[Federal Register Volume 75, Number 112 (Friday, June 11, 2010)]
[Notices]
[Pages 33262-33268]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-14106]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-489-501]
Certain Welded Carbon Steel Pipe and Tube from Turkey: Notice of
Preliminary Results of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration, U.S.
Department of Commerce.
SUMMARY: In response to a request by interested parties, the Department
of Commerce (``the Department'') is conducting an administrative review
of the antidumping duty order on certain welded carbon steel pipe and
tube (``welded pipe and tube'') from Turkey. See Initiation of
Antidumping and Countervailing Duty Administrative Reviews and Requests
for Revocation in Part, 74 FR 30052 (June 24, 2009) (``Review
Initiation''). This review covers the Borusan Group\1\ (collectively
``Borusan''), Tubeco Pipe and Steel Corporation, Toscelik,\2\ Erbosan,
Erciyas Boru Sanayi ve Ticaret A.S. (``Erbosan''),
[[Page 33263]]
and the Yucel Group companies.\3\ We preliminarily determine that
Borusan and Toscelik made sales 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 based on the difference between the export price (``EP'') and
the NV. The Yucel Group companies reported that they had no shipments
to the United States during the POR. The preliminary results are listed
below in the section titled ``Preliminary Results of Review.''
EFFECTIVE DATE: June 11, 2010.
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\1\ The Borusan Group includes Borusan Mannesmann Boru Sanayi ve
Ticaret A.S., Borusan Birlesik Boru Fabrikalari San ve Tic., Borusan
Istikbal Ticaret T.A.S., Boruson Holding A.S., Boruson Gemlik Boru
Tesisleri A.S., Borusan Ihracat Ithalat ve Dagitim A.S., and Borusan
Ithicat ve Dagitim A.S.
\2\ Toscelik Profil ve Sac Endustrisi A.S., Toscelik Metal
Ticaret A.S., Tosyali Dis Ticaret A.S. (collectively ``Toscelik'').
\3\ Cayirova Boru Sanayi ve Ticaret A.S., Yucel Boru ve Profil
Endustrisi A.S., and Yucelboru Ihracat Ithalat ve Pazarlama A.S.
(collectively ``Yucel Group Companies'').
FOR FURTHER INFORMATION CONTACT: Joy Zhang or Christopher Hargett, at
(202) 482-1168 or (202) 482-4161, respectively; AD/CVD Operations,
Office 3, Import Administration, International Trade Administration,
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW,
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Washington, DC 20230.
SUPPLEMENTARY INFORMATION:
Background
On May 15, 1986, the Department published in the Federal Register
the antidumping duty order on welded pipe and tube from Turkey. See
Antidumping Duty Order; Welded Carbon Steel Standard Pipe and Tube
Products From Turkey, 51 FR 17784 (May 15, 1986) (``Antidumping Duty
Order''). On May 1, 2009, the Department published a notice of
opportunity to request an administrative review of this order. 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, in accordance with 19 CFR
351.213(b), domestic interested parties, Wheatland Tube Company and
Allied Tube and Conduit Corporation, requested reviews of Borusan,
Toscelik, Erbosan, and the Yucel Group companies. On June 1, 2009,
Borusan also requested a review.
On June 24, 2009, the Department published a notice of initiation
of administrative review of the antidumping duty order on welded pipe
and tube from Turkey, covering the period May 1, 2008, through April
30, 2009. See Review Initiation.
On July 28, 2009, due to the significant number of requests
received and the Department's resource constraints at the time of
initiation of the instant review, the Department informed known
interested parties of its intent to limit the number of companies
examined in the current review. See Memo to Melissa Skinner, through
James Terpstra, from Dennis McClure, ``Antidumping Duty Administrative
Review of Certain Welded Carbon Steel Pipe and Tube from Turkey:
Selection of Respondents for Individual Review,'' dated July 28, 2009.
In accordance with section 777A(c)(2)(B), we selected Borusan and
Toscelik.
On July 29, 2009, the Department sent antidumping duty
administrative review questionnaires to Borusan and Toscelik.\4\ We
received Borusan's and Toscelik's Sections A-D questionnaire response
in September, 2009. We issued supplemental section A, B, C, and D
questionnaires, to which Borusan and Toscelik responded during November
and December, 2009, and January 2010.
