[Federal Register Volume 68, Number 115 (Monday, June 16, 2003)]
[Notices]
[Pages 35627-35630]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-15149]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-588-862]


Notice of Preliminary Determination of Sales at Less Than Fair 
Value: High and Ultra-High Voltage Ceramic Station Post Insulators from 
Japan

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

EFFECTIVE DATE: June 16, 2003.

FOR FURTHER INFORMATION CONTACT: Timothy Finn at (202) 482-0065 or 
Michele Mire at (202) 482-4711, AD/CVD Enforcement Office 4, Group II, 
Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue, NW, 
Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

Preliminary Determination

    We preliminarily determine that high and ultra-high voltage ceramic 
station post insulators (HVSPs) from Japan are being sold, or are 
likely to be sold, in the United States at less than fair value (LTFV), 
as provided in section 733 of the Tariff Act of 1930, as amended (the 
Act). The estimated margin of sales at LTFV is shown in the Suspension 
of Liquidation section of this notice.

Case History

    This investigation was initiated on January 21, 2003.\1\ See Notice 
of Initiation of Antidumping Duty Investigation: High and Ultra-High 
Voltage Ceramic Station Post Insulators from Japan, 68 FR 4169 (January 
28, 2003) (Initiation Notice). Since the initiation of the 
investigation, the following events have occurred.
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    \1\ The petitioners in this investigation are Lapp Insulator 
Company LLC (Lapp), Newell Porcelain Co., Inc. (Newell), Victor 
Insulators, Inc. (Victor), and the IUE Industrial Division of the 
Communications Workers of America, the union representing employees 
of Lapp (collectively, the petitioners).
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    On February 13, 2003, the United States International Trade 
Commission (ITC) preliminarily determined that there is a reasonable 
indication that an industry in the United States is materially injured 
by reason of imports from Japan of HVSPs. See Certain

[[Page 35628]]

Ceramic Station Post Insulators from Japan, 68 FR 9723 (February 28, 
2003).
    On February 3, 2003, and February 28, 2003, we solicited comments 
from interested parties regarding the criteria to be used for model-
matching purposes. Petitioners provided comments on February 10, 2003, 
February 14, 2003, February 24, 2003, and March 18, 2003. Respondent, 
NGK Insulators, Ltd. (NGK), provided comments on February 10, 2003, 
February 14, 2003, February 21, 2003, and March 18, 2003.
    On February 28, 2003, the Department issued a complete antidumping 
duty questionnaire to NGK.\2\ NGK submitted its Section A questionnaire 
response on April 4, 2003. On April 11, 2003, the Department requested 
that NGK report one additional product characteristic, cantilever 
strength, in its Sections B and C questionnaire responses. On April 18, 
2003, NGK withdrew from the antidumping duty investigation and 
requested that the Department return its Section A questionnaire 
response. On May 9, 2003, the Department removed the proprietary 
version of NGK's original Section A questionnaire response from the 
official record and returned it to NGK. The Department sent a letter to 
NGK certifying the removal and destruction of all proprietary copies of 
NGK's Section A questionnaire response. The Department retained the 
public version of NGK's Section A questionnaire response as part of the 
public record.
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    \2\ Section A of the questionnaire requests general information 
concerning a company's corporate structure and business practices, 
the merchandise under investigation that it sells, and the manner in 
which it sells that merchandise in all of its markets. Section B 
requests a complete listing of all home market sales, or, if the 
home market is not viable, of sales in the most appropriate third-
country market (this section is not applicable to respondents in 
non-market economy (NME) cases). Section C requests a complete 
listing of U.S. sales. Section D requests information on the cost of 
production (COP) of the foreign like product and the constructed 
value (CV) of the merchandise under investigation. Section E 
requests information on further manufacturing.
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Period of Investigation

    The period of investigation (POI) is October 1, 2001, through 
September 30, 2002. This period corresponds to the four most recent 
fiscal quarters prior to the date of the filing of the petition (i.e., 
December 31, 2002).

Scope of Investigation

    The scope of this investigation covers station post insulators 
manufactured of porcelain, of standard strength, high strength, or 
extra-high strength,\3\ solid core or cavity core, single unit or 
stacked unit, assembled or unassembled, and with or without hardware 
attached, rated at 115 kilovolts (kV) voltage class and above (550 kV 
Basic Impulse Insulation Level (BIL) and above), including, but not 
limited to, those manufactured to meet the following American National 
Standards Institute, Inc. (ANSI) standard class specifications: T.R.-
286, T.R.-287, T.R.-288, T.R.-289, T.R.-291, T.R.-295, T.R.-304, T.R.-
308, T.R.-312, T.R.-316, T.R.-362 and T.R.-391. Subject merchandise is 
classifiable under subheading 8546.20.0060 of the Harmonized Tariff 
Schedule of the United States (HTSUS) Annotated. While the HTSUS 
subheading is provided for convenience and customs purposes, the 
written description above remains dispositive as to the scope of the 
investigation.
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    \3\ Station post insulators are manufactured in various styles 
and sizes, and are classified primarily according to the voltage 
they are designed to withstand. Under the governing industry 
standard issued by the Institute of Electrical and Electronic 
Engineers (IEEE), the voltage spectrum is divided into three broad 
classes: ``medium'' voltage (i.e., less than or equal to 69 
kilovolts), ``high'' voltage (i.e., from 115 to 230 kilovolts), and 
``extra-high'' or ``ultra-high'' voltage (i.e., greater than 230 
kilovolts).
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Facts Available (FA)

