[Federal Register Volume 68, Number 235 (Monday, December 8, 2003)]
[Notices]
[Pages 68336-68341]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-30388]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-549-817]


Certain Hot-Rolled Carbon Steel Flat Products From Thailand: 
Preliminary Results and Partial Rescission of Antidumping Duty 
Administrative Review

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

EFFECTIVE DATE: December 8, 2003.

FOR FURTHER INFORMATION CONTACT: Michael Ferrier at (202) 482-1394 or 
Abdelali Elouaradia at (202) 482-1374, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Ave, NW., Washington, DC 20230.
SUMMARY: The Department of Commerce (``the Department'') is conducting 
an administrative review of the antidumping duty order on certain hot-
rolled carbon steel flat products from Thailand (``hot-rolled steel'') 
manufactured/exported by Sahaviriya Steel Industries Public Company 
Limited (``SSI''). The period of review (``POR'') covers the period May 
3, 2001, through October 31, 2002. We have preliminarily determined 
that SSI did not make sales of the subject merchandise at less than 
normal value (``NV'') (i.e., they made sales at zero or de minimis 
dumping margins). If these preliminary results are adopted in the final 
results of this administrative review, we will instruct the U.S. 
Customs and Border Protection (``CBP'') to liquidate appropriate 
entries without regard to antidumping duties. We invite interested 
parties to comment on these preliminary results. We request parties who 
submit argument in these proceedings to submit with the argument (1) a 
statement of the issues and (2) a brief summary of the argument.

SUPPLEMENTARY INFORMATION:

Background

    On November 29, 2001, the Department published the antidumping duty 
order on hot-rolled steel (see Antidumping Duty Order: Certain Hot-
Rolled Carbon Steel Flat Products From Thailand, 66 FR 59562) (``HRC 
Order''). On November 1, 2002, the Department published a notice of 
opportunity to request an administrative review for this order covering 
the period May 3, 2001, through October 31, 2002 (see Antidumping or 
Countervailing Duty Order, Finding, or Suspended Investigation; 
Opportunity to Request Administrative Review, 67 FR 66612). On November 
27, 2002, SSI requested a review in accordance with 19 CFR 
351.213(b)(2) of the Department's regulations, and the petitioners 
requested reviews of SSI, Nakornthai Strip Mill Public Co., Ltd. 
(``Nakornthai''), and Siam Strip Mill Public Co., Ltd. (``Siam Strip'') 
under 19 CFR 351.213(b)(1) of the Department's regulations. The 
petitioners are Nucor Corporation, National Steel Corporation, and 
United States Steel Corporation. On November 29, 2002, Siam Strip 
submitted a letter to the Department stating that they did not sell, 
ship, or export subject merchandise to the United States during the 
POR. The Department initiated these reviews on December 26, 2002 (see 
Initiation of Antidumping and Countervailing Duty Administrative 
Reviews, 67 FR 78772).
    On January 6, 2003, the Department issued the antidumping duty 
questionnaire to SSI, Nakornthai, and Siam Strip. On January 10, 2003, 
petitioners filed a letter requesting that the Department verify the 
questionnaire responses filed by SSI, Nakornthai, and Siam Strip. On 
February 19, 2003, SSI filed its section A response. On February 26, 
2003, SSI filed its sections B and C responses and on March 5, 2003, 
SSI filed its section D response. Petitioners filed comments on SSI's 
section A through D responses on the following dates: March 6, 2003, 
for section A; March 12, 2003, for sections B and C; and March 20, 2003 
for section D. On March 20, 2003, and May 12, 2003, SSI filed comments 
in response to petitioners' comments. SSI filed its supplemental 
responses on the following dates: April 15, 2003, for supplemental 
section A, April 22, 2003, for supplemental section D, and April 15, 
2003, for supplemental sections B and C. Petitioners filed additional 
comments on SSI's supplemental sections A through C responses on April 
24, 2003, and May 7, 2003. On May 7, 2003, SSI submitted minor 
corrections to the data provided in its questionnaire responses. 
Petitioners filed cost verification comments on May 12, 2003, and May 
14, 2003, and sales verification comments on June 10, 2003. SSI filed 
its third supplemental response with the Department on May 22, 2003. On 
July 7, 2003, the Department extended the deadline for the preliminary 
results of this administrative review to no later than December 1, 2003 
(see Notice of Extension of Time Limit for Preliminary Results of 
Antidumping Duty Administrative Review: Certain Hot-Rolled Carbon Steel 
Flat Products from Thailand, 68 FR 40243). On October 6, 2003, SSI 
submitted additional minor corrections to the data provided in its 
questionnaire responses. As requested, on October 14, 2003, SSI 
submitted a revised version of its COP/CV database and a revised sales 
data base on November 18, 2003.

