50.00.20,
8465.91.00.35, 85.80.00.55, 8508.80.00.65 and 8508.80.00.90. Although
the HTSUS subheading is provided for convenience and customs purposes,
the written description of the merchandise under review is dispositive.
Duty Absorption
On September 24, 1998, the petitioner requested that the Department
determine whether antidumping duties had been absorbed during the POR.
Section 751(a)(4) of the Act provides for the Department, if requested,
to determine during an administrative review initiated two or four
years after the publication of the order, whether antidumping duties
have been absorbed by a foreign producer or exporter, if the subject
merchandise is sold in the United States through an affiliated
importer. In this case Makita Japan sold to the United States through
an importer (i.e., Makita USA) that is affiliated within the meaning of
section 751(a)(4) of the Act.
Section 351.213(j)(2) of the Department's regulations provides that
for transition orders (i.e., orders in effect on January 1, 1995), the
Department will conduct duty absorption reviews, if requested, for
administrative reviews initiated in 1996 or 1998. Because the order
underlying this review was issued prior to January 1, 1995, and this
review was initiated in 1998, a duty absorption determination in this
segment of the proceeding is appropriate. As we have found that there
is no dumping margin for Makita with respect to its U.S. sales, we have
also found that there is no duty absorption for purposes of the final
results (see Final Results of Antidumping Duty Administrative Review:
Certain Hot-Rolled Lead and Bismuth Carbon Steel Products from Germany,
64 FR 43146 (August 9, 1999).).
Normal Value Comparisons
We made normal value (``NV'') comparisons to constructed export
price based on the same methodology used in the preliminary results
(see preliminary results at 43348-43350, and Preliminary Results
Calculation Memorandum to the File dated August 3, 1999).
Determination to Revoke Order in Part
The Department ``may revoke, in whole or in part,'' an antidumping
duty order upon completion of a review under section 751 of the Act.
While Congress has not specified the procedures that the Department
must follow in revoking an order, the Department has developed a
procedure for revocation that is described in 19 CFR 351.222. This
regulation requires, inter alia, that a company requesting revocation
must submit the following: (1) A certification that the company has
sold the subject merchandise at not less than NV in the current review
period and that the company will not sell at less than NV in the
future; (2) a certification that the company sold the subject
merchandise in each of the three years forming the basis of the request
in commercial quantities; and (3) an agreement to reinstatement of the
order if the Department concludes that the company, subsequent to the
revocation, sold subject merchandise at less than NV. (See 19 CFR
351.222(e)(1).) Upon receipt of such a request, the Department may
revoke an order, in part, if it concludes that: (1) The company in
question has sold subject merchandise at not less than NV for a period
of at least three consecutive years; (2) it is not likely that the
company will in the future sell the subject merchandise at less than
NV; and (3) the company has agreed to immediate reinstatement of the
order if the Department concludes that the company, subsequent to the
revocation, sold subject merchandise at less than NV. See 19 CFR
351.222(b)(2); see, e.g., Final Results of Antidumping Duty
Administrative Review and Determination Not To Revoke Order in Part:
Pure Magnesium from Canada, 64 FR 12977, 12978 (March 16, 1999) (``Pure
Magnesium from Canada'').
In our preliminary results, we found that Makita met the
requirements for revocation (see preliminary results, 64 FR 43351,
43352).
The petitioner argues that revocation is not appropriate because it
is likely that Makita will resume selling subject merchandise below NV
if the order is revoked. In general, the petitioner argues that Makita
has avoided dumping margins in the past by drastically reducing its
import volumes, and that Makita's pricing practices and loss in market
share indicate that Makita is not able to compete effectively in the
U.S. market without lowering prices. Additionally, the petitioner
argues that Makita could easily expand its production capacity in Japan
in order to begin selling at below NV in the future. Furthermore, the
petitioner argues that market demand in Japan is declining, thereby
increasing Makita's dependance on the U.S. market.
In response, Makita argues that its sales have in fact been in
commercial quantities, and that the record clearly indicates that it is
not likely that Makita will sell at below NV in the future if the order
is revoked. Makita argues that it has experienced a drastic change in
circumstance as a result of the building of its U.S. manufacturing
facility, where a majority of Makita's electric cutting tools for the
U.S. market are now produced. Thus, Makita stresses, most of its
production of ``subject merchandise'' occurs in the United States, and
consequently such products are no longer subject to the antidumping
duty order. Makita notes that it has made and continues to make
substantial investment in the U.S. facility, and that maintaining the
U.S. facility is consistent with the company's objective of producing
in close proximity to its customers. Furthermore, Makita states that,
while it has additional capacity in its U.S. production facility, it
has limited remaining production capacity in its facilities in Japan.
As such, Makita
[[Page 71413]]
claims that it is not likely that Makita would ever shift production of
its power tools back to Japan.
With regard to the market conditions and pricing levels, Makita
argues that it has no need to sell at below NV, because the U.S.
electric power tool market in general and electric cutting tool market
in particular are healthy, stable, and growing, and the Japanese
electric power tool market is also relatively stable. Makita further
argues that it is able to charge premium prices because of its
reputation for quality. Thus, Makita contends, it can make sales in the
U.S. market, even when its prices are higher than its competitors'
prices.
Upon review of the three criteria outlined at section 351.222(b) of
the Department's regulations, the comments of the parties, and all of
the evidence in the record, we have determined that the Department's
requirements for revocation have been met. Based on the final results
in this review and the final results of the two preceding reviews,
Makita has demonstrated three consecutive years of sales at not less
than NV. Furthermore, we find that Makita's aggregate sales to the
United States have been made in commercial quantities during each of
those years. Finally, based on our review of the record and the
comments of the parties, we continue to find that it is not likely that
Makita will sell at below NV in the future for the reasons set forth in
the August 2, 1999, Revocation Memorandum (see Memorandum Regarding
Revocation of the Antidumping Duty Order on Professional Electric
Cutting Tools from Japan dated August 2, 1999 (hereafter ``August 2
Revocation Memorandum'').
Although, Makita's sales to the United States have decreased
substantially since the imposition of the antidumping order, its
exports of subject merchandise to the United States, in particular
specialty PECTs, remain significant and reflect Makita's normal
commercial practice. Further, while Makita has maintained consistent
export volumes of its ``specialty'' PECTs, Makita transferred
production of the remaining subject merchandise (i.e., non-specialty
PECTs) to the United States. Makita made a substantial investment in a
U.S. manufacturing facility, and subsequently shifted production of
subject merchandise to that facility. Additionally, the record
indicates that the U.S. production facility now manufactures comparable
volumes of non-specialty merchandise to those previously manufactured
by Makita Japan. This significant change in business practice explains
the decrease in Makita's exports of subject merchandise to the United
States. With respect to products produced in Japan (i.e., specialty
PECTs), Makita has maintained consistent, significant levels of export
sales levels to hundreds of U.S. customers since 1995 (see August 2
Revocation Memorandum at Attachment 2, Makita's October 26, 1998,
section C response at Appendix C-2, and ``Commercial Quantities''
section below). Based on these facts (confirmed at verification) and
our review of Makita Japan's sales practices, we find that we can
reasonably conclude that the de minimis margins calculated for Makita
are reflective of the company's normal commercial experience and
provide a reasonable basis for our decision on revocation. See August 2
Revocation Memorandum at 10-11; and Pure Magnesium from Canada 64 FR
12977, 12979 (March 16, 1999) (where the Department found that because
sales and volume figures were so small, both in absolute terms and in
comparison with the period of investigation (``POI''), it could not
conclude that the reviews were reflective of what the company's normal
commercial experience would be without the discipline of an antidumping
duty order).
Additionally, after consideration of the various comments that were
submitted in response to the preliminary results, the Department
continues to find that because Makita is not likely to sell subject
merchandise in the United States below NV in the future, the continued
application of the antidumping duty order is no longer necessary to
offset dumping. As we stated in Brass Sheet and Strip from Germany,
Final Results of Antidumping Administrative Review and Determination to
Revoke in Part, 61 FR 49727, 49730 (September 23, 1996), ``[i]n prior
cases where revocation was under consideration and the likelihood of
resumption of dumped sales was at issue, the Department has considered,
in addition to the respondent's prices and margins in the preceding
periods, such other factors as conditions and trends in the domestic
and home market industries, currency movements, and the ability of the
foreign entity to compete in the U.S. marketplace without LTFV sales.''
See also Brass Sheet and Strip from Canada: Preliminary Results of
Antidumping Duty Administrative Review and Notice of Intent to Revoke
Order in Part, 63 FR 6519, 6523 (February 9, 1998).
