[Federal Register Volume 75, Number 111 (Thursday, June 10, 2010)]
[Notices]
[Pages 32911-32914]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-13974]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-583-008]


Preliminary Results of Antidumping Duty Administrative Review: 
Circular Welded Carbon Steel Pipes and Tubes From Taiwan

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

SUMMARY: The Department of Commerce (the Department) is conducting an 
administrative review of the antidumping duty order on circular welded 
carbon steel pipes and tubes from Taiwan for the period May 1, 2008, to 
April 30, 2009 (the POR). We preliminarily determine that sales of 
subject merchandise by Yieh Phui Enterprise Co., Ltd. (Yieh Phui) have 
been made below normal value (NV). If these preliminary results are 
adopted in our final results, we will instruct U.S. Customs and Border 
Protection (CBP) to assess antidumping duties on appropriate entries. 
Interested parties are invited to comment on these preliminary results. 
We will issue the final results no later than 120 days from the 
publication of this notice.

DATES: Effective Date: June 10, 2010.

FOR FURTHER INFORMATION CONTACT: Steve Bezirganian or Robert James, AD/
CVD Operations, Office 7, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street & Constitution

[[Page 32912]]

Avenue, NW., Washington, DC 20230; telephone: (202) 482-1131 or (202) 
482-0649, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On October 29, 2002, the Department published in the Federal 
Register an antidumping duty order on circular welded carbon steel 
pipes and tubes from Taiwan. See Certain Circular Welded Carbon Steel 
Pipes and Tubes From Taiwan: Antidumping Duty Order, 49 FR 19369 (May 
7, 1984) (Antidumping Duty Order). On May 1, 2009, the Department 
issued a notice of opportunity to request an administrative review of 
this order for the POR. See Antidumping or Countervailing Duty Order, 
Finding, or Suspended Investigation; Opportunity To Request 
Administrative Review, 74 FR 20278 (May 1, 2009). On June 1, 2009, a 
domestic producer, Wheatland Tube Company (petitioner), requested an 
administrative review of Yieh Phui Enterprise Co., Ltd. On June 24, 
2009, the Department published the notice of initiation of this 
antidumping duty administrative review. See Initiation of Antidumping 
and Countervailing Duty Administrative Reviews and Requests for 
Revocation in Part, 74 FR 30052 (June 24, 2009).
    Yieh Phui submitted a response to Section A of the Department's 
questionnaire on July 31, 2009, and a response to Sections B, C, and D 
of the Department's questionnaire on August 31, 2009. In response to 
the Department's August 25, 2009, supplemental questionnaire pertaining 
to Yieh Phui's Section A response, Yieh Phui submitted a response on 
September 18, 2009. In response to the Department's November 6, 2009, 
supplemental questionnaire covering Yieh Phui's Sections A-D responses, 
Yieh Phui submitted a response for Section A on November 30, 2009, and 
a response for Sections B-D on December 8, 2009. On December 15, 2009, 
the Department issued a supplemental questionnaire covering product 
characteristic issues, to which Yieh Phui responded on December 22, 
2009. In response to the Department's January 29, 2010, supplemental 
questionnaire covering Yieh Phui's earlier Section A-D and product 
characteristic questionnaire responses, Yieh Phui submitted responses 
on February 16, 2010 (Section A) and March 10, 2010 (Sections B-D). On 
April 22, 2010, the Department issued a supplemental questionnaire 
relating to information from various Yieh Phui submissions. Yieh Phui 
submitted a response (including its final sales and cost databases) on 
May 14, 2010.
    On January 11, 2010, the Department published an extension of the 
preliminary results of the administrative review. See Circular Welded 
Carbon Steel Pipes and Tubes from Taiwan; Extension of Time Limit for 
Preliminary Results of Antidumping Duty Administrative Review, 75 FR 
1335 (January 11, 2010). On February 12, 2010, the Department tolled 
administrative deadlines, including in the instant review, by one 
calendar week. See ``Tolling of Administrative Deadlines As a Result of 
the Government Closure During the Recent Snowstorm,'' dated February 
12, 2010. As a result, the deadline for the issuance of the preliminary 
results of the instant review is June 7, 2010.

