[Federal Register Volume 68, Number 137 (Thursday, July 17, 2003)]
[Notices]
[Pages 42386-42389]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-18131]


-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

International Trade Administration

[A-351-837]


Notice of Preliminary Determination of Sales at Less Than Fair 
Value: Prestressed Concrete Steel Wire Strand from Brazil

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

ACTION:  Notice of Preliminary Determination of Sales at Less Than Fair 
Value.

-----------------------------------------------------------------------

EFFECTIVE DATE: July 17, 2003.

FOR FURTHER INFORMATION CONTACT:  David Layton at (202) 482-0371, or 
Monica Gallardo at (202) 482-3147; AD/CVD Enforcement Office V, 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 prestressed concrete steel wire 
strand (PC strand) from Brazil 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 Tariff Act of 1930, as amended (the Act). The 
preliminary margin assigned to Belgo Bekaert Arames, S.A. (BBA) is 
based on adverse facts available (AFA). The estimated margin of sales 
at LTFV is shown in the Suspension of Liquidation section of this 
notice.
    Interested parties are invited to comment on this preliminary 
determination. We will make our final determination not later than 75 
days after the date of this preliminary determination.

Case History

    This investigation was initiated on February 20, 2003.\1\ See 
Notice of Initiation of Antidumping Duty Investigations: Prestressed 
Concrete Steel Wire Strand From Brazil, India, the Republic of Korea, 
Mexico, and Thailand, 68 FR 9050 (February 27, 2003) (Initiation 
Notice). Since the initiation of the investigation, the following 
events have occurred:
---------------------------------------------------------------------------

    \1\ The petitioners in this investigation are American Spring 
Wire Corp., Insteel Wire Products Company, and Sumiden Wire Products 
Corp.
---------------------------------------------------------------------------

    The Department of Commerce (the Department) set aside a period for 
all interested parties to raise issues regarding product coverage. See 
Initiation Notice, 68 FR at 9050. No comments were received from 
interested parties in this investigation.
    The Department issued a letter on March 7, 2003, to interested 
parties in all of the concurrent PC strand antidumping investigations, 
providing an opportunity to comment on the Department's proposed model 
match characteristics and its hierarchy of characteristics. The 
petitioners submitted comments on March 18 and March 20, 2003. The 
Department also received comments on model matching from respondents in 
the concurrent investigation involving Mexico on March 18, 2003. These 
comments were taken into consideration by the Department in developing 
the model matching characteristics and hierarchy for all of the PC 
strand antidumping investigations.
    On March 17, 2003, the United States International Trade Commission 
(ITC) preliminarily determined that there is a reasonable indication 
that imports of the products subject to this investigation are 
materially injuring an industry in the United States producing the 
domestic like product. See Prestressed Concrete Steel Wire Strand From 
Brazil, India, Korea, Mexico, and Thailand, 68 FR 13952 (March 21, 
2003).
    On April 4, 2003, the Department issued its antidumping 
questionnaire to the Brazilian respondent, BBA, specifying, that the 
response to section A would be due on April 25, 2003, and that the 
responses to sections B, C, and D would be due May 12, 2003\2\. On 
April 28, 2003, BBA confirmed that it would not participate in the 
investigation. See Memorandum from David Layton, International Trade 
Compliance Analyst, to the File, Re: Telephone Conversation with 
Counsel for Brazilian Producer Belgo Bekaert Arames S.A. Concerning 
Participation, dated April 28, 2003. BBA provided no further 
elaboration, nor did it suggest alternatives to meet the Department's 
requirements pursuant to 782(c) of the Act. Id.
---------------------------------------------------------------------------

    \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 cases). Section C requests a complete listing of U.S. sales. 
Section D requests information on the cost of production of the 
foreign like product and the constructed value of the merchandise 
under investigation. Section E requests information on further 
manufacturing.
---------------------------------------------------------------------------

