[Federal Register Volume 68, Number 110 (Monday, June 9, 2003)]
[Notices]
[Pages 34378-34383]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-14444]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-580-839]


Certain Polyester Staple Fiber from Korea; Preliminary Results of 
Antidumping Duty Administrative Review and Partial Rescission of Review

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

ACTION: Notice of preliminary results of 2001-2002 administrative 
review.

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SUMMARY: The Department of Commerce is conducting an administrative 
review of the antidumping duty order on certain polyester staple fiber 
from Korea. The period of review is May 1, 2001, through April 30, 
2002. This review covers imports of certain polyester staple fiber from 
two producers/exporters.
    We have preliminarily found that sales of subject merchandise have 
been made below normal value. If these preliminary results are adopted 
in our final results, we will instruct the U.S. Bureau of Customs and 
Border Protection to assess antidumping duties.
    Interested parties are invited to comment on these preliminary 
results. We will issue the final results not later than 120 days from 
the date of publication of this notice.

DATES: EFFECTIVE DATE: June 9, 2003.

FOR FURTHER INFORMATION CONTACT: Andrew McAllister, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW, Washington DC 20230; 
telephone (202) 482-1174.

SUPPLEMENTARY INFORMATION:

Background

    On May 25, 2000, the Department of Commerce (``the Department'') 
published an antidumping duty order on certain polyester staple fiber 
(``PSF'') from Korea. (See 65 FR 33807). On May 6, 2002, the Department 
published a notice of ``Opportunity to Request Administrative Review'' 
of this order. (See 67 FR 30356). On May 30, 2002, Daeyang Industrial 
Co., Ltd. (``Daeyang''), Sunglim Co., Ltd. (``Sunglim''), Huvis 
Corporation (``Huvis''), and Estal Industry Co., Ltd. (``Estal'') 
requested administrative reviews. On May 31, 2002, Sam Young Synthetics 
Co., Ltd. (``Sam Young''), Mijung Ind. Co., Ltd. (``Mijung''), Keon 
Baek Co., Ltd. (``Keon Baek''), and East Young Co., Ltd. (``East 
Young'') made similar requests for administrative reviews. Also, on May 
31, 2002, Stein Fibers, Ltd. (``Stein Fibers''), an interested party in 
this review, requested an administrative review of imports of the 
subject merchandise produced by Sam Young, Mijung, Keon Baek, East 
Young, Huvis, Daeyang, and Estal. On June 25, 2002, the Department 
published a notice initiating the review for the period May 1, 2001, 
through April 30, 2002. (See 67 FR 42753).
    On July 10, 2002, we issued antidumping questionnaires in this 
review. On August 2, 2002, Sunglim withdrew its request for review. On 
August 16, 2002, Sam Young, Mijung, Keon Baek, Estal, and Daeyang 
withdrew their requests for review. Also, on August 16, 2002, Stein 
Fibers withdrew its request for administrative reviews of the shipments 
of Sam Young, Mijung, Keon Baek, Daeyang, and Estal. See ``Partial 
Rescission'' section, below.
    We received responses from East Young and Huvis on September 5, 
2002. As a result of certain below cost sales being disregarded in the 
previous administrative review, on October 17, 2002, we instructed 
Huvis to respond to the cost questionnaire. On November 14, 2002, we 
received Huvis' response to the cost questionnaire.
    On September 30, 2002, in accordance with 19 CFR 351.301(d)(2)(ii), 
Arteva Specialties S.a.r.l., d/b/a KoSa and Wellman, Inc. (``the 
petitioners''), alleged that East Young had made sales to the United 
Kingdom, East Young's reported third-country market, at prices below 
the cost of production (``COP'') during the POR. On October 2, 2002, 
East Young submitted an objection to the petitioners' September 30, 
2002, COP allegation on the basis that it was untimely filed, inasmuch 
as the deadline for alleging that East Young made sales in its third-
country market at prices below the COP was September 26, 2002. However, 
we accepted the petitioners' allegation of sales below COP and 
proceeded to examine the sufficiency of the allegation because it was 
not submitted so late that the Department would be unnecessarily 
delayed in reviewing the substance of the allegation nor would it cause 
other interested parties difficulties in representing their interests. 
See Memorandum from Team to Susan Kuhbach, ``Petitioners' Allegation of 
Sales Below Cost of Production,'' dated October 21, 2002, which is on 
file in the Central Records Unit (``CRU'') in room B-099 of the main 
Department building.
    On October 29, 2002, East Young submitted further objections to the 
timeliness and merits of the petitioners' cost allegation. On November 
4, 2002, the petitioners rebutted East Young's October 29, 2002, 
submission. On November 6, 2002, East Young rebutted the petitioners' 
November 4, 2002, submission. On December 6, 2002, we found that the 
petitioners' allegation did not provide a reasonable basis to initiate 
a COP investigation on East Young's U.K. sales because the below-cost 
sales were not representative of the broader range of foreign models 
that may be used to determine normal value (``NV'') for comparison to 
U.S. sales. See Memorandum from Team to John Brinkmann, ``Petitioners' 
Allegation of Sales Below the Cost of Production for East Young Co., 
Ltd.,'' dated December 6, 2002, which is on file in the CRU.
    In its section B Questionnaire response, East Young reported the 
United Kingdom as its comparison market. In their September 30, 2002, 
cost allegation and in an October 28, 2002, letter, the petitioners 
alleged that the United Kingdom was not an appropriate third-country 
market for calculating East Young's NV because of the existence of a 
dumping finding on PSF from Korea in the European Union. On November 4, 
2002, East Young submitted an objection to the petitioners' October 28, 
2002, submission, stating that the United Kingdom is its most 
representative comparison market. In the Memorandum to Susan Kuhbach, 
``Selection of Comparison Market for East Young,'' dated November 20, 
2002 (``East Young Comparison Market Memorandum''), which is on file in 
the CRU, we recognized that the European Union has made a finding of 
dumping concerning PSF from Korea that includes PSF currently subject 
to an order in the United States and which applies to East Young's 
merchandise. As a result, we indicated that reliance on East Young's 
sales to the United Kingdom may not be appropriate for purposes of 
calculating NV in this review. While we did not immediately dismiss 
East Young's sales to the United Kingdom, we instructed East Young to 
submit a revised section B response that includes sales both to the 
United Kingdom and to its next largest third-country market for which 
no finding of dumping exists and which meets the criteria of section 
773(a)(1)(B)(ii) of the Tariff Act of 1930, as amended (``the Act''). 
See East Young Comparison

