[Federal Register Volume 66, Number 218 (Friday, November 9, 2001)]
[Notices]
[Pages 56644-56649]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-28227]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-533-823]


Notice of Preliminary Determination of Sales at Less Than Fair 
Value; Silicomanganese From India

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

EFFECTIVE DATE: November 9, 2001.

FOR FURTHER INFORMATION CONTACT: Abdelali Elouaradia (Universal Ferro & 
Allied Chemicals) at (202) 482-1374, Elfi Blum (Nava Bharat Ferro 
Alloys Limited) at (202) 482-0197, or Sally C. Gannon at (202) 482-
0162; Antidumping and Countervailing Duty Enforcement Group III, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 
20230.

The Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the statute are 
references to the Tariff Act of 1930 (the Tariff Act), as amended. In 
addition, unless otherwise indicated, all citations to the Department 
of Commerce (the Department) regulations are to the regulations at 19 
CFR part 351 (April 2001).

Preliminary Determination

    We preliminarily determine that silicomanganese from India is being 
sold, or is likely to be sold, in the United States at less than fair 
value (LTFV), as provided in section 733 of the Tariff Act. The 
estimated margins of sales at LTFV are shown in the ``Suspension of 
Liquidation'' section of this notice.

Case History

    On April 26, 2001 the Department initiated antidumping 
investigations of silicomanganese from Kazakhstan, India, and 
Venezuela. See Initiation of Antidumping Duty Investigations: 
Silicomanganese from Kazakhstan, India, and Venezuela, 66 FR 22209 (May 
3, 2001) (Initiation Notice). Since the initiation of these 
investigations the following events have occurred.
    In its initiation notice, the Department set aside a period for all 
interested parties to raise issues regarding product coverage. See 
Initiation Notice, 66 FR at 22209. On May 17, 2001, we received 
comments from Eramet Marietta, Inc. and the Paper, Allied-Industrial, 
Chemical and Energy Workers International Union, Local 5-0639 
(collectively, the petitioners) to amend the scope.
    On May 9, 2001 the Department issued a letter to interested parties 
in all of the concurrent silicomanganese antidumping investigations, 
providing an opportunity to comment on the Department's proposed model 
matching characteristics and hierarchy. In that letter, the Department 
requested the comments to be filed by close of business May 16, 2001. 
Two interested parties, Universal Ferro & Allied Chemicals Ltd. 
(Universal) and Ispat Alloys Limited (Ispat), sent comments via 
facsimile, dated May 14, 2001, on the Department's proposed model match 
criteria. Another interested party, Nava Bharat Ferro Alloys Limited 
(Nava Bharat), mailed its comments, dated May 16, 2001, to the 
Department. In letters dated May 17, 2001, to Universal and Ispat, and 
May 30, 2001, to Nava Bharat, the Department informed the interested 
parties that their comments had not been properly filed and therefore 
could not be placed on the record of this case. Further, in that letter 
the Department informed the interested parties of the proper filing 
requirements in accordance with section 351.303 of the Department's 
regulations, and invited them to refile their comments accordingly. On 
June 19, 2001, the Department received the refiled comments from Nava 
Bharat. On May 16, 2001, petitioners submitted a letter suggesting 
certain modifications be made to the Department's proposed physical 
criteria which would be used for matching purposes. Petitioners 
suggested including options for Indian Grades 2 and 1 in the ``Grade'' 
field, and modifying the ``Size'' field to list only lump 
silicomanganese and fines. After reviewing comments submitted from all 
parties, the Department agreed with petitioners and included these 
proposals in its questionnaire.
    On May 21, 2001, the United States International Trade Commission 
(ITC) notified the Department that it preliminarily determined there is 
a reasonable indication that an industry in the United States is 
materially injured by the reason of imports of the subject merchandise 
from India, Kazakhstan, and Venezuela. See Silicomanganese from India, 
Kazakhstan, and Venezuela, 66 FR 31258 (June 11, 2001).
    On May 24, 2001, the Department issued an inquiry to 15 producers/
exporters of silicomanganese to report quantity and value (Q&V) of 
sales of subject merchandise to the United States, the home market 
(HM), and third countries during the period of investigation (POI). The 
Department amended its inquiry regarding Q&V of sales on June 6, 2001, 
asking these 15 producers/exporters to separate out low carbon 
silicomanganese from subject merchandise when reporting to the 
Department, pending the Department's determination whether to exclude 
low-carbon silicomanganese from the scope, as requested by petitioners 
in their letter of May 17, 2001. The Department received a response to 
its Q&V inquiry from seven producers/exporters of subject merchandise, 
Universal, Ispat, Nava Bharat, Maharashtra Electrosmelts Ltd 
(Maharashtra), GMR Technologies and Industries Ltd. (GMR), Hira Ferro 
Alloys Limited (Hira Ferro), and Indsil Electrosmelts Ltd. (Indsil). 
Since the Department received Maharashtra's response late (dated August 
18, 2001), the company was not considered in the respondent selection. 
Two companies, GMR and Hira Ferro, reported no shipments to the United 
States during the POI. Indsil informed the Department that, based on 
petitioners' request of May 17, 2001, to amend the scope, the company 
had no shipments of subject merchandise to the United States. For two 
more producers/exporters, Moldex International and Quality Steels & 
Forgings, the Department's inquiry of Q&V was undeliverable. Based on 
the information submitted, the Department selected the following two 
respondents: Universal and Nava Bharat. For further information, please 
see Memorandum to Joseph Spetrini, Deputy Assistant Secretary, AD/CVD 
Enforcement, Group III, through Barbara E. Tillman, Director, Office of 
AD/CVD Enforcement VII, from Team: Antidumping Duty Investigation of 
Silicomanganese from India: Respondent Selection, dated July 13, 2001. 
The public version is on file in the Central Records Unit, Room B-099 
of the main Commerce Building (B-099).
    On July 18, 2001, the Department issued an antidumping duty 
questionnaire to Universal and Nava Bharat, both producers/exporters of 
subject merchandise in India. We requested that both companies respond 
to section A (general information, corporate structure, sales 
practices, and merchandise produced), section B (home market or third-
country sales), section C (U.S. sales), section D (cost of production/
constructed value), and, if

