[Federal Register Volume 77, Number 106 (Friday, June 1, 2012)]
[Notices]
[Pages 32539-32552]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-13230]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-520-805]
Circular Welded Carbon-Quality Steel Pipe From the United Arab
Emirates: Preliminary Determination of Sales at Less Than Fair Value
and Postponement of Final Determination
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: The U.S. Department of Commerce (the Department) preliminarily
determines that circular welded carbon-quality steel pipe (certain
steel pipe) from the United Arab Emirates (UAE) is being, or is likely
to be, sold in the United States at less than fair value (LTFV) as
provided in section 733(b) of the Tariff Act of 1930, as amended (the
Act). The estimated margins of sales at LTFV are listed in the
``Preliminary Determination'' section of this notice. Interested
parties are invited to comment on this preliminary determination.
Pursuant to requests from interested parties, we are postponing for 60
days the final determination and extending provisional measures from a
four-month period to not more than six months. Accordingly, we will
make our final determination not later than 135 days after publication
of the preliminary determination.
DATES: Effective Date: June 1, 2012.
FOR FURTHER INFORMATION CONTACT: Deborah Scott or Robert James, AD/CVD
Operations, Office 7, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue NW., Washington, DC 20230; telephone (202) 482-2657
or (202) 482-0649, respectively.
[[Page 32540]]
SUPPLEMENTARY INFORMATION:
Background
On October 26, 2011, the Department received petitions concerning
imports of certain steel pipe from India, the Sultanate of Oman (Oman),
the UAE, and the Socialist Republic of Vietnam (Vietnam) filed in
proper form on behalf of Allied Tube and Conduit, JMC Steel Group,
Wheatland Tube Company, and United States Steel Corporation
(collectively, petitioners).\1\ On November 15, 2011, the Department
initiated the antidumping duty investigations on certain steel pipe
from India, Oman, the UAE, and Vietnam.\2\
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\1\ See Circular Welded Carbon-Quality Steel Pipe From India,
Oman, the UAE, and Vietnam: Antidumping and Countervailing Duty
Petitions, filed on October 26, 2011.
\2\ See Circular Welded Carbon-Quality Steel Pipe from India,
the Sultanate of Oman, the United Arab Emirates, and the Socialist
Republic of Vietnam: Initiation of Antidumping Duty Investigations,
76 FR 72164 (November 22, 2011) (Initiation Notice).
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The Department set aside a period of time for parties to raise
issues regarding product coverage and encouraged all parties to submit
comments within 20 calendar days of the date of signature of the
Initiation Notice.\3\ We received comments from SeAH Steel Vina Corp.
(SeAH VINA), a Vietnamese producer, on December 5, 2011, and we
received rebuttal comments from petitioners Allied Tube and Conduit,
JMC Steel Group, and Wheatland Tube Company on December 14, 2011. After
reviewing all comments, we have adopted the ``Scope of Investigation''
section of this notice, below. The Department also set aside a period
of time for parties to comment on product characteristics to be used in
the antidumping duty questionnaire and indicated that in order to
consider such comments, they should be submitted no later than December
9, 2011.\4\ On December 9, 2011, we received comments from a UAE
producer, Universal Tube and Plastic Industries, Ltd. (UTP), and its
U.S. affiliate, Prime Metal Corp. USA (Prime Metal). After reviewing
all comments, we have adopted the characteristics and hierarchy as
explained in the ``Product Comparisons'' section of this notice, below.
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\3\ See Initiation Notice, 76 FR at 72164.
\4\ See Initiation Notice, 76 FR at 72164-5.
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The Department also stated in the Initiation Notice that it
intended to select mandatory respondents for this investigation based
on U.S. Customs and Border Protection (CBP) data.\5\ On November 22,
2011, the Department released U.S. import data obtained from CBP to all
interested parties and invited parties to submit comments on the
potential respondent selection by November 29, 2011.\6\ No parties
filed comments on these CBP data. On December 16, 2011, we selected UTP
and Abu Dhabi Metal Pipes & Profiles Industries Complex LLC (ADPICO) as
the mandatory respondents in this investigation.\7\
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\5\ See Initiation Notice, 76 FR at 72168.
\6\ See Letter from Robert James, Program Manager, to All
Interested Parties, dated November 22, 2011.
\7\ See Memorandum to Christian Marsh, Deputy Assistant
Secretary for Antidumping and Countervailing Duty Operations, from
Richard O. Weible, Director, Office 7, ``Antidumping Duty
Investigation of Circular Welded Carbon-Quality Steel Pipe from the
United Arab Emirates: Respondent Selection Memorandum,'' dated
December 16, 2011 (Respondent Selection Memorandum).
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On December 16, 2011, the International Trade Commission (ITC)
published its affirmative preliminary determination that there is a
reasonable indication that imports of certain steel pipe from India,
Oman, the UAE, and Vietnam are materially injuring the U.S. industry,
and the ITC notified the Department of its finding.\8\
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\8\ See Circular Welded Carbon-Quality Steel Pipe From India,
Oman, the United Arab Emirates, and Vietnam, Investigation Nos. 701-
TA-482-485 and 731-TA-1191-1194 (Preliminary), 76 FR 78313 (December
16, 2011).
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On December 20, 2011, the Department issued its antidumping duty
questionnaire to UTP and ADPICO. The events which have occurred with
respect to each respondent since issuance of the antidumping duty
questionnaire are discussed separately for each respondent below.
On February 29, 2012, petitioners Allied Tube and Conduit and JMC
Steel Group requested that the Department postpone its preliminary
determination by 50 days. In accordance with section 733(c)(1)(A) of
the Act, we postponed our preliminary determination by 50 days.\9\
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\9\ See Circular Welded Carbon-Quality Steel Pipe From India,
the Sultanate of Oman, the United Arab Emirates, and the Socialist
Republic of Vietnam: Postponement of Preliminary Determinations of
Antidumping Duty Investigations, 77 FR 15718 (March 16, 2012).
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On May 16, 2012, petitioners Allied Tube and Conduit and JMC Steel
Group submitted comments with respect to both respondents for
consideration in the preliminary determination.
UTP/Universal
UTP submitted its response to section A of the Department's
antidumping duty questionnaire on January 24, 2012. In its response,
UTP stated that it was reporting its own sales of the foreign like
product as well as sales of merchandise that was produced during the
period of investigation (POI) by two other affiliated manufacturers,
KHK Scaffolding & Formwork LLC (KHK) and Universal Tube and Pipe
Industries LLC (DIP). (Hereinafter, we refer to these three affiliated
producers collectively as ``Universal.'') See Universal's January 24,
2012, section A questionnaire response (AQR) at 3. With respect to its
U.S. sales, Universal reported that the overwhelming majority of its
U.S. sales during the POI were shipped directly from the UAE to the
United States. Universal explained that the remaining quantity
consisted of sales from Prime Metal's inventory, and requested that the
Department excuse Universal from reporting these sales not only because
of the small quantity but also because this merchandise is co-mingled
with material purchased from other suppliers located in the United
States. See Universal's AQR at 3-4, footnote 1.
On January 30, 2012, petitioners Allied Tube and Conduit and JMC
Steel Group filed comments on Universal's section A questionnaire
response.
On February 21, 2012, Universal submitted its response to section B
(i.e., the section covering comparison market sales) and section C
(i.e., the section covering U.S. sales) of the Department's antidumping
questionnaire. In its section B response, in addition to reporting the
sales of the three affiliated manufacturers, Universal also reported
the downstream sales made by three home market affiliated distributors.
On February 22, 2012, petitioners Allied Tube and Conduit and JMC
Steel Group filed an allegation of sales below cost with respect to
Universal. On March 13, 2012, the Department initiated a cost
investigation with respect to Universal.\10\ On March 14, we notified
Universal of our decision to initiate a cost investigation and
requested that Universal provide a response to section D of the
Department's antidumping questionnaire (i.e., the section covering the
cost of production (COP) and constructed value (CV)).
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\10\ See Memorandum to Richard Weible, Director, Office 7, from
The Team, ``The Petitioners' Allegation of Sales Below the Cost of
Production for Universal Tube and Plastic Industries, Ltd.,'' dated
March 13, 2012 (Universal Cost Initiation Memorandum).
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On February 24, 2012, the Department issued a supplemental
questionnaire concerning Universal's section A questionnaire response.
In that supplemental questionnaire, we informed Universal that we were
preliminarily not requiring it to report its U.S. sales from inventory,
but that we might require Universal to report these sales in the
future. Universal submitted its response to this
[[Page 32541]]
supplemental questionnaire on March 20, 2012.
On March 20, 2012, Universal filed a letter with the Department in
which it requested that it be permitted to report home market sales
data for only the three affiliated manufacturers or, alternatively, for
the three manufacturers and just one of the three affiliated
distributors. On March 28, 2012, the Department issued a supplemental
questionnaire covering sections B and C. In the cover letter of that
supplemental questionnaire, we informed Universal that it would not be
permitted to limit its reporting of home market sales. On April 25,
2012, Universal responded to the Department's supplemental
questionnaire for sections B and C.
On April 4, 2012, petitioner Wheatland Tube filed an allegation of
targeted dumping by Universal. See the ``Allegation of Targeted
Dumping'' section below.
On April 23, 2012, Universal filed its section D questionnaire
response. On May 15, 2012, the Department issued a supplemental
questionnaire for section D. Universal's response to this supplemental
questionnaire is currently due on May 29, 2012.
On April 25, 2012, the Department issued a second supplemental
questionnaire for section A. Universal submitted its response on May 4,
2012, and provided additional information on May 10 and 16, 2012.