[[Page 34379]]

Market Memo; see also ``Selection of Comparison Market'' section, 
below.
    In November and December 2002 and February 2003, we issued 
supplemental questionnaires to East Young and Huvis. We received 
responses to these supplemental questionnaires in December 2002 and 
January and February 2003.
    On January 9, 2003, in accordance with section 751(a)(3)(A) of the 
Act, we published a notice extending the time limit for the completion 
of the preliminary results in this case by 120 days (i.e., until no 
later than June 2, 2003). (See 68 FR 1177).

Scope of the Order

    For the purposes of this order, the product covered is certain 
polyester staple fiber (``PSF''). PSF is defined as synthetic staple 
fibers, not carded, combed or otherwise processed for spinning, of 
polyesters measuring 3.3 decitex (3 denier, inclusive) or more in 
diameter. This merchandise is cut to lengths varying from one inch (25 
mm) to five inches (127 mm). The merchandise subject to this order may 
be coated, usually with a silicon or other finish, or not coated. PSF 
is generally used as stuffing in sleeping bags, mattresses, ski 
jackets, comforters, cushions, pillows, and furniture. Merchandise of 
less than 3.3 decitex (less than 3 denier) currently classifiable under 
the Harmonized Tariff Schedule of the United States (``HTSUS'') at 
subheading 5503.20.00.20 is specifically excluded from this order. Also 
specifically excluded from this order are polyester staple fibers of 10 
to 18 denier that are cut to lengths of 6 to 8 inches (fibers used in 
the manufacture of carpeting). In addition, low-melt PSF is excluded 
from this order. Low-melt PSF is defined as a bi-component fiber with 
an outer sheath that melts at a significantly lower temperature than 
its inner core.
    The merchandise subject to this order is currently classifiable in 
the HTSUS at subheadings 5503.20.00.45 and 5503.20.00.65. Although the 
HTSUS subheadings are provided for convenience and customs purposes, 
the written description of the merchandise under order is dispositive.