[[Page 56645]]

applicable, section E (cost of further manufacture or assembly 
performed in the United States).
    Nava Bharat and Universal submitted their initial responses to 
section A of the Department's questionnaire on August 8, 2001 and 
August 9, 2001, respectively. We received responses to sections B 
through D from Nava Bharat and Universal on September 4, 2001. 
Petitioners filed comments regarding section A and sections B through D 
of Nava Bharat's response on September 9, 2001 and September 13, 2001, 
respectively, and regarding section A and sections B through C and 
section D of Universal's response on September 12, 2001, September 13, 
2001, and September 18, 2001, respectively. We issued a supplemental 
questionnaire to Nava Bharat for sections A through D on September 29, 
2001, and we issued supplemental questionnaires to Universal for 
sections A through C on September 26, 2001, and for section D on 
October 2, 2001. Nava Bharat filed its response to our supplemental 
questionnaire on October 9, 2001. Universal filed its responses to our 
sections A through D supplemental questionnaire on October 11, 2001.
    On July 16, 2001 petitioners filed an allegation that critical 
circumstances exist with respect to imports of silicomanganese from 
India. In its Notice of Preliminary Determination Of Critical 
Circumstances; Silicomanganese from India, 66 FR 53207 (October 19, 
2001) (Preliminary Determination of Critical Circumstances), the 
Department preliminarily determined that critical circumstances exist 
for Universal and ``all others,'' but not for Nava Bharat.
    Based on petitioners' request, the Department postponed the 
preliminary determination in the antidumping duty investigation by 30 
days, until October 15, 2001. See Silicomanganese from Kazakhstan, 
India and Venezuela; Notice of Postponement of Preliminary 
Determinations in Antidumping Duty Investigations, 66 FR 45964 (August 
31, 2001). Because the Indian investigation is extraordinarily 
complicated, and the case-specific information to be analyzed within 
the time constraints was voluminous, the Department postponed the 
preliminary determination for a second time, until November 2, 2001. 
See Silicomanganese From Kazakhstan, India and Venezuela; Notice of 
Postponement of Preliminary Determinations in Antidumping Duty 
Investigations, 66 FR 53206 (October 19, 2001).

