[Federal Register Volume 68, Number 54 (Thursday, March 20, 2003)]
[Notices]
[Pages 13681-13686]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-6736]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-580-850]


Notice of Preliminary Determination of Sales at Less Than Fair 
Value and Postponement of Final Determination: Polyvinyl Alcohol From 
the Republic of Korea

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

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

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SUMMARY: We preliminarily determine that polyvinyl alcohol from the 
Republic of Korea is being, or is likely to be, sold in the United 
States at less than fair value, as provided in section 733 of the 
Tariff Act of 1930, as amended.
    Interested parties are invited to comment on this preliminary 
determination. We will make our final determination not later than 135 
days after the date of publication of this preliminary determination.

EFFECTIVE DATE: March 20, 2003.

FOR FURTHER INFORMATION CONTACT: Irina Itkin, Office of AD/CVD 
Enforcement, Office 2, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
0656.

Preliminary Determination

    The Department has conducted this antidumping investigation in 
accordance with section 733 of the Tariff Act of 1930, as amended (the 
Act). We preliminarily determine that polyvinyl alcohol (PVA) from the 
Republic of Korea (Korea) 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 Act. The estimated margins of sales at LTFV are 
shown in the ``Suspension of Liquidation'' section of this notice.

Case History

    Since the initiation of this investigation (Initiation of 
Antidumping Duty Investigations: Polyvinyl Alcohol from Germany, Japan, 
the People's Republic of China, the Republic of Korea, and Singapore, 
67 FR 61591 (Oct. 1, 2002)) (Initiation Notice), the following events 
have occurred.
    On October 11, 2002, the petitioners \1\ and one Korean exporter of 
PVA, DC Chemical Company, Ltd. (DC CHEM), submitted comments on the 
model-matching criteria to be used by the Department. Two interested 
parties in the companion case on PVA from Japan, Kuraray Co., Ltd. 
(Kuraray) and Marubeni Specialty Chemicals, Inc. (Marubeni), also filed 
comments on the model-matching criteria to be used by the Department. 
On October 15, 2002, Marubeni submitted an amendment to its model-
matching comments. On December 13, 2002, the petitioners and another 
Japanese exporter, the Nippon Synthetic Chemical Industry Co., Ltd. 
(Nippon Gohsei), submitted additional model-matching comments.\2\
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    \1\ The petitioners in this investigation are Celanese Chemicals 
Ltd. and E.I. Dupont de Nemours & Co. (collectively, ``the 
petitioners'').
    \2\ Because the comments submitted by the parties in the 
companion investigation of PVA from Japan relate to this 
investigation, we placed them on the record of this case.
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    On October 21, 2002, the United States International Trade 
Commission (ITC) preliminarily determined that there is a reasonable 
indication that imports of PVA from Korea are materially injuring the 
United States industry. See ITC Investigation Nos. 731-TA-1014-1018 
(Publication No. 3553, Polyvinyl Alcohol from Germany, Japan, the 
People's Republic of China, the Republic of Korea, and Singapore, 67 FR 
65597 (Oct. 25, 2002)).
    On October 22, 2002, we selected DC CHEM, the only known producer/
exporter of PVA from Korea, as the mandatory respondent in this 
proceeding. For further discussion, see the memorandum to Louis Apple, 
Director, Office 2, from the Team entitled ``Respondent Selection,'' 
dated October 22, 2002. We also issued the antidumping questionnaire to 
DC CHEM on October 22, 2002.
    During the period November 2002 through February 2003, we received 
responses to the Department's original and supplemental questionnaires.
    On January 21, 2003, pursuant to 19 CFR 351.205(e), the petitioners 
made a timely request to postpone the preliminary determination for 30 
days. We granted this request and, on January 30, 2003, postponed the 
preliminary

[[Page 13682]]

determination until no later than March 14, 2003. See Postponement of 
Preliminary Determinations of Antidumping Duty Investigations: 
Polyvinyl Alcohol from the People's Republic of China and the Republic 
of Korea, 68 FR 4763 (Jan. 30, 2003).
    In March 2003, as provided in section 782(i)(3)(a) of the Act, we 
verified the constructed export price (CEP) sales data reported by DC 
CHEM. We used standard verification procedures, including examination 
of relevant sales and financial records. Because this verification was 
conducted immediately prior to the preliminary determination, we have 
had insufficient time to incorporate any verification findings into 
this determination. Therefore, we will consider any such findings in 
our final determination.
    On March 12, 2003, DC CHEM requested that the Department revise the 
scope to exclude certain additional copolymers. Because there was 
insufficient time to properly consider DC CHEM's exclusion request, we 
will address it in the final determination.

