[Federal Register Volume 67, Number 196 (Wednesday, October 9, 2002)]
[Notices]
[Pages 62951-62957]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-25686]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-580-601]


Top-of-the-Stove Stainless Steel Cooking Ware From the Republic 
of Korea: Preliminary Results and Rescission, in Part, of Antidumping 
Duty Administrative Review

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

ACTION: Notice of preliminary results and rescission, in part, of 
antidumping duty administrative review.

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SUMMARY: In response to requests by the Stainless Steel Cookware 
Committee (the Committee), the petitioner, and two manufacturers/
exporters of the subject merchandise, the Department of Commerce (the 
Department) is conducting an administrative review of the antidumping 
duty order on top-of-the-stove stainless steel cooking ware from Korea. 
The period of review (POR) is January 1, 2001, through December 31, 
2001.
    We preliminarily determine that certain manufacturers/exporters 
sold subject merchandise at less than normal value (NV) during the POR. 
If these preliminary results are adopted in the final results of this 
administrative review, we will instruct the U.S. Customs Service 
(Customs) to assess antidumping duties on all appropriate entries. We 
invite interested parties to comment on the preliminary results. 
Parties who submit comments in this proceeding should also submit with 
the argument(s): (1) A statement of the issue(s) and (2) a brief 
summary of their argument (not to exceed five pages).

EFFECTIVE DATE: October 9, 2002.

[[Page 62952]]


FOR FURTHER INFORMATION CONTACT: Ronald M. Trentham and Thomas F. 
Futtner, AD/CVD Enforcement, Office 4, Group II, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, NW., Washington, DC 20230; (202) 482-
6320 and (202) 482-3814, respectively.

SUPPLEMENTARY INFORMATION:

The Applicable Statute

    Unless otherwise indicated, all citations to the Tariff Act of 
1930, as amended (the Act), are references to the provisions effective 
January 1, 1995, the effective date of the amendments made to the Act 
by the Uruguay Round Agreements Act (URAA). In addition, unless 
otherwise indicated, all citations to the Department's regulations are 
to the regulations at 19 CFR part 351 (2001).