Period of Investigation

    The period of investigation (POI) is April 1, 2000 through March 
31, 2001. This period corresponds to the four most recent fiscal 
quarters prior to the month of the filing of the petition (i.e., April 
2001), and is in accordance with our regulations. See 19 CFR 
351.204(b)(1).

Scope of Investigation

    For purposes of this investigation, the products covered are all 
forms, sizes and compositions of silicomanganese, except low-carbon 
silicomanganese, including silicomanganese briquettes, fines and slag. 
Silicomanganese is a ferro alloy composed principally of manganese, 
silicon and iron, and normally contains much smaller proportions of 
minor elements, such as carbon, phosphorous and sulfur. Silicomanganese 
is sometimes referred to as ferro silicon manganese. Silicomanganese is 
used primarily in steel production as a source of both silicon and 
manganese. Silicomanganese generally contains by weight not less than 4 
percent iron, more than 30 percent manganese, more than 8 percent 
silicon and not more than 3 percent phosphorous. Silicomanganese is 
properly classifiable under subheading 7202.30.0000 of the Harmonized 
Tariff Schedule of the United States (HTSUS). Some silicomanganese may 
also be classified under HTSUS subheading 7202.99.5040. This scope 
covers all silicomanganese, regardless of its tariff classification. 
Although the HTSUS subheadings are provided for convenience and U.S. 
Customs purposes, our written description of the scope remains 
dispositive.
    The low-carbon silicomanganese excluded from this scope is a ferro 
alloy with the following chemical specifications: minimum 55 percent 
manganese, minimum 27 percent silicon, minimum 4 percent iron, maximum 
0.10 percent phosphorus, maximum 0.10 percent carbon and maximum 0.05 
percent sulfur. Low-carbon silicomanganese is used in the manufacture 
of stainless steel and special carbon steel grades, such as motor 
lamination grade steel, requiring a very low carbon content. It is 
sometimes referred to as ferro manganese-silicon. Low-carbon 
silicomanganese is classifiable under HTSUS subheading 7202.30.0000.

Product Comparisons

    Pursuant to section 771(16) of the Tariff Act, all products 
produced by the respondent within the scope of the investigation, 
detailed above, and sold in the comparison market during the POI, are 
considered to be foreign like products. To match U.S. sales of subject 
merchandise to comparison-market sales of the foreign like product, we 
relied on two physical characteristics: grade and size. During the POI, 
Nava Bharat sold two products in both the HM and the United States. 
Universal sold three products in the HM and one in the United States. 
Since the products sold in both markets by both companies were 
identical, no matches of similar merchandise were utilized in our 
calculations.

Fair Value Comparisons

    To determine whether sales of silicomanganese from India were made 
in the United States at less than fair value, we compared export price 
(EP) to normal value (NV), as described in the ``Export Price'' and 
``Normal Value'' sections of this notice. In accordance with section 
777A(d)(1)(A)(i) of the Tariff Act, we calculated weighted-average EPs 
for comparison to weighted-average NVs.