Partial Rescission

    As noted above, Sunglim, Sam Young, Mijung, Keon Baek, Estal, and 
Daeyang withdrew their requests for review, and Stein Fibers withdrew 
its request for review of Sam Young, Mijung, Keon Baek, Daeyang, and 
Estal. Because these withdrawals were timely filed and no other party 
requested a review of these companies, pursuant to 19 CFR 351.213(d)(1) 
we are rescinding this review with respect to these companies. We will 
instruct the U.S. Bureau of Customs and Border Protection (``BCBP'') to 
liquidate any entries from these companies during the period of review 
and to assess antidumping duties at the rate that was applied at the 
time of entry.

Verification

    As provided in section 782(i) of the Act, in March and May 2003, we 
verified information provided by East Young and Huvis using standard 
verification procedures, including on-site inspection of the 
manufacturers' facilities, examination of relevant sales, cost and 
financial records, and selection of original documentation containing 
relevant information. The Department reported its findings from the 
sales verifications on May 12, 2003. See Memorandum to the File, 
``Verification of the Sales Response of East Young Co., Ltd.,'' dated 
May 12, 2003 (``East Young Verification Report''), and Memorandum to 
the File, ``Verification of the Sales Response of Huvis Corporation,'' 
dated May 12, 2003 (``Huvis Sales Verification Report''), which are on 
file in the CRU. Due to the timing of the cost verification of Huvis, 
the Department will report its findings from the cost verification 
after the preliminary results.

Fair Value Comparisons

    To determine whether sales of PSF by the respondents to the United 
States were made at less than NV, we compared, as appropriate, export 
price (``EP''), to NV, as described in the ``Export Price'' and 
``Normal Value'' sections of this notice.
    Pursuant to section 777A(d)(2) of the Act, we compared the EPs of 
individual U.S. transactions to the weighted-average NV of the foreign 
like product where there were sales made in the ordinary course of 
trade, as discussed in the ``Cost of Production Analysis'' section 
below.

Product Comparisons

    In accordance with section 771(16) of the Act, we considered all 
products produced by the respondents covered by the description in the 
``Scope of the Order'' section, above, to be foreign like products for 
purposes of determining appropriate product comparisons to U.S. sales. 
In accordance with section 773(a)(1)(C)(ii) of the Act, in order to 
determine whether there was a sufficient volume of sales in the home 
market to serve as a viable basis for calculating NV, we compared each 
respondent's volume of home market sales of the foreign like product to 
the volume of its U.S. sales of the subject merchandise. (For further 
details, see the ``Normal Value'' section, below.)
    We compared U.S. sales to sales made in the appropriate comparison 
market within the contemporaneous window period, which extends from 
three months prior to the POR until two months after the POR. Where 
there were no sales of identical merchandise in the comparison 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. Where there were no sales of 
identical or similar merchandise made in the ordinary course of trade 
in the comparison market to compare to U.S. sales, we compared U.S. 
sales to constructed value (``CV''). In making product comparisons, 
consistent with our final determination in the original investigation, 
we matched foreign like products based on the physical characteristics 
reported by the respondents in the following order: (1) composition; 
(2) type; (3) grade; (4) cross section; (5) finish; and (6) denier (see 
Notice of Final Determination of Sales at Less Than Fair Value: Certain 
Polyester Staple Fiber From the Republic of Korea, 65 FR 16880, 16881 
(March 30, 2000)).

Date of Sale

    In its original questionnaire responses, East Young reported 
comparison market and U.S. sales using invoice date as the date of 
sale. Based on the description of the sales process provided by East 
Young, we note that, in the company's normal commercial practice, the 
sales invoice is normally issued after the date of shipment. Because 
the date of shipment almost always precedes the reported date of sale, 
we preliminarily find that the date of shipment better reflects the 
date on which East Young established the material terms of sale, in 
accordance with 19 CFR 351.401(i). Accordingly, we have relied on the 
date of shipment as the date of sale.