Based upon the relevant factors in this case, we find that it is
not likely that Makita will sell at less than NV if the order is
revoked with respect to Makita and, therefore, the continued
application of the antidumping duty order to Makita is no longer
necessary to offset dumping. First, with regard to capacity
utilization, the record establishes that Makita Japan has very limited
remaining capacity in its Japanese facilities, while it has additional
remaining capacity at Makita Corporation of America (``MCA''). Makita
has made significant investments in its U.S. facility, and all evidence
in the record indicates that MCA intends to produce PECTs in the United
States for the long-term. The majority of the PECTs sold by Makita USA
are now being produced in the United States. Moreover, as confirmed at
verification, Makita has never shifted production of any tool from MCA
back to Japan. Additionally, Makita Japan is currently producing only
specialty PECTs for export to the U.S. market, and Makita Japan's
existing production in Japan is primarily geared toward production for
the home market. Furthermore, the record indicates that Makita Japan
produces specialty PECTs to order and thus maintains low inventories of
subject merchandise, another fact suggesting that Makita would be less
likely to dump subject merchandise.
Second, with respect to specialty tools (imports from Makita
Japan), Makita has consistently priced its products higher than its
competition in the United States. Thus, the record indicates that
Makita has not needed to lower prices of its Japan-produced tools in
order to remain competitive or to maintain a consistent level of sales
(i.e., quantity). Although Makita has lost U.S. market share in recent
years, it has maintained consistent annual sales in significant
quantities.
Third, the record indicates that the electric power tool industry,
including PECTs, in the United States and around the world is stable
and/or growing (see August 2 Revocation Memorandum at 14-15). Based on
our review of the record data, we found that this price stability
characteristic of the electric power tool industry mitigates against
the possibility of future dumping, as compared to other industries
where market prices are volatile (see the Department's July 9, 1999,
verification report at 34-39; the Department's July 13, 1999,
verification report at 13-15; the August 2 Revocation Memorandum at 14-
15).
Therefore, for the reasons discussed above and in our August 2
Revocation Memorandum at 11-15, we find that Makita Japan qualifies for
revocation of the order on PECTs which it produces and exports to the
United States under 19 CFR 351.222(e)(1)(ii).
[[Page 71414]]
We note that in response to the decision by a WTO Panel, the
Department revised its revocation regulation. See United States--Anti-
Dumping Duty on Dynamic Random Access Memory Semiconductors of One
Megabit or Above From Korea, WTO Doc. WT/DS99/R (January 29, 1999). The
new regulation replaces the ``not likely'' standard with a requirement
that ``[t]he continued application of the antidumping duty order is no
longer necessary to offset dumping'' now codified at 19 CFR 351.222(b).
While this regulation was not yet in effect for purposes of this
review, and thus does not apply to this case, we determine, as
discussed above and in the comments outlined below, that continuation
of the order with respect to Makita is no longer necessary to offset
dumping.
Interested Party Comments
General
Comment 1: The Department's Grant of Constructed Export Price Offset
Makita argues that the Department's grant of a constructed export
price (``CEP'') offset is in accordance with the law. Makita notes that
because the petitioner stipulated to dismissal of its judicial
challenge to the Department's grant of the CEP offset in the prior
fourth antidumping duty administrative review, it may be assumed that
the petitioner is no longer interested in pursuing the CEP offset issue
for purposes of the current proceeding.
In response, the petitioner asserted that, although it stipulated
to dismissal of prior litigation on this issue, it reserves its right
to appeal the issue if and when it is finally resolved.
Department's Position: We agree with Makita that the Department's
calculation of a de minimis margin, in particular the grant of a CEP
offset as part of the level of trade (``LOT'') analysis, is in
accordance with the U.S. antidumping law. As we explained in the final
results for the previous fourth antidumping duty administrative review:
The Department is continuing its practice, articulated in
section 351.412(c) of its regulations, of making LOT comparisons for
CEP sales on the basis of the CEP after adjustments provided for in
section 772(d) of the statute. As stated in Certain Stainless Steel
Wire Rods from France: Final Results of Antidumping Duty
Administrative Review, 63 FR 30185 (June 3, 1998), we recognize that
the Department's practice has been criticized by the CIT in Borden,
Inc. v. United States. However, the decision in Borden, Inc. v.
United States, is not final, and we believe our practice to be in
full compliance with the statute and the regulations. Thus, we will
continue to apply the methodology articulated in the regulations at
section 351.412. Professional Electric Cutting Tools from Japan
Final Results of the Administrative Review, 63 FR 54441 at 54444
(October 9, 1998) (Comment 2)
Accordingly, we have applied the methodology articulated in the
regulations at section 351.412.
Comment 2: Criteria for Revocation Set Forth in the Department's
Regulations
Makita argues that it has met the criteria for revocation set forth
in the Department's regulations. Specifically, Makita states that: (1)
It has made sales of subject merchandise for three consecutive years
(i.e., three PORs) at de minimis antidumping duty margins; (2) it
agrees to reinstatement of the antidumping duty order (should dumping
of subject merchandise resume) and has provided the requisite
certifications set forth in the Department's regulations (see
preliminary results, ``Intent To Revoke'' section, 63 FR at 43350
(August 10, 1999)); (3) it has made sales of subject merchandise in
commercial quantities (see ``Commercial Quantities'' section below for
further discussion); and (4) there is no likelihood that Makita will in
the future sell the subject merchandise at less than NV (see
``Likelihood of Future Dumping'' section below for further discussion).
Therefore, based on its fulfilment of the criteria outlined above,
Makita argues that the Department should revoke the order with respect
to PECTs that are produced by Makita Japan and that are also exported
by Makita Japan.
The petitioner argues that Makita has not met the criteria for
revocation set forth in the Department's regulations. Specifically, the
petitioner states that: (1) Makita's sales of subject merchandise have
not been in commercial quantities; and (2) Makita has not presented any
compelling argument demonstrating that it is not likely to dump subject
merchandise in the future.
Department's Position: We agree with Makita that it has met the
Department's criteria for revocation set forth in its regulations.
Specifically, Makita has met the following requirements: (1) Makita has
made sales of subject merchandise for three consecutive years (i.e.,
three PORs) at de minimis dumping margins; (2) Makita agrees to
reinstatement of the antidumping duty order (should dumping of subject
merchandise resume) and has provided the requisite certifications set
forth in the Department's regulations (see preliminary results;
``Intent To Revoke'' section, 63 FR at 43350). In addition, we have
determined that Makita has made sales of subject merchandise in
commercial quantities (see ``Commercial Quantities'' section below for
detailed discussion) in each of the three years of de minimis margins.
Finally, we find that it is not likely that Makita will in the future
sell the subject merchandise at less than NV (see ``Likelihood of
Future Dumping'' section below for detailed discussion), and that the
continued application of the antidumping duty order is no longer
necessary to offset dumping. Therefore, the Department is revoking the
order with respect to PECTs from Japan that are produced by Makita
Japan and that are also exported by Makita Japan.
Commercial Quantities
Comment 1: Standard for Determining Whether Sales are Made in
Commercial Quantities
The petitioner states that Makita has not met the threshold
requirement of demonstrating that sales of subject merchandise were
made in commercial quantities during the three PORs under review (i.e.,
3rd Administrative Review: 7/1/95-6/30/96, 4th Administrative Review:
7/1/96-6/30/97, and 5th Administrative Review: 7/1/97-6/30/98--
hereafter ``3rd AR,'' ``4th AR,'' and ``5th AR''). The petitioner
argues that Makita's sales during the three years under review are not
representative of its normal commercial behavior, as is demonstrated by
the disparity between pre-order and post-order subject merchandise
sales volumes. The petitioner asserts that the Department is applying
an incorrect standard by ignoring the disparity in pre-order and post-
order sales volumes and is setting bad policy by finding sales in
commercial quantities under the facts of this case. Specifically, the
petitioner states that, consistent with prior determinations on
revocation, the Department must consider both absolute and relative
current sales volumes (i.e., post-order) in comparison to respondent's
sales volumes prior to the order, because sales volumes subsequent to
the order are meaningless without a pre-order benchmark. Thus, the
petitioner claims that the Department erred in its preliminary results
by considering sales volume only in absolute terms for determining
whether sales were made in commercial quantities.
The petitioner argues that the Department's case history on
commercial quantities determinations in the context of revocation has
focused on absolute and relative sales volumes between the pre- and
post-order periods. To support its argument, the petitioner
[[Page 71415]]
cites to cases where the respondent had zero or very few sales in
absolute terms and the Department found that it did not meet the
commercial quantities threshold (see, e.g., Pure Magnesium from Canada,
64 FR 12978 (March 16, 1999), and Certain Corrosion-Resistant Carbon
Steel Flat Products and Certain Cut-to-Length Carbon Steel Plate from
Canada: Final Results of Antidumping Duty Administrative Review and
Determination to Revoke in Part, 64 FR 2173, 2175 (January 13, 1999)
(hereafter ``Corrosion-Resistant Steel from Canada''). The petitioner
also cites to a case where respondent had 35, 45, and 70 percent of its
pre-order relative sales volumes during the three consecutive PORs
without dumping and the Department concluded that these sales volumes
met the commercial quantities threshold (i.e., Silicon Metal from
Brazil: Preliminary Results, Intent to Revoke in Part, Partial
Rescission of Antidumping Duty Administrative Review, and Extension of
Time Limits, 64 FR 43161, 43162 (August 9, 1999) (hereafter ``Silicon
Metal from Brazil'')). The petitioner states that although Makita had
more than a few sales in absolute terms, Makita's sales history is not
analogous to Silicon Metal from Brazil case cited above. Therefore, as
a matter of policy, as a matter of consistency, and due to the
importance of the comparative standard used in determining normal
commercial activities, the petitioner maintains that Makita's sales
volumes cannot be considered satisfactory.