Partial Rescission

    On January 22, 2002, Nakornthai submitted a statement that it had 
no sales to the United States during the POR. On January 24, 2002, Siam 
Strip submitted a similar statement. The Department conducted a query 
of CBP data on entries of hot-rolled steel from Thailand made during 
the POR, and confirmed that these companies made no entries during this 
period. Therefore, we preliminarily determine to rescind these reviews 
with respect to Nakornthai and Siam Strip in accordance with section 
351.213 (d)(3) of the Department's regulations.

[[Page 68337]]

Scope of the Review

    For purposes of this review, the products covered are certain hot-
rolled carbon steel flat products of a rectangular shape, of a width of 
0.5 inch or greater, neither clad, plated, nor coated with metal and 
whether or not painted, varnished, or coated with plastics or other 
non-metallic substances, in coils (whether or not in successively 
superimposed layers), regardless of thickness, and in straight lengths, 
of a thickness of less than 4.75 mm and of a width measuring at least 
10 times the thickness. Universal mill plate (i.e., flat-rolled 
products rolled on four faces or in a closed box pass, of a width 
exceeding 150 mm, but not exceeding 1250 mm, and of a thickness of not 
less than 4.0 mm, not in coils and without patterns in relief) of a 
thickness not less than 4.0 mm is not included within the scope of this 
review.
    Specifically included within the scope of this review are vacuum 
degassed, fully stabilized (commonly referred to as interstitial-free 
(IF)) steels, high strength low alloy (HSLA) steels, and the substrate 
for motor lamination steels. IF steels are recognized as low carbon 
steels with micro-alloying levels of elements such as titanium or 
niobium (also commonly referred to as columbium), or both, added to 
stabilize carbon and nitrogen elements. HSLA steels are recognized as 
steels with micro-alloying levels of elements such as chromium, copper, 
niobium, vanadium, and molybdenum. The substrate for motor lamination 
steels contains micro-alloying levels of elements such as silicon and 
aluminum.
    Steel products to be included in the scope of this review, 
regardless of definitions in the Harmonized Tariff Schedule of the 
United States (HTSUS), are products in which: (i) Iron predominates, by 
weight, over each of the other contained elements; (ii) the carbon 
content is 2 percent or less, by weight; and (iii) none of the elements 
listed below exceeds the quantity, by weight, respectively indicated:

1.80 percent of manganese, or
2.25 percent of silicon, or
1.00 percent of copper, or
0.50 percent of aluminum, or
1.25 percent of chromium, or
0.30 percent of cobalt, or
0.40 percent of lead, or
1.25 percent of nickel, or
0.30 percent of tungsten, or
0.10 percent of molybdenum, or
0.10 percent of niobium, or
0.15 percent of vanadium, or
0.15 percent of zirconium.