Selection of Respondents

    Section 777A(c)(1) of the Act directs the Department to calculate 
individual dumping margins for each known exporter and producer of the 
subject merchandise. Where it is not practicable to examine all known 
producers/exporters of subject merchandise, section 777A(c)(2) of the 
Act permits the Department to investigate either: (1) a sample of 
exporters, producers, or types of products that is statistically valid, 
based on the information available at the time of selection; or (2) 
exporters and producers accounting for the largest volume of the 
subject merchandise that can reasonably be examined.
    During the period of investigation (POI), only BBA was identified 
as a producer /exporter of subject merchandise from Brazil. In an April 
1, 2003, conversation with counsel to BBA, it was confirmed that BBA is 
the sole producer of PC strand in Brazil and that BBA is a subsidiary 
of the Companhia Siderurgica Belgo-Mineira (Belgo-Mineira) which holds 
majority shares in BBA. See Memorandum from David Layton, International 
Trade Compliance Analyst, to the File dated April 1, 2003. Therefore, 
we selected BBA as the sole respondent in the investigation of PC 
strand from Brazil. See Memorandum from Daniel O'Brien, Import 
Compliance Specialist, to Gary Taverman, Director, Office 5, RE:

[[Page 42387]]

 Selection of Respondents, dated April 4, 2003.

Period of Investigation

    The period of investigation (POI) is January 1, 2002, through 
December 31, 2002. This period corresponds to the four most recent 
fiscal quarters prior to the month of filing of the petition (i.e., 
January, 2003) involving imports from a market economy, and is in 
accordance with our regulations. See 19 CFR 351.204(b)(1).

Scope of Investigation

    For purposes of this investigation, PC strand is steel strand 
produced from wire of non-stainless, non-galvanized steel, which is 
suitable for use in prestressed concrete (both pretensioned and post-
tensioned) applications. The product definition encompasses covered and 
uncovered strand and all types, grades, and diameters of PC strand.
    The merchandise under investigation is currently classifiable under 
subheadings 7312.10.3010 and 7312.10.3012 of the Harmonized Tariff 
Schedule of the United States (HTSUS). Although the HTSUS subheadings 
are provided for convenience and customs purposes, the written 
description of the merchandise under investigation is dispositive.

Facts Available

    For the reasons discussed below, we determine that the use of AFA 
is appropriate for the preliminary determination with respect to BBA.

A. Use of Facts Available

    Section 776(a)(2) of the Act provides that, if an interested party 
withholds information requested by the Department, fails to provide 
such information by the deadline or in the form or manner requested, 
significantly impedes a proceeding, or provides information which 
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. Section 782(d) of the Act provides that if 
the Department determines that a response to a request for information 
does not comply with the Department's request, the Department shall 
promptly inform the responding party and provide an opportunity to 
remedy the deficient submission. Section 782(e) of the Act further 
states that 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.
    As discussed above, BBA failed to respond to the Department's 
request for information, thus the curative provisions of sections 
782(d) and (e) of the Act are not applicable. Specifically, the 
information that BBA failed to report is critical for calculating 
preliminary dumping margins, therefore, the Department must resort to 
facts otherwise available to ensure that BBA does not obtain a more 
favorable result than it would by responding to the Department's 
request for information. The failure of BBA to respond significantly 
impedes this process because the Department cannot accurately determine 
a margin for this party. Thus, in reaching our preliminary 
determination, pursuant to sections 776(a)(2)(A), (B), and (C) of the 
Act, we have based BBA's margin rate on facts available.

B. Application of Adverse Inferences for Facts Available

    In applying facts otherwise available, section 776(b) of the Act 
provides that the Department may use an inference adverse to the 
interests of a party that has failed to cooperate by not acting to the 
best of its ability to comply with the Department's requests for 
information. See, e.g., Notice of Final Determination of Sales at Less 
Than Fair Value and Final Negative Critical Circumstances: Carbon and 
Certain Alloy Steel Wire Rod from Brazil, 67 FR 55792, 55794-96 (August 
30, 2002). Adverse inferences are appropriate ``to ensure that the 
party does not obtain a more favorable result by failing to cooperate 
than if it had cooperated fully.'' See Statement of Administrative 
Action accompanying the Uruguay Round Agreements Act, H.R. Rep. No. 
103-316, at 870 (1994) (SAA). Furthermore, ``{a{time} ffirmative 
evidence of bad faith on the part of a respondent is not required 
before the Department may make an adverse inference.'' See Antidumping 
Countervailing Duties: Final Rule, 62 FR 27296, 27340 (May 19, 1997). 
In this case, BBA has failed to cooperate to the best of its ability by 
failing to respond to the Department's antidumping questionnaire. In 
addition, the company did not make an effort to provide an explanation 
for its failure to respond, or proposed an alternate form of submitting 
the required data. These omissions constitute a failure on the part of 
this company to cooperate ``to the best of its ability to comply with a 
request for information'' by the Department within the meaning of 
section 776 of the Act. Therefore, the Department has preliminarily 
determined that in selecting from among the facts otherwise available, 
an adverse inference is warranted. See, e.g., Notice of Final 
Determination of Sales at Less than Fair Value: Circular Seamless 
Stainless Steel Hollow Products from Japan, 65 FR 42985, 42986 (July 
12, 2000) (the Department applied total AFA where respondent failed to 
respond to the antidumping questionnaires).