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\4\ The questionnaire consists of sections A (general
information), B (sales in the home market or to third countries), C
(sales to the United States), D (cost of production/constructed
value), and E (cost of further manufacturing or assembly performed
in the United States).
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On January 25, 2010, the Department extended the time period for
issuing the preliminary results of the administrative review from
January 31, 2010, to May 31, 2010. See Certain Welded Carbon Steel Pipe
and Tube from Turkey: Notice of Extension of Time Limits for
Preliminary Results of Antidumping Duty Administrative Review, 75 FR
3896 (January 25, 2010). Further, as explained in the memorandum from
the Deputy Assistant Secretary for Import Administration, the
Department has exercised its discretion to toll deadlines for the
duration of the closure of the Federal Government from February 5,
through February 12, 2010. Thus, all deadlines in this segment of the
proceeding have been extended by seven days. See Memorandum to the
Record regarding ``Tolling of Administrative Deadlines As a Result of
the Government Closure During the Recent Snowstorm,'' dated February
12, 2010. Because of this extension, the preliminary results for this
segment of the proceeding are now due June 7, 2010.
Period of Review
The POR covered by this review is May 1, 2008, through April 30,
2009.
Scope of the Order
The products covered by this order include circular welded non-
alloy steel pipes and tubes, of circular cross-section, not more than
406.4 millimeters (16 inches) in outside diameter, regardless of wall
thickness, surface finish (black, or galvanized, painted), or end
finish (plain end, beveled end, threaded and coupled). Those pipes and
tubes are generally known as standard pipe, though they may also be
called structural or mechanical tubing in certain applications.
Standard pipes and tubes are intended for the low pressure conveyance
of water, steam, natural gas, air, and other liquids and gases in
plumbing and heating systems, air conditioner units, automatic
sprinkler systems, and other related uses. Standard pipe may also be
used for light load-bearing and mechanical applications, such as for
fence tubing, and for protection of electrical wiring, such as conduit
shells.
The scope is not limited to standard pipe and fence tubing, or
those types of mechanical and structural pipe that are used in standard
pipe applications. All carbon steel pipes and tubes within the physical
description outlined above are included in the scope of this order,
except for line pipe, oil country tubular goods, boiler tubing, cold-
drawn or cold-rolled mechanical tubing, pipe and tube hollows for
redraws, finished scaffolding, and finished rigid conduit.
Imports of these products are currently classifiable under the
following Harmonized Tariff Schedule of the United States (``HTSUS'')
subheadings: 7306.30.10.00, 7306.30.50.25, 7306.30.50.32,
7306.30.50.40, 7306.30.50.55, 7306.30.50.85, and 7306.30.50.90.
Although the HTSUS subheadings are provided for convenience and customs
purposes, our written description of the scope of this proceeding is
dispositive.
The Yucel Group Companies
On June 25, 2009, the Yucel Group companies submitted timely-filed
certifications indicating that they had no shipments of subject
merchandise to the United States during the POR. We have not received
any comments on the Yucel Group companies' submission. We confirmed
that Yucel Group companies' claim of no shipments by issuing a ``No
Shipment Inquiry'' to CBP and by reviewing electronic CBP data. See
Memo to Melissa Skinner, through James Terpstra, from Joy Zhang and
Christopher Hargett, ``Welded Carbon Steel Pipe and Tube from Turkey
Period of Review: May 1, 2008, through April 30, 2009: No Shipment
Analysis for Yucel Group Companies,'' dated April 30, 2010.
With regard to the Yucel Group companies' claim of no shipments,
our practice since implementation of the 1997 regulations concerning
no-shipment respondents has been to rescind the administrative review
if the respondent certifies that it had no shipments and we have
confirmed
[[Page 33264]]
through our examination of CBP data that there were no shipments of
subject merchandise during the POR. See Antidumping Duties;
Countervailing Duties, 62 FR 27296, 27393 (May 19, 1997), and Oil
Country Tubular Goods from Japan: Preliminary Results of Antidumping
Duty Administrative Review and Partial Rescission of Review, 70 FR
53161, 53162 (September 7, 2005), unchanged in Oil Country Tubular
Goods from Japan: Final Results and Partial Rescission of Antidumping
Duty Administrative Review, 71 FR 95 (January 3, 2006). As a result, in
such circumstances, we normally instruct CBP to liquidate any entries
from the no-shipment company at the deposit rate in effect on the date
of entry.