    All products that meet the physical and chemical description 
provided above are within the scope of this review unless otherwise 
excluded. The following products, by way of example, are outside or 
specifically excluded from the scope of this review:
    [sbull] Alloy hot-rolled steel products in which at least one of 
the chemical elements exceeds those listed above (including, e.g., 
American Society for Testing and Materials (ASTM) specifications A543, 
A387, A514, A517, A506).
    [sbull] Society of Automotive Engineers (SAE)/American Iron & Steel 
Institute (AISI) grades of series 2300 and higher.
    [sbull] Ball bearing steels, as defined in the HTSUS.
    [sbull] Tool steels, as defined in the HTSUS.
    [sbull] Silico-manganese (as defined in the HTSUS) or silicon 
electrical steel with a silicon level exceeding 2.25 percent.
    [sbull] ASTM specifications A710 and A736.
    [sbull] USS abrasion-resistant steels (USS AR 400, USS AR 500).
    [sbull] All products (proprietary or otherwise) based on an alloy 
ASTM specification (sample specifications: ASTM A506, A507).
    [sbull] Non-rectangular shapes, not in coils, which are the result 
of having been processed by cutting or stamping and which have assumed 
the character of articles or products classified outside chapter 72 of 
the HTSUS.
    The merchandise subject to this review is classified in the HTSUS 
at subheadings: 7208.10.15.00, 7208.10.30.00, 7208.10.60.00, 
7208.25.30.00, 7208.25.60.00, 7208.26.00.30, 7208.26.00.60, 
7208.27.00.30, 7208.27.00.60, 7208.36.00.30, 7208.36.00.60, 
7208.37.00.30, 7208.37.00.60, 7208.38.00.15, 7208.38.00.30, 
7208.38.00.90, 7208.39.00.15, 7208.39.00.30, 7208.39.00.90, 
7208.40.60.30, 7208.40.60.60, 7208.53.00.00, 7208.54.00.00, 
7208.90.00.00, 7211.14.00.90, 7211.19.15.00, 7211.19.20.00, 
7211.19.30.00, 7211.19.45.00, 7211.19.60.00, 7211.19.75.30, 
7211.19.75.60, and 7211.19.75.90. Certain hot-rolled carbon steel flat 
products covered by this review, including: vacuum degassed fully 
stabilized; high strength low alloy; and the substrate for motor 
lamination steel may also enter under the following tariff numbers: 
7225.11.00.00, 7225.19.00.00, 7225.30.30.50, 7225.30.70.00, 
7225.40.70.00, 7225.99.00.90, 7226.11.10.00, 7226.11.90.30, 
7226.11.90.60, 7226.19.10.00, 7226.19.90.00, 7226.91.50.00, 
7226.91.70.00, 7226.91.80.00, and 7226.99.00.00. Subject merchandise 
may also enter under 7210.70.30.00, 7210.90.90.00, 7211.14.00.30, 
7212.40.10.00, 7212.40.50.00, and 7212.50.00.00. Although the HTSUS 
subheadings are provided for convenience and CBP purposes, the written 
description of the merchandise under review is dispositive.

Period of Review

    The POR is May 3, 2001, through October 31, 2002.

Verification

    As provided in section 782(i) of the Tariff Act of 1930, as amended 
(``the Act''), we verified cost of production from May 26, 2003, 
through May 30, 2003, and sales information from October 27, 2003, 
through November 1, 2003, using standard verification procedures, 
including an examination of relevant sales, cost, financial records, 
and selection of original documentation containing relevant 
information. Our verification results are outlined in the public 
versions of the verification reports and are on file in the 
Department's Central Records Unit located in Room B-099 of the main 
Department of Commerce Building, 14th Street and Constitution Avenue, 
NW., Washington, DC.

Affiliated Party Issue

    On March 12, 2003, and May 6, 2003, the petitioner submitted 
comments alleging that SSI and one of its U.S. customers, a trading 
company, were affiliated under section 771(33) of the Act. Because of 
this alleged affiliation, the petitioner claims that the prices from 
this alleged affiliated customer to the first unaffiliated customers in 
the U.S. should be used.
    SSI and company A (the identity of this other company is business 
proprietary and can not be disclosed in this public notice) are owners 
in a number of other ventures (e.g., Thai Cold Rolled Steel and Thai 
Coated Rolled Steel) and, therefore, the petitioner claims that SSI and 
company A are affiliated. Company A also is one of two companies that 
jointly control the U.S. customer. Petitioner claims that because: (1) 
SSI is affiliated with company A via their involvement in other 
ventures, and (2) company A is in a position to control the U.S. 
customer, the Department should find that SSI and the U.S. customer are 
affiliated and that their relationship has the potential to impact the 
product under investigation.
    The petitioner also emphasizes that the characteristics of SSI's 
and company A's relationship indicate that there is affiliation based 
on, for example, the long term capital investment of both

[[Page 68338]]

companies in the other ventures and inter-company business 
relationships (e.g., SSI sells subject merchandise to Thai Cold Rolled 
and company A acts as SSI's selling arm for some of its non-subject 
merchandise).
    SSI claims that it is not affiliated with company A pursuant to 
Section 771(33)(F) nor the U.S. customer, a trading company, and thus 
it did not supplement its U.S. sales data with the sales made by the 
U.S. trading company to the next unaffiliated customer. SSI claims that 
it did not commonly control Thai Cold Rolled Steel with company A nor 
was it required to sell subject merchandise to Thai Cold Rolled Steel 
and that Thai Cold Rolled Steel has other suppliers. Additionally, SSI 
points out that it does not have ownership in company A nor in the U.S. 
customer, and that there are no common family members, officers or 
director, partner or employer/employee relationships between SSI and 
company A or the U.S. customer.
    In this case, the Department preliminarily does not find that SSI 
and the U.S. customer were affiliated, because the nature of the 
relationship between SSI and company A, one of the two owners of the 
U.S. customer, with respect to non-subject merchandise did not have the 
potential to impact decisions concerning the production, pricing or 
cost of the subject merchandise.