Export Price

Nava Bharat

    Nava Bharat reported, as export price (EP) transactions, sales of 
subject merchandise sold to unaffiliated U.S. customers prior to 
importation. See Nava Bharat's section A response of August 8, 2001, at 
10, and section C response of September 4, 2001, at Exhibit C-7. We 
calculated EP in accordance with section 772(a) of the Tariff Act 
because the merchandise was sold to the first unaffiliated purchaser in 
the United States prior to importation and the CEP methodology was not 
otherwise warranted, based on the facts of record. We made deductions 
for movement expenses in accordance with section 772(c)(2)(A) of the 
Tariff Act; these included, where appropriate, foreign inland freight 
and foreign brokerage and handling charges. See Memorandum to File from 
Elfi Blum through Sally Gannon: Preliminary Determination of 
Antidumping Investigation of Silicomanganese from India-Analysis of 
Nava Bharat Ferro Alloys Limited (November 2, 2001) (Analysis 
Memorandum Nava Bharat) (public version on file in the Department's 
Central Records Unit, in Room B-099). In addition, we did not add duty 
drawback to the starting price. Section 772(c)(1)(B) of the Tariff Act 
provides that export price (or constructed export price) shall be 
increased by ``the amount of any import duties imposed by the country 
of

[[Page 56646]]

exportation which have been rebated, or which have not been collected, 
by reason of the exportation of the subject merchandise to the United 
States.'' The Department determines that an adjustment to U.S. price 
for a claimed duty drawback is appropriate when a company can 
demonstrate that it meets both parts of our two-part test. There must 
be: (1) a sufficient link between the import duty and the rebates, and 
(2) a sufficient amount of raw materials imported and used in the 
production of the final exported product. See e.g. Stainless Steel Wire 
Rod From India; Final Results of Antidumping Duty Administrative 
Review, 65 FR 31302 (May 17, 2000) (Steel Wire Rod from India). In its 
supplemental response, Nava Bharat neither established the link between 
import duty and the rebates received from the Indian government, nor 
showed that it imported sufficient volume of raw materials to account 
for the level of duty drawback claimed for its exports to the United 
States during the POI.

Universal

    Universal reported, as export price (EP) transactions, sales of 
subject merchandise sold to unaffiliated U.S. customers prior to 
importation. See Universal's section A response of August 9, 2001, and 
section C response of September 4, 2001. We calculated EP in accordance 
with section 772(a) of the Tariff Act because the merchandise was sold 
to the first unaffiliated purchaser in the United States prior to 
importation and CEP methodology was not otherwise warranted, based on 
the facts of record. We based EP on FOB price to unaffiliated 
purchasers in the United States. Since respondent sells to the United 
States in bulk and did not incur any packing costs, we did not include 
it in our calculations. We made deductions for movement expenses in 
accordance with section 772(c)(2)(A) of the Tariff Act; these included, 
where appropriate, foreign inland freight, foreign brokerage and 
handling charges, and insurance.

Level of Trade

    In accordance with section 773(a)(1)(B)(i) of the Tariff Act, to 
the extent practicable, we determine NV based on sales in the 
comparison market at the same level of trade (LOT) as the EP or CEP 
transaction. The NV LOT is that of the starting price sales in the 
comparison market or, when NV is based on CV, that of the sales from 
which we derive selling, general and administrative (SG&A) expenses and 
profit. For EP, the U.S. LOT is also the level of the starting price 
sale, which is usually from the exporter to the importer. For CEP, it 
is the level of the constructed sale from the exporter to the importer.
    To determine whether NV sales are at a different LOT than EP or CEP 
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 LOT, and the difference affects 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 LOT of 
the export transaction, we make a LOT adjustment under section 
773(a)(7)(A) of the Tariff Act. Finally, for CEP sales, if the NV level 
is more remote from the factory than the CEP level and there is no 
basis for determining whether the differences in the levels between NV 
and CEP affect price comparability, we adjust NV under section 
773(A)(7)(B) of the Tariff Act (the CEP offset provision). See, e.g., 
Certain Carbon Steel Plate from South Africa, Final Determination of 
Sales at Less Than Fair Value, 62 FR 61731 (November 19, 1997).
    Under section 351.412(c)(2) of the Department's regulations, the 
Secretary will determine that sales are made at different levels of 
trade if they are made at different marketing stages (or their 
equivalent). According to this regulation, ``[s]ubstantial differences 
in selling activities are a necessary, but not sufficient, condition 
for determining that there is a difference in the stage of marketing'' 
and ``[s]ome overlap in selling activities will not preclude a 
determination that two sales are at different stages of marketing.''