Scope of the Order

    The merchandise covered by this order is certain circular welded 
carbon steel pipes and tubes from Taiwan, which are defined as: Welded 
carbon steel pipes and tubes, of circular cross section, with walls not 
thinner than 0.065 inch, and 0.375 inch or more but not over 4.5 inches 
in outside diameter, currently classified under Harmonized Tariff 
Schedule of the United States (HTSUS) item numbers 7306.30.5025, 
7306.30.5032, 7306.30.5040, and 7306.30.5055. Although the HTSUS 
subheading is provided for convenience and customs purposes, the 
written description of the merchandise subject to this order is 
dispositive.

Export Price

    For the price to the United States, we used export price (EP), as 
defined in section 772(a) of the Tariff Act of 1930, as amended (the 
Act). Section 772(a) of the Act defines EP as the price at which the 
subject merchandise is first sold before the date of importation by the 
producer or exporter outside of the United States to an unaffiliated 
purchaser in the United States or to an unaffiliated purchaser for 
exportation to the United States, as adjusted under section 772(c) of 
the Act. We calculated an EP for Yieh Phui's U.S. sales because they 
were made directly to the first unaffiliated purchaser in the United 
States prior to importation and constructed export price (CEP) was not 
otherwise warranted based on the facts on the record.
    For EP sales, we made deductions from the starting price (gross 
unit price), where appropriate, for movement expenses in accordance 
with section 772(c)(2)(A) of the Act. Movement expenses included inland 
freight, warehousing expenses, brokerage fees, trade promotion fees, 
harbor maintenance fees, and international freight.

Normal Value

A. Selection of Comparison Market

    Section 773(a)(1) of the Act directs that NV be based on the price 
at which the foreign like product is sold in the home market, provided 
the merchandise is sold in sufficient quantities (or value, if quantity 
is inappropriate) and that there is not a particular market situation 
that prevents a proper comparison with sales to the United States. The 
statute contemplates that quantities (or value) will normally be 
considered insufficient if they are less than five percent of the 
aggregate quantity (or value) of sales of the subject merchandise to 
the United States. See section 773(a)(1) of the Act.
    We found that Yieh Phui had a viable home market for circular 
welded carbon steel pipes and tubes because its home market sales, by 
quantity, exceeded the five percent threshold. See ``Analysis 
Memorandum for Yieh Phui Enterprise Co., Ltd. (Yieh Phui): Circular 
Welded Carbon Steel Pipes and Tubes from Taiwan (A-583-008), May 1, 
2008--April 30, 2009'' (Yieh Phui Preliminary Analysis Memorandum) at 
2. Yieh Phui submitted home market sales data for purposes of the 
calculation of NV. In deriving NV, we made adjustments as detailed in 
the ``Calculation of Normal Value Based on Comparison Market Prices'' 
section below.

B. Arm's-Length Sales

    The respondent reported sales of the foreign like product to 
affiliated customers, which, according to Yieh Phui, consumed the 
merchandise. To test whether these sales to affiliated customers were 
made at arm's length, where possible, we compared the prices of sales 
to affiliated and unaffiliated customers, net of all movement charges, 
direct selling expenses, and packing. Where the price to that 
affiliated party was, on average, within a range of 98 to 102 percent 
of the price of the same or comparable merchandise sold to the 
unaffiliated parties at the same level of trade, we determined that the 
sales made to the affiliated party were at arm's length. See 
Modification Concerning Affiliated Party Sales in the Comparison 
Market, 67 FR 69186 (November 15, 2002). Yieh Phui's sales to 
affiliated parties that were determined not to be at arm's length were 
disregarded in the cost test and in the comparison to U.S. sales.