Postponement of Final Determination

    Section 735(a)(2) of the Act provides that a final determination 
may be postponed until not later than 135 days after the date of the 
publication of the preliminary determination if, in the event of an 
affirmative preliminary determination, a request for such postponement 
is made by exporters who account for a significant proportion of 
exports of the subject merchandise, or in the event of a negative 
preliminary determination, a request for such postponement is made by 
the petitioner. The Department's regulations, at 19 CFR 351.210(e)(2), 
require that requests by respondents for postponement of a final 
determination be accompanied by a request for extension of provisional 
measures from a four-month period to not more than six months.
    Pursuant to section 735(a)(2) of the Act, on February 12, 2003, DC 
CHEM requested that the Department postpone its final determination 
until not later than 135 days after the date of the publication of the 
preliminary determination in the Federal Register. DC CHEM also 
included a request to extend the provisional measures to not more than 
six months. Accordingly, since we have made an affirmative preliminary 
determination and no compelling reasons for denial exist, we are 
granting DC CHEM's request and are postponing the final determination 
until no later than 135 days after the publication of this notice in 
the Federal Register.

Period of Investigation

    The period of investigation (POI) is July 1, 2001, through June 30, 
2002. This period corresponds to the four most recent fiscal quarters 
prior to the month of the filing of the petition (i.e., September 
2002).

Scope Comments

    In accordance with the preamble to our regulations (see Antidumping 
Duties; Countervailing Duties, 62 FR 27296, 27323 (May 19, 1997)), we 
set aside a period of time for parties to raise issues regarding 
product coverage and encouraged all parties to submit comments within 
20 calendar days of publication of the initiation notice. See the 
Initiation Notice, 67 FR at 61591. Although no comments on the scope of 
the investigation were received in this proceeding, scope comments were 
received in the companion Japanese case. Because these comments relate 
to PVA in general, we find that they are applicable to this proceeding. 
Accordingly, we have placed on the record of this proceeding all public 
scope comments as well as all public versions of the proprietary scope 
documents filed in the companion Japanese case, and, for the reasons 
specified in that preliminary determination, we have modified the scope 
of this investigation based on these comments. See the ``Scope 
Comments'' section of the Notice of Preliminary Determination of Sales 
at Less Than Fair Value: Polyvinyl Alcohol from Japan, 68 FR 8203, 
8204-05 (Feb. 20, 2003).

