[Federal Register Volume 73, Number 122 (Tuesday, June 24, 2008)]
[Notices]
[Pages 35652-35655]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-14252]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-914]


Final Determination of Sales at Less Than Fair Value and 
Affirmative Determination of Critical Circumstances, in Part: Light-
Walled Rectangular Pipe and Tube from the People's Republic of China

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

EFFECTIVE DATE: June 24, 2008.
SUMMARY: The Department of Commerce (the Department) has determined 
that light-walled rectangular pipe and tube (LWR) from the People's 
Republic of China (PRC) is being, or is likely to be, sold in the 
United States at less than fair value (LTFV) as provided in section 735 
of the Tariff Act of 1930, as amended (the Act). The final dumping 
margins for this investigation are listed in the ``Final Determination 
Margins'' section below. The period covered by the investigation is 
October 1, 2006, through March 31, 2007 (the POI).

FOR FURTHER INFORMATION CONTACT: Jeff Pedersen or Drew Jackson, AD/CVD 
Operations, Office 4, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC, 20230; telephone: (202) 482-
2769 and 482-4406, respectively.

SUPPLEMENTARY INFORMATION:

Background

    The Department published its preliminary determination of sales at 
LTFV on January 30, 2008. See Preliminary Determination of Sales at 
Less Than Fair Value, Postponement of Final Determination, and 
Affirmative Preliminary Determination of Critical Circumstances, in 
Part: Light-Walled Rectangular Pipe and Tube from the People's Republic 
of China, 73 FR 5500 (January 30, 2008) (Preliminary Determination). 
Between February 18, 2008, and February 29, 2008, the Department 
conducted verifications of Zhangjiagang Zhongyuan Pipe-Making Co., Ltd. 
(ZZPC) and Kunshan Lets Win Steel Machinery Co. Ltd. (Lets Win). See 
the ``Verification'' section below for additional information.
    In response to the Department's invitation to comment on the 
Preliminary Determination, on April 2, 2008, the petitioners,\1\ ZZPC, 
and Lets Win filed case briefs. The petitioners and ZZPC filed rebuttal 
briefs on April 7, 2008.
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    \1\ The petitioners in this investigation are Allied Tube and 
Conduit, Atlas Tube, Bull Moose Tube Company, California Steel and 
Tube, EXLTUBE, Hannibal Industries, Leavitt Tube Company, Maruichi 
American Corporation, Searing Industries, Southland Tube, Vest Inc., 
Welded Tube, and Western Tube and Conduit.
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Analysis of Comments Received

    All of the issues that were raised in the case and rebuttal briefs 
that were submitted in this investigation are addressed in the ``Issues 
and Decision Memorandum for the Final Determination in the Antidumping 
Duty Investigation of Light-Walled Rectangular Pipe and Tube from the 
People's Republic of China,'' dated June 13, 2008, which is hereby 
adopted by this notice (Issues and Decision Memorandum). Appendix I to 
this notice contains a list of the issues that are addressed in the 
Issues and Decision Memorandum. The Issues and Decision Memorandum, 
which is a public document, is on file in the Central Records Unit 
(CRU), at the Main Commerce Building, Room 1117, and is accessible on 
the Web at http://ia.ita.doc.gov/frn. The paper copy and electronic 
version of the memorandum are identical in content.

Changes Since the Preliminary Determination

    Based on our analysis of the comments received, we have revised 
ZZPC's and Lets Win's dumping margins to reflect the following changes:
    1. We based ZZPC's dumping margin on total adverse facts available.
    2. We used different surrogates to value certain steel inputs and 
packing materials.
    3. We averaged one additional surrogate company's data with those 
surrogate companies' data used in the Preliminary Determination to 
calculate the surrogate financial ratios.
    4. Since the release of the preliminary determination, more recent 
labor data for the PRC has become available, which we have used in 
calculating Lets Win's final margin.

[[Page 35653]]

    For a detailed analysis of the margin calculation for Lets Win, see 
``Final Determination in the Investigation of Light-Walled Rectangular 
Pipe and Tube from the People's Republic of China: Analysis Memorandum 
for Kunshan Lets Win Steel Machinery Co. Ltd.,'' dated June 13, 2008.
    We assigned the separate rates applicants the dumping margin that 
we calculated for Lets Win.

