[Federal Register Volume 67, Number 132 (Wednesday, July 10, 2002)]
[Notices]
[Pages 45702-45705]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-17353]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-822]


Certain Helical Spring Lock Washers from the People's Republic of 
China; Preliminary Results of Antidumping Duty Administrative Review

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

ACTION: Notice of Preliminary Results of Antidumping Duty 
Administrative Review.

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SUMMARY: We preliminarily find that helical spring lock washers from 
the People's Republic of China are not being sold in the United States 
below normal value by the Hangzhou Spring Washer Plant (also known as 
Zhejiang Wanxin Group, Ltd.). Interested parties are invited to comment 
on these preliminary results.

EFFECTIVE DATE: July 10, 2002.

FOR FURTHER INFORMATION CONTACT: Sally Hastings, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, N.W., Washington, D.C. 20230; telephone 
(202) 482-3464.

SUPPLEMENTARY INFORMATION:

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, as amended (the 
Act) by the Uruguay Round Agreements Act. Unless otherwise indicated, 
all citations to the Department of Commerce's (the Department's) 
regulations are to 19 CFR part 351 (2001).

Background

    On October 19, 1993, the Department published the antidumping duty 
order on certain helical spring lock washers (HSLWs) from the People's 
Republic of China (PRC) (58 FR 53914). The Department notified 
interested parties of the opportunity to request an administrative 
review of this order on October 1, 2001 (66 FR 49923). The petitioner, 
Shakeproof Assembly Components Division of Illinois Tool Works, Inc., 
requested that the Department conduct an administrative review of 
Hangzhou Spring Washer Plant (also known as Zhejiang Wanxin Group Co. 
Ltd. (ZWG)), the predecessor firm to Hang Zhou Spring Washer Co., Ltd. 
(collectively Hangzhou), on October 30, 2001. The notice of initiation 
of this administrative review was published on November 21, 2001 (66 FR 
58432).
    On February 15, 2002, the petitioner timely requested verification 
for ``good cause'' pursuant to 19 CFR 351.307(b)(iv). On March 8, 2002, 
Hangzhou responded to the Department's January 4, 2002, questionnaire. 
The Department, on April 18, 2002, provided parties with an opportunity 
to submit information regarding appropriate surrogate values. On May 9, 
2002, both petitioner and Hangzhou submitted surrogate value comments. 
The Department issued a supplemental questionnaire to Hangzhou on June 
3, 2002. Hangzhou submitted its supplemental questionnaire responses on 
June 17, 2002.
    The Department is conducting this administrative review in 
accordance with section 751 of the Act.

Scope of the Order

    The products covered by the order are HSLWs of carbon steel, of 
carbon alloy steel, or of stainless steel, heat-treated or non-heat-
treated, plated or non-plated, with ends that are off-line. HSLWs are 
designed to: (1) function as a spring to compensate for developed 
looseness between the component parts of a fastened assembly; (2) 
distribute the load over a larger area for screws or bolts; and, (3) 
provide a hardened bearing surface. The scope does not include internal 
or external tooth washers, nor does it include spring lock

[[Page 45703]]

washers made of other metals, such as copper.
    HSLWs subject to the order are currently classifiable under 
subheading 7318.21.0030 of the Harmonized Tariff Schedule of the United 
States (HTSUS). Although the HTSUS subheading is provided for 
convenience and customs purposes, the written description of the scope 
of this proceeding is dispositive.

Period of Review

    This review covers the period October 1, 2000, through September 
30, 2001.

Separate Rates Determination

    To establish whether a company operating in a state-controlled 
economy is sufficiently independent to be entitled to a separate rate, 
the Department analyzes each exporting entity under the test 
established in the Final Determination of Sales at Less Than Fair 
Value: Sparklers from the People's Republic of China, 56 FR 20588 (May 
6, 1991) (Sparklers), as amplified by the Final Determination of Sales 
at Less Than Fair Value: Silicon Carbide from the People's Republic of 
China, 59 FR 22585 (May 2, 1994) (Silicon Carbide). Under this policy, 
exporters in non-market economy countries (NMEs) are entitled to 
separate, company-specific margins when they can demonstrate an absence 
of government control, both in law and in fact, with respect to export 
activities. Evidence supporting, though not requiring, a finding of de 
jure absence of government control over export activities includes: 1) 
an absence of restrictive stipulations associated with the individual 
exporter's business and export licenses; 2) any legislative enactments 
decentralizing control of companies; and, 3) any other formal measures 
by the government decentralizing control of companies. De facto absence 
of government control over exports is based on four factors: 1) whether 
each exporter sets its own export prices independently of the 
government and without the approval of a government authority; 2) 
whether each exporter retains the proceeds from its sales and makes 
independent decisions regarding the disposition of profits or the 
financing of losses; 3) whether each exporter has the authority to 
negotiate and sign contracts and other agreements; and, 4) whether each 
exporter has autonomy from the government regarding the selection of 
management. (See Silicon Carbide, 59 FR at 22587 and Sparklers, 56 FR 
at 20589.)
    In each of the previous administrative reviews of the antidumping 
duty order on HSLWs from the PRC, covering successive review periods 
from October 1, 1993, through September 30, 2000, we determined that 
Hangzhou and its predecessor, ZWG, merited a separate rate. We found, 
in each review, an absence of government control, both in law and in 
fact, with respect to Hangzhou's export activities according to the 
criteria identified in Sparklers, and an absence of government control 
with respect to the additional criteria identified in Silicon Carbide. 
During this period of review (POR), we have no evidence of any change 
in either the Sparklers or Silicon Carbide criteria. Therefore, we have 
assigned Hangzhou a separate rate.

