[Federal Register Volume 72, Number 52 (Monday, March 19, 2007)]
[Notices]
[Pages 12765-12767]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-4944]



[[Page 12765]]

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-428-830]


Stainless Steel Bar from Germany: Preliminary Results of New 
Shipper Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: The Department of Commerce (``the Department'') is conducting 
a new shipper review of the antidumping duty order on stainless steel 
bar from Germany manufactured by Schmiedewerke Groditz GmbH (``SWG''). 
The period of review (``POR'') covers March 1, 2005, through February 
28, 2006. We preliminarily determine that SWG did not make sales of 
subject merchandise at less than normal value (``NV'') in the United 
States during the POR. We invite interested parties to comment on these 
preliminary results.

EFFECTIVE DATE: March 19, 2007.

FOR FURTHER INFORMATION CONTACT: Damian Felton, Audrey R. Twyman, or 
Brandon Farlander, AD/CVD Operations, Office 1, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, NW, Washington DC 20230; telephone 
(202) 482-0133, (202) 482-3534, or (202) 482-0182, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On March 7, 2002, the Department published an antidumping duty 
order on stainless steel bar from Germany. See Notice of Amended Final 
Determination of Sales at Less Than Fair Value and Antidumping Duty 
Order: Stainless Steel Bar from Germany, 67 FR 10382 (March 7, 2002) 
(``Investigation Final''). On October 10, 2003, the Department 
published an amended antidumping duty order on stainless steel bar from 
Germany. See Notice of Amended Antidumping Duty Orders: Stainless Steel 
Bar from France, Germany, Italy, Korea, and the United Kingdom, 68 FR 
58660 (October 10, 2003).
    On March 31, 2006, we received a request for a new shipper review 
from SWG for the period March 1, 2005, through February 28, 2006. We 
initiated the review on April 26, 2006. See Notice of Initiation of New 
Shipper Antidumping Duty Review: Stainless Steel Bar from Germany, 71 
FR 24642 (April 26, 2006).
    On June 9, 2006, and July 13, 2006, SWG responded to Section A and 
Sections B and C, respectively, of the antidumping questionnaire. On 
the extended deadline of October 11, 2006, SWG submitted their 
supplemental questionnaire response.
    On December 4, 2006, we extended the time limit for the preliminary 
results of this new shipper review to no later than March 15, 2007. See 
Stainless Steel Bar from Germany: Extension of Time Limit for the 
Preliminary Results of the New Shipper Review, 71 FR 70363 (December 4, 
2006).

Scope of the Order

    For the purposes of this order, the term ``stainless steel bar'' 
includes articles of stainless steel in straight lengths that have been 
either hot-rolled, forged, turned, cold-drawn, cold-rolled or otherwise 
cold-finished, or ground, having a uniform solid cross section along 
their whole length in the shape of circles, segments of circles, ovals, 
rectangles (including squares), triangles, hexagons, octagons, or other 
convex polygons. Stainless steel bar (``SSB'') includes cold-finished 
stainless steel bars that are turned or ground in straight lengths, 
whether produced from hot-rolled bar or from straightened and cut rod 
or wire, and reinforcing bars that have indentations, ribs, grooves, or 
other deformations produced during the rolling process.
    Except as specified above, the term does not include stainless 
steel semi-finished products, cut length flat-rolled products (i.e., 
cut length rolled products which if less than 4.75 mm in thickness have 
a width measuring at least 10 times the thickness, or if 4.75 mm or 
more in thickness having a width which exceeds 150 mm and measures at 
least twice the thickness), products that have been cut from stainless 
steel sheet, strip or plate, wire (i.e., cold-formed products in coils, 
of any uniform solid cross section along their whole length, which do 
not conform to the definition of flat-rolled products), and angles, 
shapes and sections.
    The SSB subject to this order is currently classifiable under 
subheadings 7222.11.00.05, 7222.11.00.50, 7222.19.00.05, 7222.19.00.50, 
7222.20.00.05, 7222.20.00.45, 7222.20.00.75, and 7222.30.00.00 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 scope of the order is 
dispositive.

Verification

    As provided in section 782(i)(3) of the Tariff Act of 1930, as 
amended (``the Act''), we intend to verify the information provided by 
SWG on April 16-18, 2007.

Bona Fide Analysis

    Consistent with the Department's practice, we investigated whether 
the U.S. transaction reported by SWG during the POR was a bona fide 
sale. Among the factors examined was the relationship between SWG and 
its reported U.S. customer. Petitioners\1\ contended that SWG and its 
customer were affiliated by virtue of a principal/agent relationship. 
Based on our investigation, we preliminarily determine that SWG and its 
U.S. customer were not affiliated and that SWG's sale was made on a 
bona fide basis. For a complete discussion of our analysis, see the 
Department's memorandum to the file entitled, ``Bona Fide Nature of 
Schmiedewerke Groditz GmbH's Sales in the New Shipper Review for 
Stainless Steel Bar from Germany,'' dated March 12, 2007, on file in 
room B-099 of the main Department of Commerce building.
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    \1\ Petitioners are Carpenter Technology Corporation, Valbruna 
Slater Stainless, Inc., and Electralloy Corporation.
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Comparisons to Normal Value

    To determine whether sales of subject merchandise to the United 
States by SWG were made at less than NV, we compared the U.S. export 
price (``EP'') to the NV, as described in the ``Export Price'' and 
``Normal Value'' sections of this notice, below. In accordance with 
section 777A(d)(2) of the Act, we calculated monthly weighted-average 
prices for NV and compared these to the prices of individual EP 
transactions. We have used the invoice date as the date of sale in both 
markets. We describe below our calculation of NV and EP.