ADPICO
ADPICO filed its response to section A of the Department's
antidumping duty questionnaire on February 7, 2012.\11\
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\11\ ADPICO filed earlier versions of its section A
questionnaire response on January 31, 2012, and February 5, 2012,
but due to issues such as improper bracketing and a missing or
incomplete public version, the Department rejected these versions.
See Memoranda to The File from Deborah Scott, International Trade
Compliance Analyst, ``Circular Welded Carbon Quality Steel Pipe From
the United Arab Emirates,'' dated February 3, 2012, and February 8,
2012, respectively. In addition, on February 9, 2012, ADPICO
submitted another version of its section A questionnaire response
with altered bracketing and certain information deleted.
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ADPICO's response to sections B and C of the Department's
antidumping questionnaire was originally due on January 26, 2012. In
response to timely requests for extensions, the Department extended the
deadline until February 9, 2012, and again until February 16, 2012.
However, ADPICO did not file a response to sections B and C of the
questionnaire on February 16, 2012. On February 17, 2012, ADPICO
requested three additional days to submit its response. Although ADPICO
did not file this request in a timely manner, the Department stated in
a letter dated February 17, 2012, that ``due to the extraordinary
circumstances cited'' by ADPICO,\12\ the Department was granting ADPICO
an extension to file its response to sections B and C until February
21, 2012. In that letter, the Department informed ADPICO that it would
not consider any additional requests for an extension to submit a
response to sections B and C of the questionnaire. Further, the
Department stated in its letter that ADPICO must file, in a timely
manner, any future questionnaire or supplemental questionnaire
responses or any requests for an extension to file such responses.
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\12\ The lead company official explained that he had been
outside the UAE undergoing several surgeries for cancer.
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On February 21, 2012, ADPICO submitted a response, albeit a
significantly deficient one, to sections B and C of the Department's
antidumping questionnaire. ADPICO's narrative response to sections B
and C totaled only one page. Although ADPICO did not submit a U.S.
sales database in the requested format or worksheets showing how it
calculated expenses incurred on its U.S. sales, it did provide
spreadsheets containing certain U.S. sales information, such as
customer names, invoice numbers, sales quantities and values, and
amounts corresponding to a few expenses. However, ADPICO did not supply
any such information with respect to its comparison market sales.
Rather, the only information ADPICO provided regarding its comparison
market sales was a listing of the total quantity and value of sales to
each customer.\13\ On February 22, 2012, petitioners Allied Tube and
Conduit and the JMC Steel Group filed a letter requesting that the
Department stay the deadline for making a sales below cost allegation
with respect to ADPICO, noting that ADPICO's February 21, 2012,
response lacked a comparison market sales database. On March 2, 2012,
the Department issued a memorandum stating it would stay the deadline
for making a sales below cost allegation with respect to ADPICO and
that the deadline would be tied to ADPICO's submission of usable data.
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\13\ This listing also contained total sales quantities and
values for ADPICO's U.S. customers.
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On March 5, 2012, the Department issued a supplemental
questionnaire to ADPICO for sections A through C. In the cover letter
to this supplemental questionnaire, the Department informed ADPICO that
it must submit its section B database, which was missing entirely from
its February 21, 2012, filing, by March 12, 2012, and that the
remainder of its supplemental questionnaire response was due on March
19, 2012. ADPICO did not submit its section B database by the
established deadline of March 12, 2012. On March 19, 2012, ADPICO
requested an extension to respond to the entire supplemental
questionnaire. ADPICO filed a supplemental questionnaire response on
March 20 and 21, 2012. On March 30, 2012, the Department issued a
letter stating that because ADPICO did not submit its section B
database by the established deadline or request an extension to submit
that portion of its response in a timely manner, ADPICO's March 20 and
21, 2012, submissions were untimely and, therefore, the Department was
rejecting ADPICO's March 20 and 21, 2012, submissions in their
entirety.
On April 20, 2012, ADPICO filed a letter requesting that the
Department reconsider its decision with respect to ADPICO's March 20
and 21, 2012, submissions. On May 17, 2012, ADPICO submitted a letter
in response to the pre-preliminary comments filed by petitioners Allied
Tube and Conduit and JMC Steel Group on May 16, 2012.
Period of Investigation
The POI is October 1, 2010, through September 30, 2011. This period
corresponds to the four most recent fiscal quarters prior to the month
of the filing of the petition, October 2011. See 19 CFR 351.204(b)(1).
Scope of Investigation
The products covered by this investigation are certain steel pipe
from the UAE. For a full description of the scope of this investigation
as set forth in the Initiation Notice, see the ``Scope of the
Investigation'' in Appendix I of this notice.
Scope Comments
As noted above, on December 5, 2011, SeAH VINA, a mandatory
respondent in the concurrent antidumping and countervailing duty
investigations concerning certain steel pipe from Vietnam, filed
comments arguing that the treatment of double and triple stenciled pipe
in the scope of these investigations differs from previous treatment of
these products under other orders on circular welded pipe.
Specifically, SeAH VINA claims that the Brazilian, Korean, and Mexican
orders on these products exclude ``Standard pipe that is dual or triple
certified/stenciled that enters the U.S. as line pipe of a kind used
for oil and gas
[[Page 32542]]
pipelines * * *'' \14\ According to SeAH VINA: (i) If the term ``class
or kind of merchandise'' has meaning, it cannot have a different
meaning when applied to the same products in two different cases; and
(ii) the distinction between standard and line pipe reflected in the
Brazil, Korea and Mexico orders derives from customs classifications
administered by CBP and, thus, is more administrable.
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\14\ See SeAH Vina comments dated December 5, 2011; see also
Certain Circular Welded Non-Alloy Steel Pipe from Brazil, the
Republic of Korea, and Taiwan; and Certain Circular Welded Carbon
Steel Pipes and Tubes From Taiwan: Final Results of the Expedited
Third Sunset Reviews of the Antidumping Duty Order, 76 FR 66899,
66900 (October 28, 2011).
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On December 14, 2011, Allied Tube and Conduit, JMC Steel Group, and
Wheatland Tube (collectively, Certain Petitioners), responded to SeAH
VINA's comments stating that the scope as it appeared in the Initiation
Notice reflected Petitioners' intended coverage. Certain Petitioners
contend that pipe that is multi-stenciled to both line pipe and
standard pipe specifications and meets the physical characteristics
listed in the scope (i.e., is 32 feet in length or less; is less than
2.0 inches (50mm) in outside diameter; has a galvanized and/or painted
(e.g., polyester coated) surface finish; or has a threaded and/or
coupled end finish) is ordinarily used in standard pipe applications.
Certain Petitioners state that, in recent years, the Department has
rejected end-use scope classifications, preferring instead to rely on
physical characteristics to define coverage, and the scope of these
investigations has been written accordingly. Therefore, Certain
Petitioners ask the Department to reject SeAH VINA's proposed scope
modification.
We agree with Certain Petitioners that the Department seeks to
define the scopes of its proceedings based on the physical
characteristics of the merchandise.\15\ Moreover, we disagree with SeAH
VINA's contention that once a ``class or kind of merchandise'' has been
established that the same scope description must apply across all
proceedings involving the product. For example, as the Department has
gained experience in administering antidumping duty and countervailing
duty orders, it has shifted away from end use classifications to scopes
defined by the physical characteristics.\16\ Thus, proceedings
initiated on a given product many years ago may have end use
classifications while more recent proceedings on the product would
not.\17\ Finally, Certain Petitioners have indicated the domestic
industry's intent to include multi-stenciled products that otherwise
meet the physical characteristics set out in the scope. Therefore, the
Department is not adopting SeAH VINA's proposed modification of the
scope.
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\15\ See Notice of Final Determination of Sales at Less Than
Fair Value and Affirmative Final Determination of Critical
Circumstances: Circular Welded Carbon Quality Steel Pipe from the
People's Republic of China, 73 FR 31970 (June 5, 2008), and
accompanying Issues and Decision Memorandum at Comment 1.
\16\ Id.
\17\ Compare, e.g., Countervailing Duty Order: Oil Country
Tubular Goods from Canada, 51 FR 21783 (June 16, 1986) (describing
subject merchandise as being ``intended for use in drilling for oil
and gas'') with Certain Oil Country Tubular Goods From the People's
Republic of China: Amended Final Affirmative Countervailing Duty
Determination and Countervailing Duty Order, 75 FR 3203 (January 20,
2010) (describing the subject merchandise in terms of physical
characteristics without regard to use or intended use).
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Selection of Respondents
Section 777A(c)(1) of the Act directs the Department to calculate
individual dumping margins for each known exporter and producer of the
subject merchandise. Section 777A(c)(2) of the Act gives the Department
discretion, when faced with a large number of exporters or producers,
to limit its examination to a reasonable number of such companies if it
is not practicable to examine all companies. As explained in the
Respondent Selection Memorandum, the Department determined that it was
appropriate to limit the number of producers or exporters examined in
this investigation, and therefore we selected the two respondents which
accounted for the largest volume of imports of subject merchandise
during the POI, ADPICO and Universal.
Use of Facts Otherwise Available
For the reasons discussed below, we determine that the use of facts
otherwise available with an adverse inference is appropriate for the
preliminary determination with respect to ADPICO.
A. Use of Facts Available
Section 776(a)(2) of the Act provides that, if an interested party
withholds information requested by the administering authority, fails
to provide such information by the deadlines for submission of the
information or in the form and manner requested, subject to subsections
(c)(1) and (e) of section 782 of the Act, significantly impedes a
proceeding under this title, or provides such information but the
information cannot be verified as provided in section 782(i) of the
Act, the administering authority shall use, subject to section 782(d)
of the Act, the facts otherwise available in reaching the applicable
determination. Section 782(d) of the Act provides that where the
Department determines a response to a request for information does not
comply with the request, the Department will so inform the party
submitting the response and will, to the extent practicable, provide
that party the opportunity to remedy or explain the deficiency. If the
party fails to remedy the deficiency within the applicable time limits
and subject to section 782(e) of the Act, the Department may disregard
all or part of the original and subsequent responses, as appropriate.