Background

    The Department published an antidumping duty order on top-of-the-
stove stainless steel cooking ware (cookware) from Korea on January 20, 
1987 (52 FR 2139). On January 2, 2002, the Department published a 
notice of ``Opportunity to Request an Administrative Review'' of the 
antidumping duty order on cookware from Korea (67 FR 56) covering the 
period January 1, 2001, through December 31, 2001.
    On January 31, 2002, in accordance with 19 CFR 351.213(b), the 
Committee, whose members are Regal Ware, Inc., The West Bend Company, 
New Era Cookware and Vita-Craft Corporation, requested that we conduct 
an administrative review of twenty-six specific manufacturers/exporters 
of cookware from Korea: Daelim Trading Co., Ltd. (Daelim), Dong Won 
Metal Co., Ltd. (Dong Won), Chefline Corporation, Sam Yeung Ind. Co., 
Ltd., Namyang Kitchenflower Co., Ltd., Kyung-Dong Industrial Co., Ltd., 
Ssang Yong Ind. Co., Ltd., O. Bok Stainless Steel Co., Ltd., Dong Hwa 
Stainless Steel Co., Ltd., Il Shin Co., Ltd., Hai Dong Stainless Steel 
Ind. Co., Ltd., Han II Stainless Steel Ind. Co., Ltd., Bae Chin Metal 
Ind. Co., East One Co., Ltd., Charming Art Co., Ltd., Poong Kang Ind. 
Co., Ltd., Won Jin Ind. Co., Ltd., Wonkwang Inc., Sungjin International 
Inc., Sae Kwang Aluminum Co., Ltd., Hanil Stainless Steel Ind. Co., 
Ltd., Seshin Co., Ltd., Pionix Corporation, East West Trading Korea, 
Ltd., Clad Co., Ltd., and B.Y. Enterprise, Ltd. On January 31, 2002, 
Daelim and Dong Won requested that the Department conduct reviews of 
their exports of the subject merchandise to the United States. In 
accordance with 19 CFR 351.221(b), we published a notice of initiation 
of the review on February 26, 2002 (67 FR 8780).
    On March 25, 2002 and on April 4, 2002, we issued Section A 
antidumping questionnaires to each of the twenty-six manufacturers/
exporters listed above.\1\
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    \1\ Section A of the questionnaire requests general information 
concerning a company's corporate structure and business practices, 
the merchandise under investigation that it sells, and the manner in 
which it sells that merchandise in all of its markets. Section B 
requests a complete listing of all home market sales, or, if the 
home market is not viable, of sales in the most appropriate third-
country market (this section is not applicable to respondents in 
non-market economy (NME) cases). Section C requests a complete 
listing of U.S. sales. Section D requests information on the cost of 
production (COP) of the foreign like product and the constructed 
value (CV) of the merchandise under investigation. Section E 
requests information on further manufacturing.
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    The following twenty-four companies failed to respond to the 
Department's Section A questionnaire: Chefline Corporation, Sam Yeung 
Ind. Co., Ltd., Kyung-Dong Industrial Co., Ltd., Ssang Yong Ind. Co., 
Ltd., O. Bok Stainless Steel Co., Ltd., Il Shin Co., Ltd., Hai Dong 
Stainless Steel Ind. Co., Ltd., Han II Stainless Steel Ind. Co., Ltd., 
Bae Chin Metal Ind. Co., East One Co., Ltd., Charming Art Co., Ltd., 
Poong Kang Ind. Co., Ltd., Won Jin Ind. Co., Ltd., Wonkwang Inc., 
Sungjin International Inc., Sae Kwang Aluminum Co., Ltd., Hanil 
Stainless Steel Ind. Co., Ltd., Seshin Co., Ltd., East West Trading 
Korea, Ltd., Clad Co., Ltd., B.Y. Enterprise, Ltd., Pionix Corporation, 
Namyang Kitchenflower Co., Ltd., and Dong Hwa Stainless Steel Co., Ltd. 
On August 1, 2002 and August 2, 2002, we informed each of these 
companies that because they failed to respond to the Department's 
questionnaire, we may use facts available (FA) to determine their 
dumping margins. In response, the following manufacturers/exporters 
reported that they had no sales or shipments during the POR: Hai Dong 
Stainless Steel Co., Ltd, Sungjin International, Inc., Seshin Co., 
Ltd., Sae Kwang Aluminum Co, Ltd., Dong Hwa Stainless Steel Co, Ltd., 
Pionix Corporation, Il Shin Co., Ltd., and Wonkwang Inc. We confirmed 
using U.S. Customs (Customs) data that there were no entries of subject 
merchandise from these firms during the POR. Accordingly, we are 
preliminarily rescinding the review with respect to these 
manufacturers/exporters.
    On April 16, 2002 and April 19, 2002, respectively, Dong Won and 
Daelim responded to Section A of the antidumping questionnaire. On May 
13, 2002, the Department issued Sections B, C and D of the Department's 
questionnaire to these two companies. Dong Won and Daelim filed 
narrative responses to Sections B, C and D on July 8, 2002. On July 12, 
2002, Daelim and Dong Wong submitted electronic databases and 
calculation worksheets for Sections B, C, and D of the Department's 
questionnaire.
    On August 12, 2002 and August 13, 2002, respectively, the 
Department issued Section A through D supplemental questionnaires to 
Dong Won and Daelim. The responses to these supplemental questionnaires 
were received on September 3, 2002 and on September 4, 2002.
    The Department is conducting this administrative review in 
accordance with section 751 of the Act.

Scope of Review

    The merchandise subject to this antidumping order is top-of-the-
stove stainless steel cookware from Korea. The subject merchandise is 
all non-electric cooking ware of stainless steel which may have one or 
more layers of aluminum, copper or carbon steel for more even heat 
distribution. The subject merchandise includes skillets, frying pans, 
omelette pans, saucepans, double boilers, stock pots, dutch ovens, 
casseroles, steamers, and other stainless steel vessels, all for 
cooking on stove top burners, except tea kettles and fish poachers. 
Excluded from the scope of the order are stainless steel oven ware and 
stainless steel kitchen ware. The subject merchandise is currently 
classifiable under Harmonized Tariff Schedule (HTS) item numbers 
7323.93.00 and 9604.00.00. The HTS item numbers are provided for 
convenience and Customs purposes only. The written description remains 
dispositive.
    The Department has issued several scope clarifications for this 
order. The Department found that certain stainless steel pasta and 
steamer inserts (63 FR 41545, August 4, 1998), certain stainless steel 
eight-cup coffee percolators (58 FR 11209, February 24, 1993), and 
certain stainless steel stock pots and covers are within the scope of 
the order (57 FR 57420, December 4, 1992). Moreover, as a result of a 
changed circumstances review, the Department revoked the order on Korea 
in part with respect to certain stainless steel camping ware (1) made 
of single-ply stainless steel having a thickness no greater than 6.0 
millimeters; and (2) consisting of 1.0, 1.5, and 2.0 quart saucepans 
without handles and with lids that also serve as fry pans (62 FR 3662, 
January 24, 1997).