[[Page 32913]]

C. Cost of Production Analysis

    Because we disregarded below-cost sales in the most recently 
completed segment of the proceeding, we had reasonable grounds to 
believe or suspect that home market sales of the foreign like product 
by the respondent were made at prices below the cost of production 
(COP) during the POR, in accordance with section 773(b)(2)(A)(ii) of 
the Act. See ``Yieh Phui Preliminary Analysis Memorandum'' at 7. 
Therefore, we required Yieh Phui to submit a response to Section D of 
the Department's Questionnaire.
1. Calculation of Cost of Production
    In accordance with section 773(b)(3) of the Act, we calculated the 
weighted-average COP by model based on the sum of materials, 
fabrication, general and administrative (G&A), and interest expenses. 
For more details, see ``Yieh Phui Preliminary Analysis Memorandum'' at 
7-8.
2. Test of Comparison Market Sales Prices
    We compared the weighted-average COPs for the respondent to its 
home market sales prices of the foreign like product, as required under 
section 773(b) of the Act, to determine whether these sales had been 
made at prices below the COP within an extended period of time (i.e., 
normally a period of one year) in substantial quantities and whether 
such prices were sufficient to permit the recovery of all costs within 
a reasonable period of time. On a model-specific basis, we compared the 
COP to the home market prices, less any applicable movement charges, 
discounts, rebates, and direct and indirect selling expenses.
3. Results of the COP Test
    We disregard below-cost sales where: (1) 20 percent or more of the 
respondent's sales of a given product during the POR were made at 
prices below the COP in accordance with sections 773(b)(2)(B) and (C) 
of the Act; and (2) based on comparisons of price to weighted-average 
COPs for the POR, we determine that the below-cost sales of the product 
were at prices that would not permit recovery of all costs within a 
reasonable time period, in accordance with section 773(b)(2)(D) of the 
Act. We found Yieh Phui made sales below cost and we disregarded such 
sales where appropriate. See ``Yieh Phui Preliminary Analysis 
Memorandum'' at 8.

D. Calculation of Normal Value Based on Comparison-Market Prices

    We determined NV for Yieh Phui as follows. We made deductions from 
the gross price to account for discounts and rebates. We deducted home 
market packing costs and added U.S. packing costs, in accordance with 
sections 773(a)(6)(A) and (B) of the Act. We also deducted home market 
movement expenses pursuant to section 773(a)(6)(B) of the Act. In 
addition, we made adjustments for differences in circumstances of sale 
(COS) pursuant to section 773(a)(6)(C)(iii) of the Act. Specifically, 
we made adjustments to normal value for comparison to Yieh Phui's EP 
transactions by deducting direct selling expenses incurred for home 
market sales (i.e., credit expenses) and adding U.S. direct selling 
expenses (i.e., credit expenses, bank charges, and cargo certification 
fees) and U.S. commissions. See section 773(a)(6)(C)(iii) of the Act, 
and 19 CFR 351.410(c). Where we compared Yieh Phui's U.S. sales to home 
market sales of merchandise, we made adjustments, where appropriate, 
for physical differences in the merchandise in accordance with section 
773(a)(6)(C)(ii) of the Act.

E. Calculation of Normal Value Based on Constructed Value

    Section 773(a)(4) of the Act provides that, where NV cannot be 
based on comparison-market sales, NV may be based on constructed value 
(CV). Accordingly, for those models of circular welded carbon steel 
pipes and tubes for which we could not determine the NV based on 
comparison-market sales, either because there were no sales of a 
comparable product or all sales of the comparison products failed the 
COP test, we based NV on CV.
    Section 773(e)(1) of the Act provides that CV shall be based on the 
sum of the cost of materials and fabrication for the imported 
merchandise plus amounts for selling, general, and administrative 
expenses (SG&A), interest expenses, profit, and U.S. packing expenses. 
We calculated the cost of materials and fabrication based on the 
methodology described in the COP section of this notice. We based SG&A 
and profit on the actual amounts incurred and realized by the 
respondent in connection with the production and sale of the foreign 
like product in the ordinary course of trade, for consumption in the 
comparison market, in accordance with section 773(e)(2)(A) of the Act.
    We made adjustments to CV for differences in COS in accordance with 
section 773(a)(8) of the Act and 19 CFR 351.410. We deducted direct 
selling expenses incurred for home market sales (i.e., credit 
expenses). See section 773(a)(6)(C)(iii) of the Act and 19 CFR 
351.410(c). We added U.S. direct selling expenses (i.e., credit 
expenses, bank charges, and cargo certification fees) and U.S. 
commissions to the NV.