1. Application of FA
    Section 776(a)(2) of the Act provides that, if an interested party 
(A) withholds information requested by the Department, (B) fails to 
provide such information by the deadline, or in the form or manner 
requested, (C) significantly impedes a proceeding, or (D) provides 
information that cannot be verified, the Department shall use, subject 
to sections 782(d) and (e) of the Act, facts otherwise available in 
reaching the applicable determination.
    Pursuant to section 782(e) of the Act, the Department shall not 
decline to consider submitted information if all of the following 
requirements are met: (1) The information is submitted by the 
established deadline; (2) the information can be verified; (3) the 
information is not so incomplete that it cannot serve as a reliable 
basis for reaching the applicable determination; (4) the interested 
party has demonstrated that it acted to the best of its ability; and 
(5) the information can be used without undue difficulties.
    On April 18, 2003, NGK notified the Department that it did not 
intend to participate further in the Department's investigation and 
requested the return of all of its business proprietary information. 
NGK was notified by the Department that failure to submit the requested 
information by the date specified could result in use of the FA, as 
required by section 776(a)(2)(B) of the Act and section 351.308 of the 
Department's regulations. See letters from the Department to respondent 
dated February 28, 2003, March 20, 2003, April 1, 2003, and April 16, 
2003.
    As described above, NGK withdrew its response to Section A of the 
Department's questionnaire, and chose not to respond to Sections B and 
C. Because NGK withheld information requested by the Department 
essential to the calculation of dumping margins, we have applied FA to 
calculate the dumping margin pursuant to section 776(a)(2) of the Act.

2. Selection of Adverse FA (AFA)

    In selecting from among the facts otherwise available, section 
776(b) of the Act authorizes the Department to use an adverse inference 
if the Department finds that an interested party failed to cooperate by 
not acting to the best of its ability to comply with the request for 
information. See, e.g., Certain Welded Carbon Steel Pipes and Tubes 
From Thailand: Final Results of Antidumping Duty Administrative Review, 
62 FR 53808, 53819-20 (October 16, 1997). As a general matter, it is 
reasonable for the Department to assume that NGK possessed the records 
necessary for the Department to complete its investigation. Therefore, 
by withdrawing some of the information the Department requested, and 
declining to submit the remainder of the requested information, NGK 
failed to cooperate to the best of its ability. As NGK failed to 
cooperate to the best of its ability, we are applying an adverse 
inference pursuant to section 776(b) of the Act.
3. Corroboration of Information
    Section 776(b) of the Act authorizes the Department to use as AFA 
information derived from the petition, the final determination from the 
LTFV investigation, a previous administrative review, or any other 
information placed on the record. In this case, we have used the 
dumping margin alleged in the petition as AFA.
    Section 776(c) of the Act requires the Department to corroborate, 
to the extent practicable, secondary information used as FA. Secondary 
information is defined as ``{i{time} nformation derived from the 
petition that gave rise to the investigation or review, the final 
determination concerning the subject merchandise, or any previous 
review under section 751 concerning the subject merchandise.'' See 
Statement of Administrative Action (SAA) accompanying the Uruguay Round

[[Page 35629]]

Agreements Act (URAA), H.R. Doc. No. 103-316 at 870 (1994), and 19 CFR 
351.308(d).
    The SAA clarifies that ``corroborate'' means that the Department 
will satisfy itself that the secondary information to be used has 
probative value (see SAA at 870). The SAA also states that independent 
sources used to corroborate such evidence may include, for example, 
published price lists, official import statistics and customs data, and 
information obtained from interested parties during the particular 
investigation. Id.
    In order to determine the probative value of the petition margin, 
we examined evidence supporting the calculation of the antidumping duty 
margin in the petition. We reviewed the adequacy and accuracy of the 
information in the petition during our pre-initiation analysis of the 
petition, to the extent appropriate information was available for this 
purpose. See AD Investigation Checklist, dated January 21, 2003 
(Initiation Checklist) for a discussion of the margin calculation in 
the petition (public version is on file in Import Administration's 
Central Record Unit (CRU) of the Department of Commerce, Room B-099). 
In addition, in accordance with section 776(c) of the Act, to the 
extent practicable, we examined the key elements of the constructed 
export price (CEP) and normal value (NV) calculations on which the 
margin in the petition was based.