Product Comparisons

    In accordance with section 771(16) of the Act, we considered all 
products described by the Scope of the Order section, above, which were 
produced and sold by SWG in the home market, to be foreign like 
products for purposes of determining appropriate comparisons to U.S. 
sales. We made comparisons using the following five model match 
characteristics: (1) Finish; (2) Grade; (3) Remelting; (4) Final 
Finishing; (5) Shape; and (6) Size.

Export Price

    In accordance with section 772(a) of the Act, EP is defined as the 
price at which the subject merchandise is first sold (or agreed to be 
sold) before the date of importation by the producer or exporter of the 
subject merchandise outside of the United States to an

[[Page 12766]]

unaffiliated purchaser in the United States, or to an unaffiliated 
purchaser for exportation to the United States. In accordance with 
section 772(b) of the Act, constructed export price (``CEP'') is the 
price at which the subject merchandise is first sold (or agreed to be 
sold) in the United States before or after the date of importation by 
or for the account of the producer or exporter of such merchandise or 
by a seller affiliated with the producer or exporter, to a purchaser 
not affiliated with the producer or exporter, as adjusted under 
subsections (c) and (d). For SWG's sales to the United States, we used 
EP in accordance with section 772(a) of the Act because its merchandise 
was sold directly to the first unaffiliated purchaser prior to 
importation, and CEP was not otherwise warranted based on the facts of 
record.
    We calculated EP based on the prices charged to the first 
unaffiliated customer in the United States. We based EP on the packed 
FOB port prices to the first unaffiliated purchasers in the United 
States. We made deductions for movement expenses in accordance with 
section 772(c)(2)(A) of the Act, including domestic inland freight, 
domestic inland insurance, international freight, U.S. customs duty, 
and U.S. brokerage and handling.

Normal Value

A. Viability

    In order to determine whether there is 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 
during the POR is equal to or greater than five percent of the 
aggregate volume of U.S. sales of subject merchandise during the POR), 
we compared SWG's volume of home market sales of the foreign like 
product to the volume of U.S. sales of the subject merchandise. See 
section 773(a)(1)(C)(iii) of the Act. Based on SWG's reported home 
market and U.S. sales quantities, we determine that the volume of 
aggregate home market sales during the POR is equal to or greater than 
five percent of the aggregate volume of U.S. sales of subject 
merchandise during the POR. Accordingly, we find that SWG had a viable 
home market. Therefore, we based NV on home market sales to 
unaffiliated purchasers made in the usual quantities and in the 
ordinary course of trade.

B. Price-to-Price Comparisons

    We compared U.S. sales with contemporaneous sales of the foreign 
like product in Germany. As noted above, we selected the comparison 
sales based on the following criteria: (1) Finish; (2) Grade; (3) 
Remelting; (4) Final Finishing; (5) Shape; and (6) Size.
    In calculating the net unit price, we used the reported gross unit 
price. We made adjustments for differences in packing costs between the 
two markets and for movement expenses in accordance with sections 
773(a)(6)(A) and (B) of the Act. We deducted early payment discounts 
and movement expenses (inland freight and inland insurance). We 
adjusted for differences in the circumstances of sale (``COS'') 
pursuant to section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410. We 
made these COS adjustments by deducting home market direct selling 
expenses and adding U.S. direct selling expenses. Home market direct 
selling expenses consisted of imputed credit, administrative charges 
associated with sales, and financing. U.S. direct selling expenses 
consisted of imputed credit, bank charges, and administrative charges 
associated with sales, and financing. Finally, we made adjustments, 
where appropriate, for physical differences between the U.S. models and 
the home market models to which they were being compared.