F. Level of Trade/Constructed Export Price Offset

    In accordance with section 773(a)(1)(B) of the Act, we determine NV 
based on sales in the comparison market at the same level of trade 
(LOT) as the EP and CEP sales, to the extent practicable. When there 
are no sales at the same LOT, we compare U.S. sales to comparison 
market sales at a different LOT. When NV is based on CV, the NV LOT is 
that of the sales from which we derive SG&A expenses and profit.
    Pursuant to 19 CFR 351.412(c)(2), to determine whether comparison 
market sales were at a different LOT, we examine stages in the 
marketing process and selling functions along the chain of distribution 
between the producer and the unaffiliated (or arm's-length) customers. 
The Department identifies the LOT based on: The starting price or 
constructed value (for normal value); the starting price (for EP 
sales); and the starting price, as adjusted under section 772(d) of the 
Act (for CEP sales). If the comparison-market sales were at a different 
LOT and the differences affect 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 will make an LOT adjustment under section 773(a)(7)(A) 
of the Act.
    Finally, if the NV LOT is more remote from the factory than the CEP 
LOT and there is no basis for determining whether the differences in 
LOT between NV and CEP affected price comparability, we will grant a 
CEP offset, as provided in section 773(a)(7)(B) of the Act.
    Yieh Phui indicated there was a single level of trade for all sales 
in both markets, and petitioner has not claimed that multiple levels of 
trade existed for Yieh Phui. Yieh Phui provided responses to the 
Department's questions regarding channels of distribution and selling 
activities performed for different categories of customers. See Yieh 
Phui's July 31, 2009 Section A response, at 12-14. Yieh Phui's chart of 
numerous specific selling functions indicates the selling functions 
performed for sales in both markets are virtually identical, with no 
significant variation across the broader categories of sales process/
marketing support, freight and delivery, inventory and warehousing, and 
quality assurance/warranty services. For more details, see ``Yieh Phui 
Preliminary Analysis Memorandum.'' We have

[[Page 32914]]

preliminarily determined there is one single level of trade for all 
sales in both the home market and the U.S. market, and, therefore, that 
no basis exists for a level of trade adjustment.

Currency Conversion

    We made currency conversions into U.S. dollars in accordance with 
section 773A of the Act, based on exchange rates in effect on the date 
of the U.S. sale, as provided by the Federal Reserve Bank. See also 19 
CFR 351.415.

Preliminary Results of Review

    As a result of this review, we preliminarily determine the 
following weighted-average margin exists for the period May 1, 2008, 
through April 30, 2009:

------------------------------------------------------------------------
                                                              Weighted-
                                                               average
                     Producer/exporter                         margin
                                                            (percentage)
------------------------------------------------------------------------
Yieh Phui Enterprise Co., Ltd.............................          5.04
------------------------------------------------------------------------

Disclosure and Public Comment

    In accordance with 19 CFR 351.224(b), the Department will disclose 
calculations performed within five days of publication of this notice. 
Interested parties may submit case briefs and/or written comments no 
later than 30 days after the date of publication of these preliminary 
results. See 19 CFR 351.309(c)(ii). Rebuttal briefs and rebuttals to 
written comments, limited to issues raised in such briefs or comments, 
may be filed no later than five days after submission of case briefs. 
See 19 CFR 351.309(d). Parties who submit arguments are requested to 
submit with the argument: (1) A statement of the issues; (2) a brief 
summary of the arguments; 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. An interested party may request a hearing within 30 days of 
publication of these preliminary results. See 19 CFR 351.310(c). Any 
hearing, if requested, will be held two days after the date for 
submission of rebuttal briefs, or the first working day thereafter. The 
Department will issue the final results of this administrative review, 
which will include the results of its analysis of issues raised in any 
such comments, within 120 days of publication of these preliminary 
results, pursuant to section 751(a)(3) of the Act.