Fair Value Comparisons

    To determine whether sales of subject merchandise were made in the 
United States at less than fair value, we compared the export price 
(EP) or constructed export price (CEP) to the NV, as described in the 
``Export Price and Constructed Export Price'' and ``Normal Value'' 
sections of this notice. In accordance with section 777A(d)(1)(A)(i) of 
the Act, we calculated EPs and compared these prices to weighted-
average normal values or CVs, as appropriate.

Export Price

    In accordance with section 772 of the Act, we calculated either an 
EP or a CEP, depending on the nature of each sale. Section 772(a) of 
the Act defines EP as the price at which the subject merchandise is 
first sold by the foreign exporter or producer before the date of 
importation to an unaffiliated purchaser in the United States, or to an 
unaffiliated purchaser for exportation to the United States. We have 
preliminarily determined that all of SSI's U.S. sales during the POR 
were EP sales.
    We calculated EP based on prices charged to the first unaffiliated 
U.S. customer, which was a trading company in this case. We used the 
final contract date as the date of sale as determined by the Department 
in the original investigation. We based EP on the packed CFR prices to 
the first unaffiliated purchasers outside Thailand. We made deductions 
for movement expenses in accordance with section 772(c)(2)(A) of the 
Act, including: foreign inland freight and foreign brokerage and 
handling.

Duty Drawback

    Section 772(c)(1)(B) of the Act provides that EP shall be increased 
by ``the amount of any import duties imposed by the country of 
exportation which have been rebated, or which have not been collected, 
by reason of the exportation of the subject merchandise to the United 
States.'' The Department determines that an adjustment to U.S. price 
for claimed duty drawback is appropriate when a company can demonstrate 
that (1) there is a sufficient link between the import duty and the 
rebate, and (2) there are sufficient imports of the imported material 
to account for the duty drawback received for the export of the 
manufactured product (the ``two pronged test''). See Rajinder Pipes 
Ltd. v. United States, 70 F. Supp. 2d 1350, 1358 (CIT 1999). See also 
Certain Welded Carbon Standard Steel Pipes and Tubes from India: Final 
Results of New Shippers Antidumping Duty Administrative Review, 62 FR 
47632 (September 10, 1997) and Federal Mogul Corp. v. United States, 
862 F. Supp. 384, 409 (CIT 1994).
    During the POR, SSI received duty drawback for its U.S. sales and 
for certain sales in the home market that were exported from Thailand 
as non-subject merchandise by unaffiliated further manufacturers and 
produced from SSI hot-rolled coil. Under the Thai Board of Investment 
(``BOI'') duty drawback scheme, SSI applies to the BOI for a duty 
exemption for the imported slab with the BOI maintaining a running 
tally of SSI's requests for slab exemptions. When SSI intends to 
export, it again applies to the BOI requesting a duty exemption for the 
exported material. During verification, the Department found that SSI 
maintains its duty exemption records on a FIFO (first in first out) 
basis. SSI noted that it applies for the BOI import surcharge exemption 
when the company expects export sales. Additionally, we noted that when 
SSI submits its application for duty drawback, SSI is not required by 
the Thai government to link the specific imported slab to the specific 
exported hot-rolled coil. The Department concludes that for SSI's U.S. 
sales, the company uses a methodology consistent with Department 
practice for applying its duty drawback received upon export of subject 
merchandise to the United States. See Far East Mach. II, 12 CIT at 975, 
699 F.Supp. at 312; see also Final Determination of Sales at Less Than 
Fair Value: Oil Country Tubular Good from Korea, 60 FR 33561 (June 28, 
1995). SSI meets the second criterion of the two-pronged test for its 
U.S. sales, as all of SSI's hot-rolled steel is made from imported 
slab. With respect to the duty drawback SSI received from certain home 
market sales that were ultimately exported, SSI received duty drawback 
from the BOI when the exporting company applied for the duty drawback. 
SSI stated that only one of its home market customers applied to the 
BOI for the import duty exemption. For this company, SSI applied the 
amount of drawback it received from the BOI over all of SSI's home 
market sales to this company. SSI stated that it is unable to determine 
which sales of hot-rolled coil it made to this further processor were 
destined for the export market versus the home market. Verification 
confirms SSI's assertion about the inability to directly link SSI's 
hot-rolled coil to the further manufactured product, but the Department 
believes that SSI's domestic customer has an adequate link to the BOI 
drawbacks for the following reasons. First, SSI stated that this 
customer applies for duty drawback in the same manner as SSI. Second, 
SSI's accounting records demonstrate that the company records in its 
accounting system these duty drawbacks in a similar manner as its U.S. 
market drawbacks. Thus, the Department finds that there is a sufficient 
link for SSI's local export sales. Since SSI received this duty 
drawback from its slab imports, the second criterion of the two pronged 
test for these local export sales is the same as SSI's direct U.S. 
sales: all of SSI's hot-rolled steel is made from imported slab. For 
these preliminary results, the Department is adding the duty drawback 
as reported by SSI to normal value.