Level of Trade

    In accordance with section 773(a)(1)(B)(i) of the Act, to the 
extent practicable, we determine NV based on sales in the home market 
at the same level of trade (``LOT'') as EP or CEP. The NV LOT is that 
of the starting-price sales in the home market or, when NV is based on 
CV, that of the sales from which we derive selling, general, and 
administrative expenses and profit. For CEP it is the level of the 
constructed sale from the exporter to an affiliated importer after the 
deductions required under section 772(d) of the Act.
    To determine whether NV sales are at a different LOT than EP or 
CEP, we examine 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, we make a LOT adjustment under 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 difference in the levels between NV and CEP 
affects price comparability, we adjust NV under section 773(a)(7)(B) of 
the Act (the CEP-offset provision). See Final Determination of Sales at 
Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate from 
South Africa, 62 FR 61731, 61732-33 (November 19, 1997).
    In implementing these principles in this review, we obtained 
information from SWG about the marketing stages involved in its U.S. 
and home market sales, including a description of its selling 
activities in the respective markets. Generally, if the reported levels 
of trade are the same in the home and U.S. markets, the functions and 
activities of the seller should be similar. Conversely, if a party 
reports differences in levels of trade, the functions and activities 
should be dissimilar.
    SWG reported one channel of distribution and one LOT in the home 
market contending that all home market sales were to end users. See 
SWG's June 9, 2006, Section A submission at A-12. SWG further contends 
it provided substantially the same level of customer support on its 
U.S. sale as it provided on its home market sales to end users. We 
examined the selling activities reported by SWG and determined that 
they are identical with respect to sales and marketing, inventory 
maintenance, warranties, and freight and delivery. For example, SWG did 
not incur freight and delivery or warehousing expenses in either 
market, and SWG performed similar activities with respect to sales and 
marketing and warranties. See SWG's June 9, 2006, Section A submission 
at A-13 and Exhibit A-5. The Department has determined that we will 
find sales to be at the same LOT when the selling functions performed 
for each customer class are sufficiently similar. See 19 CFR 
351.412(c)(2). We find SWG performed virtually the same level of 
customer support services on its U.S. EP sale as it did on its home 
market sales.
    Therefore, based on our analysis of the selling functions performed 
on SWG's EP sale in the United States, and its sales in the home 
market, we determine that the EP and the starting price of home market 
sales represent the same stage in the marketing process, and are thus 
at the same LOT. Accordingly, we preliminarily find that no level of 
trade adjustment is appropriate for SWG.

Currency Conversions

    We made currency conversions into U.S. dollars in accordance with 
section 773(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.

[[Page 12767]]

Preliminary Results of Review

    As a result of our review we preliminarily find that a weighted-
average dumping margin of 0.00 percent exists for SWG for the period 
March 1, 2005, through February 28, 2006.
    The Department will disclose calculations performed within five 
days of the date of publication of this notice in accordance with 19 
CFR 351.224(b). An interested party may request a hearing within 30 
days of publication. See 19 CFR 351.310(c). 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 pursuant 
to 19 CFR 351.310(d).
    Interested parties may submit case briefs or written comments no 
later than 30 days after the date of publication of these preliminary 
results of new shipper review. Rebuttal briefs and rebuttals to written 
comments, limited to issues raised in the case briefs and comments, may 
be filed no later than 5 days after the date of submission of case 
briefs and written comments. 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. Further, parties submitting written comments should 
provide the Department with an additional copy of the public version of 
any such comments on diskette. The Department will issue final results 
of this new shipper review, including the results of our analysis of 
the issues raised in any such written comments or at a hearing, within 
90 days of publication of these preliminary results.

Assessment Rates

    Upon issuance of the final results of this review, the Department 
shall determine, and CBP shall assess, antidumping duties on all 
appropriate entries. Pursuant to 19 CFR 351.212(b)(1), for the U.S. 
sale made by the respondent for which they have reported the importer 
of record and entered value, we have calculated an importer-specific 
assessment rate based on the ratio of the total amount of antidumping 
duties calculated for the examined sales to the total entered value of 
the U.S. sale. To determine whether the duty assessment rates were de 
minimis, in accordance with the requirement set forth in 19 CFR 
351.106(c)(2), we calculated an importer-specific ad valorem rate based 
on the reported entered value. Where the assessment rate is above de 
minimis, we will instruct CBP to assess duties on all entries of 
subject merchandise by that importer. Pursuant to 19 CFR 351.106(c)(2), 
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).
    The Department clarified its ``automatic assessment'' regulation on 
May 6, 2003 (68 FR 23954). This clarification will apply to entries of 
subject merchandise during the period of review produced by reviewed 
companies for which these companies did not know their merchandise was 
destined for the United States. In such instances, we will instruct CBP 
to liquidate unreviewed entries at the all-others rate if there is no 
rate for the intermediate company(ies) involved in the transaction. For 
a full discussion of this clarification, see Antidumping and 
Countervailing Duty Proceedings: Assessment of Antidumping Duties, 68 
FR 23954 (May 6, 2003).

Cash Deposit Requirements

    The following cash deposit rate will be effective upon publication 
of the final results of this new shipper review for shipments of 
stainless steel bar from Germany entered, or withdrawn from warehouse, 
for consumption on or after the publication date, as provided by 
section 751(a)(2)(C) of the Act. For subject merchandise produced and 
exported by SWG, the cash deposit rate will be the rate established in 
the final results of this review, except if the rate is less than 0.50 
percent and, therefore, de minimis, the cash deposit rate will be zero. 
This cash deposit requirement, when imposed, shall remain in effect 
until further notice.

Notification to Interested Parties

    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 this notice in accordance with 
sections 751(a)(1) and 777(i)(1) of the Tariff Act.

    Dated: March 12, 2007.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E7-4944 Filed 3-16-07; 8:45 am]
BILLING CODE 3510-DS-S