Section 782(e) of the Act states further that the Department shall not
decline to consider submitted information if all of the following
requirements are met: (1) The information is submitted by the
established deadline; (2) the information can be verified; (3) the
information is not so incomplete that it cannot serve as a reliable
basis for reaching the applicable determination; (4) the interested
party has demonstrated that it acted to the best of its ability; (5)
the information can be used without undue difficulties.
After multiple requests by ADPICO for extensions to submit its
response to sections B and C of the Department's antidumping
questionnaire, the Department stated the following in a letter to
ADPICO dated February 17, 2012:
Please be aware that any future questionnaire or supplemental
questionnaire responses filed with the Department, as well as any
requests for an extension to file any such responses, must be
submitted in a timely manner. The Department's antidumping
investigations are governed by statutory deadlines which are
mandatory, not optional, in nature, and we must remind you that
untimely or otherwise deficient filings hinder the progress of this
investigation.
We also noted that ``future untimely filings may result in the
rejection of such responses in their entirety, and may warrant the use
of partial or total facts available, pursuant to section 776(a) of the
{Act{time} * * *, which may include adverse inferences pursuant to
section 776(b) of the Act.''
ADPICO filed a response to sections B and C of the questionnaire on
February 21, 2012, which was the deadline established in the
Department's February 17, 2012, letter, but this response, even after
nearly one month of extensions from the original deadline, contained
myriad significant deficiencies. Sections B and C of the Department's
antidumping questionnaire request that respondents provide databases
containing detailed
[[Page 32543]]
information about their comparison (or third-country) market and U.S.
sales, including information such as product characteristics, terms of
sale, customer names, invoice numbers and dates, shipment and payment
dates, quantities, gross unit prices, and the expenses incurred in
making such sales. In addition, sections B and C of the Department's
antidumping questionnaire ask that respondents discuss the details of
their sales in narrative format and submit worksheets showing the
calculation of the sales expenses reported in their databases. In this
case, ADPICO's narrative response for sections B and C totaled only one
page; ADPICO did not provide a database detailing its comparison market
sales; it did not submit its U.S. sales database in the format
requested, and some of the requested data were missing; and ADPICO did
not include any worksheets showing how it calculated the expenses
incurred in making its comparison market and U.S. sales. In this state,
ADPICO's responses could not be relied upon to calculate a dumping
margin. Given the substantial deficiencies in ADPICO's response,
particularly the lack of a home market sales database, petitioners
Allied Tube and Conduit and the JMC Steel Group filed a letter on
February 22, 2012, requesting that the Department stay the deadline for
making a sales below cost allegation with respect to ADPICO. On March
2, 2012, the Department issued a memorandum stating that the deadline
for making a sales below cost allegation would be tied to ADPICO's
submission of usable data.
On March 5, 2012, the Department issued a supplemental
questionnaire to ADPICO to provide it an opportunity to remedy the
significant deficiencies in its section B questionnaire response, to
correct deficiencies, and to provide additional information regarding
its responses to sections A and C of the original questionnaire. With
respect to sections B and C, the Department's March 5, 2012,
supplemental questionnaire essentially asked ADPICO to refer back to
the original questionnaire and respond fully to each section therein,
while providing ADPICO with additional guidance on how to respond
properly. Because the Department had not yet received a comparison
market database or even a narrative response to section B of the
questionnaire at that point in the investigation, we established a
deadline for ADPICO to submit its section B database that was earlier
than the deadline for the rest of ADPICO's response to the March 5,
2012, supplemental questionnaire. Specifically, the Department
indicated that the due date for ADPICO's section B database was March
12, 2012, and the deadline for ADPICO to submit the remainder of its
supplemental questionnaire response was March 19, 2012. The Department
also noted in the cover letter to its March 5, 2012, supplemental
questionnaire:
The Department must conduct this investigation in accordance
with statutory and regulatory deadlines. If you are unable to
respond completely to every question in the attached supplemental
questionnaire by the established deadline, or are unable to provide
all requested supporting documentation by the same date, you must
notify the official in charge and submit a written request for an
extension of the deadline for all or part of the supplemental
questionnaire response. * * * An extension request submitted without
a proper certification for any factual information contained therein
will be considered improperly filed and, as with any other
improperly filed document, will not be accepted. Any extension
granted in response to your request will be in writing; otherwise,
the original deadline will apply.
Furthermore, we stated:
If the Department does not receive either the requested
information or a written extension request before 5 p.m. ET on the
established deadline, we may conclude that your company has decided
not to cooperate in this proceeding. The Department will not accept
any requested information submitted after the deadline. As required
by section 351.302(d) of our regulations, we will reject such
submissions as untimely. Therefore, failure to properly request
extensions for all or part of a questionnaire response may result in
the application of partial or total facts available, pursuant to
section 776(a) of the Act, which may include adverse inferences,
pursuant to section 776(b) of the Act.
ADPICO did not submit its section B database by the established
deadline of March 12, 2012. On March 19, 2012, ADPICO requested an
extension until March 20, 2012 to respond to the entire supplemental
questionnaire. In its letter, ADPICO stated that it had been
experiencing problems with the Department's electronic filing system,
IA ACCESS. However, the Department considered this explanation
inadequate as by that point, ADPICO's home market database was already
one week overdue, and ADPICO had not attempted to contact the
Department on or around the deadline of March 12, 2012, to address the
alleged technical difficulties. As a result, ADPICO's request on March
19, 2012, for additional time to submit its home market sales database,
a significant portion of the information needed to conduct our
analysis, was untimely. The Department did not extend the deadline for
any portion of ADPICO's supplemental questionnaire. ADPICO filed a
supplemental questionnaire response on March 20 and 21, 2012.
ADPICO did not submit its section B database by the established
deadline or request an extension to submit that portion of its response
in a timely manner. Accordingly, the Department issued a letter on
March 30, 2012, stating that ADPICO's March 20 and 21, 2012,
submissions were untimely and, therefore, the Department was rejecting
ADPICO's March 20 and 21, 2012, submissions in their entirety and
deleting them from the record. The Department further stated it would
not consider the information contained in those submissions in the
preliminary determination.
In this case, ADPICO failed to provide requested information by the
established deadline within the meaning of section 776(a)(2)(B) of the
Act and significantly impeded the proceeding within the meaning of
section 776(a)(2)(C) of the Act. As noted above, we provided ADPICO
with an opportunity to remedy its deficient responses, pursuant to
section 782(d) of the Act, but ADPICO failed to do so. Because ADPICO
did not provide the requested information by the established deadline,
its submissions do not satisfy the criteria of section 782(e) of the
Act. Further, as discussed below, ADPICO did not act to the best of its
ability in providing the requested information, and therefore did not
satisfy the criteria of section 782(e) of the Act for this reason as
well. Accordingly, pursuant to section 776(a)(2) of the Act, we are
relying upon facts otherwise available for ADPICO's antidumping duty
margin.
B. Application of Adverse Inferences for Facts Available
Section 776(b) of the Act provides that, if the Department finds
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 may use an inference adverse to the interests of that party
in selecting the facts otherwise available.\18\ In addition, the
Statement of Administrative Action accompanying the Uruguay Round
Agreements Act, H.R. Rep. 103-316, Vol. 1, 103d Cong. (1994) (SAA)
explains that the Department may employ an adverse
[[Page 32544]]
inference ``to ensure that the party does not obtain a more favorable
result by failing to cooperate than if it had cooperated fully.'' \19\
Furthermore, affirmative evidence of bad faith on the part of a
respondent is not required before the Department may make an adverse
inference.\20\ It is the Department's practice to consider, in
employing adverse inferences, the extent to which a party may benefit
from its own lack of cooperation.\21\
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\18\ See Notice of Final Results of Antidumping Duty
Administrative Review: Stainless Steel Bar from India, 70 FR 54023,
54025-26 (September 13, 2005), and Notice of Final Determination of
Sales at Less Than Fair Value and Final Negative Critical
Circumstances: Carbon and Certain Alloy Steel Wire Rod from Brazil,
67 FR 55792, 55794-96 (August 30, 2002).
\19\ See SAA at 870; see also, e.g., Certain Polyester Staple
Fiber from Korea: Final Results of the 2005-2006 Antidumping Duty
Administrative Review, 72 FR 69663 (December 10, 2007).
\20\ See, e.g., Notice of Final Determination of Sales at Less
Than Fair Value: Circular Seamless Stainless Steel Hollow Products
From Japan, 65 FR 42985 (July 12, 2000); Antidumping Duties,
Countervailing Duties, 62 FR 27296, 27340 (May 19, 1997); and Nippon
Steel Corp. v. United States, 337 F.3d 1373, 1382-83 (Fed. Cir.
2003) (Nippon Steel) (``While intentional conduct, such as
deliberate concealment or inaccurate reporting, surely evinces a
failure to cooperate, the statute does not contain an intent
element.'')
\21\ See Essar Steel Ltd. v. United States, 2012 U.S. App. LEXIS
8621 at *18 (Fed. Cir. Apr. 27, 2012) (Essar). (``Because Commerce
lacks subpoena power, Commerce's ability to apply adverse facts is
an important one. The purpose of the adverse facts statute is `to
provide respondents with an incentive to cooperate' with Commerce's
investigation, not to impose punitive damages.'')