In our May 6, 2003, ``automatic assessment'' clarification, we
explained that, where respondents in an administrative review
demonstrate that they had no knowledge of sales through resellers to
the United States, we would instruct CBP to liquidate such entries at
the all-others rate applicable to the proceeding. See Antidumping and
Countervailing Duty Proceedings: Assessment of Antidumping Duties, 68
FR 23954 (May 6, 2003).
Based on the Yucel Group companies' assertion of no shipments and
confirmation of that claim by CBP data, we preliminarily determine that
the Yucel Group companies had no sales to the United States during the
POR.
Because ``as entered'' liquidation instructions do not alleviate
the concerns which the May 2003 clarification was intended to address,
we find it appropriate in this case to instruct CBP to liquidate any
existing entries of merchandise produced by the Yucel Group companies
and exported by other parties at the all-others rate should we continue
to find at the time of our final results that the Yucel Group companies
had no shipments of subject merchandise from the Russian Federation.
See, e.g., Certain Frozen Warmwater Shrimp from India: Partial
Rescission of Antidumping Duty Administrative Review, 73 FR 77610,
77612 (December 19, 2008). In addition, the Department finds that it is
more consistent with the May 2003 clarification not to rescind the
review in part in these circumstances but, rather, to complete the
review with respect to the Yucel Group companies and issue appropriate
instructions to CBP based on the final results of the review. See the
Assessment Rates section of this notice below.
Product Comparisons
We compared the EP to the NV, as described in the Export Price and
Normal Value sections of this notice. In accordance with section
771(16) of the Tariff Act of 1930, as amended (``the Act''), we first
attempted to match contemporaneous sales of products sold in the United
States and comparison market that were identical with respect to the
following characteristics: (1) grade; (2) nominal pipe size; (3) wall
thickness; (4) surface finish; and (5) end finish. When there were no
sales of identical merchandise in the home market to compare with U.S.
sales, we compared U.S. sales with the most similar merchandise based
on the characteristics listed above in order of priority listed.
Export Price
Because Borusan and Toscelik sold subject merchandise directly to
the first unaffiliated purchaser in the United States prior to
importation, and constructed export price (``CEP'') methodology was not
otherwise warranted based on the record facts of this review, in
accordance with section 772(a) of the Act, we used EP as the basis for
all of Borusan and Toscellik's sales.
We calculated EP using, as starting price, the packed, delivered
price to unaffiliated purchasers in the United States. In accordance
with section 772(c)(2)(A) of the Act, we made the following deductions
from the starting price (gross unit price), where appropriate: foreign
inland freight from the mill to port, foreign brokerage and handling,
international freight, marine insurance, U.S. brokerage, U.S. duty, and
other related movement charges.
In addition, Borusan reported an amount for duty drawback which
represents the amount of duties on imported raw materials associated
with a particular shipment of subject merchandise to the United States
that is exempted upon export. Borusan requested that we add the amount
to the starting price. See page C-34 of Borusan's August 29, 2009,
original response. To determine if a duty drawback adjustment is
warranted, the Department has employed a two-prong test which
determines whether: (1) the rebate and import duties are dependent upon
one another, or in the context of an exemption from import duties, if
the exemption is linked to the exportation of the subject merchandise;
and (2) the respondent has demonstrated that there are sufficient
imports of the raw material to account for the duty drawback on the
exports of the subject merchandise. See Allied Tube & Conduit Corp. v.
United States, 29 C.I.T. 502, 506 (Ct. Int'l Trade 2005). See also
Certain Steel Concrete Reinforcing Bars from Turkey; Preliminary
Results of Antidumping Duty Administrative Review and New Shipper
Review and Notice of Intent to Revoke in Part, 72 FR 25253, 25256 (May
4, 2007), unchanged in Certain Steel Concrete Reinforcing Bars From
Turkey; Final Results of Antidumping Duty Administrative Review and New
Shipper Review and Determination To Revoke in Part, 72 FR 62630
(November 6, 2007).