Normal Value

    After testing home market viability and whether home market sales 
were at below-cost prices, the Department calculated NV as noted in the 
``Price-to-Price Comparisons'' and ``Price-to-CV Comparison'' sections 
of this notice.

[[Page 68339]]

A. Home Market Viability

    In determining that there was 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), the Department 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. Since 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, the Department 
determined that the home market was viable for SSI. Therefore, the 
Department has based NV on home market sales in the usual commercial 
quantities and in the ordinary course of trade.
    On February 14, 2003, petitioners alleged that a particular market 
situation existed in Thailand during the POR that does not permit a 
proper comparison with the export price or constructed export price 
and, therefore, normal value should be calculated based on prices to a 
third country. On March 4, 2003, SSI responded to petitioners February 
14, 2003, letter urging the Department to reject petitioners' claim of 
a particular market situation in Thailand during the POR. On March 17, 
2003, petitioners responded to SSI's March 4, 2003, response. On March 
20, 2003, the Department issued a supplemental questionnaire to SSI 
regarding the alleged particular market situation. SSI filed its 
supplemental response on March 28, 2003. On April 24, 2003, petitioners 
filed additional comments and requested that the Department obtain 
third country sales information from SSI for calculating normal value. 
On June 10, 2003, the Department issued a second supplemental 
questionnaire to SSI regarding the particular market situation. SSI 
filed its response on June 20, 2003. The Department issued a decision 
memorandum to interested parties stating that a particular market 
situation did not exist during the POR in Thailand (see Memorandum For 
Barbara Tillman, Acting Deputy Assistant Secretary for Import 
Administration, Group III, From Richard O. Weible, Director, Office 8, 
August 22, 2003). The Department concluded that there was insufficient 
information to suggest that a particular market situation exists, 
whereby prices for the domestic like product are not competitively set. 
We have preliminary determined that there is not a particular market 
situation in Thailand that would prevent a proper comparison with the 
export price or constructed export price. Therefore, the Department did 
not request SSI to report sales to its largest third country market.

B. Arm's Length Sales

    SSI reported that during the POR, it made sales in the home market 
to affiliated and unaffiliated end users and distributors/retailers. 
SSI reported the downstream sales of its affiliated reseller of the 
foreign like product and SSI's sales to its affiliated customers who 
consumed the hot-rolled steel in the production of non-subject 
merchandise. If any sales to affiliated customers in the home market 
were not made at arm's length prices, we excluded those sales from our 
analysis because we considered them to be outside the ordinary course 
of trade. To test whether these sales were made at arm's-length prices, 
we compared on a model-specific basis the starting prices of sales to 
affiliated and unaffiliated customers, net of all billing adjustments, 
early payment discounts, movement charges, direct selling expenses, and 
home market packing. Where prices to the affiliated party fell, on 
average, between 98 percent and 102 percent, inclusive, of sale prices 
of the same or comparable merchandise sold by that exporter or producer 
to all unaffiliated customers, we determined that sales made to the 
related party were at arm's length. See Antidumping Proceedings: 
Affiliated Party Sales in the Ordinary Course of Trade, 67 FR 69186 
(November 15, 2002). We performed the arm's length test on the sales to 
SSI's affiliated customers who consumed the hot-rolled steel. We 
excluded sales to those customers who failed the arm's length test. In 
our home market NV calculation, we have included SSI's reported 
downstream sales.