Nava Bharat

    In evaluating LOT for Nava Bharat, we obtained information from 
Nava Bharat about the marketing stages involved in its reported U.S. 
and home market sales, including a description of the selling 
activities performed by Nava Bharat for each channel of distribution.
    In the home market, Nava Bharat reported two channels of 
distribution based on customer category. See Nava Bharat's August 8, 
2001 response at page A-10 & 11, and its September 4, 2001 response at 
page B-5 & B-6. The selling activities did not differ significantly by 
channel of distribution. See page B-14. Because the selling functions 
performed for each channel are sufficiently similar, channels of 
distribution do not qualify as separate LOTs. Therefore, we 
preliminarily determine that one LOT exists for Nava Bharat's home 
market sales.
    In the United States, Nava Bharat reported one channel of 
distribution for sales of subject merchandise during the POI (EP sales 
made directly to one customer category). For further proprietary 
details, see Analysis Memorandum Nava Bharat. Based on the information 
provided by Nava Bharat, we preliminarily determine that one LOT exists 
in the United States.
    Nava Bharat claimed that its sales to home market customers were at 
a different LOT than its sales to U.S. customers and, therefore, 
claimed a LOT adjustment. Pursuant to section 351.412(c)(2) of the 
Department's regulations, substantial differences in selling activities 
are necessary in order to find a LOT difference. Also see Notice of 
Final Determination of Sales at Less Than Fair Value; Honey from 
Argentina, 66 FR 50611 (October 4, 2001), and accompanying Issues and 
Decision Memorandum at Comment 18, and Grain-Oriented Electrical Steel 
From Italy: Final Results of Antidumping Administrative Review, 66 FR 
14887 (March 14, 2001), and accompanying Issues and Decisions 
Memorandum at Comment 2. The information submitted by Nava Bharat 
demonstrates only one difference in selling activities for one customer 
category in the home market. Based on the limited degree to which 
selling functions/services differ on Nava Bharat's sales to its home 
market customer category and Nava Bharat's sales to its U.S. customer 
category, we preliminarily determine that the U.S. LOT is comparable to 
the home market LOT. See Nava Bharat's supplemental response of October 
9, 2001, at page 5.

Universal

    In evaluating LOT for Universal, we obtained information from 
Universal about the marketing stages involved in its reported U.S. and 
home market sales, including a description of the selling activities 
performed by Universal for each channel of distribution.
    In the home market, Universal reported two channels of distribution 
with respect to customer category and channel, one to distributors and 
one to end users. See Universal's August 9, 2001, response at page A-7 
& 8, and its October 11, 2001 response at page A-4 & 5. Universal 
claims that more selling services are required in the home market 
because most of its customers are end users. Such activities include 
calling customers, negotiating for orders, arranging freight and 
delivery, and attending to quality-related matters. Universal did not 
specify what selling functions are required for sales to distributors, 
but it did state that sales made in the western region are handled

[[Page 56647]]