[[Page 62953]]

Facts Available

Application of FA

    Section 776(a)(2) of the Act provides that if any interested party: 
(A) Withholds information that has been requested by the Department; 
(B) fails to provide such information by the deadlines for submission 
of the information or in the form or manner requested; (C) 
significantly impedes an antidumping investigation; or (D) provides 
such information but the information cannot be verified, the Department 
shall, subject to section 782(d) of the Act, use facts otherwise 
available in making its determination.
    As stated above, on March 25, 2002 and on April 4, 2002, we issued 
Section A questionnaires to twenty-six manufacturers/exporters of the 
subject merchandise. Eight companies ultimately advised the Department 
that they did not sell subject merchandise to the United States during 
the POR. The following sixteen companies failed to respond to the 
Department's Section A questionnaire: Chefline Corporation, Sam Yeung 
Ind. Co., Ltd., Kyung-Dong Industrial Co., Ltd., Ssang Yong Ind. Co., 
Ltd., O. Bok Stainless Steel Co., Ltd., Han II Stainless Steel Ind. 
Co., Ltd., Bae Chin Metal Ind. Co., East One Co., Ltd., Charming Art 
Co., Ltd., Poong Kang Ind. Co., Ltd., Won Jin Ind. Co., Ltd., Hanil 
Stainless Steel Ind. Co., Ltd., East West Trading Korea, Ltd., Clad 
Co., Ltd., B.Y. Enterprise, Ltd., and Namyang Kitchenflower Co., Ltd. 
On August 2, 2002, we informed each of these companies that because 
they failed to respond to the Department's questionnaire, we may use FA 
to determine their dumping margins.
    Because these sixteen companies failed to provide any of the 
necessary information requested by the Department, pursuant to section 
776(a)(2)(B) of the Act, we must establish the margins for these 
companies based totally on facts otherwise available.

Selection of Adverse FA (AFA)

    In selecting from among the facts otherwise available, section 
776(b) of the Act authorizes the Department to use an adverse inference 
if the Department finds that an interested party failed to cooperate by 
not acting to the best of its ability to comply with the request for 
information. See, e.g., Certain Welded Carbon Steel Pipes and Tubes 
From Thailand: Final Results of Antidumping Duty Administrative Review, 
62 FR 53808, 53819-20 (October 16, 1997). These 16 companies were given 
two opportunities to respond, and did not. Moreover, these companies 
failed to offer any explanation for their failure to respond to our 
questionnaires. As a general matter, it is reasonable for the 
Department to assume that these companies possessed the records 
necessary for this review; however, by not supplying the information 
the Department requested, these companies failed to cooperate to the 
best of their ability. As these 16 companies have failed to cooperate 
to the best of their ability, we are applying an adverse inference 
pursuant to section 776(b) of the Act. As AFA, we have used 31.23 
percent, the highest rate determined for any respondent in any segment 
of this proceeding. See Final Determination of Sales at Less Than Fair 
Value; Certain Stainless Steel Cookware from Korea, 51 FR 42873 
(November 26, 1986) (Final LTFV Determination).