Export Price

    For sales to the United States, we calculated EP, in accordance 
with section 772(a) of the Act, because the merchandise was sold prior 
to importation by the exporter or producer outside the United States to 
the first unaffiliated purchaser in the United States and because 
constructed export price methodology was not otherwise warranted. We 
calculated EP based on the FOB, C&F, CIF, EDDP (ex-dock duty paid), or 
CFR packed price to

[[Page 34380]]

unaffiliated purchasers in the United States. We made deductions, where 
appropriate, consistent with section 772(c)(2)(A) of the Act, for the 
following movement expenses: inland freight from the plant to port of 
exportation, foreign brokerage and handling, wharfage, container tax, 
bill of lading charge, terminal handling charge, international freight, 
marine insurance, and U.S. customs duty.
    We increased EP, where appropriate, for duty drawback in accordance 
with section 772(c)(1)(B) of the Act. East Young and Huvis claim to 
have received duty drawback under the two systems in place in Korea: 
either the individual-rate system or the fixed-rate system (i.e., the 
simplified fixed drawback system). In prior investigations and 
administrative reviews, the Department has examined the individual-rate 
system and found that the government controls in place enable the 
Department to examine the criteria under this system for receiving a 
duty drawback adjustment (i.e., that (1) the rebates received were 
directly linked to import duties paid on inputs used in the manufacture 
of the subject merchandise, and (2) there were sufficient imports to 
account for the rebates received). See Final Results of Antidumping 
Duty Administrative Review and Partial Termination of Administrative 
Review: Circular Welded Non-Alloy Steel Pipe From the Republic of 
Korea, 62 FR 55574, 55577 (October 27, 1997). Huvis provided 
documentation demonstrating that it received duty drawback under the 
individual-rate system. We examined this documentation and confirmed 
that Huvis met the Department's two-prong test for receiving a duty 
drawback adjustment. Accordingly, we are allowing the full duty 
drawback adjustment on all of Huvis' U.S. sales.
    For all sales by East Young, duty drawback was received under the 
fixed-rate system. The Department has found that the Korean fixed-rate 
duty drawback system does not sufficiently link import duties paid to 
rebates received upon export. Therefore, the fixed-rate system does 
not, in and of itself, meet the Department's criteria, i.e., that the 
rebates received were directly linked to import duties paid on inputs 
used in the manufacture of the subject merchandise, and that there were 
sufficient imports to account for the rebates received. See id. In this 
case, East Young was unable to demonstrate successfully that duty 
drawback which it received under the fixed-rate system met the 
Department's criteria for a duty drawback adjustment. See East Young 
Verification Report at 22. Accordingly, for purposes of these 
preliminary results, we are not granting East Young duty drawback 
adjustments claimed under the fixed-rate system.
    Finally, we made the following company-specific changes to EP. For 
East Young, we reclassified certain expenses reported by the respondent 
as direct selling expenses (i.e., wharfage, container tax, bill of 
lading charge, terminal handling charge) as movement expenses. Also, 
based on our findings at verification, we recalculated East Young's 
reported packing costs and corrected the reporting of the U.S. matching 
control numbers to include a missing characteristic. For further detail 
on these changes, see Memorandum to the File, ``Preliminary Results 
Calculation Memorandum for East Young Co., Ltd.,'' dated June 2, 2003 
(``East Young Calculation Memorandum''), which is on file in the CRU.
    For Huvis, based on our verification findings, we revised the 
reporting of product finish and corrected the matching control numbers 
for certain product types. In addition, we revised foreign brokerage 
and handling expense, credit expense, and bank fees for certain 
observations. For further detail on these changes, see Memorandum to 
the File, ``Preliminary Results Calculation Memorandum for Huvis 
Corporation,'' dated June 2, 2003 (``Huvis Calculation Memorandum''), 
which is on file in the CRU.