Assessment

    Upon completion of the administrative review, pursuant to 19 CFR 
351.212(b), the Department will calculate an assessment rate on all 
appropriate entries. The Department will issue appropriate appraisement 
instructions for the company subject to this review directly to CBP 15 
days after the date of publication of the final results of this review.
    Because Yieh Phui did not report the entered value of its sales, we 
will calculate importer-specific (or customer-specific) per-unit duty 
assessment rates by aggregating the total amount of antidumping duties 
calculated for the examined sales of each importer (or customer) and 
dividing each of these amounts by the respective quantities (by weight) 
associated with those sales. To determine whether the duty assessment 
rates are de minimis, in accordance with the requirement set forth in 
19 CFR 351.106(c)(2), we will calculate importer-specific (or customer-
specific) ad valorem ratios based on estimated entered values.
    We will instruct CBP to assess antidumping duties on all 
appropriate entries covered by this review for each importer (or 
customer) for which the importer-specific (or customer-specific) ad 
valorem ratio is above de minimis (i.e., at or above 0.50 percent). 
Pursuant to 19 CFR 351.106(c)(2), we will instruct CBP to liquidate 
without regard to antidumping duties any entries for which the 
importer-specific (or customer-specific) ad valorem ratio is de minimis 
(i.e., less than 0.50 percent).
    The Department clarified its ``automatic assessment'' regulation on 
May 6, 2003. See Antidumping and Countervailing Duty Proceedings: 
Assessment of Antidumping Duties, 68 FR 23954 (May 6, 2003) (Assessment 
Policy Notice). This clarification will apply to entries of subject 
merchandise during the POR produced by the company included in the 
final results where the reviewed companies did not know the merchandise 
it sold to the intermediary (e.g., a reseller, trading company, or 
exporter) was destined for the United States. In such instances, we 
will instruct CBP to liquidate unreviewed entries at the all-others 
rate if there was no rate calculated in this review for the 
intermediary involved in the transaction. See id., 68 FR at 23954.

Cash Deposit Requirements

    The following deposit rates will be effective upon publication of 
the final results of this administrative review for all shipments of 
circular welded carbon steel pipes and tubes from Taiwan entered, or 
withdrawn from warehouse, for consumption on or after the publication 
date, as provided by section 751(a)(1) of the Act: (1) The cash deposit 
rate for Yieh Phui will be the rate established in the final results of 
this review, except if a rate is less than 0.50 percent, and therefore 
de minimis, the cash deposit will be zero; (2) for previously reviewed 
or investigated companies not listed above, the cash deposit rate will 
continue to be the company-specific rate published for the most recent 
period; (3) if the exporter is not a firm covered in this review, a 
prior review, or the less-than-fair-value (LTFV) investigation, but the 
manufacturer is, the cash deposit rate will be the rate established for 
the most recent period for the manufacturer of the merchandise; and (4) 
if neither the exporter nor the manufacturer is a firm covered in this 
or any previous review conducted by the Department, the cash deposit 
rate will be 9.70 percent, the all-others rate established in the LTFV 
investigation. See Antidumping Duty Order.
    These cash deposit requirements, when imposed, shall remain in 
effect until publication of the final results of the next 
administrative review.

Notification to Importers

    This notice serves as a preliminary reminder to importers of their 
responsibility under 19 CFR 351.402(f)(2) 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.
    These preliminary results are issued and published in accordance 
with sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: June 4, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 2010-13974 Filed 6-9-10; 8:45 am]
BILLING CODE 3510-DS-P