[Federal Register Volume 68, Number 41 (Monday, March 3, 2003)]
[Notices]
[Pages 9977-9980]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-4927]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-821-818]


Notice of Final Determination of Sales at Less Than Fair Value: 
Urea Ammonium Nitrate Solutions From the Russian Federation

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

ACTION: Notice of final determination of sales at less than fair value.

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EFFECTIVE DATE: March 3, 2003.

FOR FURTHER INFORMATION CONTACT: Paige Rivas or Tom Futtner, AD/CVD

[[Page 9978]]

Enforcement, Office 4, Group II, Import Administration, International 
Trade Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
0651, and (202) 482-3814, respectively.

SUPPLEMENTARY INFORMATION:

Final Determination

    We determine that urea ammonium nitrate solutions (UANS) from the 
Russian Federation (Russia) are being sold, or are likely to be sold, 
in the United States at less than fair value (LTFV), as provided in 
section 735 of the Tariff Act of 1930, as amended, (the Act). The 
estimated margins of sales at LTFV are shown in the Final Determination 
of Investigation section of this notice.

Case History

    On October 3, 2002, the Department of Commerce (the Department) 
published the preliminary determination of sales at LTFV in the 
antidumping duty investigation of UANS from Russia. See Notice of 
Preliminary Determination of Sales at Less Than Fair Value: Urea 
Ammonium Nitrate Solutions from the Russian Federation, 67 FR 62008 
(October 3, 2002) (Preliminary Determination). Since the preliminary 
determination, the following events have occurred.
    During October 2002, the Department conducted a verification of JSC 
Nevinnomysskij Azot's (Nevinka's) sales and factors of production (FOP) 
information. See Memorandum from Paige Rivas to the File, 
``Verification of Sales and Factors of Production Information Reported 
by Nevinnomysskij Azot,'' dated December 11, 2002.
    On November 1, 2002, the petitioner \1\ filed a request for a 
public hearing in this investigation. However, no hearing was held in 
this investigation because the petitioner withdrew its request for a 
hearing.
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    \1\ The petitioner in this investigation is the Nitrogen 
Solutions Fair Trade Committee. Its members consist of CF 
Industries, Inc., Mississippi Chemical Corporation, and Terra 
Industries Inc.
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    On November 7, 2002, the Department published a postponement of the 
final determination of sales at LTFV in the antidumping duty 
investigation of UANS from Russia. See Postponement of the Final 
Determinations in the Less-Than-Fair-Value Investigations of Urea 
Ammonium Nitrate Solutions From Belarus, the Russian Federation, and 
Ukraine, 67 FR 67823 (November 7, 2002).
    The petitioner, Nevinka, and JR Simplot filed surrogate value 
information and data on November 26, 2002.
    Parties filed case and rebuttal briefs on January 7 and January 14, 
2002, respectively.

Continuation of Investigation

    On February 19, 2003, the Department signed a suspension agreement 
with Nevinka, JSC Kuybyshevazot/Togliatti, and S.P. Novolon/
Novomoskovsk. On February 20, 2003, we received a request from the 
petitioner requesting that we continue the investigation. Pursuant to 
this request, we have continued and completed the investigation in 
accordance with section 734(g) of the Act. If the International Trade 
Commission (ITC) determines that material injury exists, the Agreement 
shall remain in force but the Department shall not issue an antidumping 
order so long as (1) the Agreement remains in force, (2) the Agreement 
continues to meet the requirements of subsections 734b(1) and (c) of 
the Act, as appropriate and (3) the parties to the Agreement carry out 
their obligations under the Agreement in accordance with its terms.

Scope of the Investigation

    For purposes of this investigation, the product covered is all 
mixtures of urea and ammonium nitrate in aqueous or ammoniacal 
solution, regardless of nitrogen content by weight, and regardless of 
the presence of additives, such as corrosion inhibitors. The 
merchandise subject to this investigation is classified in the 
Harmonized Tariff Schedule of the United States (HTSUS) under item 
number 3102.80.00.00. Although the HTSUS item number is provided for 
convenience and U.S. Customs Service (the Customs Service) purposes, 
the written description of the merchandise under investigation is 
dispositive.

Period of Investigation

    The period of investigation (POI) is October 1, 2001, through March 
31, 2002.

Analysis of Comments Received

    All issues raised in the case and rebuttal briefs by parties to 
this proceeding and to which we have responded are listed in the 
Appendix to this notice and addressed in the Memorandum from Bernard T. 
Carreau to Faryar Shirzad, ``Issues and Decision Memorandum for the 
Antidumping Duty Investigation of Urea Ammonium Nitrate Solutions from 
the Russian Federation,'' dated concurrently with this notice (Decision 
Memorandum), which is hereby adopted by this notice. Parties can find a 
complete discussion of the issues raised in this investigation and the 
corresponding recommendations in this public memorandum, which is on 
file in the Central Records Unit (CRU), room B-099 of the main 
Department building. In addition, a complete version of the Decision 
Memorandum can be accessed directly on the Web at http://ia.ita.doc.gov. The paper copy and electronic version of the Decision 
Memorandum are identical in content.