Scope of Investigation

    The merchandise that is the subject of this investigation is 
certain welded carbon-quality light-walled steel pipe and tube, of 
rectangular (including square) cross section, having a wall thickness 
of less than 4 mm.
    The term carbon-quality steel includes both carbon steel and alloy 
steel which contains only small amounts of alloying elements. 
Specifically, the term carbon-quality includes products in which 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 
vanadium, or 0.15 percent of zirconium. The description of carbon-
quality is intended to identify carbon-quality products within the 
scope. The welded carbon-quality rectangular pipe and tube subject to 
this investigation is currently classified under the Harmonized Tariff 
Schedule of the United States (HTSUS) subheadings 7306.61.50.00 and 
7306.61.70.60. While HTSUS subheadings are provided for convenience and 
Customs purposes, our written description of the scope of the 
investigation is dispositive.

Critical Circumstances

    In the Preliminary Determination, the Department found that there 
was reason to believe or suspect that critical circumstances existed 
for imports of subject merchandise from the PRC-wide entity, and that 
these imports were massive during a relatively short period. See 
sections 733(e)(1)(A)(ii) and (B) of the Act. However, the Department 
did not preliminarily find that there was reason to believe or suspect 
that critical circumstances existed for imports of subject merchandise 
from Lets Win, ZZPC, or the separate-rate companies. See Preliminary 
Determination. No parties commented on the Department's preliminary 
critical circumstances determination and we find no reason to 
reconsider this determination. Therefore, we determine that critical 
circumstances exist for the PRC-wide entity, but that critical 
circumstances do not exist for Lets Win, ZZPC, or the separate-rate 
companies.

Facts Available and Adverse Facts Available

    Section 776(a)(2)(D) of the Act provides that, if an interested 
party 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. 
Additionally, section 776(b) of the Act permits the Department to use 
an adverse inference in selecting from among the facts otherwise 
available if it makes the additional finding that ``an interested party 
has failed to cooperate by not acting to the best of its ability to 
comply with a request for information.'' The Department was not able to 
verify the steel consumption quantities reported or the type of steel 
used by ZZPC. Furthermore, we have determined that the use of adverse 
inferences is warranted because ZZPC did not act to the best of its 
ability in reporting the quantity of steel consumed and the type of 
steel used. Given the importance of the steel input, we have based 
ZZPC's dumping margin on total adverse facts available. Specifically, 
we based ZZPC's dumping margin on the highest rate calculated in this 
investigation, 264.64[percnt]. See the accompanying Issues and Decision 
memorandum at Comment 1 for details. We do not need to corroborate this 
rate because it is based on information obtained during the course of 
this investigation rather than secondary information.\2\
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    \2\ Section 776(c) of the Act requires the Department to 
corroborate secondary information, which the SAA describes as 
``information derived from the petition that gave rise to the 
investigation or review, the final determination concerning subject 
merchandise, or any previous review under section 751 concerning the 
subject merchandise.''See SAA at 870.
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Verification

    As provided in section 782(i) of the Act, we conducted 
verifications of the respondents' information. See the Department's 
verification reports for ZZPC and Lets Win on file in the CRU. In 
conducting the verifications, we used standard verification procedures, 
including examination of relevant accounting and production records, as 
well as original source documents provided by the respondents.

Surrogate Country

    In the Preliminary Determination, we selected India as the 
appropriate surrogate country noting that India was on the Department's 
list of countries that are at a level of economic development 
comparable to the PRC and that: (1) India is a significant producer of 
merchandise comparable to subject merchandise; and, (2) reliable Indian 
data for valuing factors of production are readily available. See 
Preliminary Determination. While parties commented on this issue (see 
Issues and Decision Memorandum at Comment 2), for the final 
determination, we continue to find India to be the appropriate 
surrogate country.

Separate Rates

    In proceedings involving non-market-economy (NME) countries, the 
Department begins with a rebuttable presumption that all companies 
within the country are subject to government control and, thus, should 
be assigned a single antidumping duty deposit rate. It is the 
Department's policy to assign all exporters of merchandise subject to 
an investigation in an NME country this single rate unless an exporter 
can demonstrate that it is sufficiently independent so as to be 
entitled to a separate rate. See Final Determination of Sales at Less 
Than Fair Value: Sparklers from the People's Republic of China, 56 FR 
20588 (May 6, 1991) (Sparklers), as amplified by Notice of Final 
Determination of Sales at Less Than Fair Value: Silicon Carbide from 
the People's Republic of China, 59 FR 22585 (May 2, 1994) (Silicon 
Carbide); see also section 351.107(d) of the Department's regulations.
    In the Preliminary Determination, the Department granted separate-
rate status to ZZPC, Lets Win, and the separate rate applicants, Wuxi 
Baishun Steel Pipe Co., Ltd. (Baishun), Guangdong Walsall Steel Pipe 
Industrial Co., Ltd. (Walsall), Wuxi Worldunion Trading Co., Ltd. 
(Worldunion), Weifang East Steel Pipe Co., Ltd. (Weifang), and Jiangyin 
Jianye Metal Products Co., Ltd. (Jiangyin). However, the Department did 
not grant separate-rate status to Suns International Trading Limited, 
Liaoning Cold Forming Sectional Company Limited, or Dalian Brollo Steel 
Tubes Ltd. No parties commented on the Department's separate rate 
determinations. For the final determination, we continue to find that 
the evidence placed on the record of this investigation by ZZPC, Lets 
Win, Baishun, Walsall, Worldunion, Weifang, and Jiangyin demonstrate 
both a de jure and de facto absence of government