C. Cost of Production Analysis

    The Department initiated a sales below cost investigation to 
determine in fact whether the respondent made home market sales during 
the POR at prices below their cost of production (COP) within the 
meaning of section 773(b) of the Act. Based on the fact that the 
Department had disregarded sales in the less than fair value 
investigation because they were made below the COP, the Department has 
reasonable grounds, in accordance with section 773(b)(2)(A)(ii) of the 
Act, to believe or suspect that respondent made home market sales in 
this review at prices below the cost of producing the merchandise.
    In accordance with section 773(b)(3) of the Act, we calculated COP 
based on the sum of SSI's cost of materials and fabrication for the 
foreign like product, plus an amount for home market SG&A, interest 
expenses, and the cost of all expenses incidental to placing the 
foreign like product in condition packed ready for shipment.
    We used the information from SSI's section D questionnaire and 
supplemental questionnaire responses to calculate COP, except in the 
following adjustment. First, we revised the company's reported general 
and administrative (``G&A'') expenses to exclude foreign exchange gains 
and losses. Second, we revised the company's reported financial 
expenses to include the total net consolidated foreign exchange gain. 
In addition, we revised the company's reported financial expenses to 
exclude gains from investments in affiliated parties. For further 
discussion of these adjustments, see Memorandum to Neal Halper, from 
Mark Todd, regarding Cost of Production and Constructed Value 
Calculation Adjustments for the Preliminary Results, dated December 1, 
2003.
    We compared the weighted-average COP to home market sales prices of 
the foreign like product, as required under section 773(b) of the 
Tariff Act. In determining whether to disregard home market sales made 
at prices less than the COP, we examined whether such sales were made 
(i) in substantial quantities over an extended period of time, and (ii) 
at prices which permitted the recovery of all costs within a reasonable 
period of time. On a product-specific basis, we compared COP to home 
market prices, less any applicable movement charges, billing 
adjustments, taxes, and discounts and rebates.
    Pursuant to section 773(b)(2)(C)(i) of the Act, where less than 
twenty percent of SSI's sales of a given product were at prices less 
than the COP, we did not disregard any below-cost sales of that product 
because we determined that 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 POR were at prices less than the 
COP, we determined such sales to have been made in substantial 
quantities, in accordance with section 773(b)(2)(C)(i) of the Act, 
within an extended period of time, in accordance with section 
773(b)(2)(B) of the Act. In such cases, pursuant to section 
773(b)(2)(D) of the Act, we also determined that such sales were not 
made at prices which would

[[Page 68340]]

permit recovery of all costs within a reasonable period of time. 
Therefore, we disregarded the below-cost sales. Where all sales of a 
specific product were at prices below the COP, we disregarded all sales 
of that product and relied on sales of similar merchandise to match.
    The results of our cost test for SSI indicated that for certain 
comparison market models, more than 20 percent of the sales of the 
model were at prices below COP and were at prices which would not 
permit the recovery of all costs within a reasonable period of time. In 
accordance with section 773(b)(1) of the Act, we therefore excluded 
these below-cost sales from our analysis and used the remaining sales 
as the basis for determining NV.

Constructed Value

    In accordance with section 773(e)(1) of the Act, we calculated 
constructed value (``CV'') based on the sum of respondent's cost of 
materials, fabrication, SG&A, including interest expenses, and profit. 
In accordance with section 773(e)(2)(A) of the Act, we based SG&A and 
profit on the amounts incurred and realized by SSI in connection with 
the production and sale of the foreign like product in the ordinary 
course of trade for consumption in the foreign country. We used the CV 
data SSI supplied in its section D questionnaire and supplemental 
questionnaire responses with the exception of the adjustments to COP 
noted above.

Price-to-Price Comparisons

    We compared SSI's U.S. sales with contemporaneous sales of the 
foreign like product in the comparison market. We considered identical 
hot-rolled products based on the following model-match characteristics: 
whether or not painted, quality, carbon content, yield strength, 
thickness, width, coil versus cut-to-length, temper rolled, pickled, 
edge trim, and patterns in relief. We used a 20 percent DIFMER cost 
deviation cap as the maximum difference in cost allowable for similar 
merchandise, which we calculated as the absolute value of the 
difference between the U.S. and comparison market variable costs of 
manufacturing divided by the total cost of manufacturing of the U.S. 
product. In accordance with the Department's practice, where all 
contemporaneous matches to a U.S. sale observation resulted in DIFMER 
adjustments exceeding 20 percent of the COM of the U.S. product, we 
based NV on CV.
    For those product comparisons for which there were sales at prices 
at or above the COP, we based NV on the home market prices to home 
market customers. We made adjustments, where appropriate, for physical 
differences in the merchandise in accordance with section 
773(a)(6)(C)(ii) of the Act. In accordance with section 773(a)(6)(A) 
and (B), we deducted home market packing costs and added U.S. packing 
costs. In addition, we made adjustments for differences in circumstance 
of sale, as appropriate.