Corroboration of Information

    Section 776(b) of the Act authorizes the Department to use as AFA 
information derived from the petition, the final determination from the 
less than fair value (LTFV) investigation, a previous administrative 
review, or any other information placed on the record.
    Section 776(c) of the Act requires the Department to corroborate, 
to the extent practicable, secondary information used as facts 
available. Secondary information is defined as ``[i]nformation derived 
from the petition that gave rise to the investigation or review, the 
final determination concerning the subject merchandise, or any previous 
review under section 751 concerning the subject merchandise.'' See 
Statement of Administrative Action (SAA) accompanying the URAA, H.R. 
Doc. No. 103-316 at 870 (1994) and 19 CFR 351.308(d).
    The SAA further provides that the term ``corroborate'' means that 
the Department will satisfy itself that the secondary information to be 
used has probative value (see SAA at 870). Thus, to corroborate 
secondary information, the Department will, to the extent practicable, 
examine the reliability and relevance of the information used.
    The rate used as AFA in this segment was originally calculated 
using verified information from the investigative segment of this 
proceeding. See Final LTFV Determination. The only source for 
calculated margins is administrative determinations. Thus, in an 
administrative review, if the Department chooses as AFA a calculated 
dumping margin from a prior segment of the proceeding, it is not 
necessary to question the reliability of the margin for that time 
period. Furthermore, we have no new information that would lead us to 
reconsider the reliability of the rate being used in this case.
    As to the relevance of the margin used for AFA, the courts have 
stated that ``[b]y requiring corroboration of adverse inference rates, 
Congress clearly intended that such rates should be reasonable and have 
some basis in reality.'' F.Lli De Cecco Di Filippo Fara S. Martino 
S.p.A., v. U.S., 216 F.3d 1027, 1034 (Fed. Cir. 2000).
    The rate selected is the rate currently applicable to certain 
companies, including fifteen of the sixteen companies that failed to 
respond to the Department's questionnaires in this POR. See Top-of-the-
Stove Stainless Steel Cooking Ware From the Republic of Korea: Final 
Results and Rescission, in Part, of the Antidumping Duty Administrative 
Review, 67 FR 40274 (June 12, 2002) (Final Results). In determining a 
relevant AFA rate, the Department assumes that if the non-responding 
parties could have demonstrated that their dumping margins were lower, 
they would have participated in this review and attempted to do so. See 
Rhone Poulenc, Inc. v. United States, 899 F.2d 1185, 1190-91 (Fed. Cir. 
1990). Therefore, given these sixteen companies' failure to cooperate 
to the best of their ability in this review, we have no reason to 
believe that their dumping margins would be any less than the highest 
rate in this proceeding. This rate ensures that they do not benefit by 
failing to cooperate fully. Therefore, we consider the rate of 31.23 
percent relevant and appropriate to use as AFA for the non-responding 
parties.

NV Comparisons

    To determine whether sales of cookware from South Korea to the 
United States were made at less than NV, we compared the export price 
(EP) to the NV for Daelim and EP and constructed export price (CEP) to 
the NV for Dong Won, as specified in the EP, CEP and NV sections of 
this notice, below. In accordance with section 777A(d)(2) of the Act, 
we calculated monthly weighted-average prices for NV and compared these 
to individual EP and CEP transactions.

EP

    Where Daelim and Dong Won sold merchandise directly to unaffiliated 
purchasers in the United States, we used EP, in accordance with section 
772(a) of the Act, as the price to the United States. For both 
respondents, we calculated EP using the packed prices charged to the 
first unaffiliated customer in the United States (the starting price).

[[Page 62954]]

    We made deductions from the starting price for movement expenses in 
accordance with section 772(c) of the Act. Movement expenses included, 
where appropriate, brokerage and handling, international freight, and 
marine insurance, in accordance with section 772(c)(2)(A) of the Act. 
For Dong Won, we disallowed a duty drawback adjustment to the starting 
price. See Calculation Memorandum for Dong Won, dated October 3, 2002, 
on file in the Central Records Unit (CRU), B-099 of the main Department 
Building.

CEP

    For Dong Won, we calculated CEP, in accordance with subsection 
772(b) of the Act, for those sales to unaffiliated purchasers that took 
place after importation into the United States. We based CEP on the 
packed FOB prices to unaffiliated purchasers in the United States. 
Where appropriate, we made deductions for discounts. We also made 
deductions for movement expenses in accordance with 772(c)(2)(A) of the 
Act. Movement expenses included foreign inland freight, ocean freight, 
marine insurance, U.S. brokerage and handling, U.S. Customs duties, and 
U.S. inland freight. In accordance with section 772(d)(1) of the Act, 
we deducted those selling expenses associated with economic activities 
occurring in the United States, including direct selling expenses, 
inventory carrying costs, and other indirect selling expenses. Also, we 
made an adjustment for profit in accordance with section 772(d)(3) of 
the Act.

NV

1. Viability

    In order to determine whether there is 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 
is equal to or greater than five percent of the aggregate volume of 
U.S. sales), we compared the respondents' 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)(1) of the Act. Since 
Daelim's and Dong Won's aggregate volume of home market sales of the 
foreign like product was greater than five percent of the aggregate 
volume of their respective U.S. sales of the subject merchandise, we 
determined that the home market provides a viable basis for calculating 
NV. Therefore, pursuant to section 773(a)(1)(B) of the Act, we based NV 
on home market sales.