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Despite granting ADPICO numerous extensions of time to submit
information critical to the antidumping analysis and providing ADPICO
with notice of the consequences of the failure to respond to our
antidumping questionnaires or to request extensions in a timely manner,
ADPICO failed to provide a timely response to a critical portion of the
Department's March 5, 2012, supplemental questionnaire, i.e., its home
market sales database, by the established deadline of March 12,
2012.\22\ Further, having given ADPICO an opportunity to correct the
other significant deficiencies identified in its original responses,
ADPICO failed to do so by the deadline of March 19, 2012, requesting
yet another extension, which we did not grant. These failures indicate
that ADPICO did not ``put forth its maximum effort to provide Commerce
with full and complete answers to all inquiries in {this{time}
investigation.'' \23\ Moreover, ``{i{time} t is {respondent's{time}
burden to create an accurate record during Commerce's investigation.''
\24\ ADPICO's repeated failure to submit information in a proper and
timely manner has precluded the Department from performing the
necessary analysis and verification of ADPICO's questionnaire responses
required by section 782(i)(1) of the Act and within the time required
to complete an investigation.
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\22\ See Essar at *19 (``Without the ability to enforce full
compliance with its questions, Commerce runs the risk of
gamesmanship and lack of finality in its investigations.'').
\23\ See Nippon Steel, 337 F.3d at 1382 (While the `` `best of
its ability' '' ``standard does not require perfection and
recognizes that mistakes sometimes occur, it does not condone
inattentiveness, carelessness, or inadequate recordkeeping.'').
\24\ See Essar at *22 (citing Zenith Elecs. Corp. v. United
States, 988 F.2d 1573, 1583 (Fed. Cir. 1993)).
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For the reasons discussed above, the Department has preliminarily
determined that ADPICO has failed to cooperate to the best of its
ability and, therefore, in selecting from among the facts otherwise
available, an adverse inference is warranted, pursuant to section
776(b) of the Act.\25\
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\25\ See, e.g., Notice of Preliminary Determinations of Sales at
Less Than Fair Value: Steel Concrete Reinforcing Bars From Poland,
Indonesia, and Ukraine, 66 FR 8343, 8346 (January 30, 2001)
(unchanged in Notice of Final Determinations of Sales at Less Than
Fair Value: Steel Concrete Reinforcing Bars from Indonesia, Poland
and Ukraine, 66 FR 18752, 18753 (April 11, 2001)) and Notice of
Final Determination of Sales at Less Than Fair Value: Circular
Seamless Stainless Steel Hollow Products From Japan, 65 FR 42985,
42986 (July 12, 2000) (where the Department applied total adverse
facts available (AFA) where respondents failed to respond to
questionnaires in a timely manner).
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C. Selection and Corroboration of Information Used as Facts Available
Where the Department applies AFA because a respondent failed to
cooperate by not acting to the best of its ability to comply with a
request for information, section 776(b) of the Act authorizes the
Department to rely on information derived from the petition, a final
determination, a previous administrative review, or other information
placed on the record.\26\ In selecting a rate for AFA, the Department
selects a rate that is sufficiently adverse to ensure that the
uncooperative party does not obtain a more favorable result by failing
to cooperate than if it had fully cooperated. Normally, it is the
Department's practice to use the highest rate from the petition in an
investigation when a respondent fails to act to the best of its ability
to provide the necessary information.\27\ The rates in the petition
range from 6.23 percent to 11.71 percent.\28\ We have selected the
highest petition rate of 11.71 percent as AFA for ADPICO. This rate
achieves the purpose of applying an adverse inference, i.e., it is
sufficiently adverse to ensure that the uncooperative party does not
obtain a more favorable result by failing to cooperate than if it had
fully cooperated.\29\
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\26\ See also 19 CFR 351.308(c) and the SAA at 868-870.
\27\ See, e.g., Notice of Preliminary Determination of Sales at
Less Than Fair Value and Postponement of Final Determination:
Purified Carboxymethylcellulose From Finland, 69 FR 77216 (December
27, 2004) (unchanged in Notice of Final Determination of Sales at
Less Than Fair Value: Purified Carboxymethylcellulose From Finland,
70 FR 28279 (May 17, 2005)).
\28\ See Initiation Notice, 76 FR at 72168.
\29\ See Gallant Ocean (Thailand) Co. v. United States, 602 F.3d
1319, 1323 (Fed. Cir. 2010).
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Section 776(c) of the Act provides that, when the Department relies
on secondary information rather than on information obtained in the
course of an investigation as facts available, it must, to the extent
practicable, corroborate that information from independent sources
reasonably at its disposal. Secondary information is described in the
SAA as ``information derived from the petition that gave rise to the
investigation or review, the final determination concerning the subject
merchandise, or any previous review under section 751 concerning the
subject merchandise.'' See SAA at 870. The SAA provides that to
``corroborate'' means simply that the Department will satisfy itself
that the secondary information to be used has probative value. Id. The
Department's regulations state that independent sources used to
corroborate such evidence may include, for example, published price
lists, official import statistics and customs data, and information
obtained from interested parties during the particular investigation.
See 19 CFR 351.308(d); see also the SAA at 870. To corroborate
secondary information, the Department will, to the extent practicable,
examine the reliability and relevance of the information used.\30\
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\30\ See Tapered Roller Bearings and Parts Thereof, Finished and
Unfinished, From Japan, and Tapered Roller Bearings, Four Inches or
Less in Outside Diameter, and Components Thereof, From Japan;
Preliminary Results of Antidumping Duty Administrative Reviews and
Partial Termination of Administrative Reviews, 61 FR 57391, 57392
(November 6, 1996), unchanged in Tapered Roller Bearings and Parts
Thereof, Finished and Unfinished, From Japan, and Tapered Roller
Bearings, Four Inches or Less in Outside Diameter, and Components
Thereof, From Japan; Final Results of Antidumping Duty
Administrative Reviews and Termination in Part, 62 FR 11825 (March
13, 1997).
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The AFA rate the Department has used for ADPICO is from the
petition. During our pre-initiation analysis, we examined evidence
supporting the calculations in the petition and the supplemental
information provided by petitioners to determine the probative value of
the margins alleged in the petition. During our pre-initiation
analysis, we also examined the information used as the basis of the
export price (EP) and normal value (NV) in the petition to derive the
alleged margins, thereby corroborating key elements of the EP and NV
calculations and establishing the basis for the estimated margins
identified in the
[[Page 32545]]
Initiation Notice.\31\ Petitioners' methodology for calculating EP and
NV in the petition is discussed in the Initiation Notice.\32\ These
calculations appear reasonable and no information on the record
provides a basis for challenging the appropriateness of those estimated
margins. Therefore, because we confirmed the accuracy and validity of
the information underlying the calculation of margins in the petition
by examining source documents as well as publicly available
information, we preliminarily determine that the margins in the
petition and in the Initiation Notice are reliable for the purposes of
this investigation.
---------------------------------------------------------------------------
\31\ See Initiation Notice, 76 FR at 72166-68.
\32\ Id.
---------------------------------------------------------------------------
With respect to the relevance aspect of corroboration, the
Department will consider information reasonably at its disposal as to
whether there are circumstances that would render a margin irrelevant.
Where circumstances indicate that the selected margin is not
appropriate as AFA, the Department will disregard the margin and
determine an appropriate margin.\33\ The rates in the petition reflect
commercial practices of the steel pipe industry and, as such, are
relevant to ADPICO. Commercial behavior inherent in the industry is
important in determining the relevance of the selected AFA rate to the
uncooperative respondent by virtue of it belonging to the same
industry.\34\ Such consideration typically encompasses the commercial
behavior of other respondents under investigation and the selected AFA
rate is gauged against the margins we calculate for those respondents.
Therefore, we compared the transaction-specific margins we calculated
for Universal for the POI to the petition rate of 11.71 percent,
selected as AFA in this investigation, in order to determine whether
the rate of 11.71 percent is probative. We found that a number of
transaction-specific margins we calculated for Universal in this
investigation were higher than or within the range of the 11.71 percent
margin alleged in the petition. Accordingly, the AFA rate is relevant
as applied to ADPICO for this investigation because it falls within the
range of transaction-specific margins we calculated for Universal in
this investigation. A similar corroboration methodology has been upheld
by the court.\35\ Further, it is consistent with our past practice.\36\
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\33\ See Fresh Cut Flowers From Mexico; Final Results of
Antidumping Duty Administrative Review, 61 FR 6812, 6814 (February
22, 1996) (the Department disregarded the highest dumping margin as
best information available because the margin was based on another
company's uncharacteristic business expense resulting in an
unusually high margin).
\34\ See, e.g., Stainless Steel Bar from Spain: Final Results of
Antidumping Duty Administrative Review, 72 FR 42395 (August 2,
2007), and accompanying Issues and Decision Memorandum at Comment 6.
\35\ See PAM, S.p.A. v. United States, 582 F.3d 1336, 1340 (Fed.
Cir. 2009).
\36\ See Narrow Woven Ribbons With Woven Selvedge From the
People's Republic of China: Final Determination of Sales at Less
Than Fair Value, 75 FR 41808, 41811 (July 19, 2010).
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Accordingly, by using information that was corroborated in the pre-
initiation stage of this investigation and preliminarily determining it
to be reliable and relevant for the uncooperative respondent in this
investigation, we have corroborated the AFA rate of 11.71 percent ``to
the extent practicable'' as provided in section 776(c) of the Act. See
also 19 CFR 351.308(d). Therefore, for ADPICO we have used, as AFA, the
margin in the petition of 11.71 percent, as set forth in the Initiation
Notice.
Affiliation and Collapsing--Universal
Section 771(33) of the Act provides that:
The following persons shall be considered to be `affiliated' or
`affiliated persons':
(A) Members of a family, including brothers and sisters (whether
by the whole or half blood), spouse, ancestors, and lineal
descendants.
(B) Any officer or director of an organization and such
organization.
(C) Partners.
(D) Employer and employee.