Scope of Investigation

    The merchandise covered by this investigation is PVA. This product 
consists of all PVA hydrolyzed in excess of 80 percent, whether or not 
mixed or diluted with commercial levels of defoamer or boric acid, 
except as noted below.
    The following products are specifically excluded from the scope of 
this investigation:
    (1) PVA in fiber form.
    (2) PVA with hydrolysis less than 83 mole percent and certified not 
for use in the production of textiles.
    (3) PVA with hydrolysis greater than 85 percent and viscosity 
greater than or equal to 90 cps.
    (4) PVA with a hydrolysis greater than 85 percent, viscosity 
greater than or equal to 80 cps but less than 90 cps, certified for use 
in an ink jet application.
    (5) PVA for use in the manufacture of an excipient or as an 
excipient in the manufacture of film coating systems which are 
components of a drug or dietary supplement, and accompanied by an end-
use certification.
    (6) PVA covalently bonded with cationic monomer uniformly present 
on all polymer chains in a concentration equal to or greater than one 
mole percent.
    (7) PVA covalently bonded with carboxylic acid uniformly present on 
all polymer chains in a concentration equal to or greater than two mole 
percent, certified for use in a paper application.
    (8) PVA covalently bonded with thiol uniformly present on all 
polymer chains, certified for use in emulsion polymerization of non-
vinyl acetic material.
    (9) PVA covalently bonded with paraffin uniformly present on all 
polymer chains in a concentration equal to or greater than one mole 
percent.
    (10) PVA covalently bonded with silan uniformly present on all 
polymer chains certified for use in paper coating applications.
    (11) PVA covalently bonded with sulfonic acid uniformly present on 
all polymer chains in a concentration level equal to or greater than 
one mole percent.
    (12) PVA covalently bonded with acetoacetylate uniformly present on 
all polymer chains in a concentration level equal to or greater than 
one mole percent.
    (13) PVA covalently bonded with polyethylene oxide uniformly 
present on all polymer chains in a concentration level equal to or 
greater than one mole percent.
    (14) PVA covalently bonded with quaternary amine uniformly present 
on all polymer chains in a concentration level equal to or greater than 
one mole percent.
    The merchandise under investigation is currently classifiable under 
subheading 3905.30.00 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 
merchandise under investigation is dispositive.

Fair Value Comparisons

    To determine whether sales of PVA from Korea to the United States 
were made at LTFV, we compared the CEP to the normal value (NV), as 
described in the ``Constructed Export Price'' and ``Normal Value'' 
sections of this notice, below. In accordance with section 
777A(d)(1)(A)(i) of the Act, we compared POI weighted-average CEPs to 
weighted-average NVs.

[[Page 13683]]

Product Comparisons

    In accordance with section 771(16) of the Act, we considered all 
products produced and sold by DC CHEM in the home market during the POI 
that fit the description in the ``Scope of Investigation'' section of 
this notice to be foreign like products for purposes of determining 
appropriate product comparisons to U.S. sales. In accordance with 
section 777A(d)(1)(A)(i) of the Act, we compared POI weighted-average 
CEPs to POI weighted-average NVs. Where there were no sales of 
identical merchandise in the home market made in the ordinary course of 
trade to compare to U.S. sales, we compared U.S. sales to sales of the 
most similar foreign like product made in the ordinary course of trade.
    In October 2002, DC CHEM, Kuraray, Marubeni, and the petitioners 
submitted comments on the model-matching criteria to be used by the 
Department.\3\ Based on these comments, we proposed to match products 
sold in the United States to products sold in the home market in the 
ordinary course of trade that were identical with respect to the 
following hierarchy of characteristics: molecular structure, 
hydrolysis, viscosity, degree of modification, particle size, 
tackifier, defoamer, ash, color, volatiles, and visual impurities. We 
invited interested parties to submit additional comments on these 
criteria prior to the preliminary determination. In December, the 
petitioners and Nippon Gohsei submitted additional model-matching 
comments.\4\
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    \3\ As noted in the ``Case History'' section of this notice, 
Kuraray and Marubeni submitted their comments for the record of the 
companion case on PVA from Japan. Because these comments are 
relevant in this proceeding, we have placed them on the record here 
as well.
    \4\ These comments were only placed on the record for the 
companion case on PVA from Japan. Because they are relevant to this 
proceeding, we have placed them on the record here as well.
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    After analyzing these comments, we have reconsidered the model-
matching hierarchy and revised it as follows: (1) We added as the most 
important criterion whether the product is a homo-or a co-polymer; (2) 
we placed hydrolysis and viscosity before molecular structure (i.e., 
the type of copolymer); and (3) we allowed the reporting of hydrolysis, 
viscosity, and degree of modification in ranges.\5\ All other 
characteristics remain the same. For further discussion, see the 
memorandum entitled ``Concurrence Memorandum for the Preliminary 
Determination in the Investigation of Polyvinyl Alcohol from Korea,'' 
dated March 14, 2003, (Concurrence Memo), on file in room B-099 of the 
Department's Central Records Unit.
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    \5\ In the companion case of PVA from Japan, we also revised the 
particle size field to include PVA in standard, fine, pellet and 
liquid forms. Because DC CHEM sold PVA in only the two original size 
classifications, standard and fine, this revision is not relevant to 
this proceeding.
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Constructed Export Price