2. Cost of Production (COP) Analysis

    In the review segment of this proceeding that was most recently 
completed prior to initiating this review, we disregarded home market 
sales found to be below the cost of production (COP) for Daelim and 
Dong Won. See Top-of-the Stove Stainless Steel Cooking Ware from the 
Republic of Korea: Final Results and Rescission, in Part, of 
Antidumping Duty Administrative Review, 66 FR 45664 (August 29, 2001). 
Pursuant to section 773(b)(2)(A)(ii) of the Act, this provides 
reasonable grounds to believe or suspect in this review segment that 
Daelim and Dong Won made sales in the home or third country markets at 
prices below the COP. Consequently we initiated a COP inquiry with 
respect to both Daelim and Dong Wong and conducted the COP analysis 
described below.
A. Calculation of COP
    In accordance with section 773(b)(3) of the Act, we calculated, 
respectively, COP based on the sum of Daelim and Dong Won's cost of 
materials and fabrication (COM) for the foreign like product, plus 
amounts for selling, general, and administrative (SG&A) expenses, 
including financial expenses, and packing costs. For the preliminary 
results, we relied on Daelim's and Dong Won's submitted information 
without adjustment.
B. Test of Foreign Market Sales Prices
    We compared COP to foreign market sale prices of the foreign like 
product, as required under section 773(b) of the Act, in order to 
determine whether these sales had been made at prices below the COP. In 
determining whether to disregard foreign market sales made at prices 
below the COP, we examined whether such sales were made (1) within an 
extended period of time in substantial quantities, and (2) at prices 
which permitted the recovery of all costs within a reasonable period of 
time, in accordance with sections 773(b)(1)(A) and (B) of the Act. On a 
product-specific basis, we compared the COP to foreign market prices, 
less any applicable movement charges, discounts and rebates, and 
selling expenses.
C. Results of the COP Test
    Pursuant to section 773(b)(2)(C) of the Act, where less than 20 
percent of the 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 the respondent's 
sales of a given product during the POR were at prices less than the 
COP, we determined such sales to have been made in substantial 
quantities within an extended period of time, within the meaning of 
section 773(b)(2)(B) of the Act. Because we compared prices to POR or 
fiscal year 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 Act.
    We found, looking at Dong Won's and Daelim's home market sales, 
that both firms made sales at below COP prices within an extended 
period of time in substantial quantities. Further, we found that these 
sales prices did not permit for the recovery of costs within a 
reasonable period of time. Therefore, we excluded these sales from our 
analysis and used the remaining sales as the basis for determining NV, 
in accordance with section 773(b)(1) of the Act.

Product Comparisons

    In accordance with section 771(16) of the Act, we considered all 
products sold in the relevant foreign markets meeting the description 
in the ``Scope of the Review'' section of this notice, above, for 
purposes of determining appropriate product comparisons to U.S. sales. 
Where there were no sales of identical merchandise in the foreign 
markets made in the ordinary course of trade (i.e., sales within the 
contemporaneous window which passed the cost test), we compared U.S. 
sales to sales of the most similar foreign like product made in the 
ordinary course of trade. Further, as in prior segments of this 
proceeding, merchandise was considered ``similar'' for purposes of 
comparison only if it is of the same ``product type,'' (i.e., (1) 
vessels or (2) parts). Among merchandise which was identical on the 
basis of ``product type,'' we then selected the most ``similar'' model 
through a hierarchical ranking of the remaining 11 product 
characteristics listed in sections B and C of our antidumping 
questionnaire and application of the difference in merchandise test. If 
there were no sales of identical or similar merchandise in the foreign 
market to compare to U.S. sales, we compared U.S. sales to the 
constructed value (CV) of the product sold in the U.S. market during 
the comparison period. For a further discussion of the Department's 
product comparison methodology see Top-of-the-Stove Stainless Steel 
Cooking Ware From the Republic of Korea: Final Results and Rescission, 
in Part, of Antidumping Duty Administrative Review, 66 FR 45664 (August 
29, 2001)

[[Page 62955]]

and accompanying Issues and Decision Memorandum at Comment 1.