Price-to-CV Comparisons

    In accordance with section 773(a)(4) of the Act, we based NV on CV 
if we were unable to find a contemporaneous comparison market match for 
the U.S. sale. We calculated CV based on the cost of materials and 
fabrication employed in producing the subject merchandise, SG&A, 
interest expense and profit. In accordance with section 773(e)(2)(A) of 
the Act, we based SG&A expenses, interest and profit on the amounts SSI 
incurred and realized in connection with the production and sale of the 
foreign like product in the ordinary course of trade for consumption in 
Thailand. For selling expenses, we used the weighted-average home 
market selling expenses. Where appropriate, we made COS adjustments to 
CV in accordance with section 773(a)(8) of the Act and 19 CFR 351.410 
of the Department's regulations.

Currency Conversion

    We made currency conversions into U.S. dollars, where appropriate, 
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.

Level of Trade

    In accordance with section 773(a)(1)(B) of the Act, to the extent 
practicable, we determine NV based on sales in the comparison market at 
the same level of trade (LOT) as the EP transaction or constructed 
export price (CEP) transaction. The LOT in the comparison market is the 
LOT of the starting-price sales in the comparison market or, when NV is 
based on CV, the LOT of the sales from which we derive SG&A expenses 
and profit. With respect to U.S. price for EP transactions, the LOT is 
also that of the starting-price sale, which is usually from the 
exporter to the importer. For CEP, the LOT is that of the constructed 
sale from the exporter to the importer.
    To determine whether comparison market sales are at a different LOT 
from U.S. sales, we examined stages in the marketing process and 
selling functions along the chain of distribution between the producer 
and the unaffiliated customer. If the comparison market sales are at a 
different LOT, and the difference affects price comparability, as 
manifested in a pattern of consistent price differences between the 
sales on which NV is based and comparison market sales at the LOT of 
the export transaction, the Department makes a LOT adjustment in 
accordance with section 773(a)(7)(A) of the Act. For CEP sales, if the 
NV level is more remote from the factory than the CEP level and there 
is no basis for determining whether the differences in the levels 
between NV and CEP sales affects price comparability, the Department 
adjusts NV under section 773(A)(7)(B) of the Act (the CEP offset 
provision). See Notice of Final Determination of Sales at Less Than 
Fair Value: Certain Cut-to-Length Carbon Steel Plate from South Africa, 
62 FR 61731 (November 19, 1997).
    SSI claimed one LOT in the U.S. market and two LOTs in the home 
market: LOT 1 includes sales through unaffiliated trading companies and 
direct sales to end-users and LOT 2 includes sales through affiliated 
trading companies and to service centers. SSI claimed that all U.S. 
sales are at the same LOT as LOT 1 in the home market. SSI reported 
four channels of distribution for home market sales made through LOT 1 
and LOT 2. The first channel of distribution was sales made through 
unaffiliated trading companies with two customer categories (i.e., 
unaffiliated end-users and service centers). The second channel of 
distribution was sales made through affiliated trading companies with 
two customer categories (i.e., unaffiliated end-users and service 
centers). The third channel of distribution was direct sales with two 
customer categories (i.e., affiliated and unaffiliated end-users and 
service centers). The fourth channel of distribution was direct sales 
with one customer category (i.e., affiliated end-users or resellers). 
In analyzing SSI's selling activities for its home market and U.S. 
market, we determined that essentially the same services were provided 
for both markets. Due to the proprietary nature of the levels of these 
selling activities, for further analysis, see Memorandum To The File, 
From Michael Ferrier, regarding Administrative Review of the 
Antidumping Duty Order on Certain Hot-Rolled Carbon Steel Flat Products 
from Thailand; Preliminary Results Analysis for SSI, December 1, 2003. 
Therefore, based upon this information, we have preliminarily 
determined that the LOT for all EP sales is the same as the LOT for all 
sales in the home

[[Page 68341]]

market. Accordingly, because we find the U.S. sales and home market 
sales to be at the same LOT, no LOT adjustment under section 
773(a)(7)(A) of the Act is warranted for SSI.