by an unaffiliated agent that earns three percent commission for his 
services. Universal did not fully explain the selling activities for 
its second channel of distribution and how the end user channel is 
different from the distributor channel in the home market. Therefore, 
based on the information on the record for this preliminary 
determination, we find that there is only one LOT. However, the 
Department will request further clarification from Universal through 
supplemental questionnaires and during verification.
    In the United States, Universal states that the prices charged for 
United States sales are lower than the prices charged for home market 
sales because, in the United States, it sells to traders in bulk while, 
in the home market, it sells in bags of 50 kg to end users, and to some 
sales distributors. Id at A-9. In addition, Universal reported one 
channel of distribution for sales of subject merchandise during the POI 
(EP sales made directly to one customer category). For its U.S. sales, 
Universal claims that, aside from executing the sales transactions and 
arranging for freight and delivery, no other selling activities are 
provided on export sales.
    Universal claims that its sales to home market customers were at a 
different LOT than its sales to U.S. customers and, therefore, the 
Department should adjust for the LOT difference. In this case, the 
selling activities for U.S. sales are similar if not identical to the 
selling activities for home market sales. For U.S. sales, just as for 
home market sales, Universal has to maintain contact with its 
customers, negotiate orders, and arrange for freight. Moreover, the 
only selling activity that is allegedly done in the home market and not 
the U.S. market is attending to quality-related matters. However, 
Universal failed to explain or quantify such selling activity. 
Furthermore, based on section 351.412(c)(2) of the Department's 
regulations, substantial differences in selling activities are 
necessary in order to find a LOT difference. Also see Notice of Final 
Determination of Sales at Less Than Fair Value; Honey from Argentina, 
66 FR 50611 (October 4, 2001), and accompanying Issues and Decision 
Memorandum at Comment 18, and Grain-Oriented Electrical Steel From 
Italy: Final Results of Antidumping Administrative Review, 66 FR 14887 
(March 14, 2001), and accompanying Issues and Decisions Memorandum at 
Comment 2. Therefore, based on the information provided by Universal, 
we preliminarily determine that one LOT exists in the United States and 
the home market.

Normal Value

Home Market Viability

    In order to determine whether there was a sufficient volume of 
sales in the home market to serve as a viable basis for calculating NV 
(i.e., the aggregate volume of home market sales of the foreign like 
product was equal to or greater than five percent of the aggregate 
volume of U.S. sales), we compared Nava Bharat's and Universal's volume 
of home market sales of the foreign like product to the volume of U.S. 
sales of the subject merchandise, respectively, in accordance with 
section 773(a)(1)(C) of the Tariff Act. As both Nava Bharat's and 
Universal's aggregate volume of home market sales of the foreign like 
product was greater than five percent of its aggregate volume of U.S. 
sales of the subject merchandise, we determined that the home market 
was viable. Therefore, we have based NV on home market sales in the 
usual commercial quantities and in the ordinary course of trade.

Cost of Production Analysis

    Based on allegations contained in the petition, and in accordance 
with section 773(b)(2)(A)(i) of the Tariff Act, we found reasonable 
grounds to believe or suspect that sales of silicomanganese in India 
were made at prices below the cost of production (COP). As a result, 
the Department initiated an investigation to determine whether Nava 
Bharat or Universal made home market sales during the POI at prices 
below their respective COP, within the meaning of section 773(b) of the 
Tariff Act. We conducted the COP analysis described below.

A. Calculation of COP

    In accordance with section 773(b)(3) of the Tariff Act, we 
calculated COP based on the sum of Nava Bharat's and Universal's cost 
of materials and fabrication for the foreign like product, plus an 
amount for home market SG&A expenses, including interest expenses, and 
packing costs, where applicable. We relied on the home market sales and 
COP information provided by both respondents in their original and 
supplemental responses. Where appropriate, we made certain adjustments 
to Nava Bharat's and Universal's reported COP. See Analysis Memorandum 
Nava Bharat; and Memorandum to the File, from Abdelali Elouaradia 
through Sally Gannon: Preliminary Calculation Memo, (November 2, 2001) 
on file in room B-099 of the Main Commerce building.

B. Test of Home-Market Sales Prices

    We compared the adjusted weighted-average COPs for Nava Bharat and 
Universal to the home market sales prices of the foreign like product, 
as required under section 773(b) of the Tariff Act, in order to 
determine whether these sales had been made at prices below the COP 
within an extended period of time (i.e., a period of one year) in 
substantial quantities and whether such prices were sufficient to 
permit the recovery of all costs within a reasonable period of time. In 
accordance with section 773(b)(2)(C)(i) of the Tariff Act, we 
determined that sales made below the COP were made in substantial 
quantities if the volume of such sales represented 20 percent or more 
of the volume of sales under consideration for the determination of 
normal value.
    On a model-specific basis, we compared the revised COP to the home 
market prices, less any applicable movement charges and other direct 
and indirect selling expenses.