The petitioner disagrees with the Department's finding in the
preliminary results that, ``[a]lthough Makita's sales to the United
States have decreased substantially since the imposition of the
antidumping order, its exports to the United States remain significant.
* * * Thus regardless of the decrease in shipments during the course of
this proceeding, * * * Makita is currently selling in commercial
quantities.'' (See August 2 Revocation Memorandum at 10.) Specifically,
the petitioner claims that sales volume during the POI must be
considered when ascertaining whether the company's current sales
reflect normal commercial practice, because the POI provides the only
time period for which there is evidence concerning the respondent's
commercial behavior without the discipline of the antidumping duty
order. Citing Certain Corrosion-Resistant Carbon Steel Flat Products
and Certain Cut-to-Length Carbon Steel Plate from Canada: Preliminary
Results of Antidumping Duty Administrative Reviews, Intent to Revoke in
Part, Intent to Not Revoke in Part, and Rescission of Review in Part,
64 FR 45228, 45230 (August 19, 1999) (hereafter ``Corrosion-Resistant
Carbon Steel Flat Products from Canada'') (where the Department found
that sales were not in commercial quantities when the respondent's
sales volumes for the current POR were only 0.173 percent of the POI
sales volumes); and Pure Magnesium from Canada, 64 FR 12977, 12982
(March 16, 1999) (where the volume of subject merchandise sales sold in
each year under review was less than 0.5 percent of the volume sold
prior to the imposition of the order). Thus, the petitioner claims that
because the volume of Makita's subject merchandise sales sold in each
year under review was one percent or less than the volume sold prior to
the imposition of the order, the Department cannot reasonably conclude
that the consecutive de minimis margins are reflective of Makita's
normal commercial experience in this case. Additionally, the petitioner
argues that the Department cannot declare an amount to be
``significant'' (i.e., current sales volume) without having some
comparison or benchmark to provide context; in other words,
``significant'' must be relative to some defensible benchmark (See
Shakeproof Assembly Components v. United States, Slip Op. 99-70 at 6
(CIT July 29, 1999) and Taiwan Semiconductor Industry Ass'n v. United
States, Slip Op. 99-57 at 18 (CIT June 30, 1999).)
Additionally, the petitioner maintains that Makita's current sales
activity (post-order) does not reflect the company's normal commercial
activity (pre-order), because Makita's recent exports to the United
States consist only of low-sales-volume, ``specialty'' PECT models
(i.e., not high-sales-volume, non-specialty PECT models), which are
sold at relatively high prices. The petitioner argues that Makita's
pre-order subject merchandise exports represented a full range of PECT
models sold in significant quantities, rather than just ``specialty''
PECT models. Thus, the petitioner argues that Makita's post-order
``specialty'' PECT sales are not reflective of the company's normal
pre-order commercial activity. The petitioner further contends that
Makita's total number of PECT sales dropped considerably while Makita's
sales of other non-subject power tools (i.e., drills, sanders, and
grinders) remained consistent, thus indicating that Makita's current
sales of subject merchandise are not reflective of its normal
commercial activity.
Makita states that its sales from the 3rd through the 5th ARs
represent Makita's normal commercial behavior and reflect significant,
consistent sales volumes. In addition, Makita argues that its current
sales volumes continue to exhibit substantially the same range of
specialty PECTs that were exported in 1992, prior to the imposition of
the antidumping duty order, and that nothing has changed in regard to
its specialty PECT exports.
Furthermore, Makita argues that it is not necessary to rely on pre-
order sales volumes in this case in order to ascertain Makita's normal
commercial practice, emphasizing that the Department cannot ignore the
fact that Makita has established a permanent U.S. production facility
that now manufactures the majority of Makita's PECT production for the
U.S. market. Thus, Makita asserts, the subject merchandise that was
previously produced in Makita's facility in Japan (pre-order) is now
being manufactured in the United States. As a consequence of this
substantial and permanent change in the company's business practice,
which occurred in 1993, Makita stresses that pre-order export levels
cannot properly represent current commercial activity.
Makita further notes that because it has permanently shifted the
production of its high-sales-volume, ``non-specialty'' PECTs from
Makita Japan to its U.S. production facility (i.e., MCA)), it is
unlikely that Makita will ever again achieve 1992 pre-order sales
quantities of PECTs that are produced in Japan. Thus, Makita argues
that if the Department were to apply the petitioner's suggested
requirement for commercial quantities, Makita could never obtain a
revocation of the order. In effect, Makita argues, no company that
shifts its production to the United States would ever be able to seek
revocation. Makita further argues that the Department has considerable
discretion in determining whether sales were made in commercial
quantities and that the Department's preliminary finding in this case
was in fact consistent with another recent decision issued by the
Department. Citing Notice of Preliminary Results of Antidumping
Administrative Review and Intent to Revoke Order in Brass Sheet and
Strip from the Netherlands, 64 FR 48760, 48765, (September 8, 1999)
(hereafter ``Brass Strip from the Netherlands''), Makita states that
its change in commercial practice is similar to the circumstances in
that case, where the respondent acquired a U.S. production facility and
shifted significant production to the United States. Makita notes that,
in Brass Strip from the Netherlands, the Department determined that the
respondent's U.S.
[[Page 71416]]
sales were made in commercial quantities, despite a decline in exports,
based on the Department's finding that the acquisition of the U.S.
facility represented an ``unusual occurrence'' that significantly
altered the company's commercial practice. Makita further argues that,
in Brass Strip from the Netherlands, the Department stated that it is
reasonable to conclude that the company's commercial practices were
permanently changed when its subject merchandise production shifted to
its U.S. facility, thereby making the date of the production shift,
rather than the pre-order period, the appropriate benchmark for
measuring whether respondent's sales during the three years without
dumping were made in commercial quantities.
Makita stresses that it is not necessary to consider pre-order
sales volumes, if the more current data provides the Department with
appropriate information for determining Makita's normal commercial
behavior. Makita argues that the Department's practice regarding the
determination of commercial quantities must be applied on a case-by-
case basis and that there are no set guidelines, commercial standards,
or policies setting forth precise minimum sales quantities or
permissible percentage changes in those quantities that are needed to
determine a respondent's normal commercial behavior. Makita argues that
this case is different from the cases cited by the petitioner (i.e.,
Pure Magnesium from Canada, Corrosion-Resistant Steel from Canada,
Corrosion-Resistant Carbon Steel Flat Products from Canada, and Silicon
Metal from Brazil), noting that none of the cases cited involved a
major shift in production of subject merchandise. Additionally, Makita
argues that the petitioner's citation to Shakeproof Assembly Components
v. United States and Taiwan Semiconductor Industry Ass'n v. United
States is not persuasive because those cases involved decisions by the
International Trade Commission (``ITC''), rather than the Department of
Commerce.
Makita also argues that there is a sound basis on which to evaluate
what the Department means when it uses the term ``significant'' with
respect to Makita's volume of export sales to the United States in this
review. Specifically, Makita notes that by defining the relevant
universe of subject merchandise imports as specialty PECTs only, then
its sales of the 16 specialty PECTs in the post-order period have
unquestionably been consistent and significant in relation to pre-order
sales of the same 16 models.
Finally, in response to the petitioner's argument that the
Department should decide this case in a manner consistent with other
revocation cases, Makita states that this is precisely what the
Department did, i.e., the Department based its decision on Makita's
normal commercial practices. Makita argues that if the Department could
not consider a significant and long-term change in business practice
(i.e., shifting high-volume PECT production to a U.S. production
facility (MCA)), Makita would forever be locked into the order.
According to Makita, any changes in the way Makita did business that
resulted in lower volumes of imports would result in an indefinite
continuation of the order, thereby rendering the revocation provision
meaningless for Makita.