Non-Market Economy

    The Department has treated Russia as a nonmarket economy (NME) 
country in previous antidumping investigations (see e.g., Notice of 
Final Determination of Sales at Less Than Fair Value: Structural Steel 
Beams From the Russian Federation, 67 FR 35490 (May 20, 2002); Notice 
of Final Determination of Sales at Not Less Than Fair Value: Pure 
Magnesium From the Russian Federation, 66 FR 49347, (September 27, 
2001); and Notice of Final Determination of Sales at Less Than Fair 
Value: Certain Cold-Rolled Flat-Rolled Carbon-Quality Steel Products 
From the Russian Federation, 65 FR 5510 (February 4, 2000)). In 
accordance with section 771(18)(C) of the Act, any determination that a 
foreign country is an NME country shall remain in effect until revoked. 
On June 6, 2002, the Department revoked Russia's NME status effective 
April 1, 2002. Because the POI for this investigation precedes the 
effective date of the market economy determination, this final 
determination is based on information contained in the NME 
questionnaire responses submitted by the respondent. Therefore, 
pursuant to section 771(18)(C) of the Act, the Department has continued 
to treat Russia as an NME country for the purposes of this 
investigation.

Separate Rates

    In our Preliminary Determination, we found that the only responding 
company, Nevinka, met the criteria for the application of separate, 
company-specific antidumping duty rates. We have not received any other 
information since the preliminary determination which would warrant 
reconsideration of our separate rates determination with respect to 
this company. For a complete discussion of the Department's 
determination that Nevinka is entitled to a separate rate, see the 
Preliminary Determination.

The Russia-Wide Rate

    In the Preliminary Determination, we found that the use of a 
Russia-wide rate was appropriate for other exporters in

[[Page 9979]]

Russia based on our presumption that those respondents who failed to 
demonstrate entitlement to a separate rate constitute a single 
enterprise under common control by the Russian government. Because we 
have received no comments regarding our decision to apply the Russia-
wide rate to all entries of the merchandise under investigation except 
for entries from Nevinka, we have continued to apply this rate in the 
final determination. We also determined that, pursuant to section 
776(a) of the Act, the Department is required to base the margin for 
the Russia-wide entity on the facts available, because information 
necessary to calculate this margin is not available on the record. 
Further, we determined, pursuant to section 776(b) of the Act, that 
because the Russia-wide entity had failed to act to the best of its 
ability by not responding to the Department's requests for information, 
it was appropriate to use an adverse inference in selecting the facts 
available. The Russia-wide rate applies to all entries of the 
merchandise under investigation except for entries from Nevinka.
    When analyzing the petition for purposes of the initiation, the 
Department reviewed all of the data upon which the petitioner relied in 
calculating the estimated dumping margin and determined that the margin 
in the petition was appropriately calculated and supported by adequate 
evidence, in accordance with the statutory requirements for initiation. 
In order to corroborate the petition margin for purposes of using it as 
adverse facts available, we examined the price and cost information 
provided in the petition in the context of our preliminary 
determination. For further details, see Memorandum from Paige Rivas to 
Holly A. Kuga, ``Corroboration of Secondary Information,'' dated 
September 26, 2002. We received no comments on this decision and 
continue to find in this final determination that the rate contained in 
the petition, as recalculated, has probative value.
    Since the preliminary determination, we have revised several 
surrogate values. In order to take into account these values, we have 
recalculated the petition margin using, where possible, the revised 
surrogate values. As a result of this recalculation, the Russia-wide 
rate is, for the final determination, 239.14 percent. See Memorandum 
from Paige Rivas to the File, ``Corroboration of Secondary 
Information,'' dated February 21, 2003.

Surrogate Country

    For purposes of the final determination, we continue to find that 
Egypt remains the appropriate surrogate country for Russia. For further 
discussion and analysis regarding the surrogate country selection for 
Russia, see the Preliminary Determination.

Verification

    As provided in section 782(i) of the Act, we verified the 
information submitted by the respondent for use in our final 
determination. We used standard verification procedures including 
examination of relevant accounting and production records, and original 
source documents provided by the respondents. For changes from the 
Preliminary Determination as a result of verification, see the Changes 
Since the Preliminary Determination section below.

