[Federal Register Volume 65, Number 26 (Tuesday, February 8, 2000)]
[Notices]
[Pages 6153-6155]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-2847]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-351-505]


Certain Malleable Cast Iron Pipe Fittings From Brazil: 
Preliminary Results of Antidumping Administrative Review

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

ACTION:  Notice of preliminary results of antidumping administrative 
review.

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SUMMARY:  The Department of Commerce is conducting an administrative 
review of the antidumping duty order on certain malleable cast iron 
pipe fittings from Brazil in response to a request from a respondent, 
Industria de Fundicao Tupy Ltda. This review covers the period May 1, 
1998, through April 30, 1999.
    We preliminarily determine that sales have been made below normal 
value. Interested parties are invited to comment on these preliminary 
results. Parties who submit argument are requested to submit with the 
argument (1) a statement of the issue and (2) a brief summary of the 
argument.

EFFECTIVE DATE:  February 8, 2000.

FOR FURTHER INFORMATION CONTACT:  Thomas Schauer or Richard Rimlinger, 
Office of AD/CVD Enforcement, Import Administration, International 
Trade Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230; telephone (202) 482-0410 
or (202) 482-4477, respectively.

SUPPLEMENTARY INFORMATION:

The Applicable Statute

    Unless otherwise indicated, all citations to the statute are 
references to the provisions effective January 1, 1995, the effective 
date of the amendments made to the Tariff Act of 1930(the Act) by the 
Uruguay Round Agreements Act (URAA). In addition, unless otherwise 
indicated, all citations to the Department of Commerce's (the 
Department's) regulations are to 19 CFR Part 351 (1998).

Background

    On May 28, 1999, the Department received a request from Industria 
de Fundicao Tupy Ltda. (Tupy) to conduct an administrative review of 
the antidumping duty order on certain malleable cast iron pipe fittings 
from Brazil. On June 30, 1999, the Department published a notice of 
initiation of an administrative review of Tupy, covering the period May 
1, 1998, through April 30, 1999, in the Federal Register (64 FR 14860).

Scope of Review

    Imports covered by this review are shipments of certain malleable 
cast iron pipe fittings, other than grooved, from Brazil. In the 
original antidumping duty order, these products were classifiable in 
the Tariff Schedules of the United States, Annotated, under item 
numbers 610.7000 and 610.7400. These products are currently 
classifiable under item

[[Page 6154]]

numbers 7307.19.00 and 7307.19.90 of the Harmonized Tariff Schedule of 
the United States (HTSUS). The HTSUS item numbers are provided for 
convenience and customs purposes. The written description remains 
dispositive.

United States Price

    In calculating the price to the United States, we used export price 
(EP) as defined in section 772(a) of the Act because the subject 
merchandise was sold to an unaffiliated U.S. purchaser in the United 
States prior to the date of importation into the United States and the 
use of constructed export price was not indicated by the facts of 
record.
    We calculated EP for U.S. sales based on C&F U.S. port prices to 
the United States. We made adjustments for domestic inland freight, 
domestic inland freight insurance, domestic brokerage and handling, 
international freight, and freight revenue in accordance with section 
772(c)(2)(A) of the Act. According to Tupy's representations, the 
material terms of sale were established on the purchase-order date. 
Therefore, we used the purchase-order date as the date of sale for the 
U.S. market. No other adjustments to EP were claimed.

Normal Value

    In order to determine whether there is a sufficient volume of sales 
in the home market to serve as a basis for calculating normal value 
(NV), we compared the respondent's volume of home-market sales of the 
foreign like product to the volume of U.S. sales of the subject 
merchandise, in accordance with section 773(a) of the Act. Because the 
aggregate volume of home-market sales of the foreign like product was 
greater than five percent of the aggregate volume of U.S. sales of the 
subject merchandise, we determined that the home market provides a 
viable basis for calculating NV. Therefore, in accordance with section 
773(a)(1)(B)(i) of the Act, we based NV on the price at which the 
foreign like product was first sold to unaffiliated customers for 
consumption in the exporting country, in the usual commercial 
quantities and in the ordinary course of trade.
    We compared the EP sales of individual transactions to the monthly 
weighted-average price of sales of the identical product Tupy sold in 
Brazil. We based NV on delivered prices to unaffiliated purchasers in 
the home market. Where applicable, we made adjustments to home-market 
price for billing adjustments and inland freight. We matched EP sales 
to sales at the same level of trade in the home market and made no 
level-of-trade adjustment. (See Level of Trade below.)
    When applicable, we made adjustments for differences in packing in 
accordance with section 773(a)(6)(A) of the Act. We made adjustments 
for differences in circumstances of sale (COS) in accordance with 
section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410. To make COS 
adjustments, we reduced home-market price by an amount for home-market 
credit, advertising expenses, and commissions, and we increased it by 
an amount for U.S. credit expenses. We also made adjustments, in 
accordance with 19 CFR 351.410(e), for indirect selling expenses 
incurred on home market or U.S. sales where commissions were granted on 
sales in one market but not in the other (the ``commission offset''). 
Specifically, where commissions were granted in the home market but not 
in the U.S. market, we made a upward adjustment to normal value for the 
lesser of (1) the amount of the commission paid in the home market, or 
(2) the amount of indirect selling expenses incurred in the U.S. 
market. We also deducted value-added taxes pursuant to section 
773(a)(6)(B)(iii) of the Act. Because we compared U.S. sales to 
identical merchandise sold in the home market, no adjustment for 
differences in cost attributable to differences in physical 
characteristics of the merchandise pursuant to section 773(a)(6)(C)(ii) 
of the Act was necessary.