Department's Position: We agree with the petitioner that in order
to form the basis for a revocation determination, past margins must be
reflective of the company's normal commercial activity. See Corrosion-
Resistant Steel from Canada. Sales during a POR which, in the
aggregate, are of an abnormally small quantity do not generally provide
a reasonable basis for determining that the discipline of the order is
no longer necessary to offset dumping. Id.; see also Pure Magnesium
from Canada at 12979 (``These sales and volume figures are so small,
both in absolute terms and in comparison with the period of
investigation, that we cannot reasonably conclude that the zero margins
[respondent] received are reflective of the company's normal commercial
experience.''). However, the determination as to whether or not sales
volumes are made in commercial quantities is made on a case-by-case
basis, based on the unique facts of each proceeding. Neither the
statute nor the regulations prescribes a specific standard for
determining whether sales have been made in commercial quantities. For
example, we have specifically found in prior cases that although one or
two sales is not generally sufficient to meet the threshold, a sales
drop-off after the imposition of an antidumping duty order does not
necessarily prevent revocation (see, e.g., Pure Magnesium From Canada;
Final Results of Antidumping Duty Administrative Review and
Determination Not to Revoke Order in Part 64 FR 50489, 50490-Comment 1,
50492-Comment 4 (September 17, 1999) (hereafter ``Pure Magnesium from
Canada 2'') (where one or two sales was not consistent with normal
commercial practice; also stating that a sales drop-off after
imposition of the order does not necessarily prevent revocation). See
also Corrosion-Resistant Steel from Canada (although one sale during
the POR was insufficient, several thousand sales during another POR was
distinguishable); and Brass Strip from the Netherlands, 64 FR 48760,
48765 (September 8, 1999) (respondent provided a commercially
acceptable explanation of why exports of subject merchandise had
declined).
In this case, we agree with Makita that its sales volumes during
each of the three years under consideration were significant. Unlike in
prior cases where the Department did not revoke because the respondent
did not meet the basic threshold requirement of sales made in
commercial quantities, in this case, Makita made thousands of sales
during each POR to hundreds of different customers (see August 2
Revocation Memorandum at Attachment 2 and Makita's October 26, 1998
section C response at Appendix C-2). Compare Corrosion-Resistant Steel
from Canada (sales were not in commercial quantities where respondent
only had one sale during the POR); Pure Magnesium from Canada (sales
were not in commercial quantities where respondent had one sale in two
of the relevant years and two sales in the other). Thus, this case is
distinguishable from other cases where the respondents only had one or
two sales during the relevant PORs. Moreover, although Makita's
aggregate subject merchandise PECT sales have decreased since the
imposition of the antidumping order, that decrease relates to products
that Makita now produces in the United States. Makita continues to
export from Japan significant quantities of ``specialty'' PECTs, the
only PECT models not produced in the United States, and these
quantities are significant relative to pre-order (1992) sales of the
same models.1
---------------------------------------------------------------------------
\1\ Makita's history of specialty PECT sales is as follows:
Makita's 1993 sales of specialty PECTs were 00.00% of its 1992 sales
of specialty PECTs. Makita's 1994 sales of specialty PECTs were
38.39% of its 1992 sales of specialty PECTs. Makita's 1995 sales of
specialty PECTs were 38.60% of its 1992 sales of specialty PECTs.
Makita's 1996 sales of specialty PECTs were 47.18% of its 1992 sales
of specialty PECTs. Makita's 1997 sales of specialty PECTs were
42.17% of its 1992 sales of specialty PECTs. Makita's 1998 sales of
specialty PECTs were 50.86% of its 1992 sales of specialty PECTs.
(See August 2 Revocation Memorandum at Attachment 2).
---------------------------------------------------------------------------
Furthermore, sales during the three years in question are
reflective of the company's normal commercial experience since the
establishment of its production facility in the United States. The
record indicates that the U.S. production facility now manufactures
volumes of merchandise comparable to
[[Page 71417]]
what was previously being manufactured by Makita Japan. This
significant change in business practice provides a logical commercial
explanation for Makita's relative drop in subject merchandise sales.
In the preliminary results of Brass Strip from the Netherlands, we
evaluated whether the volume of sales prior to the order was the proper
benchmark for measuring whether a respondent's sales volumes during the
three years without dumping were made in commercial quantities, where
the respondent acquired a U.S. manufacturing facility (subsequent to
the imposition of the order) and had shifted a substantial portion of
its production of subject merchandise to the United States. In Brass
Strip from the Netherlands at 48765-48766, we found that this ``unusual
occurrence'' provided sufficient reason to re-evaluate the benchmark.
We stated:
Although both the quantity and number of [respondent]'s
shipments to the United States of subject merchandise have decreased
since the imposition of the antidumping duty order, we find that the
. . . acquisition of [the U.S. facility] and the subsequent transfer
of in-scope radiator strip production to the United States is
reflective of the type of ``unusual occurrence'' contemplated by the
Department, in promulgating its regulations, as an acceptable
explanation of why exports of subject merchandise have declined.
Prior to this acquisition, . . . [respondent] continued to ship in
similar quantities to the pre-order period and the subsequent
cessation of shipments until 1995 was the immediate result of the
1991 acquisition. Based upon these circumstances, it is reasonable
to conclude that the company's commercial practices were permanently
changed in 1991, and that 1991, rather than the pre-order period,
should be the benchmark for measuring whether the company's sales
during the three years without dumping were made in commercial
quantities.
Thus, as indicated in Brass Strip from the Netherlands, in order to
ascertain a corporation's ``normal commercial practice'' with respect
to shipment volumes, where necessary, we will evaluate the most
appropriate benchmark. We recognize that in most cases, sales of
subject merchandise sold prior to the imposition of the order will
provide the most relevant benchmark. However, in unusual instances,
such as those in this case, flexibility may be warranted in order to
properly evaluate the company's normal commercial practice. In this
instance the record indicates that Makita made the long term, if not
permanent, decision to shift its production of non-specialty PECTs to
the United States in 1993. Thus, while the sales levels prior to the
imposition of the order provide an appropriate benchmark for analyzing
sales volumes of specialty PECTs--this benchmark is no longer relevant
to sales volumes of non-specialty PECTs. As such, we have compared
Makita's sales volumes of specialty PECTs prior to the imposition of
the order with those in the post-order period and, as stated above,
after considering all relevant factors, found the latter to be
significant.
Additionally, as we stated in Pure Magnesium from Canada 2 at
50492, a sales drop-off after imposition of the order does not
necessarily prevent revocation. The Department explained:
The Department's threshold requirement does not mean, as NHCI
suggests, that the Department is effectively disqualifying companies
from revocation if there is a sales drop off following the
imposition of an antidumping order. The issue that is analyzed by
the Department is the magnitude of the drop-off. In this regard, the
Department has expressed its intent to revoke an antidumping duty
order even where the sales drop-off has been substantial so long as
the sales used to demonstrate a lack of price discrimination are
reflective of the company's normal commercial experience.
Thus, the normal concern that accompanies decreased sales (i.e.,
that a low level of sales activity does not provide a reasonable basis
for determining that the discipline of the order is no longer necessary
to offset dumping) is not present here because there is an explanation
as to why Makita has decreased sales of subject merchandise and current
sales levels are significant. Compare with Pure Magnesium from Canada
(where the Department could not reasonably conclude that the zero
margins received by respondent were reflective of the company's normal
commercial experience without the discipline of an order). For these
reasons, we find that we can reasonably conclude that the de minimis
margins calculated for Makita are reflective of the company's normal
commercial experience and provide a reasonable basis for our decision
to revoke. See August 2 Revocation Memorandum at 10-11.
Comment 2: Consideration of ``Changed Circumstances'' in the
Context of Revocation
The petitioner states that the Department has improperly collapsed
its revocation review pursuant to 751(a) of the Act with a changed
circumstance review pursuant to 751(b) of the Act. The petitioner
purports that the Department has done this without prior notice and
therefore does not have the authority to do so. Citing the Department's
August 2 Revocation Memorandum (at 4-5), the petitioner states that in
its preliminary results of this AR the Department concluded that
Makita's main argument supporting revocation is its ``changed
circumstance'' in subject merchandise production (i.e., Makita Japan's
substantial investment in a U.S. production facility--MCA--and its
PECT/power tool production shift from Makita Japan to MCA). The
petitioner argues that the Department has been careful not to conduct a
review under the guise of a changed circumstances review and that the
Department has always given notice in the Federal Register when it does
initiate a changed circumstance review (citing Carbon Steel Plate from
Korea: Final Results of Changed Circumstances Administrative Review and
Revocation of Antidumping Duty Order 51 FR 13042 (April 17, 1986); and
Certain Dried Heavy Salted Codfish from Canada; Initiation and
Preliminary Results of Changed Circumstances Administrative Review;
Consideration of Revocation; and Intent to Revoke Antidumping Duty
Order 54 FR 41479 (October 10, 1989)). Therefore, the petitioner argues
that by considering MCA as a factor for revocation, the Department is
effectively conducting a changed circumstances review without proper
notice, and is thus violating its statutory and regulatory obligations.
Makita states that the Department did not convert the revocation
proceeding to a changed circumstances proceeding. Makita stresses that
the fact that some of the Department's preliminary findings could also
have been used in a changed circumstances review does not turn the
revocation proceeding into a changed circumstances review. Makita notes
that at no point did the Department indicate that its decision to
revoke was based simply on ``changed circumstances.'' Rather, according
to Makita, the Department considered the establishment of MCA as a
relevant factor regarding Makita's normal business practices and its
applicability toward satisfying the commercial quantities threshold.