Level of Trade (LOT)

    In accordance with section 773(a)(7)(A) of the Act, if the 
Department compares a U.S. sale at one LOT to NV sales at a different 
LOT, we will adjust the NV to account for the difference in LOT if the 
difference affects price comparability as evidenced by a pattern of 
consistent price differences between sales at the different LOTs in the 
market in which NV is determined.
    Section 351.412(c)(2) of the Department's regulations states that 
the Secretary will determine that sales are made at different LOTs if 
they are made at different marketing stages (or their equivalent). To 
make this determination, the Department reviews such factors as selling 
functions, classes of customer, and the level of selling expenses for 
each type of sale. Different stages of marketing necessarily involve 
differences in selling functions, but differences in selling functions, 
even if substantial, are not alone sufficient to establish a difference 
in the LOT. Similarly, while customer categories such as 
``distributor'' and ``wholesaler'' may be useful in identifying 
different LOTs, they are insufficient in themselves to establish that 
there is a difference in the LOT.
    In determining whether separate LOTs actually existed in the 
foreign and U.S. markets for each respondent, we examined whether the 
respondent's sales involved different marketing stages (or their 
equivalent) based on the channel of distribution, customer categories, 
and selling functions (or services) offered to each customer or 
customer category, in both markets.
    Dong Won reported home market sales through one channel of 
distribution, sales made by Dong Won to unaffiliated distributors/
wholesalers and retailers. Upon review of the record, we found that 
Dong Won performed the same selling functions at the same degree for 
all home market sales. Therefore, we preliminarily determined that Dong 
Won made all home market sales at one LOT for purposes of our 
antidumping analysis.
    For the U.S. market, Dong Won reported both EP and CEP sales. After 
reviewing the U.S. market selling functions reported by Dong Won, and 
after deducting the CEP selling expenses incurred by Dong Won's U.S. 
affiliate, we found that Dong Won provided a qualitatively different 
degree of services on EP sales than for CEP sales. We therefore found 
the selling functions were sufficiently different to warrant a 
preliminary determination that two separate LOTs exist in the United 
States.
    When we compared EP sales to home market sales, we found that Dong 
Won provided a qualitatively different degree of services on home 
market sales than on EP sales. In addition, the differences in selling 
functions performed for home market and EP transactions indicate that 
home market sales involved a more advanced stage of distribution than 
EP sales. Our preliminary analysis demonstrates that the home market 
LOT is different from, and constitutes a more advanced stage of 
distribution than the EP LOT because, the home market LOT includes 
significantly more selling functions at a higher level of service with 
greater selling expenses than the EP LOT. See Memorandum on LOT for 
Dong Won, dated October 3, 2002 (Dong Won LOT Memo).
    Section 773(a)(7)(A) of the Act describes the LOT adjustment. 
Section 351.412(a) of the Department's regulations states that the 
Secretary is authorized to adjust NV to account for the effect on the 
comparability of U.S. and home market prices when sales in the two 
markets are not made at the same LOT. Section 351.412(d) of the 
Department's regulations states that the Secretary will determine that 
a difference in LOT has an effect on price comparability only if it is 
established that there is a pattern of consistent price differences 
between sales at the LOT of the EP or CEP and the LOT at which NV is 
determined. Section 351.412(d)(2) states that the Secretary will make 
the determination under section 351.412(d)(1) on the basis of sales of 
the foreign like product by the producer, or when this is not possible, 
on sales of different or broader product lines, sales by other 
companies, or on any other reasonable basis.
    As discussed above, we found that there is only one LOT in the 
market in which NV is determined. Therefore, it is not possible to 
determine a pattern of price differences on the basis of sales of the 
foreign like product by the producer. Furthermore, we do not have 
information on the record in this review to determine a pattern of 
price differences on the basis of sales of different or broader product 
lines, sales by other companies, or on any other reasonable basis. As 
such, no LOT adjustment is possible for comparison to Dong Won's EP 
transactions.
    For CEP sales, Dong Won performed fewer selling functions than in 
the home market. In addition, the differences in selling functions 
performed for home market and CEP transactions indicate that home 
market sales involved a more advanced stage of distribution than CEP 
sales. Our preliminary analysis demonstrates that the home market LOT 
is different from, and constitutes a more advanced stage of 
distribution than, the CEP LOT because, after making the CEP deductions 
under section 772(d) of the Act, the home market LOT includes 
significantly more selling functions at a higher level of service with 
greater selling expenses than the CEP LOT.
    Section 773(a)(7)(B) of the Act provides for a CEP offset to NV 
when NV is established to be at a LOT which constitutes a more advanced 
LOT than the LOT of the CEP transaction, but the data available do not 
provide an appropriate basis upon which to determine a LOT adjustment. 
Since NV is established at a LOT which constitutes a more advanced LOT 
than the LOT of the CEP transaction, and, as discussed above, the data 
do not provide an appropriate basis upon which to determine a LOT 
adjustment, we conclude that Dong Won is entitled to a CEP offset to 
NV. See Dong Won LOT Memo.
    Daelim reported sales through two channels of distribution for its 
home market sales. The first channel of distribution was sales through 
its affiliate in the home market, Living Star. The second channel of 
distribution was direct sales to home market customers. Daelim performs 
the same selling activities for home market sales in both channels of 
distribution. Although these functions are not performed at the same 
degree of intensity, we found that the differences in degree of 
intensity in selling functions between the two channels of distribution 
does not give rise to a substantial distinction. Therefore, we conclude 
that there is one LOT in the home market. See Memorandum on LOT for 
Daelim, dated October 3, 2002. Daelim reported only EP sales in the 
U.S. market. For EP sales, Daelim reported one LOT, consisting of two 
channels of distribution.
    Upon review of the record we found that Daelim performed the same 
selling functions (i.e., inventory maintenance, technical advice, 
warranty services, freight & delivery arrangement, and advertising) at 
the same degree for EP sales as compared to home market sales. As such, 
we preliminarily find that there are no differences in the number, 
type, and degree of selling functions that Daelim performs for home 
market sales as compared to its EP sales. Therefore, because we are 
calculating NV at the same LOT as Daelim's EP sales, no LOT adjustment 
is warranted. See 19 CFR 351.412(b)(1).