Export Price

    Because Hangzhou sold the subject merchandise to unaffiliated 
purchasers in the United States prior to importation into the United 
States and constructed export price methodology is not otherwise 
indicated, we have used export price in accordance with section 772(a) 
of the Act.
    We calculated export price based on the FOB price to unaffiliated 
purchasers. From this price, we deducted amounts for foreign inland 
freight, and brokerage and handling pursuant to section 772(c)(2)(A) of 
the Act. We valued these deductions using surrogate values. We selected 
India as the primary surrogate country for the reasons explained in the 
``Normal Value'' section of this notice.

Normal Value

    The Department has determined the PRC to be an NME country in all 
previous antidumping cases. In accordance with section 771(18)(C)(i) of 
the Act, any determination that a foreign country is an NME shall 
remain in effect until revoked by the administering authority. None of 
the parties to this proceeding has contested such treatment in this 
review. Moreover, parties to this proceeding have not argued that the 
PRC HSLW industry is a market-oriented industry and, consequently, we 
have no basis to determine that the information in this review would 
permit the calculation of normal value (NV) using PRC prices or costs. 
Section 773(c)(1) of the Act provides that, in the case of an NME, the 
Department shall determine NV using a factors-of-production methodology 
if: (1) the merchandise is exported from an NME, and (2) the 
information does not permit the calculation of NV using home-market 
prices, third-country prices, or constructed value under section 773(a) 
of the Act. Therefore, we calculated NV based on factors of production 
in accordance with sections 773(c)(3) and (4) of the Act and 19 CFR 
351.408(c).
    Because we are using surrogate country factors-of-production prices 
to determine NV, section 773(c)(4) of the Act requires that the 
Department use values from a market economy (surrogate) country that 1) 
is at a level of economic development comparable to that of the PRC, 
and 2) is a significant producer of comparable merchandise. We have 
determined that India, Pakistan, Indonesia, Sri Lanka and the 
Philippines are market economy countries at a comparable level of 
economic development to that of the PRC. (See Memorandum to Susan 
Kuhbach from Jeff May, dated April 11, 2002, ``Eighth Administrative 
Review for Certain Helical Spring Lock Washers from the People's 
Republic of China,'' which is available in the Public File in the 
Central Records Unit in the main Commerce Building (CRU)). In addition, 
India and Indonesia are significant producers of comparable 
merchandise. The regulations at 19 CFR 351.408(c)(2) state that the 
Secretary normally will value all factors in a single surrogate country 
(emphasis added). However, when a FOP value from the primary surrogate 
country is aberrational or unreliable, we may use a publicly available 
value from another appropriate surrogate country. See Tapered Roller 
Bearings and Parts Thereof, Finished and Unfinished, from the People's 
Republic of China; Final Result s of 1998-1999 Administrative Review, 
and Determination Not To Revoke Order in Part, 66 FR 1953, (January 10, 
2001), and the accompanying Decision Memorandum at Comment 10, which is 
available in the Public File of the CRU. As in the investigation and 
seven previous reviews, we have chosen India as the primary surrogate 
country. We have used Indian prices to value the factors of production 
except where 1) a meaningful amount of the factor was purchased from a 
market economy supplier and paid for in a market economy currency, or 
2) the Indian price for a factor was aberrational and unreliable.
    We selected, where possible, publicly available values from India 
which were: (1) average non-export values; (2) representative of a 
range of prices within the POR or most contemporaneous with the POR; 
(3) product-specific; and, (4) tax-exclusive. We valued the factors of 
production as follows:
     A meaningful amount of the input carbon steel wire rod was 
purchased from the United Kingdom, a market economy supplier, and paid 
for in a