(E) Any person directly or indirectly owning, controlling, or
holding with power to vote, 5 percent or more of the outstanding
voting stock or shares of any organization and such organization.
(F) Two or more persons directly or indirectly controlling,
controlled by, or under common control with, any person.
(G) Any person who controls any other person and such other
person.
Additionally, section 771(33) of the Act stipulates that: ``For
purposes of this paragraph, a person shall be considered to control
another person if the person is legally or operationally in a position
to exercise restraint or direction over the other person.''
In its questionnaire responses, Universal indicated it was
reporting the sales of three producers, UTP, KHK, and DIP, since all
three companies are affiliated and manufacture subject merchandise.
See, e.g., Universal's AQR at 2. Based on the record evidence, we found
that UTP, KHK, and DIP are affiliated pursuant to section 771(33) of
the Act by virtue of their ownership through Taurani Holdings Limited.
Because our analysis of affiliation involves the use of business
proprietary information, see Memorandum to the File, through Robert
James, Program Manager, from Deborah Scott, International Trade
Analyst, ``Analysis Memorandum for the Preliminary Determination of the
Antidumping Duty Investigation of Circular Welded Carbon-Quality Steel
Pipe from the United Arab Emirates,'' dated May 23, 2012 (Universal
Preliminary Analysis Memorandum) for more information.
Section 351.401(f)(1) of the Department's regulations outlines the
criteria for collapsing (i.e., treating as a single entity) affiliated
producers for purposes of calculating a dumping margin. The regulations
state that we will treat two or more affiliated producers as a single
entity where (1) those producers have production facilities for similar
or identical products that would not require substantial retooling of
either facility in order to restructure manufacturing priorities and
(2) we conclude that there is a significant potential for the
manipulation of price or production. In identifying a significant
potential for the manipulation of price or production, the Department
may consider the following factors: (i) The level of common ownership;
(ii) the extent to which managerial employees or board members of one
firm sit on the board of directors of an affiliated firm; (iii) whether
operations are intertwined, such as through the sharing of sales
information, involvement in production and pricing decisions, the
sharing of facilities or employees, or significant transactions between
the affiliated producers. See 19 CFR 351.401(f)(2). Based on
information on the record, we find that, as UTP, KHK, and DIP each
produced the merchandise under consideration during the POI, they had
production facilities for similar or identical merchandise that would
not require substantial retooling of any of the three facilities in
order to restructure their manufacturing priorities. We also find that
there was a significant potential for the manipulation of price or
production among the three companies based on their common ownership
and their intertwined operations. Accordingly, the Department has
preliminarily determined that it is appropriate to treat UTP, KHK, and
DIP as a single entity, pursuant to 19 CFR 351.401(f)(1) and (2). For a
more detailed discussion of our collapsing analysis, see Universal
Preliminary Analysis Memorandum.
Allegation of Targeted Dumping
Section 777A(d)(1)(B) of the Act allows the Department to employ an
alternative dumping margin calculation
[[Page 32546]]
methodology in an AD investigation under the following circumstances:
(1) There is a pattern of EPs or CEPs for comparable merchandise that
differ significantly among purchasers, regions, or periods of time; and
(2) the Department explains why such differences cannot be taken into
account using the standard average-to-average or transaction-to-
transaction methodology.
On April 4, 2012, petitioner Wheatland Tube submitted a timely
allegation of targeted dumping with respect to Universal, arguing the
Department should apply the average-to-transaction methodology to all
reported U.S. sales in calculating Universal's dumping margin. In its
allegation, petitioner asserted there are patterns of U.S. prices for
comparable merchandise that differ significantly among customers, time
periods, and regions. The petitioner relied on the Department's current
version of the targeted dumping test first introduced in Certain Steel
Nails from the United Arab Emirates: Notice of Final Determination of
Sales at Not Less Than Fair Value (Nails) and recently clarified in
Multilayered Wood Flooring From the People's Republic of China: Final
Determination of Sales at Less Than Fair Value (Wood Flooring).\37\
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\37\ See Nails, 73 FR 33985 (June 16, 2008), and accompanying
Issues and Decision Memorandum (Nails Decision Memorandum) at
Comments 1-9 and Wood Flooring, 76 FR 64318 (October 18, 2011), and
accompanying Issues and Decision Memorandum (Wood Flooring Decision
Memorandum) at Comment 4, respectively. See also Proposed
Methodology for Identifying and Analyzing Targeted Dumping in
Antidumping Investigations; Request for Comment, 73 FR 26371 (May 9,
2008).
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A. Targeted Dumping Test
We conducted customer, time-period, and regional analyses of
targeted dumping for Universal using the methodology we adopted in
Nails and most recently articulated in Wood Flooring. The methodology
we employed involves a two-stage test; the first stage addresses the
pattern requirement and the second stage addresses the significant-
difference requirement.\38\ In this test, we made all price comparisons
on the basis of identical merchandise (i.e., by control number or
CONNUM). The test procedures are the same for the customer, time-
period, and regional allegations of targeted dumping. We based all of
our targeted dumping calculations on the U.S. net price, which we
determined for Universal's U.S. sales in our standard margin
calculations. For further discussion of the test and the results, see
Universal Preliminary Analysis Memorandum. As a result of our analysis,
we preliminarily determine that there is a pattern of U.S. prices for
comparable merchandise that differs significantly among certain
customers, time periods, and regions for Universal in accordance with
section 777A(d)(1)(B)(i) of the Act and our current practice as
discussed in Nails and Wood Flooring.
---------------------------------------------------------------------------
\38\ See Nails Decision Memorandum at Comments 3 and 6 and Wood
Flooring Decision Memorandum at Comment 4; see also section
777A(d)(1)(B)(i) of the Act.
---------------------------------------------------------------------------
B. Price Comparison Method
Section 777A(d)(1)(B)(ii) of the Act states that the Department may
compare the weighted average of the NV to EPs or CEPs of individual
transactions for comparable merchandise if the Department explains why
differences in the patterns of EPs and CEPs cannot be taken into
account using the average-to-average methodology. As described above,
we preliminarily determine that, with respect to sales by Universal,
for certain customers, time periods, and regions there was a pattern of
prices that differed significantly. For Universal, we find that these
differences cannot be taken into account using the standard average-to-
average methodology because the average-to-average methodology conceals
differences in the patterns of prices between the targeted and non-
targeted groups by averaging low-priced sales to the targeted group
with high-priced sales to the non-targeted group. Therefore, the
Department preliminarily determines, pursuant to 777A(d)(1)(B)(ii) of
the Act, that the standard average-to-average methodology does not take
into account Universal's price differences because the alternative
average-to-transaction methodology yields a material difference in the
margin. Accordingly, for this preliminary determination we have applied
the alternative average-to-transaction methodology to all of
Universal's reported U.S. sales to calculate the dumping margin for
Universal.\39\ See Universal Preliminary Analysis Memorandum for
further discussion.
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\39\ See Certain Coated Paper Suitable for High-Quality Print
Graphics Using Sheet-Fed Presses From Indonesia: Preliminary
Determination of Sales at Less Than Fair Value and Postponement of
Final Determination, 75 FR 24885, 24888 (May 6, 2010) and
Polyethylene Retail Carrier Bags From Indonesia: Final Determination
of Sales at Less Than Fair Value, 75 FR 16431 (April 1, 2010), and
accompanying Issues and Decision Memorandum at Comment 1.
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Product Comparisons
The Department identified five criteria for matching U.S. sales of
subject merchandise to normal value (specification/grade, diameter,
wall thickness, coating, and end finish) and, as noted above, gave
parties to this and the concurrent AD investigations an opportunity to
comment within a certain deadline. The only timely comments submitted
were from UTP and its U.S. affiliate, Prime Metal. UTP and Prime Metal
requested that the placement of the coating characteristic in the model
match hierarchy be adjusted from that proposed by the Department, so
that it would be the highest in the hierarchy. UTP and Prime Metal
argued that the coating characteristic should be highest in the
hierarchy of product characteristics because significant cost and price
differences are associated with whether or not pipes are coated with
zinc (galvanized), and because of differences in end uses between
galvanized pipes and pipes that are not galvanized.
None of the interested parties objected to the inclusion of the
coating product characteristic in the hierarchy, and none of the
interested parties in the four concurrent certain steel pipe
antidumping investigations (India, Oman, UAE, and Vietnam) other than
UTP and Prime Metal suggested that the placement of the coating product
characteristic in the model match hierarchy should be changed from that
originally proposed by the Department.
The Department is not modifying the model match hierarchy that it
originally proposed to incorporate the suggestion of UTP and Prime
Metal. The goal of the product characteristic hierarchy is to identify
the best possible matches with respect to the characteristics of the
merchandise. While variations in cost may suggest the existence of
variation in product characteristics, such variations do not constitute
differences in products in and of themselves. Furthermore, the
magnitude of variations in cost may differ from company to company, and
even for a given company over time, and therefore do not, in and of
themselves, provide a reliable basis for identifying the relative
importance of different product characteristics. The Department has
noted that for defining products and creating a model match hierarchy,
``{t{time} he physical characteristics are used to distinguish the
differences among products across the industry,'' that ``{c{time} ost
is not the primary factor for establishing these characteristics,''
and, in short, ``{c{time} ost variations are not the determining factor
in assigning product characteristics for model-matching purposes.''
\40\
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\40\ See Stainless Steel Wire Rod from Sweden: Final Results of
Antidumping Duty Administrative Review, 73 FR 12950 (March 11,
2008), and accompanying Issues and Decision Memorandum at Comment 1.