Preliminary Results of Review

    As a result of our review, we preliminarily determine the weighted-
average dumping margin for the period May 5, 2001, through October 31, 
2002, to be as follows:

------------------------------------------------------------------------
                                                                Margin
                    Manufacturer/Exporter                      (percent)
------------------------------------------------------------------------
Sahaviriya Steel Industries Public Company Limited..........       0.00
------------------------------------------------------------------------

The cash deposit rates for Siam Strip and Nakornthai will continue to 
be the cash deposit rate established in the original investigation. See 
HRC Order.
    Article VI.5 of the General Agreement on Tariffs and Trade (GATT 
1994) prohibits assessing dumping duties on the portion of the margin 
attributable to an export subsidy. In this case, the product under 
investigation is subject to a countervailing duty investigation. See 
Notice of Final Affirmative Countervailing Duty Determination: Certain 
Hot-Rolled Carbon Steel Flat Products from Thailand, 66 FR 50410 
(October 3, 2001).
    Therefore, for all entries of hot-rolled steel from Thailand 
entered, or withdrawn from warehouse, for consumption on or after the 
date on which the order in the companion countervailing duty 
investigation is published in the Federal Register, we will request for 
duty deposit purposes that the CBP deduct the portion of the margin 
attributable to export subsidies as determined in the countervailing 
duty investigation. Since SSI received a zero margin for this 
administrative review, no adjustment for export subsidies is necessary.
    The Department will disclose calculations performed in connection 
with these preliminary results of review within five days of the date 
of publication of this notice in accordance with 19 CFR 351.224(b) of 
the Department's regulations. An interested party may request a hearing 
within 30 days of publication. See CFR 351.310(c) of the Department's 
regulations. Any hearing, if requested, will be held 37 days after the 
date of publication, or the first business day thereafter, unless the 
Department alters the date per 19 CFR 351.310(d) of the Department's 
regulations. Interested parties may submit case briefs and/or written 
comments no later than 30 days after the date of publication of these 
preliminary results of review. Rebuttal briefs and rebuttals to written 
comments, limited to issues raised in the case briefs and comments, may 
be filed no later than 35 days after the date of publication of this 
notice. Parties who submit argument in these proceedings are requested 
to submit with the argument (1) a statement of the issue, (2) a brief 
summary of the argument and (3) a table of authorities. The Department 
will issue the final results of this administrative review, including 
the results of our analysis of the issues raised in any such written 
comments or at a hearing, within 120 days of publication of these 
preliminary results.
    Upon completion of the administrative review, the Department shall 
determine, and CBP shall assess, antidumping duties on all appropriate 
entries. In accordance with 19 CFR 351.212(b)(1) of the Department's 
regulations, we have calculated assessment rates for the merchandise 
based on the ratio of the total amount of antidumping duties calculated 
for the examined sales made during the POR to the total quantity of the 
sales used to calculate those duties. This rate will be assessed 
uniformly on all entries of merchandise of that manufacturer/exporter 
made during the POR. To determine whether the duty assessment rate was 
de minimis, in accordance with the requirement set forth in 19 CFR 
351.106(c)(2) of the Department's regulations, we calculated ad valorem 
ratios based on the EPs. We will instruct CBP to liquidate without 
regard to antidumping duties any entries for which the assessment rate 
is de minimis (i.e., less than 0.50 percent), pursuant to 19 CFR 
351.106(c)(2) of the Department's regulations. The Department will 
issue appropriate appraisement instructions directly to CBP upon 
completion of the review.
    Furthermore, the following deposit requirement will be effective 
upon completion of the final results of this administrative review for 
all shipments of hot-rolled steel from Thailand 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 
company will be the rate established in the final results of 
administrative review, except if the rate is less than 0.50 percent 
and, therefore, de minimis within the meaning of 19 CFR 351.106 of the 
Department's regulations, the cash deposit will be zero; (2) for 
merchandise exported by manufacturers or exporters not covered in this 
review but covered in the original less-than-fair-value (LTFV) 
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 a company-
specific rate; (3) if the exporter is not a firm covered in this 
review, or the original investigation, but the manufacturer is, the 
cash deposit rate will be that established for the manufacturer of the 
merchandise in the final results of this review, or the LTFV 
investigation; and (4) if neither the exporter nor the manufacturer is 
a firm covered in this review or any previous reviews, the cash deposit 
rate will be 3.86 percent, the ``all others'' rate established in the 
LTFV investigation (see HRC Order).
    This deposit requirement, when imposed at the final results, shall 
remain in effect until publication of the final results of the next 
administrative review.
    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 351.402(f) of the Department's 
regulations 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 this notice in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: December 1, 2003.
James J. Jochum,
Assistant Secretary for Import Administration.
[FR Doc. 03-30388 Filed 12-5-03; 8:45 am]
BILLING CODE 3510-DS-P