Department's Position: This administrative review has been
conducted under section 751(a) of the Act; it is not a ``changed
circumstances'' review under section 751(b). The difference between
these two types of proceedings is primarily procedural. A section
751(a) review is conducted any time the Department receives a request
for review in the anniversary month. Moreover, the regulations
specifically provide that, if certain criteria are met, parties may
request revocation at the time they request an administrative review
under section 751(a) (see 19 CFR 351.222(e)). In contrast, a 751(b)
review
[[Page 71418]]
is conducted any time the Department determines that there are changed
circumstances sufficient to warrant review. Revocation can also be
considered in the context of a 751(b) review (see 19 CFR 351.222(g)).
Although changed circumstances may warrant a review under section
751(b), nothing precludes the Department from considering facts
relating to changed circumstances in the context of a section 751(a)
review. In fact, the Department must consider all facts of record that
are relevant to an issue under consideration in a section 751(a)
review, whether it be an issue related to a margin calculation or to a
request for revocation. However, the character of the review does not
change simply because some of the facts considered relate to changes in
the way a company conducts business.
Makita's establishment of MCA and its subsequent transfer of
production to the United States is a relevant fact that cannot be
ignored in the Department's revocation analysis. Indeed this fact could
be characterized as a significant ``changed circumstance'' as was
stated in the preliminary results. This characterization of the record
facts, however, does not alter the nature of the proceeding. The
petitioner, who has participated throughout this 751(a) review, has
been afforded full notice and opportunity to provide evidence and
comment regarding the issue of revocation generally and the impact of
the shift in production specifically. The petitioner, in fact, has
commented extensively on these issues.
Comment 3: Five Percent Market Viability Test and Commercial Quantities
Determination
The petitioner argues that the Department's commercial quantities
determinations in the context of revocation should be consistent with
its policy in determining market viability under 19 CFR 351.404(b). The
petitioner states that the Department's five percent viability standard
is an appropriate benchmark to use because the requirement that NV be
based on home market (or third country market) sales of a certain
quantity and the commercial quantities standard are similar. The
petitioner states, based on this comparison, that sales quantities in
the U.S. market that are less than five percent of pre-order sales
should not be considered representative to calculate margins for
purposes of revocation.
Regarding the petitioner's argument that the Department's
revocation determinations should be consistent with its home market
viability determinations, Makita states that the five percent test for
home market viability is designed for an entirely different purpose and
has little applicability to the determination of commercial quantities
in revocation. According to Makita, given the many years (six years at
minimum) that typically intervene between the pre-order period and the
revocation determination, any fixed, pre-determined percentage would
not allow for significant changes in commercial practice. Additionally,
Makita purports that by rejecting home markets where the quantity of
sales is less than five percent of the U.S. export quantity, the
Department is in no way suggesting that such sales are not made in
commercial quantities.
Department's Position: We agree with Makita that the five percent
test for home market viability is not relevant to the determination of
commercial quantities in a revocation proceeding. The purpose of the
viability test is to identify the most appropriate market in which to
determine the NV of the subject merchandise, which is an issue that
must be decided very early in the proceeding. That issue lends itself
to a rule of general applicability and a general rule facilitates the
requisite early decision. In contrast, for revocation, the issue is
whether a company's sales during the three years in question provide a
reasonable and reliable basis for determining that continuation of the
order with respect to that company is no longer necessary to offset
dumping. This is a more complex issue and a threshold matter in the
context of the revocation decision. Thus, a general rule on the level
of sales is inappropriate; it is an issue that can only reasonably be
decided on a case-by-case basis.
Likelihood of Future Dumping
Comment 1: History of Dumping
The petitioner states that Makita's history of dumping, as
evidenced by the imposition of the antidumping duty order, illustrates
that Makita has to dump in order to compete effectively in the U.S.
market, and that Makita will resume dumping if the Department revokes
the order. The petitioner notes that Makita's drop in subject
merchandise sales since the imposition of the antidumping duty order
(i.e., in terms of total number of models, total number of units, and
loss of market share) has been substantial based on the Department's
preliminary analysis. Thus, the petitioner states that revoking the
order now would provide little commercial benefit to Makita unless
Makita intends to resume selling higher volumes of subject merchandise
in the United States at dumped prices.
The petitioner also argues that Makita will resume dumping subject
merchandise in the future if the order is revoked because Makita has
continued dumping non-subject tools (i.e., professional electric
sanding-grinding tools (``PESGTs'')). The petitioner purports that
Makita's normal pattern of production and trade are presumptively
reflected in its non-subject tool sales and therefore Makita's trade in
PECTs will match its trade in PESGTs if the order is revoked. Based on
its analysis of Makita's PESGTs sales, the petitioner maintains that
Makita has not stopped dumping its PESGTs in the U.S. market since the
time of the antidumping duty investigation (see pages 7-13 of the
petitioner's September 10, 1999, case brief).2 In addition,
the petitioner states that, based on Makita's admission, PESGTs are not
materially different from PECTs. According to the petitioner's
analysis, Makita has continued dumping its PESGTs at a 46 percent
margin during the PORs that are the subject of this revocation inquiry.
Therefore, the petitioner states that continued dumping of non-subject
tools provides a clear indication that Makita would likely resume
dumping subject merchandise if the antidumping duty order were revoked.
---------------------------------------------------------------------------
\2\ Note: PESGTs were investigated as subject merchandise during
the original less-than-fair-value investigation of PECTs. However,
the ITC determined that there was no material injury to the U.S.
industry for these products. Consequently, no antidumping duty order
was imposed on PESGTs from Japan.
---------------------------------------------------------------------------
Finally, the petitioner asserts that Makita has an incentive to
resume dumping of its low-sales-volume, specialty PECTs that it has
been importing into the United States during the pre- and post-order
periods. The petitioner states that Makita's sales of specialty PECTs
have decreased by 50 percent since 1992, as a result of increasing its
prices on specialty PECTs in response to the antidumping duty order.
Thus, the petitioner argues that there is incentive for Makita to
resume dumping of subject merchandise (i.e., specialty PECTs).
Makita disagrees, stating that the facts alleged by the petitioner
do not show any history of dumping by Makita, but only show a history
of accusations that Makita engages in dumping. Makita states that the
petitioner's allegation is not supported by any evidence in the record
because the Department has found that Makita has not dumped subject
merchandise for three years. Makita maintains that its losses in market
share are not compelling
[[Page 71419]]
evidence that it is likely to dump if the order is revoked, especially
since, in Makita's opinion, increases in the petitioner's U.S. market
share have resulted from predatory pricing techniques, which also
explain Makita's decreased market share. Makita states that its subject
merchandise sales business is not predicated on a particular market
share in order to effectively compete in the United States. More
importantly, Makita points out that most of its U.S. PECT sales are not
subject merchandise, but are U.S.-MCA-produced PECTs. Therefore, Makita
maintains that it does not need to dump its sales of subject
merchandise (i.e., low-sales-volume, specialty PECTs) in order to
maintain its U.S. market share because most of its PECTs for the U.S.
market are produced at MCA.
Further, Makita argues that the petitioner's assertion that
revocation will only benefit Makita by facilitating its resumption of
dumping is inaccurate. Makita states that revocation of the order will
have the following benefits: (1) Removal of the stigma associated with
being the subject of an antidumping duty order; (2) resumption of sales
to U.S. customers who will not purchase tools that are subject to an
antidumping duty order; and (3) elimination of expenses involved with
participation in the Department's administrative reviews. Thus, Makita
asserts the petitioner has presented no positive rebuttal evidence
which can overcome the presumption that, if the order is revoked, there
is no likelihood that Makita will resume dumping in the future.
Regarding the petitioner's argument that Makita's continued
``dumping'' of non-subject power tools is probative of future dumping
of subject merchandise, Makita contends it is unpersuasive because
Makita's sales of non-subject merchandise are irrelevant and outside
the scope of this proceeding. Makita argues that a comparison of its
subject merchandise sales with its non-subject merchandise sales is
nowhere recognized as a relevant test of any likelihood of future
dumping of subject merchandise. Makita purports that the petitioner
misrepresents Makita's comments regarding the distinctions between
PESGTs and PECTs. Makita states that it never claimed that there are no
differences between PESGTs and PECTs, but that there is a substantial
commonality in components, production machinery, manufacturing
processes, and assembly of the two tool categories. Thus, Makita
states, there are no relevant production-related distinctions between
PESGTs and PECTs that would prompt Makita to keep production of either
tool category in Japan or the United States. Makita contends that the
petitioner's argument which seeks to compare Makita's pricing and
production policies on PESGTs (non-subject merchandise) and PECTs
(subject merchandise) in the context of analyzing the likelihood of
future dumping of the latter, is not founded in Department precedent.