Also, the Department's `` * * * selection of model match
characteristics {is based{time} on unique measurable physical
characteristics that the product can possess * * *.'' and `` * * *
differences in price or cost, standing alone, are not sufficient to
warrant inclusion in the Department's model-match of characteristics
which a respondent claims to be the cause of such differences * *
*.'' See Notice of Final Determination of Sales at Less Than Fair
Value; Certain Cold-Rolled Flat-Rolled Carbon-Quality Steel Products
from Turkey, 65 FR 15123 (March 21, 2000), and accompanying Issues
and Decision Memorandum at Model Match Comment 1.
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[[Page 32547]]
UTP and Prime Metal also refer to price and end-use differences
regarding galvanized versus non-galvanized pipe, but the Department's
proposed hierarchy for the certain steel pipe antidumping duty
investigations did include coating as a characteristic because whether
or not the product is coated (e.g., galvanized) is important enough to
distinguish products from one another. However, differences in other
product characteristics also influence potential end uses. Neither UTP
nor Prime Metal demonstrated why the coating product characteristic
should be considered the most important of all when defining models and
for comparison purposes and, as noted above, no other interested
parties argued for such a change in a timely manner.
Therefore, as noted above, the Department is not modifying the
hierarchy it proposed at the outset of the AD investigations and
included in the questionnaires it issued to respondents in these
investigations. In accordance with section 771(16) of the Act, all
products produced by Universal covered by the description in the
``Scope of the Investigation'' in Appendix I of this notice, below, and
sold in the UAE during the POI are considered to be the foreign like
product for purposes of determining appropriate product comparisons to
U.S. sales. We have relied on five criteria to match U.S. sales of
subject merchandise to comparison market sales of the foreign like
product: (1) Pipe specification and grade; (2) outside diameter; (3)
wall thickness; (4) coating; and (5) end finish. Where there were no
sales of identical merchandise in the home market made in the ordinary
course of trade to compare to U.S. sales, we compared U.S. sales to
sales of the next most similar foreign like product on the basis of the
characteristics listed above which were made in the ordinary course of
trade. See Universal Preliminary Analysis Memorandum for additional
information.
Date of Sale
The regulation at 19 CFR 351.401(i) states that the Department
normally will use the date of invoice, as recorded in the producer's or
exporter's records kept in the ordinary course of business, as the date
of sale. The regulation provides further that the Department may use a
date other than the date of the invoice if the Secretary is satisfied
that a different date better reflects the date on which the material
terms of sale are established. The Department has a long-standing
practice of finding that, where shipment date precedes invoice date,
shipment date better reflects the date on which the material terms of
sale are established.\41\
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\41\ See, e.g., Notice of Final Determination of Sales at Less
Than Fair Value and Negative Final Determination of Critical
Circumstances: Certain Frozen and Canned Warmwater Shrimp From
Thailand, 69 FR 76918 (December 23, 2004), and accompanying Issues
and Decision Memorandum at Comment 10; see also Notice of Final
Determination of Sales at Less Than Fair Value: Structural Steel
Beams From Germany, 67 FR 35497 (May 20, 2002), and accompanying
Issues and Decision Memorandum at Comment 2.
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For its home market sales, Universal indicated that the sales
invoice is normally issued at the same time or a few days after
shipment, and it reported the earlier of shipment date or invoice date
as the date of sale. See Universal's March 20, 2012, section A
supplemental questionnaire response (ASQR) at 11 and its February 21,
2012, section B questionnaire response (BQR) at 15-16. For its U.S.
sales, Universal stated that its sales are shipped directly from
Universal to the unaffiliated U.S. customer, and therefore it reported
the bill of lading date, which it characterized as the shipment date,
as the date of sale since shipment occurs before issuance of the
invoice from Prime Metal to the U.S. customer. See Universal's February
21, 2012, section C questionnaire response (CQR) at 11-12. For these
preliminary results, we have used the date of sale as reported by
Universal, i.e., shipment date where it precedes the invoice date, and
invoice date in the remaining instances, in accordance with our
practice.
Fair Value Comparisons
To determine whether Universal made sales of certain steel pipe to
the United States at LTFV, we compared the constructed export price
(CEP) to NV and as described in the ``Constructed Export Price'' and
``Normal Value'' sections of this notice. In accordance with section
777A(d)(1)(B) of the Act, we compared transaction-specific CEPs to POI
weighted-average NVs.
Constructed Export Price
As noted above in the ``Background'' section of this notice,
Universal reported that all but a minor quantity of its U.S. sales
during the POI were shipped directly from the UAE to the U.S. customer.
Universal described these sales as ``direct CEP shipments,'' whereby
its U.S. affiliate, Prime Metals, made the sale, and then Universal
manufactured the pipe and shipped it directly to the United States. See
Universal's CQR at 2. Universal requested that the Department excuse it
from reporting the remaining quantity of its U.S. sales, which were
made from Prime Metal's inventory, claiming that the small quantity
coupled with the merchandise being co-mingled with merchandise
purchased from other U.S. suppliers would make it difficult to report
these sales. See Universal's AQR at 3-4, footnote 1. In our February
24, 2012, section A supplemental questionnaire, we informed Universal
that we were preliminarily not requiring it to report its U.S. sales
through inventory.
For the price to the United States, we used CEP, in accordance with
section 772(b) of the Act. We calculated CEP for those sales where a
person in the United States, affiliated with the foreign exporter or
acting for the account of the exporter, made the sale to the first
unaffiliated purchaser in the United States of the subject merchandise.
See section 772(b) of the Act. We based CEP on the packed prices
charged to the first unaffiliated customer in the United States and the
applicable terms of sale.
In accordance with section 772(b) of the Act, we calculated CEP
where the record established that sales made by Universal were made in
the United States after the date of importation by or for the account
of the producer or exporter, or by a seller affiliated with the
producer or exporter, to a purchaser not affiliated with the producer
or exporter.
In accordance with section 772(c)(2)(A) of the Act, and where
appropriate, we made deductions from the starting price for certain
billing adjustments and early payment discounts. We made further
deductions to price for certain movement expenses (offset by reported
freight revenue), where appropriate, for foreign inland freight,
foreign brokerage and handling, ocean freight, marine insurance, U.S.
inland freight, certain other transportation expenses, and U.S.
brokerage expenses, pursuant to section 772(c)(2)(A) of the Act. In
accordance with our practice, we capped Universal's freight revenue at
the
[[Page 32548]]
corresponding amount of freight charges incurred.\42\
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\42\ See Wood Flooring Decision Memorandum at Comment 39.
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Pursuant to section 772(d)(1) of the Act, we made additional
adjustments to CEP for credit expenses, warranty expenses, inventory
carrying costs incurred in the UAE, and other indirect selling
expenses. Pursuant to section 772(d)(3) of the Act, we made an
adjustment for CEP profit. For a detailed discussion of these
adjustments, see Universal Preliminary Analysis Memorandum.
Normal Value
A. Home Market Viability and Comparison-Market Selection
To determine whether there is a sufficient volume of sales in the
home market to serve as a viable basis for calculating NV (i.e., the
aggregate volume of home market sales of the foreign like product is
equal to or greater than five percent of the aggregate volume of U.S.
sales), we compared Universal's volume of home market sales of the
foreign like product to its volume of U.S. sales of the subject
merchandise. See section 773(a)(1)(C) of the Act. Based on this
comparison, we determined that Universal had a viable home market
during the POI. See Universal's April 25, 2012 section B and C
supplemental questionnaire response at Exhibit A-38 (quantity and value
chart). Consequently, we based NV on Universal's home market sales.
B. Affiliated Party Transactions
Pursuant to 19 CFR 351.403(d), if an exporter or producer sold the
foreign like product through an affiliated party, the Department may
calculate NV based on sales made by such affiliated party. The
Department's regulation further states that the Department normally
will not calculate NV based on sales by an affiliated party if sales of
the foreign like product by an exporter or producer to affiliated
parties account for less than five percent of the total value or
quantity of the exporter's or producer's sales of the foreign like
product in the comparison market or if sales to the affiliated party
are comparable, as defined in 19 CFR 351.403(c).
During the POI, Universal sold the foreign like product to three
affiliated distributors in the UAE: Al Zaher Building Materials LLC
(ALZ), ANA Steel Trading LLC (ANA), and Dayal Steel Suppliers (DSS). In
its BQR at 7, Universal stated that since its sales to ALZ, ANA, and
DSS surpassed five percent of domestic market sales during the POI and
none of the affiliated distributors consumed the foreign like product,
it was reporting sales by the affiliated distributors to unaffiliated
customers in the UAE. For the preliminary determination, we have
calculated NV based on downstream sales by ALZ, ANA, and DSS.
C. Level of Trade
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 (LOT) as the EP or CEP. See also section
773(a)(7) of the Act. Pursuant to 19 CFR 351.412(c)(1)(iii), the NV LOT
is based on the starting price of the sales in the comparison market
or, when NV is based on constructed value, the starting price of the
sales from which we derive selling, general and administrative
expenses, and profit. For CEP sales (which constituted all of
Universal's reported sales), the U.S. LOT is based on the starting
price of the U.S. sales, as adjusted under section 772(d) of the Act,
which is from the exporter to the importer. See 19 CFR
351.412(c)(1)(ii).
To determine whether NV sales are at a different LOT than CEP
sales, we examine stages in the marketing process and selling functions
along the chain of distribution between the producer and the
unaffiliated customer. See 19 CFR 351.412(c)(2). If the comparison-
market sales are at a different LOT, and the difference affects price
comparability, as manifested in a pattern of consistent price
differences between the sales on which NV is based and comparison-
market sales at the LOT of the export transaction, we make a LOT
adjustment under section 773(a)(7)(A) of the Act. For CEP sales, if the
NV level is more remote from the factory than the CEP level and there
is no basis for determining whether the difference in levels between NV
and CEP affects price comparability, we adjust NV under section
773(a)(7)(B) of the Act (the CEP offset provision).\43\
---------------------------------------------------------------------------
\43\ See Notice of Final Determination of Sales at Less Than
Fair Value: Certain Cut-to-Length Carbon Steel Plate from South
Africa, 62 FR 61731, 61732-33 (November 19, 1997) (applying the CEP
offset analysis under section 773(a)(7)(B)).