    In accordance with section 772(b) of the Act, we calculated the CEP 
for those sales where the merchandise was sold (or agreed to be sold) 
in the United States before or after the date of importation by or for 
the account of the producer or exporter, or by a seller affiliated with 
the producer or exporter, to a purchaser not affiliated with the 
producer or exporter. In this case, we are treating all of DC CHEM's 
U.S. sales as CEP sales because they were made in the United States by 
DC CHEM's U.S. affiliate on behalf of DC CHEM, within the meaning of 
section 772(b) of the Act.
    We based the CEP on the packed delivered prices to unaffiliated 
purchasers in the United States. We added duty drawback received on 
imported materials, where applicable, pursuant to section 772(c)(1)(B) 
of the Act. Where appropriate, we made adjustments for billing errors 
and discounts. We also made deductions for movement expenses, in 
accordance with section 772(c)(2)(A) of the Act; these included, where 
appropriate, foreign inland freight, foreign brokerage and handling, 
international freight, marine insurance, U.S. customs duties (including 
U.S. duties, harbor maintenance fees, and merchandise processing fees), 
U.S. customs brokerage charges, U.S. inland freight expenses (i.e., 
freight from port to warehouse and freight from warehouse to the 
customer), and U.S. warehousing expenses. In accordance with section 
772(d)(1) of the Act and 19 CFR 351.402(b), we deducted those selling 
expenses associated with economic activities occurring in the United 
States related to sales to an unaffiliated purchaser, including direct 
selling expenses (imputed credit costs and other direct selling 
expenses), and indirect selling expenses (including U.S. inventory 
carrying costs and other indirect selling expenses incurred in the 
United States).
    Pursuant to section 772(d)(3) of the Act, we further reduced the 
starting price by an amount for profit to arrive at the CEP. In 
accordance with section 772(f) of the Act, we calculated the CEP profit 
rate using the expenses incurred by DC CHEM and its affiliates on their 
sales of the subject merchandise in the United States and the foreign 
like product in the home market and the profit associated with those 
sales.

Normal Value

A. Home Market 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 respondent's volume of home market sales 
of the foreign like product to the volume of U.S. sales of the subject 
merchandise, in accordance with section 773(a)(1)(C) of the Act. 
Because the respondent'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 for the subject merchandise, we determined that 
the home market was viable for the respondent.

B. Affiliated-Party Transactions and Arm's-Length Test

    DC CHEM reported sales of the foreign like product to affiliated 
end-users. To test whether these sales to affiliated customers were 
made at arm's length, we compared the prices of sales to affiliated and 
unaffiliated customers, net of all movement charges, direct selling 
expenses, and packing. Where the price to the affiliated party was, on 
average, 99.5 percent or more of the price to unaffiliated parties, we 
determined that sales made to the affiliated party were at arm's 
length. See 19 CFR 351.403(c). Based on this analysis, we found that 
100 percent of DC CHEM's sales to affiliates in the home market were 
made at arm's length.

C. Cost of Production Analysis

    Based on our analysis of an allegation contained in the petition, 
we found that there were reasonable grounds to believe or suspect that 
sales of PVA in the home market were made at prices below their cost of 
production (COP). Accordingly, pursuant to section 773(b) of the Act, 
we initiated a country-wide sales-below-cost investigation to determine 
whether sales were made at prices below their respective COPs. See 
Initiation Notice, 67 at FR 61594.
1. Calculation of COP
    In accordance with section 773(b)(3) of the Act, we calculated COP 
based on the sum of the cost of materials and fabrication for the 
foreign like product, plus an amount for general and administrative 
expenses (G&A), including interest expenses. See the ``Test of Home 
Market Sales Prices'' section below for treatment of home market 
selling expenses. We relied on