Thus, Makita states that the petitioner's argument lacks relevant
evidence rebutting the Department's presumption that Makita is not
likely to dump in the future.
Regarding the petitioner's argument that Makita is likely to resume
dumping of specialty PECTs to regain market share, Makita states the
following: (1) Its current sales volumes of specialty PECTs are not
inconsistent with its historical sales volumes; (2) it does not need to
lower the price of specialty PECTs because of its premium pricing
strategy; and (3) it has flexibility in the amounts by which it can
lower prices on specialty PECTs (should Makita choose to) before
dumping occurs. Specifically, Makita argues that its sales of specialty
PECTs have always been limited and have fluctuated from year to year.
Makita states that the record shows that it is engaged in premium
pricing of its specialty PECTs, where it restricts the supply of a tool
category in order to maintain its higher price quality image, but that
there is no evidence on the record showing that Makita intends to
regain market share through reduced prices. In addition, Makita states
that it has significant room in which to lower its specialty PECT
prices before dumping occurs and this shows that Makita has not
increased prices on specialty PECTs simply to avoid dumping.
Department's Position: We disagree with the petitioner's contention
that Makita's history of dumping PECTs, prior to the 3rd AR of this
proceeding, illustrates that dumping is a necessary part of Makita's
competitive position in the U.S. PECT market. As a threshold matter,
the Department's revocation analysis focuses on the three most recent
review periods. The Department generally finds that three consecutive
years of non-dumped sales in commercial quantities indicates that a
company will not dump in the future. See Corrosion-Resistant Steel from
Canada at 2175 (``in evaluating the issue of likelihood, the Department
has considered three years of sales in the United States with no
dumping margins, plus an agreement to reinstatement [of] the order, to
be indicative of expected future behavior.''). Thus, where there is no
evidence to the contrary, the Department will normally determine that
revocation is warranted. See also Furfuryl Alcohol From the Republic of
South Africa; Preliminary Results of Antidumping Duty Administrative
Review and Revocation of Antidumping Duty Order, 64 FR 10983, 10894
(March 8, 1999); Titanium Sponge from the Russian Federation:
Preliminary Results of Antidumping Duty Administrative Review and
Partial Revocation, 63 FR 47474, 47475 (September 8, 1998); and Steel
Wire Rope From the Republic of Korea: Final Results of Antidumping Duty
Administrative Review and Revocation in Part of Antidumping Duty Order,
63 FR 17986, 17988 (April 13, 1998) (hereafter Steel Rope from Korea).
Makita has satisfactorily established that it has sold subject
merchandise in commercial quantities at fair value for three
consecutive years. Absent evidence to the contrary, the Department
presumes that three years of de minimis or zero margins is indicative
of Makita's future behavior (see August 2 Revocation Memorandum at 11).
We also disagree with the petitioner's allegation that Makita's
continued dumping of non-subject power tools (including both U.S.-made
and Japanese-made non-subject merchandise) is probative of future
dumping of subject merchandise in this case. Generally, information
regarding non-subject merchandise is irrelevant to whether an existing
order continues to be necessary to offset dumping of the subject
merchandise. The information provided by the petitioner does not
warrant an exception in this case and thus cannot provide a basis for
rebutting the presumption established by three consecutive years of
sales of the subject merchandise at not less than fair value. Although
the petitioner did not submit its allegation regarding Makita's pricing
of non-subject merchandise in time for the Department to consider it
for purposes of the preliminary results, the Department preliminarily
indicated that pricing of non-subject merchandise might be a relevant
factor in its analysis and that it may consider the petitioner's
information for purposes of the final results (see August 2 Revocation
Memorandum at page 16). However, as discussed above, the Department
finds that in this case, the information on sales of non-subject
merchandise is irrelevant for purposes of this final revocation
determination. Therefore, the Department's revocation decision in this
case is based only on the facts related to the subject merchandise
sales alone.
The Department further disagrees with the petitioner's allegation
that Makita will resume dumping to regain lost share of the PECT
market. Evidence
[[Page 71420]]
on the record indicates that Makita has suffered continued losses in
its market share in the ``electric power tool market'' as a whole
(i.e., all electric power tools including subject PECTs--see Makita's
February 9, 1999, submission at Appendix 15). Therefore, if the
petitioner's rationale (i.e., dumping maintains market share) is to be
considered accurate, one would have expected Makita to have maintained
its market share in other categories of electric power tools, which the
petitioner contends Makita has continued to dump, while only losing
market share in PECTs. This in fact is not the case, as Makita has lost
market share in other electric power tool categories as well. Thus, it
is clear there are other factors that impact a competitor's position in
the market (e.g., introduction of a new competitor, innovations,
reputation). Therefore, we agree with Makita that its sales of subject
merchandise are not predicated on a particular market share in order to
effectively compete in the United States.
Comment 2: Home Market Demand
The petitioner states that declining home market sales and home
market demand (i.e., decline in the Japanese electric power tool market
and Japanese housing starts from 1997-1998), coupled with rising demand
in the United States, have increased the likelihood that Makita will
dump PECTs in the U.S. market in the future. The petitioner submits
that the evidence in the record contradicts the Department's finding of
market stability in Japan. Therefore, the petitioner maintains that
with Makita's declining sales in the home market, Makita has greater
incentive to direct its PECT sales to the U.S. market.
Makita stresses that although there have been fluctuations in its
home market electric power tool sales and Japanese housing starts, the
petitioner is confusing short-term fluctuations in an otherwise
relatively stable home market with a permanent decline in demand for
electric power tools (i.e., from 1992 to 1997). In addition, Makita
states it has no incentive to increase exports from Japan because most
of its tools sold in the U.S. market are produced in the United States
(i.e., MCA), and that its focus is to increase production at MCA rather
than increase production in Japan. Moreover, Makita states that it has
many other viable markets, other than the United States and Japan,
where Makita Japan sells its cutting tools, thereby reducing its
financial dependance on Japanese exports to the United States.
Furthermore, Makita maintains that it would not be practical for Makita
Japan to export subject merchandise that would, in effect, be competing
with MCA's production of PECTs.
Department's Position: We agree with Makita that a stable home
market does not require an absence of market fluctuations, and that the
evidence on the record pertaining to the health of the Japanese home
market does not suggest that Makita is likely to dump PECTs in the U.S.
market in the future if the order were revoked. Although the petitioner
claims that the Japanese power tool market is in decline, we find that
the record data indicates that the market in Japan is relatively stable
(see August 2 Revocation Memorandum at 14). We do not conclude that the
drop in housing starts in Japan and home market demand for subject
merchandise between fiscal year (``FY'') 1996 and FY 1997 indicates a
declining or unhealthy market. Rather, we would expect even a healthy
market, especially the electric power tool market, to experience both
peaks and troughs in demand. Contrary to the petitioner's assertion, we
have no evidence that suggests that the above mentioned one-year
decline in the Japanese power tool market is a long-term occurrence.
Therefore, based on the evidence as a whole, we find the Japanese power
tool market to be relatively stable.
In addition, the record supports Makita's assertion that it is
unlikely to increase its PECT exports from Japan to the United States
to pre-order levels because most of its tools sold in the U.S. market
are now produced in the United States by MCA. This conclusion is
particularly evident when reviewing Makita's production capacities in
both the U.S. and home markets, i.e., Makita has substantial excess
capacity available in the United States and is producing at full
capacity in Japan. (See Comment 3 of this section below for further
discussion.) Furthermore, it is unlikely that Makita Japan will resume
its pre-order export levels of subject merchandise because such exports
would be competing with MCA's production of PECTs, or would require
costly shifts in PECT production back to and restructuring of capacity
utilization in Japan (see the Department's July 9, 1999 verification
report at 22-23, 34-36; and July 13, 1999 verification report at 4-7).
Finally, we verified that Makita has other viable markets, other than
the United States and Japan, wherein Makita Japan can sell its cutting
tools (see the Department's July 9, 1999, verification report at 36-
40). Thus, Makita Japan is not dependant on Japanese exports to the
United States for financial viability. As such, based upon the data on
the record regarding the Japanese and U.S. PECT markets, the existence
of Makita's U.S. production facility, the available or lack of
available production capacity levels in MCA and Makita Japan (i.e.,
Okazaki plant), respectively, and Makita's healthy sales history in
other world markets, we find that the sales pattern in the Japanese
home market does not suggest that Makita is likely to resume dumping of
PECTs in the United States without the discipline of the order.
Comment 3: PECT Production in Japan Versus the United States
The petitioner purports that Makita Japan could increase its
production output with relative ease and despite its reported capacity
utilization figures and thereby increase production of PECTs for sale
in the U.S. market at dumped prices if the order is revoked. The
petitioner argues that plant capacity is unrelated to production output
because the annual production output at Makita's Okazaki plant has
increased nearly 100 percent from 1992 through 1997, while its capacity
utilization has remained constant during the same time period.