After analyzing the facts on the record of this case, we find that
Borusan has adequately demonstrated that import duties for raw
materials and rebates granted on exports are linked under the
Government of Turkey's duty drawback scheme. Additionally, Borusan has
provided evidence that the imports of hot- rolled coil are sufficient
to account for the duty drawback claimed on the export of subject
merchandise. At Borusan's sales verification, we reviewed and obtained
copies of documents that demonstrated that Borusan has passed the
Department's two-prong test: 1) The Internal Processing Permit
Certificate which shows all imports covered by the program (which are
sufficient to cover the volume of exports), 2) The Letter of Export
Commitment which shows the actual exports covered by the program, and
3) The Duty Drawback Certificate, which demonstrates that the imports,
exports, and drawback are all linked under the program. See Exhibit C-8
of Borusan's August 29, 2009, response, and Sales Verification
Report\5\ at page 15. Therefore, consistent with our determination in
the 2007-2008 administrative review, we are granting Borusan a duty
drawback adjustment for purposes of the preliminary results. See Notice
of Preliminary Results of Antidumping Duty Administrative Review:
Certain Welded Carbon Steel Pipe and Tube From Turkey, 74 FR 6368
(February 9, 2009), unchanged in Certain Welded Carbon Steel Pipe and
Tube from Turkey: Notice of Final Results of Antidumping Duty
Administrative Review, 74 FR 22883 (May 15, 2009) (``2007-08
Administrative Review'').
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\5\ Memorandum to File:``Verification of the Sales Response of
the Borusan Group in the Antidumping Review of Certain Welded Carbon
Steel Standard Pipe from Turkey'' from Christopher Hargett and Joy
Zhang, analysts, through James Terpstra, Program Manager, and
Melissa Skinner, Office Director, dated April 19, 2010 (``Sales
Verification Report'').
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[[Page 33265]]
Normal Value
A. Selection of Comparison Market
In order to determine whether there was a sufficient volume of
sales in the home market to serve as a viable basis for calculating NV,
we compared Borusan and Toscelik's volume of home market sales of the
foreign like product to the volume of its U.S. sales of the subject
merchandise, in accordance with section 773(a)(1)(C) of the Act.
Because Borusan and Toscelik'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 of the subject merchandise, we determined that the
home market was viable. We calculated NV as noted in the ``Calculation
of NV Based on Comparison Market Prices'' section of this notice. See
also Borusan and Toscelik's calculation memos.
B. Cost Reporting Period
The Department's normal practice is to calculate an annual
weighted-average cost for the entire period of investigation or period
of review. See, e.g., Notice of Final Results of Antidumping Duty
Administrative Review: Certain Pasta from Italy, 65 FR 77852 (December
13, 2000), and accompanying Issues and Decision Memorandum at Comment
18, and Notice of Final Results of Antidumping Duty Administrative
Review: Carbon and Certain Alloy Steel Wire Rod from Canada, 71 FR 3822
(January 24, 2006), and accompanying Issues and Decision Memorandum at
Comment 5 (explaining the Department's practice of computing a single
weighted-average cost for the entire period). This methodology is
predictable and generally applicable in all proceedings. However, the
Department recognizes that possible distortions may result if our
normal annual weighted-average cost method is used during a period of
significant cost changes.
In determining whether to deviate from our normal methodology of
calculating an annual weighted average cost, the Department evaluates
the case-specific record evidence using two primary factors: (1) the
change in the cost of manufacturing (``COM'') recognized by the
respondent during the POI must be significant; and (2) the record
evidence must indicate that sales during the shorter averaging periods
reasonably link to the cost of production (``COP'') or constructed
value (``CV'') during the same shorter averaging periods. See, e.g.,
Stainless Steel Plate in Coils From Belgium: Final Results of
Administrative Review, 73 FR 75398, 75399 (December 11, 2008) and
Stainless Steel Sheet and Strip in Coils from Mexico: Final Results of
Administrative Review, 75 FR 6627 (February 10, 2010).