[[Page 45704]]

market economy currency. Pursuant to 19 CFR 351.408(c)(1), we valued 
this factor using the price paid to the market economy supplier. Thus, 
for carbon steel wire rod values, we used the average cost per metric 
ton of carbon steel wire rod imported from the United Kingdom by 
Hangzhou during the POR. We made adjustments to account for the freight 
costs incurred between the port and Hangzhou.
     To value the scrap steel sold by Hangzhou, we used per 
kilogram values obtained from the Monthly Statistics of the Foreign 
Trade of India - Imports (MSFTI) as a by-product offset.
     To value hydrochloric acid used in both the production and 
plating processes, we used per kilogram values for imports into 
Indonesia obtained from the Indonesian Badan Pusat Stastisik. We 
rejected the Indian import values as we did in the most recent review 
because the values were aberrational. See Certain Helical Spring Lock 
Washers from the People's Republic of China; Final Results of the 
Antidumping Duty Administrative Review, 67 FR 8520 (February 25, 2002) 
(HSLWs-7).
     To value other chemicals used in the production and 
plating processes of HSLWs, we used per kilogram import values obtained 
from MSFTI and the Indian publication Chemical Weekly. We adjusted 
these values, where appropriate, to reflect inflation using the 
Wholesale Price Index (WPI) as reported in the International Financial 
Statistics published by the International Monetary Fund (IMF). We also 
adjusted these values to account for freight costs incurred between the 
supplier and Hangzhou.
     To value coal, we used a per kilogram value obtained from 
the MFSTI. We adjusted this value to reflect inflation using the WPI 
published by the IMF. We also made adjustments to account for freight 
costs incurred between the supplier and Hangzhou.
     To value electricity, we used the electricity price data 
from Energy Data Directory and Yearbook (1999/2000) published by the 
Tata Energy Research Institute. We adjusted the value to reflect 
inflation using the electricity sector-specific inflation index 
published in the Reserve Bank of India (RBI) Bulletin.
     To value water, we used the Second Water Utilities Data 
Book for the Asian and Pacific Region published by the Asian 
Development Bank in 1997. We adjusted the value to reflect inflation 
using the WPI published by the IMF.
     For labor, we used the regression-based wage rate for the 
PRC in ``Expected Wages of Selected NME Countries,'' located on the 
Internet at http://ia.ita.doc.gov.wages/99wages/htm. Because of the 
variability of wage rates in countries with similar per capita gross 
domestic products (GDP), 19 CFR 351.408(c)(3) requires the use of a 
regression-based wage rate. The source for the regression wage rates is 
``Expected Wages of Selected NME Countries - 1999 Income Data,'' Year 
Book of Labour Statistics 1999, International Labour Office, (Geneva: 
2000).
     For factory overhead, selling, general, and administrative 
expenses (SG&A), and profit values, we used information from the 
January, 1997 RBI Bulletin for the Indian industry group ``Processing 
and Manufacturing: Metals, Chemicals, and Products Thereof.'' From this 
information, we were able to determine factory overhead as a percentage 
of the total raw materials, labor and energy (ML&E) costs, SG&A as a 
percentage of ML&E plus overhead (i.e., cost of manufacture), and the 
profit rate as a percentage of the cost of manufacture plus SG&A.
     For packing materials, we used the per kilogram values 
obtained from the MFSTI. Where necessary, we adjusted these values to 
reflect inflation using the WPI published by the IMF. We also made 
adjustments to account for freight costs incurred between the PRC 
supplier and Hangzhou.
     To value foreign brokerage and handling, we used 
information reported in the New Shipper Review for Stainless Steel Wire 
Rod from India, 66 FR 27629 (May 18, 2001). See Meltroll Engineering 
Pvt. Ltd.'s submission dated September 12, 1999. We adjusted this value 
to reflect inflation using the WPI published by the IMF.
     To value truck freight, we used November 1999 price quotes 
which were obtained by the Department in India and used in the Final 
Determination of Sales at Less than Fair Value: Bulk Aspirin from the 
People's Republic of China, 65 FR 33805 (May 25, 2000) (Bulk Aspirin 
from the PRC) and Tapered Roller Bearings and Parts Thereof, Finished 
and Unfinished, from the PRC; Final Results of 1999-2000 Administrative 
Review, Partial Rescission of the Review , and Determination Not to 
Revoke the Order in Part, 66 FR 57420 (November 15, 2001) (TRBs-13).
     To value rail freight, we used November 1999 rail freight 
price quotes obtained by the Department and used in Bulk Aspirin from 
the PRC and TRBs-13.
     To value shipping freight, we used a rate reported in a 
July 14, 1997, letter from the Inland Waterways of India which was used 
in HSLWs-7. We adjusted the rate to reflect inflation using the WPI 
published by the IMF.
    For a complete description of the factor values used, see 
``Memorandum to File: Factor Values Used for the Preliminary Results of 
the Eighth Administrative Review,'' dated July 3, 2002 (Factors 
Memorandum), a public version of which is available in the Public File 
of the CRU.