Constructed Export Price

    With respect to the margin in the petition, CEP was based on two 
price quotes for NGK merchandise during the POI. The petitioners 
calculated net U.S. price by deducting from the starting price U.S. 
sales commissions, inventory carrying costs, U.S. warehousing expenses, 
U.S. imputed credit expenses, foreign inland freight, ocean freight, 
U.S. customs duty and fees, U.S. inland freight, U.S. indirect selling 
expenses, and an amount for CEP profit. See Initiation Checklist.
    With regard to the CEP contained in the petition, the Department 
has no information from the respondent and is aware of no other 
independent sources of information that would enable us to further 
corroborate the CEP. See Initiation Checklist. Notably, the 
implementing regulation for section 776 of the Act states, ``(t)he fact 
that corroboration may not be practicable in a given circumstance will 
not prevent the Secretary from applying an adverse inference as 
appropriate and using secondary information in question.'' See 19 CFR 
351.308(d). Additionally, the SAA at 870 specifically states that where 
``corroboration may not be practicable in a given circumstance, the 
Department need not prove that the facts available are the best 
alternative information.'' Therefore, based on our efforts, described 
above, to corroborate information contained in the petition, and in 
accordance with section 776(c) of the Act, we consider the CEP based on 
the petition to be corroborated to the extent practicable for purposes 
of this preliminary determination.

Normal Value

    The petitioners calculated NV based on home market price quotes 
that were obtained through foreign market research. These prices 
quotes, which were made during the POI, are for subject merchandise of 
the same grade as that of the merchandise for which the U.S. price 
quotes for CEP were obtained. See Initiation Checklist. With regard to 
the NV contained in the petition, as with the CEP contained in the 
petition, the Department has no information from the respondent and is 
aware of no other independent sources of information that would enable 
us to further corroborate NV.
    Accordingly, in selecting AFA with respect to NGK, the Department 
applied the petition dumping margin of 105.8 percent.

All Others

    Section 735(c)(5)(B) of the Act provides that, where the estimated 
weighted-average dumping margins established for all exporters and 
producers individually investigated are zero or de minimis, or are 
determined entirely under section 776 of the Act, the Department may 
use any reasonable method to establish the estimated ``all others'' 
rate for exporters and producers not individually investigated. This 
provision contemplates that the Department may weight-average margins 
other than zero, de minimis, and FA margins to establish the ``all 
others'' rate. Where the data do not permit weight-averaging such 
rates, the SAA, at 873, provides that we may use other reasonable 
methods. Because the petition contained only an estimated price-to-
price dumping margin, there are no other estimated margins available 
with which to create the ``all others'' rate. Therefore, we applied the 
petition margin of 105.8 percent as the ``all others'' rate. See, e.g., 
Notice of Preliminary Determination of Sales at Less Than Fair Value: 
Certain Hot-Rolled Carbon Steel Flat Products From Indonesia, 66 FR 
22163 (May 3, 2001).

Suspension of Liquidation

    In accordance with section 733(d) of the Act, we are directing the 
U.S. Bureau of Customs and Border Protection (BCBP) to suspend 
liquidation of all imports of HVSPs from Japan 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 BCBP to 
require a cash deposit or the posting of a bond equal to the weighted-
average amount by which the normal value exceeds the U.S. price, as 
indicated below. These suspension of liquidation instructions will 
remain in effect until further notice.

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                 Manufacturer/Exporter                               Weighted-Average Percent Margin
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NGK Insulators, Ltd...................................                                             105.8 percent
All Others............................................                                             105.8 percent
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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 is the later of 120 days after 
the date of this preliminary determination or 45 days after the date of 
our final determination.

Public Comment

    For the investigation of HVSPs from Japan, case briefs must be 
submitted no later than 30 days after the publication of this notice in 
the Federal Register. Rebuttal briefs must be filed within five 
calendar days after the deadline for submission of 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. Public versions of all comments and rebuttals should be

[[Page 35630]]

provided to the Department and made available on diskette. Section 774 
of the Act provides that the Department will hold a hearing to afford 
interested parties an opportunity to comment on arguments raised in 
case or rebuttal briefs, provided that such a hearing is requested by 
any interested party. If a request for a hearing is made in an 
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 30 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. If this 
investigation proceeds normally, we will make our final determination 
in the investigation of HVSPs from Japan no later than 75 days after 
the date of this preliminary determination.
    This determination is issued and published pursuant to sections 
733(f) and 777(i)(1) of the Act.

    Dated: June 6, 2003.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 03-15149 Filed 6-13-03; 8:45 am]
BILLING CODE 3510-DS-S