[[Page 35654]]

control, with respect to their respective exports of the merchandise 
under investigation and thus they are eligible for separate rate 
status.

The PRC-Wide Rate

    In the Preliminary Determination, the Department considered certain 
non-responsive PRC producers/exporters to be part of the PRC-wide 
entity because they did not respond to our requests for information and 
did not demonstrate that they operated free of government control over 
their export activities. No additional information regarding these 
entities has been placed on the record after the Preliminary 
Determination. Since the PRC-wide entity did not provide the Department 
with requested information, pursuant to section 776(a)(2)(A) of the Act 
(which covers situations where an interested party withholds requested 
information), we continue to find it appropriate to base the PRC-wide 
rate on facts available. Moreover, given that the PRC-wide entity did 
not respond to our request for information, we continue to find that it 
failed to cooperate to the best of its ability to comply with a request 
for information. Thus, pursuant to section 776(b) of the Act, we have 
continued to use an adverse inference in selecting from among the facts 
otherwise available. See Notice of Final Determination of Sales at Less 
Than Fair Value: Certain Cold-Rolled Flat-Rolled Carbon-Quality Steel 
Products from the Russian Federation, 65 FR 5510, 5518 (February 4, 
2000) (a case in which the Department applied an adverse inference in 
determining the Russia-wide rate); see also ``Statement of 
Administrative Action'' accompanying the URAA, H.R. Rep. No. 103-316, 
vol. 1, at 870 (1994) (SAA). Specifically, we have assigned the highest 
margin calculated in this proceeding to the PRC-wide entity (as we have 
done for ZZPC). We do not need to corroborate this rate because it is 
based on information obtained during the course of this investigation 
rather than secondary information.
    Since we begin with the presumption that all companies within a NME 
country are subject to government control and only the exporters listed 
under the ``Final Determination Margins'' section below have overcome 
that presumption, we are applying a single antidumping rate (i.e., the 
PRC-wide rate) to all exporters of subject merchandise from the PRC, 
other than the exporters listed in the ``Final Determination Margins'' 
sections. See, e.g., Synthetic Indigo from the People's Republic of 
China: Notice of Final Determination of Sales at Less Than Fair Value, 
65 FR 25706 (May 3, 2000) (applying the PRC-wide rate to all exporters 
of subject merchandise in the PRC based on the presumption that the 
export activities of the companies that failed to respond to the 
Department's questionnaire were controlled by the PRC government). 
Thus, the PRC-wide rate will apply to all entries of subject 
merchandise except for entries of subject merchandise from the 
exporters that are listed in the ``Final Determination Margins'' 
section below (except as noted).

Combination Rates

    In Initiation of Antidumping Duty Investigation: Light-Walled 
Rectangular Pipe and Tube from Republic of Korea, Mexico, Turkey, and 
the People's Republic of China, 72 FR 40274 (July 24, 2007) (Initiation 
Notice), the Department stated that it would calculate combination 
rates for respondents that are eligible for a separate rate in this 
investigation. See Initiation Notice. This change in practice is 
described in Policy Bulletin 05.1, available at http://ia.ita.doc.gov/. 
Policy Bulletin 05.1, states:
    {w{time} hile continuing the practice of assigning separate rates 
only to exporters, all separate rates that the Department will now 
assign in its NME investigations will be specific to those producers 
that supplied the exporter during the period of investigation. Note, 
however, that one rate is calculated for the exporter and all of the 
producers which supplied subject merchandise to it during the period of 
investigation. This practice applies both to mandatory respondents 
receiving an individually calculated separate rate as well as the pool 
of non-investigated firms receiving the weighted-average of the 
individually calculated rates. This practice is referred to as the 
application of ``combination rates'' because such rates apply to 
specific combinations of exporters and one or more producers. The cash-
deposit rate assigned to an exporter will apply only to merchandise 
both exported by the firm in question and produced by a firm that 
supplied the exporter during the period of investigation.
See Policy Bulletin 05.1, ``Separate Rates Practice and Application of 
Combination Rates in Antidumping Investigations Involving Non-Market 
Economy Countries.''