Changes Since the Preliminary Determination

    Based on our findings at verification and on our analysis of the 
comments received, we have made adjustments to the calculation 
methodologies used in the Preliminary Determination. These adjustments 
are listed below and discussed in detail in the (1) Decision 
Memorandum, (2) Memorandum from the Team to the File, ``Final Factors 
of Production Valuation Memorandum,'' dated February 21, 2003, (Factors 
Memorandum) and (3) Memorandum from the Team to the File, ``Calculation 
Memorandum for the Final Determination,'' dated February 21, 2003 
(Calculation Memorandum).
    1. We accepted minor corrections to the FOP database presented at 
verification. For our final calculations, we used the updated 
consumption rates submitted by Nevinka at verification. See Calculation 
Memorandum.
    2. We calculated a surrogate value for water using the water 
consumption rate for residential use for Egypt found on the 
Department's Trade Information Center web page (http://www.trade.gov/td/tic), rather than including water in overhead as we did in the 
preliminary determination. See Comment 5 of the Decision Memorandum.
    3. We calculated a surrogate value for steam energy by converting 
the energy content for steam, which is measured in gigacalories, to 
kilowatt hours using the electricity surrogate value calculated in the 
Preliminary Determination, rather than including it in overhead as was 
done in the Preliminary Determination. See Comment 5 of the Decision 
Memorandum.
    4. In determining U.S. price, we calculated the market economy 
freight expenses for inland freight for shipments of UANS to the port 
of export. See Calculation Memorandum.
    5. We revised the surrogate value for labor and are using the 2000 
wage rate for Russia, as corrected on the Department's website in 
February 2003. See Factors Memorandum.
    6. We revised our calculation of freight costs for the FOP to 
include the revised distances identified during verification. See 
Calculation Memorandum.
    7. We revised our calculation of the net U.S. price to not include 
foreign inland freight for observations 7, 8, and 9. See Comment 4 of 
the Decision Memorandum.
    8. We revised our calculation of the net U.S. price to include 
billing adjustments, where appropriate. See Comment 2 of the Decision 
Memorandum.
    9. We revised our calculation of surrogate financial ratios. See 
Comment 6 of the Decision Memorandum.

Suspension of Liquidation

    On February 19, 2003, the Department signed a suspension agreement 
with Nevinka. Pursuant to that suspension agreement, we have instructed 
Customs to terminate the suspension of liquidation of all entries of 
UANS from Russia. Any cash deposits for entries of UANS from Russia 
shall be refunded and any bonds shall be released. On February 20, 
2003, we received a request from the petitioner that we continue the 
investigation. Pursuant to this request, we have continued and 
completed the investigation in accordance with section 734(g) of the 
Act. We have found the following weighted-average dumping margins:

------------------------------------------------------------------------
                                                              Weighted-
                                                               average
                   Manufacturer/exporter                        margin
                                                              (percent)
------------------------------------------------------------------------
JSC Nevinnomysskij Azot....................................       106.98
Russia-Wide Rate...........................................       239.14
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    The Russia-wide rate applies to all entries of the subject 
merchandise except for entries from Nevinka.

International Trade Commission Notification

    In accordance with section 735(d) of the Act, we have notified the 
International Trade Commission (ITC) of our determination. Because our 
final determination is affirmative, the ITC will, within 45 days, 
determine whether these imports are materially injuring, or threatening 
material injury to, the U.S. industry. If the ITC determines that 
material injury, or threat of material injury does not exist, the 
Agreement will have no force or effect, and the investigation shall be 
terminated. See

[[Page 9980]]

section 734(f)(3)(A) of the Act. If the ITC determines that such injury 
does exist, the Agreement shall remain in force but the Department 
shall not issue an antidumping order so long as (1) the Agreement 
remains in force, (2) the Agreement continues to meet the requirements 
of subsections (d) and (c)(l) of the Act, and (3) the parties to the 
Agreement carry out their obligations under the Agreement in accordance 
with its terms. See section 734(f)(3)(B) of the Act. This determination 
is issued and published in accordance with sections 735(d) and 
777(i)(1) of the Act.

Notification Regarding Administrative Protective Order (APO)

    This notice also serves as a reminder to parties subject to APO of 
their responsibility concerning the disposition of proprietary 
information disclosed under APO in accordance with 19 CFR 351.305. 
Timely notification of return/destruction of APO materials or 
conversion to judicial protective order is hereby requested. Failure to 
comply with the regulations and the terms of an APO is a sanctionable 
violation.
    This determination is issued and published in accordance with 
sections 735(d) and 777(i)(1) of the Act.

    Dated: February 21, 2003.
Faryar Shirzad,
Assistant Secretary for Import Administration.

Appendix--Issues in Decision Memorandum

    Comment 1: Whether the Department Should Continue to Value Natural 
Gas Using the Price from Gas Producers to the Egyptian Government.
    Comment 2: Whether the Department Should Continue to Deny Billing 
Adjustments.
    Comment 3: Whether the Department Should Consider Observation 16 to 
be Within the POI.
    Comment 4: Whether the Department Should Reflect in its Final 
Determination that Nevinka Did Not Pay Foreign Inland Freight Charges 
for Observations 7 through 9.
    Comment 5: Whether the Department Should Continue to Treat 
Catalysts, Water, and Water-based Inputs as Overhead Items.
    Comment 6: Whether the Department Should Calculate its Surrogate 
Financial Ratios Based Upon One Egyptian Producer.

[FR Doc. 03-4927 Filed 2-28-03; 8:45 am]
BILLING CODE 3510-DS-P