Normal Value

A. Selection of Comparison Market
    In order to determine whether there was a sufficient volume of 
sales of certain PSF in the home market to serve as a viable basis for 
calculating NV, we compared each respondent's home market sales of the 
foreign like product to its volume of U.S. sales of the subject 
merchandise, in accordance with section 773(a) of the Act. In the case 
of Huvis, because the aggregate volume of home market sales of the 
foreign like product was greater than five percent of the aggregate 
volume of U.S. sales for the subject merchandise, we determined that 
the home market provided a viable basis for calculating NV. Therefore, 
for Huvis, in accordance with section 773(a)(1)(B)(i) of the Act, we 
based NV on the prices at which the foreign like product was first sold 
for consumption in the exporting country in the usual commercial 
quantities and in the ordinary course of trade.
    East Young reported that its home market sales of PSF during the 
POR were less than five percent of its sales to the United States. 
Therefore, East Young did not have a viable home market for purposes of 
calculating NV. As noted above in the ``Background'' section, East 
Young reported that the United Kingdom was its largest third-country 
market and, consequently, submitted its sales to the United Kingdom for 
purposes of calculating NV. Pursuant to section 773(a)(1)(B)(ii) of the 
Act, sales to a particular third-country market may be utilized if (I) 
the prices in such market are representative; (II) the aggregate 
quantity of the foreign like product sold by the producer or exporter 
in the third-country market is five percent or more of the aggregate 
quantity of the subject merchandise sold in or to the United States; 
and (III) the Department does not determine that a particular market 
situation in the third-country market prevents a proper comparison with 
the U.S. price. Based on our review of these criteria, the Department 
found that East Young had more than one potential comparison market 
that satisfied these criteria. See East Young Comparison Market Memo.
    In accordance with 19 CFR 351.404(e), in selecting a third-country 
market where prices in more than one third country satisfy the criteria 
of section 773(a)(1)(B)(ii) of the Act, the Department will generally 
select the third country based on the following criteria: (1) the 
foreign like product exported to a particular third country is more 
similar to the subject merchandise exported to the United States than 
is the foreign like product exported to other third countries; (2) the 
volume of sales to a particular third country is larger than the volume 
of sales to other third countries; and (3) such other factors as the 
Department considers appropriate. Regarding the third criterion, the 
Department has never formally specified ``such other factors'' that the 
Department considers appropriate and, therefore, the Department's 
determination of whether other factors exist is made on a case-by-case 
basis. See Antidumping Duties; Countervailing Duties; Final Rule, 62 FR 
27296, 27358 (May 19, 1997).
    We believe that the existence of a dumping finding in a third-
country market which includes the merchandise and the company that is 
being investigated or reviewed by the Department is a relevant factor 
in determining whether to use such market as a basis for determining 
NV. Such a scenario signifies a clear reason to believe or suspect that 
a NV calculated using sales in such market would potentially be 
understated, thereby undermining the validity and accuracy of our 
dumping calculations. See also Alloy Piping Products, Inc. v. United

[[Page 34381]]

