[Federal Register Volume 69, Number 112 (Thursday, June 10, 2004)]
[Notices]
[Pages 32508-32510]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-13071]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-449-804]
Notice of Preliminary Results of Antidumping Duty Administrative
Review: Steel Concrete Reinforcing Bars From Latvia
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
DATES: Effective Date: June 10, 2004.
FOR FURTHER INFORMATION CONTACT: Daniel O'Brien or Shane Subler, at
(202) 482-5346 or (202) 482-0189, respectively; AD/CVD Enforcement
Office 1, Group 1, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street & Constitution
Avenue, NW., Washington, DC 20230.
SUMMARY: The Department of Commerce (the Department) is conducting an
administrative review of the antidumping duty order on steel concrete
reinforcing bar (rebar) from Latvia. We preliminarily determine that
sales of subject merchandise by Joint Stock Company Liepajas Metalurgs
(Liepajas Metalurgs) 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 based on the difference between the export price
(EP) and the NV.
Interested parties are invited to comment on these preliminary
results. Parties that submit arguments are requested to submit with
each argument: (1) A statement of the issue and (2) a brief summary of
the argument. Further, we ask that parties submitting comments provide
the Department with an additional copy of the public version of any
such comments on diskette.
SUPPLEMENTARY INFORMATION:
Background
On September 7, 2001, the Department issued an antidumping duty
order on rebar from Latvia. See Antidumping Duty Orders: Steel Concrete
Reinforcing Bars From Belarus, Indonesia, Latvia, Moldova, People's
Republic of China, Poland, Republic of Korea and Ukraine, 66 FR 46777
(September 7, 2001). On September 2, 2003, the Department issued a
notice of opportunity to request the second administrative review of
this order. See Antidumping or Countervailing Duty Order, Finding, or
Suspended Investigation; Opportunity to Request Administrative Review,
68 FR 52181 (September 2, 2003). On September 17, 2003, in accordance
with 19 CFR 351.213(b), Liepajas Metalurgs requested an administrative
review. On September 30, 2003, also in accordance with 19 CFR
351.213(b), the petitioners \1\ requested an administrative review of
Liepajas Metalurgs. On October 24, 2003, the Department published the
notice of initiation of this antidumping duty administrative review,
covering the period September 1, 2002, through August 31, 2003 (the
POR). See Initiation of Antidumping and Countervailing Duty
Administrative Reviews, 68 FR 60910 (October 24, 2003).
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\1\ The petitioners in this case are the Rebar Trade Action
Coalition (``RTAC'') and its individual members.
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On November 7, 2003, the Department issued its antidumping
questionnaire to Liepajas Metalurgs, specifying that the responses to
Section A and Sections B-D would be due on November 28, 2003, and
December 14, 2003, respectively.\2\ We received timely responses to
Sections A-C of the initial antidumping questionnaire and associated
supplemental questionnaires. We initiated a cost of production (COP)
investigation of Liepajas Metalurgs on April 23, 2004. The company
submitted timely responses to Section D of the antidumping
questionnaire, as well as to supplemental questionnaires.
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\2\ Section A of the questionnaire requests general information
concerning a company's corporate structure and business practices,
the merchandise under review that it sells, and the manner in which
it sells that merchandise in all of its markets. Section B requests
a complete listing of all home market sales, or, if the home market
is not viable, of sales in the most appropriate third-country market
(this section is not applicable to respondents in non-market economy
cases). Section C requests a complete listing of U.S. sales. Section
D requests information on the cost of production of the foreign like
product and the constructed value of the merchandise under review.
Section E requests information on further manufacturing.
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Due to the unexpected emergency closure of the main Commerce
building on Tuesday, June 1, 2004, the Department has tolled the
deadline for these preliminary results by one day to June 2, 2004.
Scope of the Order
For purposes of this review, the product covered by this order is
all steel concrete reinforcing bars sold in straight lengths, currently
classifiable in the Harmonized Tariff Schedule of the United States
(HTSUS) under item number 7214.20.00 or any other tariff item number.
Specifically excluded are plain rounds (i.e., non-deformed or smooth
bars) and rebar that has been further processed through bending or
coating. HTSUS subheadings are provided for convenience and customs
purposes. The written description of the scope of this proceeding is
dispositive.