C. Results of the COP Test

    Pursuant to section 773(b)(2)(C) of the Tariff Act, where less than 
20 percent of a respondent's sales of a given product were at prices 
less than the COP, we did not disregard any below-cost sales of that 
product because we determined that the below-cost sales were not made 
in ``substantial quantities.'' Where 20 percent or more of a 
respondent's sales of a given product during the POI were at prices 
less than the COP, we determined such sales to have been made in 
``substantial quantities'' within an extended period of time in 
accordance with section 773(b)(2)(B) or the Tariff Act. In such cases, 
because we compared prices to POI-average costs, we also determined 
that such sales were not made at prices which would permit recovery of 
all costs within a reasonable period of time, in accordance with 
section 773(b)(2)(D) of the Tariff Act. Therefore, we disregarded the 
below-cost sales.

Nava Bharat

    We found that for some of the models of silicomanganese sold in the 
home market, more than 20 percent of Nava Bharat's home market sales 
were made within an extended period of time at prices less than the 
COP. Further, the prices did not provide for the recovery of costs 
within a reasonable period of time. We therefore disregarded these 
below-cost sales and used the remaining sales as the basis for 
determining NV, in accordance with section 773(b)(1) of the Tariff Act. 
Since all U.S. sales of

[[Page 56648]]

silicomanganese were of a model identical or similar to that sold in 
the home market and there were sufficient above-cost sales of that 
model, we did not have to compare EP to CV in accordance with section 
773(a)(4) of the Tariff Act.

Universal

    We found that for some of the models of silicomanganese sold in the 
home market, more than 20 percent of Universal's home market sales were 
made within an extended period of time at prices less than the COP. 
Further, the prices did not provide for the recovery of costs within a 
reasonable period of time. We therefore disregarded these below-cost 
sales and used the remaining sales as the basis for determining NV, in 
accordance with section 773(b)(1) of the Tariff Act. Since all U.S. 
sales of silicomanganese were of a model identical to that sold in the 
home market and there were sufficient above-cost sales of that model, 
we did not have to compare EP to CV in accordance with section 
773(a)(4) of the Tariff Act.

Price-to-Price Comparisons

Nava Bharat

    We calculated NV based on the delivered prices to unaffiliated 
customers. We made deductions, where appropriate, from the starting 
price for inland freight. We made adjustments under section 
773(a)(6)(C)(iii) of the Tariff Act for differences in circumstances of 
sale (COS) based on direct selling expenses. We have recalculated the 
value of other direct selling expenses, based on Nava Bharat's amended 
Exhibit D-8 in the supplemental response and included it in our 
calculations of the foreign unit price in dollars (FUPDOL). We also 
made COS adjustments for commissions. See Analysis Memorandum Nava 
Bharat. In addition, we made COS adjustments for imputed credit 
expenses. However, we did not rely on Nava Bharat's reported U.S. 
credit expenses, because Nava Bharat did not use the appropriate 
interest rate. Therefore, we recalculated credit expenses using the 
average short-term lending rates calculated by the Federal Reserve. We 
made deductions for home market packing costs.

Universal

    We calculated NV based on the ex-factory prices to unaffiliated 
customers. We made adjustments under section 773(a)(6)(C)(iii) of the 
Tariff Act for differences in circumstances of sale for imputed credit 
expenses, interest revenue and banking charges. However, we did not 
rely on Universal's reported home market credit expenses because 
Universal calculated these expenses using a gross unit price inclusive 
of taxes. Therefore, we recalculated credit expenses using the gross 
unit price exclusive of any taxes. Universal paid commissions to 
unaffiliated sales intermediaries on some home market sales of 
silicomanganese but did not pay commissions on its U.S. sales. 
Therefore, in accordance with 19 CFR 351.410(e), we offset the 
commission incurred in the home market, with indirect selling expenses 
incurred on U.S. sales to the extent of the lesser of the commission or 
the indirect selling expenses. We made deductions for home market 
packing costs. However, we did not add U.S. packing costs to NV as the 
respondent reported that it incurred no such expenses in selling 
silicomanganese in the U.S. market.