Verification

    Because the Department verified Hangzhou's information in the 6th 
administrative review for the POR from October 1, 1998, through 
September 30, 1999, we are not, absent a showing of good cause, 
statutorily required to verify Hangzhou's response in this review. (See 
Section 782(i)(3)(B) of the Act and 19 CFR 351.307(b)(iv)). The focus 
of petitioner's alleged ``good cause'' verification request is on 
Hangzhou's importation of steel from a market economy country that is 
used in the production of the subject merchandise. Hangzhou, however, 
provided the requested information regarding its steel purchases from a 
market economy supplier in its June 17, 2002, supplemental response. 
When verifications were conducted in previous reviews, we examined and 
verified the accuracy of Hangzhou's steel import information. 
Essentially, the petitioner makes the same arguments for a ``good 
cause'' verification that it has made in the past when the Department 
has conducted verifications of Hangzhou's steel imports. Petitioner has 
not presented any information to the Department for purposes of this 
review that causes us to question the validity of the information 
Hangzhou has submitted regarding its purchase of steel from a market 
economy supplier. Therefore, the Department has determined that the 
petitioner has not shown ``good cause'' to verify Hangzhou's 
information in this review.

Preliminary Results of Review

    We preliminarily determine that the following dumping margin 
exists:

[[Page 45705]]



----------------------------------------------------------------------------------------------------------------
                     Manufacturer/exporter                            Time Period            Margin (percent)
----------------------------------------------------------------------------------------------------------------
Hang Zhou Spring Washer Co. Ltd./.............................
  Zhejiang Wanxin.............................................
  Group Co., Ltd..............................................          10/1/00-9/30/01                        0
----------------------------------------------------------------------------------------------------------------

    The Department shall determine, and the Customs Service shall 
assess, antidumping duties on all appropriate entries. If these 
preliminary results are adopted in our final results, we will direct 
Customs to liquidate the entries made during the POR without regard to 
antidumping duties. The Department will issue appraisement instructions 
directly to the U.S. Customs Service.
    Furthermore, the following cash deposit rates will be effective 
upon publication of the final results for all shipments of HSLWs from 
the PRC entered, or withdrawn from warehouse, for consumption on or 
after the publication date, as provided for by section 751(a)(1) of the 
Act: (1) for Hangzhou, which has a separate rate, the cash deposit rate 
will be the company-specific rate established in the final results of 
review; (2) for all other PRC exporters, the cash deposit rate will be 
the PRC rate, 128.63 percent, which is the All Other PRC Manufacturers, 
Producers and Exporters rate from the Final Determination of Sales at 
Less Than Fair Value: Certain Helical Spring Lock Washers from the PRC, 
58 FR 48833 (September 20, 1993); and, (3) for non-PRC exporters of 
subject merchandise from the PRC, the cash deposit rate will be the 
rate applicable to the PRC supplier of that exporter. These deposit 
rates, 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.

Public Comment

    Pursuant to 19 CFR 351.24, the Department will disclose to parties 
the calculations performed in connection with these preliminary results 
within five days of the date of any public announcement, or, if there 
is no public announcement, within five days of the date of publication 
of this notice. Interested parties may request a hearing within 30 days 
of the date of publication of this notice (See 19 CFR 351.310). Any 
hearing, if requested, will be held two days after the scheduled date 
for submission of rebuttal briefs (see below). According to 19 CFR 
351.309, interested parties may submit written arguments in case briefs 
within 30 days of the date of publication of this notice. Rebuttal 
briefs, limited to issues raised in case briefs, may be filed no later 
than five days after the date of filing the case briefs. Parties who 
submit briefs in these proceedings should provide a summary of the 
arguments not to exceed five pages and a table of statutes, 
regulations, and cases cited. Copies of case briefs and rebuttal briefs 
must be served on interested parties in accordance with 19 CFR 
351.303(f)(3).
    The Department will publish the final results of this 
administrative review, including the results of its analysis of issues 
raised in any such briefs or hearing, within 120 days of publication of 
these preliminary results.
    This administrative review and notice are in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: July 3, 2002.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 02-17353 Filed 7-9-02; 8:45 am]
BILLING CODE 3510-DS-S