States, 201 F. Supp.2d 1267, 1277 (CIT 2002) (noting that 
``the goal of accuracy cannot be achieved if Commerce relies upon 
dumped third country prices to calculate NV''). Accordingly, because 
the European Union has made a finding of dumping concerning PSF from 
Korea which includes the PSF currently subject to an order in the 
United States and to which East Young is subject, we are rejecting the 
use of the United Kingdom as a third-country comparison market for 
purposes of determining NV. Instead, for purposes of determining NV, we 
are relying on East Young's sales to its next largest third-country 
market for which no finding of dumping exists and which meets the 
criteria of section 773(a)(1)(B)(ii) of the Act, i.e., Morocco.
B. Level of Trade
    Section 773(a)(1)(B)(i) of the Act states that, to the extent 
practicable, the Department will calculate NV based on sales at the 
same level of trade (``LOT'') as the EP. 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 (November 19, 1997). 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''),\1\ including selling 
functions,\2\ class of customer (``customer category''), and the level 
of selling expenses for each type of sale.
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    \1\ The marketing process in the United States and comparison 
markets begins with the producer and extends to the sale to the 
final user or customer. The chain of distribution between the two 
may have many or few links, and the respondents' sales occur 
somewhere along this chain. In performing this evaluation, we 
considered the narrative responses of each respondent to properly 
determine where in the chain of distribution the sale appears to 
occur.
    \2\ Selling functions associated with a particular chain of 
distribution help us to evaluate the level(s) of trade in a 
particular market. For purposes of these preliminary results, we 
have organized the common selling functions into four major 
categories: sales process and marketing support, freight and 
delivery, inventory and warehousing, and quality assurance/warranty 
services. Other selling functions unique to specific companies were 
considered, as appropriate.
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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\3\), we consider the 
starting prices before any adjustments. See Micron Technology, Inc. v. 
United States, et. al., 243 F. 3d 1301, 1314-1315 (Fed. Cir. 2001) 
(affirming this methodology).
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    \3\ Where NV is based on CV, we determine the NV LOT based on 
the LOT of the sales from which we derive selling expenses, general 
and administrative (``G&A'') expenses, and profit for CV, where 
possible.
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    When the Department is unable to match U.S. sales to sales of the 
foreign like product in the comparison market at the same LOT as the 
EP, the Department may compare the U.S. sale to sales at a different 
LOT in the comparison market. In comparing EP sales at a different LOT 
in the comparison market, where available data show that the difference 
in LOT affects price comparability, we make a LOT adjustment under 
section 773(a)(7)(A) of the Act.
    Huvis reported that it made direct sales to distributors and end 
users in both the home market and in the United States, and also to the 
United States through a trading company. East Young made direct sales 
to an end user in the comparison market and to distributors and end 
users in the United States. Each respondent has reported a single 
channel of distribution and a single level of trade in each market, and 
has not requested a level of trade adjustment. We examined the 
information reported by each respondent regarding its marketing process 
for making the reported comparison market and U.S. sales, including the 
type and level of selling activities performed and customer categories. 
Specifically, we considered the extent to which sales process, freight 
services, warehouse/inventory maintenance, and warranty services varied 
with respect to the different customer categories (i.e., distributors 
and end users) within each market and across the markets. Based on our 
analyses, we found a single level of trade in the United States, and a 
single, identical level of trade in the comparison market for both 
respondents. Thus, it was unnecessary to make a LOT adjustment for East 
Young or Huvis in comparing EP and comparison market prices.
C. Sales to Affiliated Customers
    Huvis made sales in the home market to an affiliated customer. To 
test whether these sales were made at arm's length, we compared the 
starting prices of sales to the affiliated customer to those of 
unaffiliated customers, net of all movement charges, direct and 
indirect selling expenses, discounts, and packing. Where the price to 
the affiliated customer was on average 99.5 percent or more of the 
price to Huvis' unaffiliated customers, we determined that the sales 
made to the affiliated customer were at arm's length and included those 
sales in our calculation of NV pursuant to 19 CFR 351.403(c).\4\ Where 
prices to Huvis' affiliated customer were, on average, less than 99.5 
percent of the prices to unaffiliated customers, we determined that 
these sales were not at arm's length and excluded them from our 
analysis.
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    \4\ We note that the Department recently adopted a new arm's 
length test whereby sales to affiliates will be determined to be at 
arm's length if the prices are, on average, within a range of 98 
percent to 102 percent of prices to unaffiliated customers. See 
Antidumping Proceedings: Affiliated Party Sales in the Ordinary 
Course of Trade, 67 FR 69186 (November 15, 2002). The Department's 
new arm's length test is only applicable to investigations and 
reviews initiated on or after November 23, 2002, which is subsequent 
to the initiation of this review.
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D. Cost of Production Analysis
    As discussed in the ``Background'' section above, there were 
reasonable grounds to believe or suspect that Huvis made sales of the 
subject merchandise in its comparison market at prices below the COP in 
accordance with section 773(b) of the Act.
    1.Calculation of COP
    We calculated the COP on a product-specific basis, based on the sum 
of Huvis' costs of materials and fabrication for the foreign like 
product, plus amounts for selling, general and administrative 
(``SG&A'') expenses, including interest expenses, and the costs of all 
expenses incidental to placing the foreign like product in a condition 
packed ready for shipment in accordance with section 773(b)(3) of the 
Act.
    We relied on COP information submitted by Huvis in its cost 
questionnaire responses, except for the following adjustments. First, 
we adjusted Huvis' reported cost of manufacturing to account for 
purchases of terephthalic acid and ethylene glycol from affiliated 
parties at non-arm's length prices. See Memorandum from Robert Greger 
to Neal Halper, Director, Office of Accounting, ``Cost Adjustments,'' 
dated June 2, 2003 (``Huvis Cost Memorandum''), which is on file in the 
CRU. Second, we adjusted Huvis' submitted G&A expenses to exclude 
foreign exchange gains and losses, revenue from the sale of test 
materials, revenue on further processing and revenue on the sale of raw 
materials. See Huvis Cost Memorandum. Third, we adjusted Huvis' 
submitted financial expense ratio to include the total net foreign 
exchange gains and losses from the financial statements. See Huvis Cost 
Memorandum.