Currency Conversions

    We made currency conversions into U.S. dollars in accordance with 
section 773A(a) of the Tariff Act, based on the exchange rates in 
effect on the dates of the U.S. sales, as certified by the Federal 
Reserve Bank.

Verification

    Pursuant to section 782(i) of the Tariff Act, we intend to verify 
all information relied upon in making our final determination.

Suspension of Liquidation

    In accordance with section 733(d)(2) of the Tariff Act, we are 
directing the Customs Service to suspend liquidation of all entries of 
silicomanganese from India that are entered, or withdrawn from 
warehouse, for consumption, as follows: For Nava Bharat, Customs should 
suspend liquidation on or after the date of publication of this notice 
in the Federal Register; for Universal, and ``all others,'' Customs 
should suspend liquidation on or after the date which is 90 days prior 
to the date of publication of this notice in the Federal Register, due 
to the Preliminary Determination of Critical Circumstances. We will 
instruct the Customs Service to require a cash deposit or the posting 
of a bond equal to the weighted-average amount by which the NV exceeds 
the EP, as indicated in the chart below. These suspension-of-
liquidation instructions will remain in effect until further notice. 
The weighted-average dumping margins are as follows:

------------------------------------------------------------------------
                                                              Weighted-
                                                               average
                   Exporter/manufacturer                        margin
                                                              percentage
------------------------------------------------------------------------
Nava Bharat Ferro Alloys Ltd...............................        22.88
Universal Ferro and Allied Chemicals Ltd...................        13.24
All Others.................................................        18.94
------------------------------------------------------------------------

ITC Notification

    In accordance with section 733(f) of the Tariff Act, we have 
notified the ITC of our determination. If our final antidumping 
determination is affirmative, the ITC will determine whether these 
imports are materially injuring, or threaten material injury to, the 
U.S. industry. The deadline for that ITC determination would be the 
later of 120 days after the date of this preliminary determination or 
45 days after the date of our final determinations.

Public Comment

    Unless otherwise notified by the Department, case briefs or other 
written comments in at least six copies must be submitted to the 
Assistant Secretary for Import Administration no later than fifty days 
after the date of publication of this notice, and rebuttal briefs, 
limited to issues raised in case briefs, no later than fifty-five days 
after the date of publication of this preliminary determination. A list 
of authorities used and an executive summary of issues should accompany 
any briefs submitted to the Department. Such summary should be limited 
to five pages total, including footnotes. Further, we would appreciate 
it if parties submitting written comments would provide the Department 
with an additional copy of the public version of any such comments on 
diskette. In accordance with section 774 of the Tariff Act, we will 
hold a public hearing, if requested, to afford interested parties an 
opportunity to comment on arguments raised in case or rebuttal briefs. 
Tentatively, any hearing will be held fifty-seven days after 
publication of this notice, time and room to be determined, at the U.S. 
Department of Commerce, 14th Street and Constitution Avenue, NW., 
Washington, DC 20230. Parties should confirm by telephone the time, 
date, and place of the hearing 48 hours before the scheduled time.
    Interested parties who wish to request a hearing, or to participate 
if one is requested, must submit a written request to the Assistant 
Secretary for Import Administration, U.S. Department of Commerce, Room 
1870, within 30 days of the publication of this notice. Requests should 
contain: (1) The party's

[[Page 56649]]

name, address, and telephone number; (2) the number of participants; 
and (3) a list of the issues to be discussed. Oral presentations will 
be limited to issues raised in the case and rebuttal briefs. If this 
investigation proceeds normally, we will make our final determination 
no later than 75 days after the date of this preliminary determination.
    This determination is issued published pursuant to sections 733(f) 
and 777(i)(1) of the Tariff Act.

    Dated: November 2, 2001.
Faryar Shirzad,
Assistant Secretary for Import Administration.
[FR Doc. 01-28227 Filed 11-8-01; 8:45 am]
BILLING CODE 3510-DS-P