[[Page 13684]]

the COP data submitted by DC CHEM, except as noted below:
    [sbull] We revised the calculation of the G&A expense ratio to: (1) 
Include losses from the impairment of goodwill, losses on the valuation 
of inventories, donations, losses on the disposal of non-current 
assets, losses on construction, and losses on the cancellation of 
contracts; (2) exclude the cost offsets taken for equity gains on 
investments, duty drawback, rental income of a training institute, and 
other non-operating income; and (3) exclude gains and losses from 
foreign currency transactions and translation; and
    [sbull] We revised the financial expense ratio to only include the 
amounts for gains and losses on foreign currency exchange transactions 
and translation from the 2001 consolidated financial statements.
    For further discussion, see the memorandum from James Balog to Neal 
Halper, Director, Office of Accounting, entitled ``Cost of Production 
and Constructed Value Calculation Adjustments for the Preliminary 
Determination,'' dated March 14, 2003.
    For this preliminary determination, we have implemented a change in 
practice regarding the treatment of foreign exchange gains and losses. 
The Department's previous practice was to have respondents identify the 
source of all foreign exchange gains and losses (e.g., debt, accounts 
receivable, accounts payable, cash deposits) at both a consolidated and 
unconsolidated corporate level. At the consolidated level, the current 
portion of foreign exchange gains and losses generated by debt or cash 
deposits were included in the interest expense rate computation. At the 
unconsolidated producer level, foreign exchange gains and losses on 
accounts payable were either included in the G&A rate computation, or 
under certain circumstances, in the cost of manufacturing. Gains and 
losses on accounts receivable at both the consolidated and 
unconsolidated producer levels were excluded from the COP and CV 
calculations.
    Instead of splitting apart the foreign exchange gains and losses as 
reported in an entity's financial statements, we will normally include 
in the interest expense computation all foreign exchange gains and 
losses. In doing so, we will no longer include a portion of foreign 
exchange gains and losses from two different financial statements 
(i.e., consolidated and unconsolidated producer). Instead, we will only 
include the foreign exchange gains and losses reported in the financial 
statement of the same entity used to compute each respondent's net 
interest expense rate. This approach recognizes that the key measure is 
not necessarily what generated the exchange gain or loss, but rather 
how well the entity as a whole was able to manage its foreign currency 
exposure in any one currency. As such, for these preliminary results, 
we included all foreign exchange gains or losses in the interest 
expense rate computation. We note that there may be unusual 
circumstances in certain cases which may cause the Department to 
deviate from this general practice. We will address exceptions on a 
case-by-case basis.
    As this is a change in practice, we invite the parties to the 
proceeding to comment on this issue.
2. Test of Home Market Sales Prices
    On a product-specific basis, we compared the adjusted weighted-
average COP to the home market sales of the foreign like product, as 
required under section 773(b) of the Act, in order to determine whether 
the sale prices were below the COP. The prices were exclusive of any 
applicable movement charges, rebates, and direct and indirect selling 
expenses. In determining whether to disregard home market sales made at 
prices less than their COP, we examined, in accordance with sections 
773(b)(1)(A) and (B) of the Act, 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.
3. Results of the COP Test
    Pursuant to section 773(b)(2)(C), where less than 20 percent of the 
respondent's sales of a given product are at prices less than the COP, 
we do not disregard any below-cost sales of that product, because we 
determine that in such instances 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 are at prices less than the 
COP, we determine that in such instances the below-cost sales represent 
``substantial quantities'' within an extended period of time, in 
accordance with section 773(b)(1)(A) of the Act. In such cases, we also 
determine whether such sales were made at prices which would not permit 
recovery of all costs within a reasonable period of time, in accordance 
with section 773(b)(1)(B) of the Act.
    We found that, for certain specific products, more than 20 percent 
of DC CHEM's home market sales were at prices less than the COP and, in 
addition, such sales did not provide for the recovery of costs within a 
reasonable period of time. We therefore excluded these sales and used 
the remaining sales, if any, as the basis for determining NV, in 
accordance with section 773(b)(1) of the Act.