Final Determination Margins

    We determine that the following weighted-average dumping margins 
exist for the period October 1, 2006, through March 31, 2007:

------------------------------------------------------------------------
           Exporter / Producer                Weighted-Average Margin
------------------------------------------------------------------------
Zhangjiagang Zhongyuan Pipe-Making Co.,                   264.64[percnt]
 Ltd./ Zhangjiagang Zhongyuan Pipe-Making
 Co., Ltd................................
Kunshan Lets Win Steel Machinery Co.,                     249.12[percnt]
 Ltd./ Kunshan Lets Win Steel Machinery
 Co., Ltd................................
Wuxi Baishun Steel Pipe Co., Ltd./ Wuxi                   249.12[percnt]
 Baishun Steel Pipe Co., Ltd.............
Guangdong Walsall Steel Pipe Industrial                   249.12[percnt]
 Co., Ltd./ Guangdong Walsall Steel Pipe
 Industrial Co., Ltd.....................
Wuxi Worldunion Trading Co., Ltd./ Wuxi                   249.12[percnt]
 Hongcheng Bicycle Material Co., Ltd.....
Weifang East Steel Pipe Co., Ltd./                        249.12[percnt]
 Weifang East Steel Pipe Co., Ltd........
Jiangyin Jianye Metal Products Co., Ltd./                 249.12[percnt]
 Jiangyin Jianye Metal Products Co., Ltd.
PRC-Wide Rate............................                 264.64[percnt]
------------------------------------------------------------------------

Disclosure

    We will disclose to parties the calculations performed within five 
days of the date of public announcement of this determination in 
accordance with 19 CFR 351.224(b).

Continuation of Suspension of Liquidation

    In accordance with section 735(c)(1)(B) of the Act, we are 
directing U.S. Customs and Border Protection (CBP) to continue to 
suspend liquidation of all imports of subject merchandise entered or 
withdrawn from warehouse, for consumption on or after the following 
dates: (1) for ZZPC, Lets Win, and the separate rate companies, on or 
after January 30, 2008, the date of publication of the preliminary 
determination in the Federal Register, (2) for the PRC-wide entity, on 
or after November 1, 2007, which is 90 days prior to the publication of 
the

[[Page 35655]]

preliminary determination (consistent with our finding that critical 
circumstances exist for the PRC-wide entity). We will instruct CBP to 
continue to require a cash deposit or the posting of a bond for all 
companies based on the estimated weighted-average dumping margins shown 
above. The suspension of liquidation instructions will remain in effect 
until further notice.

ITC Notification

    In accordance with section 735(d) of the Act, we have notified the 
International Trade Commission (ITC) of our final determination of 
sales at LTFV. As our final determination is affirmative, in accordance 
with section 735(b)(2) of the Act, the ITC will determine whether the 
domestic industry in the United States is materially injured, or 
threatened with material injury, by reason of imports or sales (or the 
likelihood of sales) for importation of the subject merchandise within 
45 days of this final determination. If the ITC determines that 
material injury or threat of material injury does not exist, the 
proceeding will be terminated and all securities posted will be 
refunded or canceled. If the ITC determines that such injury does 
exist, the Department will issue an antidumping duty order directing 
CBP to assess upon further instruction by the Department antidumping 
duties on all imports of the subject merchandise entered, or withdrawn 
from warehouse, for consumption on or after the effective date of the 
suspension of liquidation.

Notification Regarding APO

    This notice also serves as a reminder to the parties subject to 
administrative protective order (APO) of their responsibility 
concerning the disposition of proprietary information disclosed under 
APO in accordance with 19 CFR 351.305. Timely notification of return or 
destruction of APO materials or conversion to judicial protective order 
is hereby requested. Failure to comply with the regulations and the 
terms of an APO is a sanctionable violation. This determination and 
notice are issued and published in accordance with sections 735(d) and 
777(i)(1) of the Act.

    Dated: June 13, 2008.
David M. Spooner,
Assistant Secretary for Import Administration.

Appendix I

Parties' Comments

Comment 1: Whether ZZPC's Dumping Margin Should be Based on Adverse 
Facts Available
Comment 2: The Appropriate Surrogate Country
Comment 3: The Appropriate Surrogate Financial Ratios
Comment 4: The Appropriate Surrogate Values for Steel Inputs Used by 
Lets Win
Comment 5: The Appropriate Surrogate Value for Hot-Rolled Steel
Comment 6: The Appropriate Surrogate Value for Certain Packing 
Materials
[FR Doc. E8-14252 Filed 6-23-08; 8:45 am]
BILLING CODE 3510-DS-S