C. Selection and Corroboration of Information Used as Facts Available

    Where the Department applies AFA because a respondent failed to 
cooperate by not acting to the best of its ability to comply with a 
request for information, section 776(b) of the Act authorizes the 
Department to rely on information derived from the petition, a final 
determination, a previous administrative review, or other information 
placed on the record. See also 19 CFR 351.308(c); SAA at 829-831. In 
this case, because we are unable to calculate margins for the 
respondent in this investigation, we assign to BBA the highest margin 
from the proceeding, which is the highest margin alleged for Brazil in 
the petition. See Initiation Notice, 68 FR at 9052.
    When using facts otherwise available, section 776(c) of the Act 
provides that, when the Department relies on secondary information 
(such as the petition) in using facts otherwise available, it must, to 
the extent practicable, corroborate that information from independent 
sources that are reasonably at its disposal. 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 Department's regulations state 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. 
See 19 CFR 351.308(d); see also SAA at 870.
    To assess the reliability of the petition margin for the purposes 
of this investigation, to the extent appropriate information was 
available, we reviewed the adequacy and accuracy of the information in 
the petition for both this preliminary determination and during our 
pre-initiation analysis. See Office of AD/CVD Enforcement Initiation 
Checklist, at 15 (February 20, 2003)

[[Page 42388]]

(Initiation Checklist). Also, as discussed below, we examined evidence 
supporting the calculations in the petition to determine the probative 
value of the margins in the petition for use as AFA for purposes of 
this preliminary determination. 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. See Memorandum from David 
Layton and Monica Gallardo, International Trade Compliance Analysts, to 
Gary Taverman, Director, Office 5, Re: Corroboration of Data Contained 
in the Petition for Assigning Facts Available Rates, dated July 10, 
2003 (Corroboration Memo).
1. Corroboration of Constructed Export Price
    The petitioners based CEP on prices for sales of low-relaxation PC 
strand from a Brazilian producer, through its U.S. affiliate, to an 
unaffiliated U.S. purchaser. The petitioners calculated a single 
average gross unit price and deducted from it estimated costs for 
international freight and insurance charges, U.S. inland freight 
charges, harbor maintenance and merchandise processing fees, imputed 
credit expenses, and trading company commission to arrive at an average 
net U.S. price. Information regarding U.S. prices including warehousing 
expenses, indirect selling expenses, inventory carrying expenses, and 
CEP profit was not reasonably available to the petitioners. Therefore, 
the petitioners did not deduct these items from the average gross unit 
price. Instead, as a conservative estimate of these expenses, the 
petitioners subtracted an amount for the ``prevailing commission rate 
for PC strand sold in the United States via unaffiliated agents to 
foreign producers' unaffiliated U.S. customers.'' See Volume II-Brazil 
AD of the petition at 2-3. We compared the U.S. market price quotes 
with official U.S. import statistics and U.S. customs data, and found 
the prices used by the petitioners to be reliable. For further 
discussion, see Corroboration Memo at 2.
2. Corroboration of Normal Value
    With respect to the NV, the petitioners provided a home market 
price for low-relaxation PC strand that was obtained from foreign 
market research. See Memorandum to the File, Re: Telephone Conversation 
with Market Researcher Regarding the Petitions for Imposition of 
Antidumping: Prestressed Concrete Steel Wire Strand from Brazil 
(February 12, 2003). The petitioners adjusted the gross unit price for 
home market credit expenses and inland freight.
    The Department was provided with no useful information by the 
respondent or other interested parties and is aware of no other 
independent source of information that would enable it to further 
corroborate the margin calculations in the petition. Specifically, we 
attempted to locate both home market prices through publicly available 
sources and U.S. producer costs upon which the CV was based, but we 
were unable to do so. See Corroboration Memo at 3.
    The implementing regulation for section 776 of the Act, at 19 CFR 
351.308(d) states, ``{t{time} 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 the secondary 
information in question.'' Additionally, we note that 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.''
    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 margins in the petition to be 
corroborated to the extent practicable for purposes of this preliminary 
determination. Accordingly, in selecting AFA with respect to BBA, we 
have applied the margin rate of 118.75 percent, which is the highest 
estimated dumping margin set forth in the notice of initiation. See 
Initiation Notice, 68 FR at 9052.