[[Page 62956]]

Date of Sale

    In accordance with 19 CFR 351.401(i), the date of sale will 
normally be the date of the invoice, as recorded in the exporters's or 
producer's records kept in the ordinary course of business, unless 
satisfactory evidence is presented that the exporter or producer 
established the material terms of sale on some other date. For both 
foreign market and U.S. transactions, Daelim and Dong Won reported the 
date of the contract (i.e., purchase order date) as the date of sale, 
i.e., the date when the material terms of sale are finalized. The 
respondents note that the purchase order confirms all major terms of 
sale--price, quantity, and product specification--as agreed to by the 
respondents and the customer. Because there is nothing on the record to 
indicate that there were changes in the material terms of sale between 
the purchase order (or revised purchase order) and the invoice, the 
Department preliminarily determines that the purchase order date is the 
most appropriate date to use for the date of sale.

CV

    In accordance with section 773(e) of the Act, we calculated CV 
based on the respondents' respective COM employed in producing the 
subject merchandise, SG&A expenses, the profit incurred and realized in 
connection with the production and sale of the foreign like product, 
and U.S. packing costs. We used the COM and G&A expenses as reported in 
the CV portion of respondents' questionnaire responses. We used the 
U.S. packing costs as reported in the U.S. sales portion of the 
respondents' questionnaire responses. For selling expenses, we used the 
average of the selling expenses reported for home market sales that 
passed the cost test, weighted by the total quantity of sales of each 
product. For profit, we first calculated, based on the home market 
sales that passed the cost test, the difference between the home market 
sales value and home market COP, and divided the difference by the home 
market COP. We then multiplied this percentage by the COP for each U.S. 
model to derive profit.

Price-to-Price and Price-to-CV Comparisons

    For those comparison products for which there were sales that 
passed the cost test, we based the respondent's NV on the price at 
which the foreign like product is first sold for consumption in Korea, 
in the usual commercial quantities, in the ordinary course of trade in 
accordance with section 773(a)(1)(B)(i) of the Act.
    In accordance with section 773(a)(6) of the Act, for both CV and 
NV, we made adjustments, where appropriate, for inland freight, inland 
insurance, and discounts. We also reduced CV and foreign market prices 
by packing costs incurred in the foreign market, in accordance with 
section 773(a)(6)(B)(i) of the Act. In addition, we increased CV and 
foreign market prices for U.S. packing costs, in accordance with 
section 773(a)(6)(A) of the Act. We made further adjustments to foreign 
market prices, when applicable, to account for differences in physical 
characteristics of the merchandise, in accordance with section 
773(a)(6)(C)(ii) of the Act. Pursuant to section 773(a)(6)(C)(iii) of 
the Act, we made an adjustment for differences in circumstances of sale 
by deducting foreign market direct selling expenses and adding any 
direct selling expenses associated with U.S. sales not deducted under 
the provisions of section 772(d)(1) of the Act. Finally, in the case of 
Dong Wong, where appropriate, we made a CEP offset adjustment to 
account for comparing U.S. and foreign market sales at different LOTs.