[[Page 34382]]

    2. Test of Comparison Market Prices
    For Huvis, on a product-specific basis, we compared the adjusted 
weighted-average COP figures for the POR to the comparison market sales 
of the foreign like product, as required under section 773(b) of the 
Act, in order to determine whether these sales were made at prices 
below the COP. On a product-specific basis, we compared the COP, 
consisting of the cost of manufacturing, G&A and interest expenses, to 
the comparison market prices, less any applicable movement charges, 
rebates, discounts, and direct and indirect selling expenses. In 
determining whether to disregard comparison 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 COP Test
    Pursuant to section 773(b)(1), where less than 20 percent of Huvis' 
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 Huvis' sales of 
a given product are at prices less than the COP, we determine that 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 Huvis' comparison market sales were at prices less than the COP and, 
thus, the below-cost sales were made within an extended period of time 
in substantial quantities. In addition, these sales were made at prices 
that did not provide for the recovery of costs within a reasonable 
period of time. Therefore, we excluded these sales and used the 
remaining sales, if any, as the basis for determining NV, in accordance 
with section 773(b)(1).
E. Calculation of Normal Value Based on Comparison Market Prices
    We calculated NV based on the price to unaffiliated customers. We 
made adjustments for differences in packing in accordance with sections 
773(a)(6)(A) and 773(a)(6)(B)(i) of the Act. We also made adjustments, 
where appropriate, consistent with section 773(a)(6)(B)(ii) of the Act, 
for the following movement expenses: inland freight from the plant to 
the port of exportation, inland freight from the plant to the customer, 
foreign brokerage and handling, wharfage, container tax, bill of lading 
charge, terminal handling charge, and international freight. In 
addition, we made adjustments for differences in circumstances of sale 
(``COS'') in accordance with section 773(a)(6)(C)(iii) of the Act and 
19 CFR 351.410. We made COS adjustments, where appropriate, by 
deducting direct selling expenses incurred on comparison market sales 
(credit expenses, bank charges, less charges, and letter of credit 
charges) and adding U.S. direct selling expenses (credit expenses, bank 
charges, and less charges). For East Young, we did not increase NV for 
duty drawback because, as stated in the ``Export Price'' section, East 
Young was unable to demonstrate successfully that duty drawback which 
it received under the fixed-rate system met the Department's criteria 
for a duty drawback adjustment.
    Finally, we made the following company-specific changes to NV. For 
East Young, we reclassified certain expenses reported by the respondent 
as direct selling expenses (i.e., wharfage, container tax, bill of 
lading charge, terminal handling charge) as movement expenses. Also, 
based on our findings at verification, we recalculated East Young's 
reported packing costs. See East Young Calculation Memorandum.
    For Huvis, based on our findings at verification, we revised the 
reporting of product finish and recalculated the matching control 
numbers for certain product types. We also recalculated credit expenses 
by revising the short-term interest rate and correcting the credit 
periods for certain customers who purchase PSF on open payment terms. 
Finally, based on our verification findings, we made several revisions 
to the respondent's reported inland freight expenses. See Huvis 
Calculation Memorandum.
F. Calculation of Normal Value Based on Constructed Value
    Section 773(a)(4) of the Act provides that, where NV cannot be 
based on comparison-market sales, NV may be based on CV. Accordingly, 
for East Young, when sales of comparison products could not be found 
because there were no sales of a comparable product, we based NV on CV.
    In accordance with sections 773(e)(1), (e)(2)(A), and (e)(3) of the 
Act, we calculated CV based on the sum of the cost of materials and 
fabrication for the merchandise, plus amounts for selling expenses, G&A 
(including interest), profit and U.S. packing costs. We calculated the 
cost of materials and fabrication based on the methodology described in 
the ``Calculation of COP'' section of this notice. In accordance with 
section 773(e)(2)(A) of the Act, we based selling expenses, G&A, and 
profit on the amounts incurred and realized by East Young in connection 
with the production and sale of the foreign like product in the 
ordinary course of trade for consumption in the foreign country. For a 
discussion of the calculation of G&A and interest expense ratios for 
East Young, see East Young Calculation Memorandum.
    For price-to-CV comparisons, we made adjustments to CV in 
accordance with section 773(a)(8) of the Act. Where we compared CV to 
EP, we made circumstance-of-sale adjustments.