a. Significance of Cost Changes
Record evidence shows that both Borusan and Toscelik experienced
significant changes in the total COM during the POR and that the
changes in COM are primarily attributable to the price volatility for
hot-rolled coils, the main input consumed in the production of the
merchandise under consideration. See Memorandum to Neal M. Halper,
``Cost of Production and Constructed Value Calculation Adjustments for
the Preliminary Results Borusan,'' dated June 7, 2010 (``Borusan
Preliminary Cost Memorandum''), and Memorandum to Neal M. Halper,
``Cost of Production and Constructed Value Calculation Adjustments for
the Preliminary Determination Toscelik'' dated June 7, 2010 (``Toscelik
Preliminary Cost Memorandum'').
The record indicates that hot-rolled prices changed dramatically
throughout the POR. Id. Specifically, the record data shows that the
percentage difference between the high and low quarterly costs for
welded carbon pipe and tube products exceeded 25 percent during the
POR. Id. As a result, we have determined that for the preliminary
results the changes in COM for Borusan and Toscelik are significant.
b. Linkage between Cost and Sales Information
The Department evaluates whether there is evidence of linkage
between the cost changes and the sales prices for the given POI/POR.
Our definition of linkage does not require direct traceability between
specific sales and their specific production cost, but rather relies on
whether there are correlative elements which would indicate a
reasonable correlation between the underlying costs and the final sales
prices levied by the company. These correlative elements may be
measured and defined in a number of ways depending on the associated
industry, and the overall production and sales processes. See, e.g.,
Stainless Steel Bar from India: Preliminary Results of Antidumping Duty
Administrative Review 75 FR 12204 (March 15, 2010).
Based on record evidence we find that the cost changes and sales
prices for Borusan and Toscelik appear to be reasonably correlated.
Because the data on which we base our analysis contains business
proprietary information, a detailed analysis is included in Borusan
Preliminary Cost Memorandum and Toscelik Preliminary Cost Memorandum.
In light of the two factors discussed above, we preliminarily
determined that it is appropriate to rely on a shorter cost periods
with respect to Borusan and Toscelik. Thus, we used quarterly indexed
annual average raw material costs and annual weighted-average
fabrication costs in the COP and CV calculations. See Borusan
Preliminary Cost Memorandum and Toscelik Preliminary Cost Memorandum.
C. Cost of Production Analysis
Because the Department disregarded sales below the COP in the last
completed review of Borusan and Toscelik, we have reasonable grounds to
believe or suspect that sales of the foreign like product under
consideration for the determination of NV in this review may have been
made at prices below the COP as provided by section 773(b)(2)(A)(ii) of
the Act. Therefore, pursuant to section 773(b)(1) of the Act, we
initiated a COP investigation of sales by Borusan and Toscelik in the
home market. See 2007-08 Administrative Review.
1. Calculation of Cost of Production
Before making any comparisons to NV, we conducted a quarterly COP
analysis of Borusan and Toscelik's sales pursuant to section 773(b)(3)
of the Act to determine whether Borusan and Toscelik's comparison
market sales were made at prices below the COP. We calculated the COP
based on the sum of the cost of materials and fabrication for the
foreign like product, plus amounts for SG&A expenses and packing, in
accordance with section 773(b)(3) of the Act.
The Department relied on the COP data submitted by Borusan and
Toscelik and their supplemental section D questionnaire responses for
the COP calculation, except for the following instances:
Borusan:
a) We excluded packing costs from Borusan's the cost of goods sold
(``COGS'') in the financial expense rate ratio calculation.
b) We adjusted Borusan's general administrative expense (``G&A'')
calculation by excluding an amount for doubtful accounts and included
this amount in the calculations of indirect selling expenses.
For additional details, see Borusan Preliminary Cost Memorandum. No
adjustments were made to Toscelik's reported cost data.