D. Level of Trade

    In accordance with section 773(a)(1)(B)(i), to the extent 
practicable, the Department will determine NV based on sales in the 
comparison market at the same level of trade (LOT) as the EP or CEP. 
Sales are made at different LOTs if they are made at different 
marketing stages (or their equivalent). See 19 CFR 351.412(c)(2). 
Substantial differences in selling activities are a necessary, but not 
sufficient, condition for determining that there is a difference in the 
stages of marketing. Id.; see also Notice of Final Determination of 
Sales at Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate 
From South Africa, 62 FR 61731, 61732 (Nov. 19, 1997) (Plate from South 
Africa). In order to determine whether the comparison sales were at 
different stages in the marketing process than the U.S. sales, we 
reviewed the distribution system in each market (i.e., the ``chain of 
distribution''),\6\ including selling functions, class of customer 
(``customer category''), and the level of selling expenses for each 
type of sale.
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    \6\ The marketing process in the United States and comparison 
markets begins with the producer and extends to the sale to the 
final user or consumer. The chain of distribution between the two 
may have many or few links, and the respondent's sales occur 
somewhere along this chain. In performing this evaluation, we 
considered the narrative responses of the respondent to properly 
determine where in the chain of distribution the sale appears to 
occur.
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    Pursuant to section 773(a)(1)(B)(i) of the Act, in identifying 
levels of trade for EP and comparison market sales (i.e., NV based on 
either home market or third country prices \7\ ), we consider the 
starting prices before any adjustments. For CEP sales, we consider only 
the selling activities reflected in the price after the deduction of 
expenses and profit under section 772(d) of the Act. See Micron 
Technology, Inc. v. United States, Court Nos. 00-1058,-1060 (Fed. Cir. 
2001).
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    \7\ Where NV is based on constructed value (CV), we determine 
the NV LOT based on the LOT of the sales from which we derive 
selling, general, and administrative expenses, and profit for CV, 
where possible.
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    When the Department is unable to find sales of the foreign like 
product in the comparison market at the same LOT as the EP or CEP, the 
Department may compare the U.S. sale to sales at a different LOT in the 
comparison market. In comparing EP or CEP sales at a different LOT in 
the comparison market, where available data make it

[[Page 13685]]

practicable, we make an LOT adjustment under section 773(a)(7)(A) of 
the Act. Finally, for CEP sales only, if an NV LOT is more remote from 
the factory than the CEP LOT and there is no basis for determining 
whether the difference in LOTs between NV and CEP affected price 
comparability (i.e., no LOT adjustment was practicable), the Department 
shall grant a CEP offset, as provided in section 773(a)(7)(B) of the 
Act. See Plate from South Africa, 62 FR at 61732.
    We obtained information from DC CHEM regarding the marketing stages 
involved in making the reported home market and U.S. sales, including a 
description of the selling activities performed by DC CHEM and its 
affiliates for each channel of distribution. Regarding the home market, 
DC CHEM reported home market sales through only one channel of 
distribution: direct sales to end-users and distributors. We examined 
the chain of distribution and the selling activities associated with 
sales reported by DC CHEM to each of these customer categories. The 
information on the record demonstrates that DC CHEM performs the same 
selling functions across customer categories. See DC CHEM's response to 
the Department's questionnaire, dated December 9, 2001, at page B-22. 
Based on our analysis of this information, we find that only one LOT 
exists in the home market.\8\
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    \8\ Because DC CHEM claimed business proprietary treatment for 
this information, we are unable to discuss it further here. For a 
description of the selling functions in question, see the 
Concurrence Memorandum.
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    In the U.S. market, DC CHEM reported CEP sales through three 
channels of distribution. DC CHEM also reported that it performed the 
same selling functions for all U.S. sales regardless of distribution 
channel. Because the selling functions performed for sales through each 
channel of distribution were essentially the same, a finding of 
separate LOTs is not warranted.\9\ Therefore, we determine that DC CHEM 
made sales through only one LOT in the U.S. market.
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    \9\ As noted above, because DC CHEM claimed business proprietary 
treatment for this information, we are unable to discuss it further 
here. For a description of these selling functions, see the 
Concurrence Memorandum.
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    In order to determine whether NV was established at an LOT which 
constituted a more advanced stage of distribution than the LOT of the 
CEP, we compared the selling functions performed for home market sales 
with those performed with respect to the CEP transaction, which 
excludes economic activities occurring in the United States. We found 
that DC CHEM performed essentially the same marketing functions when 
selling in both the home market and the United States. Therefore, we 
determine that these sales are at the same LOT and no LOT adjustment is 
warranted. Because we find that no difference in the LOT exists between 
markets, we have not granted a CEP offset to DC CHEM. For further 
discussion, see the Concurrence Memorandum.