Fair Value Comparisons
We compared the EP to the NV, as described in the Export Price and
Normal Value sections of this notice. We first attempted to compare
contemporaneous sales of products sold in the United States and
comparison market that are identical with respect to the matching
characteristics. Pursuant to section 771(16) of the Act, all products
produced by the respondent that fit the definition of the scope of the
order and were sold in the comparison market during the POR fall within
the definition of the foreign like product. We have relied on three
criteria to match U.S. sales of subject merchandise to comparison
market sales of the foreign like product: type of steel, yield
strength, and size. Where there were no sales of identical merchandise
in the comparison market, we compared U.S. sales to sales of the next
most similar foreign like product on the basis of the characteristics
listed above.
Export Price
We calculated an EP for all of Liepajas Metalurgs' sales because
the merchandise was sold directly by Liepajas Metalurgs to the first
unaffiliated purchaser for delivery to the United States, and
constructed export price (CEP) was not otherwise warranted based on the
facts of record. We made deductions from the starting price for
movement expenses in accordance with section 772(c)(2)(A) of the Act.
These included inland freight and domestic brokerage and handling
expenses.
Normal Value
A. Selection of Comparison Markets
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
that the
[[Page 32509]]
merchandise is sold in sufficient quantities (or value, if quantity is
inappropriate); that the time of the sales reasonably corresponds to
the time of the sale used to determine EP; and that there is no
particular market situation that prevents a proper comparison with the
EP. 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.
We found that Liepajas Metalurgs had a viable home market for
rebar. As such, Liepajas Metalurgs 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 Home Market Prices section below.
B. Cost of Production Analysis
Because we disregarded below-cost sales in the first administrative
review, we have reasonable grounds to believe or suspect that home
market sales of the foreign like product by Liepajas Metalurgs have
been made at prices below the COP during the period of the second
review. Therefore, pursuant to section 773(b)(1) of the Act, we
initiated a COP investigation of sales made by Liepajas Metalurgs. See
Memorandum From Daniel O'Brien, International Trade Compliance Analyst,
to Gary Taverman, Director, Office 5, Re: Allegation of Sales Below the
Cost of Production for Joint Stock Company Liepajas Metalurgs, dated
April 23, 2004.
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, and general and administrative (G&A) expenses. We relied
on Liepajas Metalurgs' submitted COP. See Memorandum from Daniel
O'Brien and Jim Kemp, International Trade Compliance Analysts, to
Constance Handley, Program Manager, Re: Analysis Memorandum for Joint
Stock Company Liepajas Metalurgs, dated June 2, 2004 (the Analysis
Memorandum).
2. Test of Comparison Market Sales Prices
We compared the weighted-average COPs for Liepajas Metalurgs 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., 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 disregarded below-cost sales where (1) 20 percent or more of
Liepajas Metalurgs' sales of a given product during the POR were made
at prices below the COP, because such sales 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 comparisons
of price to weighted-average COPs for the POR, we determined that the
below-cost sales of the product were at prices which 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 that Liepajas Metalurgs
made sales below cost and we disregarded such sales where appropriate.
C. Calculation of Normal Value Based on Comparison-Market Prices
We determined NV for Liepajas Metalurgs as follows. We made
adjustments for any differences in packing and deducted home market
movement expenses pursuant to sections 773(a)(6)(A) and
773(a)(6)(B)(ii) 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. We made COS adjustments for Liepajas
Metalurgs's EP transactions by deducting direct selling expenses
incurred for home market sales (credit expenses) and adding U.S. direct
selling expenses (credit expenses). We note that Liepajas Metalurgs
reported freight revenue on some sales, but failed to provide the
corresponding freight expenses. For the purposes of this preliminary
results, we have not added freight revenue to normal value. We will
request the correct freight information from Liepajas Metalurgs prior
to the deadline for case briefs being due.
D. Level of Trade Adjustment
In accordance with section 773(a)(1)(B) of the Act, to the extent
practicable, we determine NV based on sales in the comparison market at
the same level of trade as the EP transaction. The NV level of trade is
that of the starting-price sales in the comparison market. For EP
sales, the U.S. level of trade is also the level of the starting-price
sale, which is usually from exporter to importer.
To determine whether NV sales are at a different level of trade
than EP transactions, 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 level of trade 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 level of trade of the export transaction, we make a
level-of-trade adjustment under section 773(a)(7)(A) of the Act.
In implementing these principles in this administrative review, we
obtained information from Liepajas Metalurgs about the marketing stages
involved in the reported U.S. and home market sales, including a
description of the selling activities performed by the respondent for
each channel of distribution. In identifying levels of trade for EP and
home market sales, we considered the selling functions reflected in the
starting price before any adjustments.