Preliminary Results of the Review

    We determine that the following dumping margins exist for the 
period May 1, 2001, through April 30, 2002:

------------------------------------------------------------------------
                                                       Weighted-average
               Exporter/manufacturer                  margin percentage
------------------------------------------------------------------------
East Young Co., Ltd................................                 4.07
Huvis Corporation..................................     0.22(de minimis)
------------------------------------------------------------------------

    Any interested party may request a hearing within 30 days of 
publication of this notice. Any hearing, if requested, will be held 42 
days after the publication of this notice, or the first workday 
thereafter. Issues raised in the hearing will be limited to those 
raised in the case and rebuttal briefs. Interested parties may submit 
case briefs within 30 days of the date of publication of this notice. 
Rebuttal briefs, which must be limited to issues raised in the case 
briefs, may be filed not later than 35 days after the date of 
publication of this notice. Parties who submit case briefs or rebuttal 
briefs in this proceeding are requested to submit with each argument 
(1) a statement of the issue and (2) a brief summary of the argument 
with an electronic version included.
    The Department will issue the final results of this administrative 
review, including the results of its analysis of issues raised in any 
such written briefs or hearing, within 120 days of publication of these 
preliminary results.

Assessment Rates and Cash Deposit Requirements

    Pursuant to 19 CFR 351.212(b), the Department calculates an 
assessment rate for each importer of the subject merchandise. The 
Department will issue appropriate assessment instructions directly to 
the BCBP within 15 days of publication of the final results of this

[[Page 34383]]

review. Upon issuance of the final results of this administrative 
review, if any importer-specific assessment rates calculated in the 
final results are above de minimis (i.e., at or above 0.5 percent), the 
Department will instruct the BCBP to assess antidumping duties on 
appropriate entries by applying the assessment rate to the entered 
quantity of the merchandise. For assessment purposes, we calculated 
importer-specific assessment rates for the subject merchandise by 
aggregating the dumping duties due for all U.S. sales to each importer 
and dividing the amount by the total entered quantity of the sales to 
that importer.
    The following deposit requirements will be effective upon 
completion of the final results of this administrative review for all 
shipments of certain polyester staple fiber from Korea entered, or 
withdrawn from warehouse, for consumption on or after the publication 
date of the final results of this administrative review, as provided by 
section 751(a)(1) of the Act: (1) the cash deposit rate for the 
reviewed companies will be the rate established in the final results of 
this administrative review (except no cash deposit will be required if 
its weighted-average margin is de minimis, i.e., less than 0.5 
percent); (2) for merchandise exported by manufacturers or exporters 
not covered in this review but covered in the original less-than-fair-
value investigation or a previous review, the cash deposit will 
continue to be the most recent rate published in the final 
determination or final results for which the manufacturer or exporter 
received an individual rate; (3) if the exporter is not a firm covered 
in this review, the previous review, or the original 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, the cash deposit rate will be 11.35 
percent, the ``all others'' rate established in Notice of Amended Final 
Determination of Sales at Less Than Fair Value: Certain Polyester 
Staple Fiber from the Republic of Korea, and Antidumping Duty Orders: 
Certain Polyester Staple Fiber from the Republic of Korea and Taiwan, 
65 FR 33807 (May 25, 2000).

Notification to Importers

    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 351.402(f) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    We are issuing and publishing these results in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: June 2, 2003.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 03-14444 Filed 6-6-02; 8:45 am]
BILLING CODE 3510-DS-S