E. Calculation of Normal Value Based on Comparison Market Prices

    We calculated NV based on delivered prices to unaffiliated 
customers or prices to affiliated customers that we determined to be at 
arm's-length. In accordance with our practice, for DC CHEM's local 
export sales, we also made an addition to home market price for duty 
drawback. See, e.g., Notice of Final Determination of Sales at Less 
Than Fair Value: Stainless Steel Bar From Korea 67 FR 3149, 3151 (Jan. 
23, 2002). We made deductions for rebates, where appropriate. We also 
made deductions, where appropriate, for movement expenses, including 
inland freight (plant to distribution warehouse and plant/warehouse to 
customer) and warehousing under section 773(a)(6)(B)(ii) of the Act. 
Pursuant to section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410, we 
also made deductions for home market imputed credit expenses and 
commissions. In accordance with 19 CFR 351.410(e), we offset home 
market commissions by the lesser of the commission amount or the amount 
of U.S. indirect selling expenses because DC CHEM incurred commissions 
only in the home market.
    Furthermore, we made adjustments for differences in costs 
attributable to differences in the physical characteristics of the 
merchandise in accordance with section 773(a)(6)(C)(ii) of the Act and 
19 CFR 351.411. We also deducted home market packing costs and added 
U.S. packing costs in accordance with section 773(a)(6)(A) and (B) of 
the Act.

Currency Conversion

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

Verification

    As provided in section 782(i) of the Act, we will verify all 
information relied upon in making our final determination.

Suspension of Liquidation

    In accordance with section 733(d)(2) of the Act, we are directing 
the Customs Service to suspend liquidation of all imports of subject 
merchandise from Korea entered, or withdrawn from warehouse, for 
consumption on or after the date of publication of this notice in the 
Federal Register. We will instruct the Customs Service to require a 
cash deposit or the posting of bond equal to the weighted-average 
amount by which the NV exceeds the CEP, 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
------------------------------------------------------------------------
DC Chemical Company, Ltd....................................        8.06
All Others..................................................        8.06
------------------------------------------------------------------------

Disclosure

    The Department will disclose calculations performed within five 
days of publication of this notice to parties in this proceeding in 
accordance with 19 CFR 351.224(b).

ITC Notification

    In accordance with section 733(f) of the 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 determination.

Public Comment

    Case briefs for this investigation must be submitted no later than 
seven days after the date of the final verification report issued in 
this proceeding. Rebuttal briefs must be filed five days from the 
deadline date for case briefs. A list of authorities used, a table of 
contents, and an executive summary of issues should accompany any 
briefs submitted to the Department. Executive summaries should be 
limited to five pages total, including footnotes. See 19 CFR 351.309.
    Section 774 of the Act provides that the Department will hold a 
public hearing to afford interested parties an opportunity to comment 
on arguments raised in case briefs, provided that such a hearing is 
requested by any interested party. If a request for a hearing is made

[[Page 13686]]

in this investigation, the hearing will tentatively be held two days 
after the deadline for submission of the rebuttal briefs, 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 within 10 days of the 
publication of this notice. Requests should specify the number of 
participants and provide a list of the issues to be discussed. Oral 
presentations will be limited to issues raised in the briefs. See 19 
CFR 351.310.
    We will make our final determination no later than 135 days after 
the date of publication of this preliminary determination, pursuant to 
section 735(a)(1) of the Act.
    This determination is published pursuant to sections 733(f) and 
777(i) of the Act.

    Dated: March 14, 2003.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 03-6736 Filed 3-19-03; 8:45 am]
BILLING CODE 3510-05-P