In conducting our level-of-trade analysis for Liepajas Metalurgs,
we examined the specific types of customers, the channels of
distribution, and the selling practices of the respondent. Generally,
if the reported levels of trade are the same, the functions and
activities of the seller should be similar. Conversely, if a party
reports levels of trade that are different for different categories of
sales, the functions and activities may be dissimilar. We found the
following.
Liepajas Metalurgs reported two channels of distribution in the
home market: (1) Direct sales by Liepajas Metalurgs; and (2) sales by
Liepajas Metalurgs' affiliated reseller Armaturas Servisa Centrs
(ASC).\3\ In the U.S. market, Liepajas Metalurgs reported one channel
of distribution: direct sales by Liepajas Metalurgs. The company
reported three customer categories in the home market: (1) Traders; (2)
end users; and (3) service centers. We found that the selling functions
performed by Liepajas Metalurgs differed significantly for home market
customers depending on the channel of distribution. The activities
performed by ASC were in greater number and more advanced than those
provided by Liepajas Metalurgs on
[[Page 32510]]
direct sales. ASC provided selling functions such as customer
negotiation, warehousing, sorting, repacking, and freight delivery,
while Liepajas Metalurgs only negotiated with customers and arranged
delivery of the product. Therefore, we have preliminarily determined
that sales through ASC are at a more advanced level of trade than
Liepajas Metalurgs' direct sales in the home market.
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\3\ Liepajas Metalurgs sold its share in ASC on August 19, 2003.
For all sales subsequent to that date, Liepajas Metalurgs reported
its sales to ASC as direct sales to an unaffiliated customer.
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Liepajas Metalurgs has reported one customer category in the U.S.
market: traders. In comparing EP sales to the direct sales in the home
market, we found that the selling functions performed by Liepajas
Metalurgs were very similar in the U.S. and Latvian markets. For U.S.
sales, Liepajas Metalurgs conducts negotiations with the traders and
arranges delivery to the port. Therefore, we concluded that the EP and
home market direct sales were made at the same level of trade. Since
Liepajas Metalurgs' direct home market and U.S. sales are at the same
level of trade, and ASC's home market sales are at a more advanced
level of trade and a pattern of consistent price differences exists, we
have preliminarily determined that a level of trade adjustment is
warranted when we based NV on sales made through ASC. We have
calculated a level of trade adjustment based on the difference in price
between the two levels of trade in the home market for U.S. sales that
match to sales made through ASC.
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 certified by the Federal Reserve Bank.
Preliminary Results of Review
As a result of this review, we preliminarily determine that the
following weighted-average margin exists for the period September 1,
2002, through August 31, 2003:
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Weighted-average margin
Producer (percentage)
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Joint Stock Company Liepajas Metalurgs.... 4.61
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The Department will disclose calculations performed in accordance
with 19 CFR 351.224(b). 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 44 days after the
date of publication, or the first working day thereafter. Interested
parties may submit case briefs and/or written comments no later than 30
days after the date of publication of these preliminary results.
Rebuttal briefs and rebuttals to written comments, limited to issues
raised in such briefs or comments, may be filed no later than 37 days
after the date of publication. Parties who submit arguments 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, the 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 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.
Assessment
Upon completion of this administrative review, pursuant to 19 CFR
351.212(b), the Department will calculate an assessment rate on all
appropriate entries. We will calculate importer-specific duty
assessment rates on the basis of the ratio of the total amount of
antidumping duties calculated for the examined sales to the total
entered value of the examined sales for that importer. Since the
delivery terms for all of Liepajas Metalurgs' U.S. sales were FOB
Latvian seaport, we will calculate entered value using the gross unit
price reported in the U.S. sales database. Where the assessment rate is
above de minimis, we will instruct CBP to assess duties on all entries
of subject merchandise by that importer.
Cash Deposit Requirements
The following deposit rates will be effective upon publication of
the final results of this administrative review for all shipments of
rebar from Latvia 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 listed above for Liepajas Metalurgs
will be the rate established in the final results of this review,
except if a rate is less than 0.5 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 17.21 percent, the ``All Others'' rate established in the
LTFV investigation. These cash deposit requirements, when imposed,
shall remain in effect until publication of the final results of the
next administrative review.
This notice 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 entities 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.
This determination is issued and published in accordance with
sections 751(a)(1) and 777(i)(1) of the Act.
Dated: June 2, 2004.
James J. Jochum,
Assistant Secretary for Import Administration.
[FR Doc. 04-13071 Filed 6-9-04; 8:45 am]
BILLING CODE 3510-DS-P