Furthermore, the petitioner suggests that the Department has ignored
its claim regarding the ease with which an electric power tool
manufacturer can expand production. (See Declaration of Ronald S.
Taylor, Black & Decker February 24, 1999, submission.) Finally, the
petitioner argues that a manufacturing plant (i.e., Makita's Okazaki
plant) with easily modifiable assembly lines does not face the same
barriers to expansion and conversion as other complex, more capital-
intensive facilities with fixed, dedicated, and expensive equipment.
Thus, the petitioner asserts that Makita's capacity in Japan can be
easily and relatively inexpensively altered, resulting in increased
PECT production in Japan for sale in the U.S. market at dumped prices
if the order is revoked.
The petitioner also states that Makita USA's consolidated financial
statements show poor performance for FYs 1997 and 1998 3 and
Makita's U.S. production facility MCA has utilized less than two thirds
of its total production capacity. The petitioner argues that Makita's
U.S. operations are a drain on the Makita corporation and that
continued poor financial performance of Makita's U.S.
[[Page 71421]]
operations will render Makita's capital investments in MCA moot.
---------------------------------------------------------------------------
\3\ The financial statements for Makita USA (Makita Japan's
affiliated selling agent in the United States) and MCA (Makita's
U.S. production facility) are consolidated for financial reporting
purposes in the United States. The Makita USA/MCA consolidated
financial statement is consolidated into Makita's overall corporate
financial statement as well.
---------------------------------------------------------------------------
In addition, the petitioner states that the downward trend in the
yen against the U.S. dollar (i.e., depreciation of the yen against the
dollar) suggests that production in Japan is and will become more
profitable than production in the United States based on its estimation
of Makita's cost of manufacturing in the United States verses Makita's
cost of manufacturing in Japan. The petitioner argues that Makita would
have increased its profits if Makita would have shifted its production
back to Japan (see the petitioner's September 17, 1999, case brief at
18-19 and at Exhibit 6). Finally, the petitioner asserts that Makita's
loss in U.S. market share gives Makita a financial incentive to
concentrate its production of cordless tools (i.e., PECTs) in Japan.
Specifically, the petitioner claims that Makita has not participated
meaningfully in the U.S. market for cordless saws, which are currently
produced by MCA. Because cordless tools are not affected by voltage
differences, the petitioner argues that if the order is revoked Makita
will consolidate its cordless saw production in Japan in order to take
advantage of its economies of scale and production experience in Japan.
The petitioner argues further that Makita will have to adopt measures
to regain market share which will include a resumption of subject
merchandise sales at dumped prices, particularly in the popular and
growing cordless PECT market. Thus, the petitioner asserts that Makita
USA's poor financial performance, favorable currency fluctuations, and
losses in U.S. market share all give Makita an incentive to resume
dumping in the United States should the order be revoked.
Makita asserts that the Department correctly concluded that Makita
Japan operates at the upper limit of the maximum volume that can be
produced by its Japanese facility. Makita states that because it closed
down its Anjo, Japan production facility and moved a portion of Anjo's
production capacity into the Okazaki plant in 1997, the Department must
consider the distinctions between Makita's prior and current production
capacities, namely, its past capacity when its Okazaki and Anjo plants
were open and producing PECTs in comparison to its current capacity
where only a single plant (i.e., the Okazaki plant) is producing PECTs.
Makita argues that when recognizing such significant differences, it is
clear that the closing of the Anjo plant significantly reduced its
production capacity and Makita Japan's ability to expand its capacity.
Makita argues further that whether or not it can set up new
assembly lines in its Okazaki plant is not relevant to this segment of
the proceeding. Makita states that assembly of new lines involves the
construction of new capacity and not the utilization of current
capacity. Makita maintains that in this segment of the proceeding the
Department's focus should be whether Makita has idle capacity currently
available to increase the output of subject tools for export. Makita
states that evidence on the record suggests that no such additional
capacity is available in Japan.
Regarding the petitioner's allegation that the Department has not
considered the affidavit of Ronald S. Taylor, regarding the ease with
which assembly lines can be added to Makita's Okazaki production plant,
Makita states that the statements made in the affidavit are not
applicable to Makita's business practices for the following reasons:
(1) Makita's Okazaki plant does not have the floor space to add
production; (2) substantial increases in capacity in Japan would
include re-opening the Anjo facility and a reduction in capacity at
MCA; and (3) returning production to Japan would be costly and
difficult to implement. Thus, Makita argues that transferring
production from MCA back to Japan is neither easy nor inexpensive, and
that the affidavit does not fully address Makita's commercial situation
because Makita's long-range business strategy includes the shifting of
production closer to its international markets.
Furthermore, Makita argues that Makita USA is on the road to
profitability and that MCA's operations have been profitable in 1997
and 1998. Makita argues that Makita USA's poor financial performance in
FYs 1997 and 1998 and MCA's low capacity utilization does not support a
return of production to Japan, but rather a reinforcement of its
efforts to increase production at MCA (noting that Makita has made a
substantial investment in MCA). In addition, if Makita's only business
concern was cost of production, then, Makita states, it would be far
more sensible for it to shift its production to the People's Republic
of China where it already has a production facility rather than Japan.
Makita argues that Makita USA's poor financial performance is not
unexpected in a situation where a still-expanding U.S. subsidiary
(i.e., MCA) is operating below its capacity. Makita asserts that MCA is
still growing toward its role as the main provider of electric power
tools in the U.S. market and that Makita's continued investment in the
facility indicates Makita's continued commitment to expand MCA's role
in the U.S. market. Thus, Makita contends that the establishment and
strengthening of MCA is a long-term investment project on which it does
not expect an immediate return.
In addition, Makita maintains that only when the value of the
Japanese yen is decreasing against the U.S. dollar do currency
fluctuations make its Japanese operations more profitable than its
operations in the United States. Makita states that MCA was
established, at least in part, in order to avoid dependancy on exchange
rate fluctuations and the risks associated with them. Makita argues
that the time frames (i.e., June 1993 and June 1998) that the
petitioner cites in its analysis were periods when the yen was weak
against the dollar, but that in June 1995 and September 1999 when the
yen was stronger, Makita's U.S. operations were more profitable.
Notwithstanding these facts, Makita states that it has never
conditioned its long-term strategy on short-term currency fluctuations,
but on the premise that Makita is best served by eliminating the risks
associated with the unpredictability of fluctuating exchange rates and
by moving production from Japan to its local markets.
Finally, Makita states that the petitioner's argument that Makita
has financial incentive to consolidate its production of electric power
tools in Japan, particularly cordless PECTs, is based on the
petitioner's incorrect assumption that Makita does not already produce
cordless PECTs in the United States. Makita notes that it has been
producing cordless PECTs at MCA for years, and has never found that
production would be facilitated or improved if it was shifted back to
Japan. Makita argues it has not forfeited its share of the U.S.
cordless PECT market, but rather it has taken full advantage of the
opportunity by establishing efficient operations that are close to its
customer base in the U.S. market. Makita states that the petitioner has
not presented any evidence supporting the argument that consolidation
of cordless tool production in Japan would be more cost effective.
Department's Position. We agree with Makita that the record
indicates an intent to maintain and/or increase production operations
in the United States without increasing production in Japan. The record
indicates that Makita has limited unutilized capacity in Japan, but
available capacity in the United States. Makita's verified submissions
demonstrate that Makita's facility in Okazaki, Japan (Makita's only
remaining production facility for PECTs in Japan) is currently
operating at full capacity,
[[Page 71422]]
and has been doing so since 1991. Two important facts that were
considered in analyzing production capacity at the Okazaki plant are
(1) the Okazaki plant (and the Anjo plant when it was open) has
operated with two shifts only since 1996, and thus the Okazaki plant's
capacity utilization figures were based on one production shift prior
to 1996; and (2) Makita closed down its Anjo production facility and
moved a portion of Anjo's production capacity (i.e., production
equipment including armature winding lines, assembly lines, armature
shaft hardening machines) into the Okazaki plant in 1997, thereby
bringing the Okazaki plant to its optimal production capacity. The
addition of a production shift explains how Makita's Okazaki plant was
able to increase its total annual production nearly 100 percent from
1992 through 1997, while its annual capacity utilization remained
constant. Additionally, we verified that it would be difficult, if not
impossible, for Makita to add a third shift in its Okazaki plant (see
August 2 Revocation Memorandum at 14). In sum, comparing Makita's
production capacity and total annual output when its Okazaki and Anjo
plants were open and producing electric power tools with one shift
each, with Makita's current production capacity and annual output at
the Okazaki plant producing electric power tools with two shifts (see
Appendix 4 of Makita's September 17, 1999, rebuttal brief and
verification exhibit 13 of the Department's July 9, 1999 verification
report), the Department finds that Makita Japan's total annual
production output at the Okazaki plant using two production shifts
since 1997 is comparable to Makita Japan's previous total annual
production output at the Anjo and Okazaki plants using one production
shift in each plant prior to 1997. In short, from 1992 through 1998,
Makita Japan's annual production of electric power tools for each shift
reflected Makita Japan's optimal capacity utilization. Thus, Makita
Japan's production with two shifts at one plant (i.e., Okazaki plant)
is comparable to Makita Japan's production with one shift at each of
the two plants (i.e., Okazaki and Anjo plants).