[[Page 33266]]
2. Test of Comparison Market Sales Prices
As required under section 773(b)(2) of the Act, we compared the
quarterly weighted average COP to the per-unit price of the comparison
market sales of the foreign like product to determine whether these
sales had been made at prices below the COP within an extended period
of time in substantial quantities, and whether such prices were
sufficient to permit the recovery of all costs within a reasonable
period of time. We determined the net comparison market prices for the
below cost test by subtracting from the gross unit price any applicable
movement charges, discounts, rebates, direct and indirect selling
expenses (also subtracted from the COP), and packing expenses.
3. Results of the COP Test
Pursuant to section 773(b)(2)(C)(i) of the Act, where less than 20
percent of 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 the respondent's home market
sales of a given model were at prices less than the COP, we disregarded
the below-cost sales because: (1) they were made within an extended
period of time in ``substantial quantities,'' in accordance with
sections 773(b)(2)(B) and (C) of the Act; and (2) based on our
comparison of prices to the indexed POR weighted-average COPs, they
were at prices which would not permit the recovery of all costs within
a reasonable period of time, in accordance with section 773(b)(2)(D) of
the Act.
Therefore, for Borusan and Toscelik, we disregarded below-cost
sales of a given product of 20 percent or more and used the remaining
sales as the basis for determining NV, in accordance with section
773(b)(1) of the Act. See Borusan and Toscelik's calculation memos.
D. Calculation of NV Based on Comparison Market Prices
For Borusan and Toscelik, for those comparison products for which
there were sales at prices above the COP, we based NV on home market
prices. In these preliminary results, we were able to match all U.S.
sales to contemporaneous sales, made in the ordinary course of trade,
of either an identical or a similar foreign like product, based on
matching characteristics. We calculated NV based on free on board
(``FOB'') mill or delivered prices to unaffiliated customers, or prices
to affiliated customers which were determined to be at arm's length
(see discussion below regarding these sales). We made deductions, where
appropriate, from the starting price for billing adjustments,
discounts, rebates, and inland freight. Additionally, we added interest
revenue. In accordance with section 773(a)(6) of the Act, we deducted
home market packing costs and added U.S. packing costs.
In accordance with section 773(a)(6)(C)(iii) of the Act, we
adjusted for differences in the circumstances of sale. These
circumstances included differences in imputed credit expenses and other
direct selling expenses, such as the expense related to bank charges
and factoring. We also 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 (``CV'')
When we could not determine the NV based on comparison market sales
because there were no contemporaneous sales of a comparable product, we
compared the EP to CV. In accordance with section 773(e) of the Act, we
calculated CV based on the sum of the COM of the product sold in the
United States, plus amounts for SG&A expenses, profit, and U.S. packing
costs. In accordance with section 773(e)(2)(A) of the Act, we based
SG&A expenses and profit on the amounts incurred by Borusan in
connection with the production and sale of the foreign like product in
the comparison market.
For price to CV comparisons, we made adjustments to CV for
circumstances of sale (``COS'') differences, in accordance with section
773(a)(8) of the Act and 19 CFR 351.410. We made COS adjustments by
deducting direct selling expenses incurred on comparison market sales
and adding U.S. direct selling expenses.
F. Calculation of Arm's-Length Sales
We included in our analysis Borusan and Toscelik's home market
sales to affiliated customers only where we determined that such sales
were made at arm's-length prices, i.e., at prices comparable to prices
at which Borusan and Toscelik sold identical merchandise to their
unaffiliated customers. Borusan and Toscelik's sales to affiliates
constituted less than five percent of overall home market sales. To
test whether the sales to affiliates were made at arm's-length prices,
we compared the starting prices of sales to affiliated and unaffiliated
customers net of all movement charges, direct selling expenses,
discounts, 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, we
determined that the sales made to the affiliated party were at arm's-
length. See Notice of Preliminary Results and Partial Rescission of
Antidumping Duty Administrative: Ninth Administrative Review of the
Antidumping Duty Order on Certain Pasta from Italy, 71 FR 45017, 45020
(August 8, 2006) (unchanged in Notice of Final Results of the Ninth
Administrative Review of the Antidumping Duty Order on Certain Pasta
from Italy, 72 FR 7011 (February 14, 2007)); 19 CFR 351.403(c).