---------------------------------------------------------------------------
In this investigation, we obtained information from Universal
regarding the marketing stages involved in making its reported home
market and U.S. market sales, including a description of the selling
activities performed by Universal and its affiliates for each channel
of distribution. See Universal's AQR at pages 10-15 and Universal's
ASQR at 5-10 and Exhibit A-19 (revised selling functions chart).
Universal reported two channels of distribution in the home market: (1)
Sales by UTP, DIP, and KHK directly to unaffiliated customers; and (2)
sales by the three affiliated distributors directly to unaffiliated
customers. See, e.g., Universal's BQR at 15. In the U.S. market,
Universal reported one channel of distribution corresponding to the CEP
sales made through its affiliated company in the United States, Prime
Metal. See, e.g., Universal's CQR at 11. Universal claimed that its CEP
U.S. sales were made at a different, less advanced LOT than its
comparison market sales. See, e.g., Universal's May 4, 2012
supplemental questionnaire response at 2. Because it had no comparison
market sales that were at the same LOT as its CEP sales, Universal
stated that it cannot seek a LOT adjustment and claimed that a CEP
offset is warranted. Id.
In evaluating Universal's claim, we examined the sales activities
it performed for both of its reported home market channels of
distribution. Based on our analysis, we preliminarily determine that
Universal made sales at two different LOTs, because for sales by
affiliated distributors, both Universal and its affiliated distributors
performed various selling activities associated with the affiliated
distributors' sales to unaffiliated customers in the home market,
whereas only Universal performed such selling functions for sales
directly to unaffiliated customers. See, e.g., Universal's ASQR at 5-10
and Exhibit A-19. Thus, based on Universal's responses, we
preliminarily determine that Universal sold at two LOTs in the
comparison market. Further, based on Universal's responses, we
preliminarily determine that Universal sold at one LOT in the U.S.
market since there is only one channel of distribution in this market,
and the marketing process and selling functions are generally the same
for all of Universal's customers in the United States. Id.
We then compared the U.S. LOT to the two LOTs in the comparison
market. Record evidence indicates that Universal undertakes
significantly fewer selling activities for its CEP sales than it
performed for its home market sales. For example, based on Universal's
responses, sales at the U.S. LOT do not include activities such as
inventory maintenance, warranty services, and sales/marketing support.
Id. Accordingly, we considered the CEP LOT to be different from the two
home market LOTs and to be at a less advanced stage of distribution
than the home market LOTs.
Based on our findings, we could not match the CEP sales to sales at
the same
[[Page 32549]]
LOT in the home market. In addition, we could not make a LOT adjustment
because the differences in price between the CEP level of trade and the
two home market LOTs could not be quantified due to the lack of an
equivalent LOT in the home market to the CEP LOT. Also, there are no
other data on the record which would allow us to make a LOT adjustment.
Because the data available do not form an appropriate basis for making
a LOT adjustment, and because the NV LOTs are more remote from the
factory than the CEP LOT, for this preliminary determination we have
made a CEP offset to NV in accordance with section 773(a)(7)(B) of the
Tariff Act. In accordance with section 773(a)(7) of the Act, we
calculated the CEP offset as the smaller of the indirect selling
expenses on the home-market sale or the indirect selling expenses we
deducted from the starting price in calculating CEP.
D. Cost of Production Analysis
Based on the Department's analysis of petitioners' allegation, we
initiated a sales-below-cost investigation to determine whether
Universal had sales that were made at prices below their COP pursuant
to section 773(b) of the Act. See Universal Cost Initiation Memorandum.
1. Calculation of Cost of Production
We calculated the COP based on the sum of the cost of materials and
fabrication for the foreign like product, plus amounts for selling,
general, and administrative expenses and packing, in accordance with
section 773(b)(3) of the Act. We relied on the COP data submitted by
Universal except where noted below. Based on the review of record
evidence, Universal did not appear to experience significant changes in
the cost of manufacturing during the period of investigation.
Therefore, we followed our normal methodology of calculating an annual
weighted-average cost.
--We increased UTP's and DIP's reported total cost of manufacturing
(COM) to include the un-reconciled difference between the COM in the
overall cost reconciliation and the reported cost files.
--We included provisions for net realizable value in the calculation of
UTP's general and administrative (G&A) expense ratio numerator.
--We included the annual management fees and excluded the scrap
revenues which were related to the merchandise not under consideration
from the calculation of DIP's G&A expense ratio numerator.
--We included interest expenses associated with loans from the
shareholders in the calculation of UTP's, DIP's, and KHK's financial
expense ratio numerator.
--We set UTP's negative other material costs (which were reported in a
separate data field of the cost file) to zero.
--For CONNUMs sold but not produced during the POI, we used as a
surrogate the most similar product cost based on the Department's
product characteristic hierarchy. For additional details, see
Memorandum to Neal M. Halper from Ji Young Oh, ``Cost of Production and
Constructed Value Calculation Adjustments for the Preliminary
Determination--Universal Tube and Plastic Industries, Ltd.'' dated May
23, 2012 (Universal Preliminary Cost Calculation Memorandum).
2. Test of Comparison Market Prices
As required under section 773(b)(1)-(2) of the Act, we compared the
weighted-average COP for Universal to its home market sales prices of
the foreign like product 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. We compared the model-specific COP to home
market prices, less any applicable billing adjustments, movement
charges, commissions, direct and indirect selling expenses, and
packing. See Universal Preliminary Analysis Memorandum.
3. Results of COP Test
Pursuant to section 773(b)(2)(C)(i) of the Act, where less than 20
percent of a respondent's sales of a given product during the POI are
at prices less than the COP, we do 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 a
respondent's sales of a given product during the POI were made at
prices less than the COP, we determine that such sales have been made
in ``substantial quantities.'' See section 773(b)(2)(C) of the Act.
Further, we determine that the sales were made within an extended
period of time, in accordance with section 773(b)(2)(B) of the Act,
because we examine below-cost sales occurring during the entire POI. In
accordance with section 773(b)(2)(D) of the Act, we compare prices to
the POI-average costs to determine whether the prices permit recovery
of costs within a reasonable period of time.
In this case, we found that, for certain products, more than 20
percent of Universal's sales were made at prices less than the COP and,
in addition, such sales did not provide for the recovery of costs
within a reasonable period of time. Therefore, we excluded these sales
and used the remaining sales as the basis for determining NV, in
accordance with section 773(b)(1) of the Act. See Universal Preliminary
Analysis Memorandum.
E. Calculation of Normal Value Based on Comparison-Market Prices
We calculated NV for Universal based on the reported packed,
delivered prices to comparison market customers. We made deductions
from the starting price, where appropriate, for billing adjustments,
inland freight, and warehousing expenses, pursuant to section
773(a)(6)(B)(ii) of the Act.
Pursuant to section 773(a)(6)(C)(iii) of the Act and 19 CFR
351.410(b), we made, where appropriate, circumstance-of-sale
adjustments for credit expenses, warranties, and import duties paid on
finished goods sold in the UAE that were produced in the Jebel Ali free
trade zone. We added U.S. packing costs and deducted home market
packing costs, in accordance with sections 773(a)(6)(A) and (B)(i) of
the Act. In accordance with 19 CFR 351.410(e), we made an adjustment
(i.e., the commission offset) to account for commissions paid in one
market but not the other. Finally, we made a CEP offset pursuant to
section 773(a)(7)(B) of the Act and 19 CFR 351.412(f). We calculated
the CEP offset as the lesser of the indirect selling expenses incurred
on the home market sales or the indirect selling expenses deducted from
the starting price in calculating CEP.
When comparing U.S. sales with comparison market sales of similar,
but not identical, merchandise, we also made adjustments for physical
differences in the merchandise in accordance with section
773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. We based this
adjustment on the difference in the variable cost of manufacturing for
the foreign-like product and subject merchandise. See 19 CFR
351.411(b).
Currency Conversion
We made currency conversions into U.S. dollars in accordance with
section 773A(a) of the Act and 19 CFR 351.415(a) based on the exchange
rates in effect on the dates of the U.S. sales, as certified by the
Federal Reserve Bank.
[[Page 32550]]
Verification
As provided in section 782(i)(1) of the Act, we intend to verify
the information relied upon in making our final determination for
Universal.
Preliminary Determination
The weighted-average dumping margins are as follows:
------------------------------------------------------------------------
Weighted-
average
Manufacturer/exporter margin
(percent)
------------------------------------------------------------------------
Universal Tube and Plastic Industries, Ltd., KHK Scaffolding 3.29
& Formwork LLC, Universal Tube and Pipe Industries LLC.....
Abu Dhabi Metal Pipes & Profiles Industries Complex LLC.... 11.71
All Others.................................................. 3.29
------------------------------------------------------------------------
Suspension of Liquidation
In accordance with section 733(d)(2) of the Act, we will direct CBP
to suspend liquidation of all entries of certain steel pipe from the
UAE that are entered, or withdrawn from warehouse, for consumption on
or after the date of publication of this notice in the Federal
Register.
Consistent with the Department's practice, where the product under
investigation is also subject to a concurrent countervailing duty
investigation, we instruct CBP to require a cash deposit or posting of
a bond equal to the amount by which the normal value exceeds the export
price or constructed export price, less the amount of the
countervailing duty determined to constitute an export subsidy.\44\ In
this case, although the product under investigation is also subject to
a concurrent countervailing duty investigation, the Department
preliminarily found no countervailable export subsidy.\45\ Therefore,
we have not offset the cash deposit rates shown above for purposes of
this preliminary determination.