We further note that although Makita USA's financial statement
reports a poor performance for 1997 and 1998, the MCA plant operated
profitably in 1998 (see the Department's July 13, 1999, verification
report at 10 and 11, and verification exhibit 12). Moreover, there is
nothing on the record to indicate that the entire financial loss is
directly related to Makita's U.S. production of PECTs. Indeed, the
Department recognizes there could be a number of explanations for
Makita USA's poor financial performance in 1997 and 1998 (e.g.,
accounting policies, long-term investment strategies, failed business
ventures). There is nothing on the record indicating specifically what
the losses are attributable to and, where the U.S. production operation
has been profitable in 1998, the Department cannot make an assumption
that the corporation would choose to cease such operations in order to
increase profitability for a related entity. Additionally, Makita's
statement regarding the expected growth of MCA provides a reasonable
explanation for any losses incurred, i.e., MCA is still growing toward
its role as the main provider of electric power tools in the U.S.
market and Makita continues to invest in the facility (see the
Department's July 13, 1999, verification report at 9 and verification
exhibit 12); thus it is reasonable to conclude that building up MCA is
a long-term undertaking and Makita does not expect an immediate return
on its investment.
Additionally, the record supports and we accept Makita's
characterization as to the effect of currency fluctuations on Makita's
decision to maintain production of PECTs at MCA (see Makita's September
17, 1999, rebuttal brief at 31-33). Given the many factors that can
affect profitability during a time of currency depreciation, we cannot
determine which operations (i.e., Makita's Japanese operations or
Makita's U.S. operations) will be more profitable as the petitioner
suggests. However, a depreciation of the yen does not imply that
dumping will occur. To the contrary, the Department notes that during a
period of a depreciating home market currency, there is even less
pressure to engage in pricing below NV. In this proceeding, there is no
evidence on the record indicating the likelihood of a resumption of
dumping due to the effect of a long-term depreciation of the yen
against the dollar, which by itself does not indicate a likelihood of
sales at less than fair value. See Steel Rope from Korea at 17988.
Furthermore, Makita has demonstrated that there are a number of long-
term business advantages in establishing a U.S. production facility
including: (1) Makita's ability to avoid dependancy on exchange rate
fluctuations and the risks associated with them; and (2) Makita's
ability to respond to the needs of the U.S. market in a more timely
fashion. Finally, evidence on the record supports Makita's long-term
business practice of moving production from Japan to Makita's electric
power tool markets abroad (see the Department's July 9, 1999,
verification report at 22-23 and verification exhibit 6A).
Comment 4: Pricing Practices With Respect to Subject and Non-Subject
Merchandise
The petitioner states that Makita's inability to undercut its U.S.
competitors' prices with respect to PECTs it produces in Japan, coupled
with its widespread undercutting of prices on U.S.-made PECTs and other
non-subject tools, indicates the effectiveness of the order and the
likelihood that Makita would resume dumping if the order were revoked.
The petitioner states that if it were not for the order, Makita's
prices for specialty PECTs imported from Japan would be lower than
those of Makita's competitors. Therefore, the petitioner argues that by
forcing Makita to maintain high prices, the order has resulted in
Makita's devastating loss of U.S. market share in PECTs, and that
Makita will have to lower its prices on PECTs as soon as the order is
lifted in order to regain its lost market share.
Makita states that it has considerable room for dropping the price
on its subject merchandise sales without incurring a dumping liability.
Makita argues that it has not been forced to maintain higher prices on
its Japan-made specialty PECTs due to the impact of the order, but has
chosen not to lower its prices for marketing purposes (i.e., Makita's
marketing strategy entails producing a higher quality product that
demands higher prices). Thus, Makita states that higher pricing is the
result of its business strategy rather than the result of the impact to
the antidumping duty order.
In addition, Makita argues that it has not undercut the
petitioner's prices with respect to its U.S.-produced PECTs, and that
Makita has in fact experienced drops in its market share of non-
subject, U.S.-produced PECTs. Makita states that of the thousands of
U.S.-produced PECT sales made every month, the petitioner has found
only 10 PECT models on which to base its allegation of price
undercutting. Makita argues that even if the petitioner's allegation
were correct, the small number of tool models cited would amount to a
de minimis margin. In response to the petitioner's allegation that
market share is gained through undercutting competitors' prices, Makita
reasons that if it had undercut its competitors' prices with its U.S.-
produced PECTs, then it should have increased its share of the U.S.
PECT market rather than lost it (as is the case since 1992). To the
contrary, Makita
[[Page 71423]]
purports that petitioner undercuts Makita's prices in every case of
which Makita is aware.
Department's Position: We disagree with petitioner. Regarding the
petitioner's argument that Makita would undercut U.S. competitors'
prices on PECTs if the order were revoked, the Department generally
finds that three years of no dumping is predictive of future behavior.
(See Corrosion-Resistant Steel from Canada, at 2175. Thus, where there
is no evidence to the contrary, the Department will normally determine
that continuation of the order is no longer necessary to offset
dumping. Further, because Makita has agreed to reinstatement of the
order in the event of future dumping, it is inappropriate to presume
that the imposition of the order is the only factor preventing dumping.
Rather, we considered other factors that might suggest a likelihood of
future dumping as discussed in the ``Determination to Revoke the Order
in Part'' and ``Likelihood of Future Dumping'' sections in this notice
above.
Regarding the petitioner's argument that Makita's widespread
undercutting of prices on U.S.-made PECTs and other tools is indicative
of Makita's behavior in the absence of an order, the Department
reiterates its position enumerated above in Comment 1 of the
``Likelihood of Future Dumping'' section of this notice. We disagree
with the petitioner's allegation that the pricing of non-subject
merchandise in this case is probative of whether the order continues to
be necessary to offset dumping of subject merchandise.
Final Results of the Review
We determine that the following weighted-average margin for Makita
exists for the period July 1, 1997, through June 30, 1998:
Manufacturer/producer/exporter: Makita Corporation Incorporated
Margin (percent): 0.07 percent (de minimis)
Effective Date of Revocation
This revocation applies to all entries of subject merchandise that
are produced by Makita Japan and that are also exported by Makita
Japan, entered, or withdrawn from warehouse, for consumption on or
after July 1, 1998. The Department will order the suspension of
liquidation ended for all such entries and will instruct the Customs
Service to release any cash deposits or bonds. The Department will
further instruct Customs Service to refund with interest any cash
deposits on entries made after June 30, 1998.
Assessment
The Department shall determine, and the Customs Service shall
assess, antidumping duties on all appropriate entries. The Department
will issue appraisement instructions directly to the Customs Service.
For entries of subject merchandise that are produced by Makita Japan
and that are also exported by Makita Japan, entered, or withdrawn from
warehouse, for consumption during the POR (i.e., July 1, 1997-June 30,
1998), the Department will instruct the Customs Service to liquidate
entries without regard to antidumping duties. The Department will order
the suspension of liquidation ended for all such entries and will
instruct the Customs Service to release any cash deposits or bonds with
interest if applicable.
Cash Deposit Requirements
The following deposit requirements shall be required for
merchandise subject to the order entered, or withdrawn from warehouse,
for consumption on or after the publication date of this final results
of the administrative review, as provided by section 751(a)(1) of the
Act: (1) the cash deposit rate for Makita Japan will be zero, except
that for imports of PECTs that are produced by Makita Japan and that
are also exported by Makita Japan, cash deposits will no longer be
required and the suspension of liquidation will cease for entries made
on or after July 1, 1998; (2) if the exporter is not a firm covered in
this review or the less-than-fair-value (``LTFV'') investigation, but
the manufacturer is, the cash deposit rate will be that established for
the most recent period for the manufacturer of the merchandise; and (3)
if neither the exporter nor the manufacturer is a firm covered in this
review or the LTFV investigation, the cash deposit rate will be 54.5
percent, the ``all others'' rate made effective by the LTFV
investigation. These requirements shall remain in effect until
publication of the final results of the next administrative review.
Notification to Importers and Interested Parties
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 the 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 a final reminder to parties subject to
APO of their responsibility concerning the disposition of proprietary
information disclosed under APO in accordance with 19 CFR 351.105(a).
Timely written notification or conversion to judicial protective order
is hereby requested. Failure to comply with the regulations and terms
of the APO is a sanctionable violation.
This determination is issued and published in accordance with
sections 751(a)(1) and 777(i)(1) of the Act.
Dated: December 8, 1999.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 99-32673 Filed 12-20-99; 8:45 am]
BILLING CODE 3510-DS-P