Conversely, where we found that the sales to an affiliated party did
not pass the arm's-length test, then all sales to that affiliated party
have been excluded from the NV calculation. See Antidumping
Proceedings: Affiliated Party Sales in the Ordinary Course of Trade, 67
FR 69186, 69187 (November 15, 2002).
Level of Trade
As set forth in section 773(a)(1)(B)(i) of the Act and in the
Statement of Administrative Action (``SAA'') accompanying the Uruguay
Round Agreements Act, at 829-831 (see H.R. Doc. No. 316, 103d Cong., 2d
Sess. 829-831 (1994)), to the extent practicable, the Department
calculates NV based on sales at the same level of trade (``LOT'') as
U.S. sales, either EP or CEP. When the Department is unable to find
sale(s) in the comparison market at the same LOT as the U.S. sale(s),
the Department may compare sales in the U.S. and foreign markets at
different LOTs. The NV LOT is that of the starting price sales in the
home market. To determine whether home market sales are at a different
LOT than U.S. sales, we examine stages in the marketing process and
selling functions along the chain of distribution between the producer
and the unaffiliated customer. See Honey from Argentina: Preliminary
Results of Antidumping Duty Administrative Review and Intent to Revoke
Order in Part, 73 FR 79802, 79805 (December 30, 2008) (``Honey from
Argentina''). If the comparison-market sales are 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
make an LOT adjustment under section 773(a)(7)(A) of the Act. See Honey
from Argentina, 73 FR at 79805.
[[Page 33267]]
In implementing these principles, we examined information from
Borusan and Toscelik regarding the marketing stages involved in the
reported home market and EP sales, including a description of the
selling functions performed by Borusan and Toscelik for the channels of
distribution in the home market and U.S. market. In our analysis, we
grouped the reported selling functions into the following sales
function category: sales process and marketing support, freight and
delivery, inventory maintenance, and quality assurance/warranty
service.
For home market sales, we found that Borusan's mill-direct sales
comprised one LOT. Furthermore, Borusan provided similar selling
functions to each type of customer (i.e. trading companies/distributors
and industrial end-users/construction companies), with the exception of
rebates grouped into the sales process and marketing category which
were given to trading companies/distributors. See pages A-18 and A-21
of Borusan's September 25, 2009, response.
We found that Borusan's U.S. sales were also made at only one LOT.
Borusan reports one channel of distribution, and sales are negotiated
on an order-by-order basis with an unaffiliated trading company. See
page A-17 of Borusan's September 25, 2009, response.
We then compared Borusan's home market LOT and with the U.S. LOT.
We note the selling functions do not differ for the activities falling
under inventory maintenance (i.e., forward inventory maintenance and
sales from warehouse), quality assurance/warranty service (i.e.,
provide warranty service), and freight and delivery (i.e., act as agent
or coordinate production/delivery for customer with mill and coordinate
freight and delivery arrangement). Furthermore, we note that the
selling functions grouped under sales process and marketing, such as
customer advice/product information, discounts, advertising, and
rebates only differ somewhat between the home market LOT and U.S. LOT.
See page A-9 of Borusan's September 25, 2009, response. Therefore, we
compared all U.S. sales to an identical home market LOT and did not
find it necessary to make an LOT adjustment.
In the home market, Toscelik reported that they sold through one
channel of distribution; ex works. Toscelik also reported that they
sold to one customer category: distributors. Toscelik reported the
following selling activities in the home market: (1) Packing, (2) Order
Input/Processing, (3) Direct Sales Personnel, (4) Sales/Marketing
Support, and (5) Warranty Service. See Toscelik's section A D
antidumping questionnaire response (``Toscelik QR response''), dated
September 4, 2009, at page 14. We found Toscelik's home market sales
constitute one level of trade.
In the U.S. market, Toscelik made direct sales on an EP basis
through one channel of distribution to unaffiliated trading companies.
Toscelik identified the following selling activities in the U.S.
market: (1) Packing, (2) Order Input/Processing, (3) Direct Sales
Personnel, (4) Sales/Marketing Support, and (5) Warranty Service. Id.