Level of Trade

    As set forth in section 773(a)(1)(B)(i) of the Act and in the 
Statement of Administrative Action (SAA) accompanying the Uruguay Round 
Agreements Act, at 829-831 (see H.R. Doc. No. 103-316, at 829-831 
(1994)), to the extent practicable, the Department calculates NV based 
on sales at the same level of trade as the U.S. sales (either EP or 
constructed export price). When the Department is unable to find 
sale(s) in the comparison market at the same level of trade as the U.S. 
sale(s), the Department may compare sales in the U.S. and foreign 
markets at different levels of trade. When NV is based on constructed 
value (CV), the level of trade is that of the sales from which we 
derive selling, general and administrative expenses (SG&A) and profit.
    To determine whether home-market sales are at a different level of 
trade than U.S. sales, we examine stages in the marketing process and 
selling functions along the chain of distribution between the producer 
and the unaffiliated customer. If the comparison-market sales are at a 
different level of trade and the differences affect price 
comparability, as manifested in a pattern of consistent price 
differences between the sales on which NV is based and comparison-
market sales at the level of trade of the export transaction, we make a 
level-of-trade adjustment under section 773(a)(7)(A) of the Act. See 
Notice of Final Determination of Sales at Less Than Fair Value: Certain 
Cut-to-Length Carbon Steel Plate from South Africa, 62 FR 61731 
(November 19, 1997).
    In implementing these principles in this review, we examined 
information from the respondent regarding the marketing stages involved 
in the reported home-market and EP sales, including a description of 
the selling activities Tupy performed for each channel of distribution. 
Tupy reported three types of customers in the home market: wholesalers, 
distributors, and retailers. We found that the selling and other 
activities associated with selling to each of the three types of 
customers differed significantly from activities for the other two 
types of customers. For example, we found differences with respect to 
inventory maintenance, freight and delivery arrangements, packing and 
handling, advertising, technical services, and sales and administrative 
functions. Based on these differences, we found that the three types of 
home-market customers constituted three different levels of trade.
    All of the U.S. sales were EP sales. Based on our examination of 
the record, we determined that the level of trade of the EP sales was 
the same as that of the home-market wholesale level of trade. We found 
that the level of trade of the EP sales was different from that of 
distributor and retail sales because Tupy performed a number of selling 
functions for distributor and retail sales at a moderate or high level 
that it either did not perform or performed at a low level for the EP 
and wholesale sales. These selling functions included freight and 
delivery arrangements, inventory maintenance, packing and handling, 
advertising, technical services, and sales and administrative 
functions.
    Because we found that Tupy's EP sales were made at the same level 
of trade as its home-market wholesale level and because we were able to 
match EP sales to home-market sales made at the wholesale level of 
trade in all instances, no level-of-trade adjustments to normal value 
were necessary.

Preliminary Results of Review

    As a result of our comparison of EP and NV, we preliminarily 
determine a weighted-average dumping margin of

[[Page 6155]]

2.91 percent for Tupy for the period May 1, 1998, through April 30, 
1999.
    Any interested party may request a hearing within 30 days of 
publication of this notice. Any hearing, if requested, will be held 38 
days after the date of publication of this notice, or the first workday 
thereafter. Issues raised in hearings will be limited to those raised 
in the respective case and rebuttal briefs. Interested parties may 
submit case briefs within 30 days of the date of publication of this 
notice. Rebuttal briefs, which must be limited to issues raised in the 
case briefs, may be filed not later than 35 days after the date of 
publication.
    Parties who submit argument are requested to submit with the 
argument (1) a statement of the issue, and (2) a brief summary of the 
argument. The Department will publish a notice of final results of this 
administrative review, which will include the results of its analysis 
of issues raised in any such comments or at a hearing.
    The Department shall determine, and the Customs Service shall 
assess, antidumping duties on all appropriate entries. In accordance 
with 19 CFR 351.212(b)(1), we have calculated an exporter/customer-
specific assessment value for subject merchandise. Upon completion of 
this review, the Department will issue appraisement instructions 
directly to the Customs Service.
    Furthermore, the following deposit rates will be effective upon 
publication of the final results of this administrative review for all 
shipments of certain malleable cast iron pipe fittings from Brazil 
entered, or withdrawn from warehouse, for consumption on or after the 
publication date, as provided for by section 751(a)(2)(c) of the Act: 
(1) The cash deposit rate for Tupy will be the rate established in the 
final results of this review; (2) for previously reviewed or 
investigated companies not listed above, the cash-deposit rate will 
continue to be the company-specific rate published for the most recent 
period; (3) if the exporter is not a firm covered in this review, or 
the original less-than-fair-value (LTFV) investigation, but the 
manufacturer is, the cash deposit rate will be the rate established for 
the most recent period for the manufacturer of the merchandise; and (4) 
for all other producers and/or exporters of this merchandise, the cash 
deposit rate shall be 5.64 percent, the all-others rate established in 
the LTFV investigation.
    The deposit rate, when imposed, shall remain in effect until 
publication of the final results of the next administrative review.
    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 351.402(f) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    We are issuing and publishing this determination in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: January 31, 2000.
Holly A. Kuga,
Acting Assistant Secretary, Import Administration.
[FR Doc. 00-2847 Filed 2-7-00; 8:45 am]
BILLING CODE 3510-DS-P