All Others Rate

    Section 735(c)(5)(B) of the Act provides that, where the estimated 
weighted-averaged 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 we weight-average margins other than zero, 
de minimis, and facts available margins to establish that ``All 
Others'' rate. Where the data do not permit weight-averaging such 
rates, the SAA provides that we use other reasonable methods. See SAA 
at 873. Because the revised petition, contained only one price-to-price 
dumping margin, it is reasonable to use this dumping margin to create 
an ``All Others'' rate. Further, since BBA is the only known Brazilian 
producer/exporter of subject merchandise, it is reasonable to use a 
margin based on a comparison of its sales as the ``All Others'' rate. 
Accordingly, we have applied a margin of 118.75 percent as the ``All 
Others'' rate.

Suspension of Liquidation

    In accordance with section 733(d)(2) of the Act, we are directing 
the U.S. Bureau of Customs and Border Protection (BCBP) to suspend 
liquidation of all entries of PC strand from Brazil that are entered, 
or withdrawn from warehouse, for consumption on or after the date of 
publication of this notice in the Federal Register. We are also 
instructing the BCBP to require a cash deposit or the posting of a bond 
equal to the dumping margin as indicated in the chart below. These 
instructions suspending liquidation will remain in effect until further 
notice.
    The dumping margins are as follows:

------------------------------------------------------------------------
               Producer/Exporter                   Margin (Percentage)
------------------------------------------------------------------------
Belgo Bekaert Arames S.A.......................                   118.75
All Others.....................................                   118.75
------------------------------------------------------------------------

International Trade Commission Notification

    In accordance with section 733(f) of the Act, we have notified the 
ITC of the Department's preliminary affirmative determination. If the 
final determination in this proceeding is affirmative, the ITC will 
determine before the later of 120 days after the date of this 
preliminary determination or 45 days after the final determination 
whether imports of PC strand from Brazil are materially injuring, or 
threaten material injury, to the U.S. industry.

Public Comment

    Interested parties are invited to comment on the preliminary

[[Page 42389]]

determination. Interested parties may submit case briefs within 30 days 
of the date of publication of this notice. See 19 CFR 351.309(c)(1)(I). 
Rebuttal briefs, the content of which is limited to the issues raised 
in the case briefs, must be filed within five days after the deadline 
for the submission of case briefs. See 19 CFR 351.309(d). 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. Further, we request that parties submitting briefs and 
rebuttal briefs provide the Department with a copy of the public 
version of such briefs on diskette.
    In accordance with section 774 of the Act, we will hold a public 
hearing, if requested, to afford interested parties an opportunity to 
comment on arguments raised in case or rebuttal briefs. If a request 
for a hearing is made, we will tentatively hold the hearing two days 
after the deadline for submission of rebuttal briefs at the U.S. 
Department of Commerce, 14th Street and Constitution Avenue, NW, 
Washington, DC 20230, at a time and in a room to be determined. Parties 
should confirm by telephone the date, time, and location of the hearing 
48 hours before the scheduled date.
    Interested parties who wish to request a hearing, or to participate 
in a hearing if one is requested, must submit a written request to the 
Assistant Secretary for Import Administration, U.S. Department of 
Commerce, Room 1870, within 30 days of the date of publication of this 
notice. Requests should contain: (1) the party's name, address, and 
telephone number; (2) the number of participants; and (3) a list of the 
issues to be discussed. At the hearing, oral presentations will be 
limited to issues raised in the briefs. See 19 CFR 351.310(c). The 
Department will make its final determination no later than 75 days 
after the date of publication of this preliminary determination.
    This determination is issued and published in accordance with 
sections 733(f) and 777(I)(1) of the Act.

    Dated: July 10, 2003.
Jeffrey May,
Acting Assistant Secretary for Grant Aldonas, Under Secretary.
[FR Doc. 03-18131 Filed 7-16-03; 8:45 am]
BILLING CODE 3510-DS-S