We found that Toscelik's sales to the United States were made to one
level of trade. Further, we find only minor differences between the
sole home market LOT and that of Toscelik's U.S. LOT. Accordingly, we
preliminarily determine that Toscelik's home market LOT and U.S. LOT
were comparable, and that a LOT adjustment is not appropriate for
Toscelik in this case.
Currency Conversion
The Department's preferred source for daily exchange rates is the
Federal Reserve Bank. However, the Federal Reserve Bank does not track
or publish exchange rates for the Turkish lira. Therefore, we made
currency conversions based on the daily exchange rates from the Dow
Jones Business Information Services.
Section 773A(a) of the Act directs the Department to use a daily
exchange rate in order to convert foreign currencies into U.S. dollars,
unless the daily rate involves a ``fluctuation.'' It is the
Department's practice to find that a fluctuation exists when the daily
exchange rate differs from a benchmark rate by 2.25 percent. The
benchmark rate is defined as the rolling average of the rates for the
past 40 business days. When we determine that a fluctuation existed, we
generally utilize the benchmark rate instead of the daily rate, in
accordance with established practice. We did not find a fluctuation
existed during the POR in this case.
Preliminary Results of Review
As a result of this review, we preliminarily determine that the
following margin exists for the period May 1, 2008, through April 30,
2009:
------------------------------------------------------------------------
Weighted-Average
Manufacturer/Exporter Margin (percent)
------------------------------------------------------------------------
Borusan............................................. 5.44
Toscelik............................................ 0.00
Yucel Group\6\...................................... 3.28
All Others.......................................... 14.74
------------------------------------------------------------------------
\6\ No shipments or sales subject to this review. The firm has an
individual rate from the last segment of the proceeding (the 2004-2005
review) in which the firm had shipments or sales.
We will disclose the calculations used in our analysis to parties
to this proceeding within five days of the publication date of this
notice. See section 351.224(b) of the Department's regulations.
Interested parties are invited to comment on the preliminary results.
Interested parties may submit case briefs within 30 days of the date of
publication of this notice. Rebuttal briefs, limited to issues raised
in the case briefs, may be filed no later than 37 days after the date
of publication of this notice. Parties who submit arguments are
requested to submit with each 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 a diskette. Any interested party may request a hearing
within 30 days of publication of this notice. See section 351.310(c) of
the Department's regulations. If requested, a hearing will be held 44
days after the publication of this notice, or the first workday
thereafter. The Department will publish a notice of the final results
of this administrative review, which will include the results of its
analysis of issues raised in any written comments or hearing, within
120 days from publication of this notice.
Assessment
The Department will determine, and CBP shall assess, antidumping
duties on all appropriate entries, pursuant to section 751(a)(1)(B) of
the Act and 19 CFR 351.212(b). The Department calculated importer-
specific duty assessment rates on the basis of the ratio of the total
antidumping duties calculated for the examined sales to the total
entered value of the examined sales for that importer. Where the
assessment rate is above de minimis, we will instruct CBP to assess
duties on all entries of subject merchandise by that importer. The
Department intends to issue assessment instructions to CBP 15 days
after the date of publication of the final results of review.
The Department clarified its ``automatic assessment'' regulation on
May 6, 2003. See Antidumping and Countervailing Duty Proceedings:
Assessment of Antidumping Duties, 68
[[Page 33268]]
FR 23954 (May 6, 2003). This clarification will apply to entries of
subject merchandise during the period of review produced by companies
included in these preliminary results of review for which the reviewed
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 rates will be effective upon publication
of the final results of this administrative review for all shipments of
welded pipe and tube from Turkey 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 the company
listed above will be the rate established in the final results of this
review; (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 or the LTFV investigation conducted by the Department, the cash
deposit rate will be 14.74 percent, the ``All Others'' rate established
in the LTFV investigation. These cash deposit requirements, when
imposed, shall remain in effect until further notice.
This notice serves as a preliminary reminder to importers of their
responsibility under section 351.402(f)(2) of the Department's
regulations to file a certificate regarding the reimbursement of
antidumping and/or countervailing 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 and/or countervailing duties occurred and
the subsequent assessment of double antidumping duties.
This determination is 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. 2010-14106 Filed 6-10-10; 8:45 am]
BILLING CODE 3510-DS-S