Preliminary Results of the Review

    As a result of our review, we preliminarily determine that the 
following weighted-average dumping margins exist for the period January 
1, 2000, through December 31, 2000:

------------------------------------------------------------------------
                                                                Margin
                   Manufacturer/Exporter                      (percent)
------------------------------------------------------------------------
Dong Won Metal Co., Ltd....................................         0.20
Dae-Lim Trading Co., Ltd...................................         0.90
Chefline Corporation.......................................        31.23
Sam Yeung Ind. Co., Ltd....................................        31.23
Kyung-Dong Industrial Co., Ltd.............................        31.23
Han II Stainless Steel Ind. Co., Ltd.......................        31.23
East One Co., Ltd..........................................        31.23
Charming Art Co., Ltd......................................        31.23
Won Jin Ind. Co., Ltd......................................        31.23
Hanil Stainless Steel Ind. Co., Ltd........................        31.23
East West Trading Korea, Ltd...............................        31.23
Clad Co., Ltd..............................................        31.23
B.Y. Enterprise, Ltd.......................................        31.23
Namyang Kitchenflower Co., Ltd.............................        31.23
Ssang Yong Ind. Co., Ltd...................................        31.23
O. Bok Stainless Steel Co., Ltd............................        31.23
Bae Chin Metal Ind. Co.....................................        31.23
Poong Kang Ind. Co., Ltd...................................        31.23
------------------------------------------------------------------------

    Pursuant to 19 CFR 351.224(b), the Department will disclose to 
parties to the proceeding any calculations performed in connection with 
these preliminary results within 5 days of the date of publication of 
this notice. Any interested party may request a hearing within 30 days 
of the date of publication of this notice. Parties who submit arguments 
in this proceeding are requested to submit with each argument: (1) A 
statement of the issue and (2) a brief summary of the argument. All 
case briefs must be submitted within 30 days of the date of publication 
of this notice. Rebuttal briefs, which are limited to issues raised in 
the case briefs, may be filed not later than seven days after the case 
briefs are filed. 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. A hearing, if 
requested, will be held two days after the date the rebuttal briefs are 
filed or the first business day thereafter.
    The Department will publish a notice of the final results of this 
administrative review, which will include the results of its analysis 
of the issues raised in any written comments, within 120 days from the 
publication of these preliminary results.
    Upon completion of this administrative review, the Department will 
determine, and Customs shall assess, antidumping duties on all 
appropriate entries. In accordance with 19 CFR 351.212(b)(1), we have 
calculated importer-specific assessment rates for the merchandise 
subject to this review. The Department will issue appropriate 
assessment instructions directly to Customs within 15 days of 
publication of the final results of review. If these preliminary 
results are adopted in the final results of review, we will direct 
Customs to assess the resulting assessment rates against the entered 
Customs values for the subject merchandise on each of the importer's 
entries during the POR. For Daelim and Dong Won, we have calculated 
importer-specific ad valorem duty assessment rates based on the ratio 
of the total amount of dumping margins calculated for the examined 
sales to the entered value of sales used to calculate those duties. For 
all other respondents, the assessment rate will be based on the margin 
percentage identified above. We will direct Customs to liquidate 
without regard to antidumping duties any entries for which the 
importer-specific assessment rate is de minimis, i.e., less then 0.5 
percent.
    Furthermore, the following cash deposit requirements will be 
effective upon completion of the final results of this administrative 
review for all shipments of top-of-stove stainless steel cooking ware 
from Korea entered, or withdrawn from warehouse, for consumption on or 
after publication

[[Page 62957]]

date of the final results of these administrative reviews, as provided 
by section 751(a)(1) of the Act: (1) The cash deposit rates for the 
reviewed companies will be the rates established in the final results 
of this administrative review, except if the rate is less than 0.5 
percent ad valorem and, therefore, de minimis, no cash deposit will be 
required; (2) for exporters not covered in this review, but covered in 
the original LTFV investigation or a previous review, the cash deposit 
rate will continue to be the company-specific rate published in the 
most recent period; (3) if the exporter is not a firm covered in this 
review, a previous review, or the original 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) 
if neither the exporter nor the manufacturer is a firm covered in this 
or any previous reviews or the LTFV investigation, the cash deposit 
rate will be 8.10 percent, the ``all-others'' rate established in the 
LTFV investigation. These deposit requirements, when imposed, shall 
remain in effect until publication of the final results of the next 
administrative review.
    This notice 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.
    This administrative review and this notice are in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: October 3, 2002.
Faryar Shirzad,
Assistant Secretary for Import Administration.
[FR Doc. 02-25686 Filed 10-8-02; 8:45 am]
BILLING CODE 3510-DS-P