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\44\ See, e.g., Notice of Final Determination of Sales at Less
Than Fair Value: Carbazole Violet Pigment 23 From India, 69 FR
67306, 67307 (November 17, 2004).
\45\ See Circular Welded Carbon-Quality Steel Pipe From the
United Arab Emirates: Preliminary Negative Countervailing Duty
Determination and Alignment of Final Countervailing Duty
Determination With Final Antidumping Duty Determination, 77 FR 19219
(March 30, 2012).
---------------------------------------------------------------------------
We will instruct CBP to require a cash deposit or the posting of a
bond equal to the weighted-average margin, as indicated above as
follows: (1) The rates for Universal and ADPICO will be the rates we
have determined in this preliminary determination; (2) if the exporter
is not a firm identified in this investigation but the manufacturer is,
the rate will be the rate established for the manufacturer of the
subject merchandise; and (3) the rate for all other producers or
exporters will be 3.29 percent, as discussed in the ``All Others Rate''
section below. These suspension-of-liquidation instructions will remain
in effect until further notice.
All Others Rate
Section 735(c)(5)(A) of the Act provides that the estimated ``All
Others'' rate shall be an amount equal to the weighted average of the
estimated weighted-average dumping margins established for exporters
and producers individually investigated, excluding any zero or de
minimis margins, and any margins determined entirely under section 776
of the Act. Universal is the only respondent in this investigation for
which the Department has calculated a company-specific rate that is not
zero or de minimis. Therefore, for purposes of determining the ``all
others'' rate and pursuant to section 735(c)(5)(A) of the Act, we are
using the dumping margin calculated for Universal, 3.29 percent, for
the ``all others'' rate, as referenced in the ``Preliminary
Determination'' section, above.
Disclosure
The Department will disclose to parties the calculations performed
in connection with this preliminary determination within five days of
the date of publication of this notice. See 19 CFR 351.224(b).
Postponement of Final Determination and Extension of Provisional
Measures
Section 735(a)(2) of the Act provides that a final determination
may be postponed until not later than 135 days after the date of the
publication of the preliminary determination if, in the event of an
affirmative preliminary determination, a request for such postponement
is made by exporters, who account for a significant proportion of
exports of the subject merchandise, or in the event of a negative
preliminary determination, a request for such postponement is made by
the petitioner. The Department's regulations, at 19 CFR 351.210(e)(2),
require that requests by respondents for postponement of a final
determination be accompanied by a request for extension of provisional
measures from a four-month period to not more than six months.
On May 17, 2012, Universal requested that in the event of an
affirmative preliminary determination in this investigation, the
Department postpone its final determination by 60 days (135 days after
publication of the preliminary determination) and extend the
application of the provisional measures prescribed under section 733(d)
of the Act and 19 CFR 351.210(e)(2), from a four-month period to a six-
month period. On May 18, 2012, petitioners Allied Tube and Conduit, JMC
Steel Group, and Wheatland Tube also requested that the Department
postpone its final determination by 60 days. In accordance with section
735(a)(2)(A) of the Act and 19 CFR 351.210(b)(2)(ii), because (1) our
preliminary determination is affirmative; (2) the requesting producer/
exporter accounts for a significant proportion of exports of the
subject merchandise; and (3) no compelling reasons for denial exist, we
are granting this request and are postponing the final determination
until no later than 135 days after the publication of this notice in
the Federal Register. Suspension of liquidation will be extended
accordingly. We are also extending the application of the provisional
measures prescribed under section 733(d) of the Act and 19 CFR
351.210(e)(2) from a four-month period to a six-month period.
ITC Notification
In accordance with section 733(f) of the Act, we will notify the
ITC of the Department's preliminary affirmative determination of sales
at LTFV. Section 735(b)(2) of the Act requires the ITC to make its
final determination as to whether the domestic industry in the United
States is materially injured, or threatened with material injury, by
reason of imports of certain steel pipe from the UAE, or sales (or the
likelihood of sales) for importation, of the certain steel pipe within
45 days of our final determination.
Public Comment
Interested parties are invited to comment on the preliminary
determination. Interested parties may submit case briefs to the
Department no later than seven days after the date of the issuance of
the last verification report in this proceeding. See 19 CFR
351.309(c)(1)(i). Rebuttal briefs, the content of which is limited to
the issues raised in the case briefs, must be filed within five days
from the deadline date for the submission of case briefs. See 19 CFR
351.309(d)(1) and 19 CFR 351.309(d)(2). A list of authorities used, a
table of contents, and an executive summary of issues should accompany
any briefs submitted to the Department. See 19 CFR 351.309(c)(2).
Executive summaries should be limited to five pages total, including
footnotes. Interested parties who wish to comment on the preliminary
determination must
[[Page 32551]]
file briefs electronically using Import Administration's Antidumping
and Countervailing Duty Centralized Electronic Service System (IA
ACCESS). An electronically filed document must be received successfully
in its entirety by the Department's electronic records system, IA
ACCESS, by 5 p.m. Eastern Time.
In accordance with section 774(1) of the Act, the Department will
hold a public hearing, if timely requested, to afford interested
parties an opportunity to comment on arguments raised in case or
rebuttal briefs, provided that such a hearing is requested by an
interested party. See also 19 CFR 351.310. Interested parties who wish
to request a hearing, or to participate if one is requested, must
submit a written request to the Assistant Secretary for Import
Administration, U.S. Department of Commerce, filed electronically using
IA ACCESS, as noted above. An electronically filed document must be
received successfully in its entirety by the Department's electronic
records system, IA ACCESS, by 5 p.m. Eastern Standard Time within 30
days after the date of publication of this notice. See 19 CFR
351.310(c). Requests should contain the party's name, address, and
telephone number, the number of participants, and a list of the issues
to be discussed. Oral presentations will be limited to issues raised in
the case briefs. If a request for a hearing is made, we will inform
parties of the scheduled date and time for the hearing which will be
held at the U.S. Department of Commerce, 14th Street and Constitution
Avenue NW., Washington, DC 20230. See 19 CFR 351.310. Parties should
confirm by telephone the date, time, and location of the hearing 48
hours before the scheduled date.
This determination is issued and published pursuant to sections
733(f) and 777(i)(1) of the Act.
Dated: May 23, 2012.
Paul Piquado,
Assistant Secretary for Import Administration.
Appendix I--Scope of the Investigation
This investigation covers welded carbon-quality steel pipes and
tube, of circular cross-section, with an outside diameter (``O.D.'')
not more than 16 inches (406.4 mm), regardless of wall thickness,
surface finish (e.g., black, galvanized, or painted), end finish
(plain end, beveled end, grooved, threaded, or threaded and
coupled), or industry specification (e.g., American Society for
Testing and Materials International (``ASTM''), proprietary, or
other) generally known as standard pipe, fence pipe and tube,
sprinkler pipe, and structural pipe (although subject product may
also be referred to as mechanical tubing). Specifically, the term
``carbon quality'' includes products in which: (a) Iron
predominates, by weight, over each of the other contained elements;
(b) the carbon content is 2 percent or less, by weight; and (c) none
of the elements listed below exceeds the quantity, by weight, as
indicated:
(i) 1.80 percent of manganese;
(ii) 2.25 percent of silicon;
(iii) 1.00 percent of copper;
(iv) 0.50 percent of aluminum;
(v) 1.25 percent of chromium;
(vi) 0.30 percent of cobalt;
(vii) 0.40 percent of lead;
(viii) 1.25 percent of nickel;
(ix) 0.30 percent of tungsten;
(x) 0.15 percent of molybdenum;
(xi) 0.10 percent of niobium;
(xii) 0.41 percent of titanium;
(xiii) 0.15 percent of vanadium;
(xiv) 0.15 percent of zirconium.
Subject pipe is ordinarily made to ASTM specifications A53,
A135, and A795, but can also be made to other specifications.
Structural pipe is made primarily to ASTM specifications A252 and
A500. Standard and structural pipe may also be produced to
proprietary specifications rather than to industry specifications.
Fence tubing is included in the scope regardless of certification to
a specification listed in the exclusions below, and can also be made
to the ASTM A513 specification. Sprinkler pipe is designed for
sprinkler fire suppression systems and may be made to industry
specifications such as ASTM A53 or to proprietary specifications.
These products are generally made to standard O.D. and wall
thickness combinations. Pipe multi-stenciled to a standard and/or
structural specification and to other specifications, such as
American Petroleum Institute (``API'') API-5L specification, is also
covered by the scope of this investigation when it meets the
physical description set forth above, and also has one or more of
the following characteristics: is 32 feet in length or less; is less
than 2.0 inches (50mm) in outside diameter; has a galvanized and/or
painted (e.g., polyester coated) surface finish; or has a threaded
and/or coupled end finish.
The scope of this investigation does not include: (a) Pipe
suitable for use in boilers, superheaters, heat exchangers, refining
furnaces and feedwater heaters, whether or not cold drawn; (b)
finished electrical conduit; (c) finished scaffolding; \46\ (d) tube
and pipe hollows for redrawing; (e) oil country tubular goods
produced to API specifications; (f) line pipe produced to only API
specifications; and (g) mechanical tubing, whether or not cold-
drawn. However, products certified to ASTM mechanical tubing
specifications are not excluded as mechanical tubing if they
otherwise meet the standard sizes (e.g., outside diameter and wall
thickness) of standard, structural, fence and sprinkler pipe. Also,
products made to the following outside diameter and wall thickness
combinations, which are recognized by the industry as typical for
fence tubing, would not be excluded from the scope based solely on
their being certified to ASTM mechanical tubing specifications:
---------------------------------------------------------------------------
\46\ Finished scaffolding is defined as component parts of a
final, finished scaffolding that enters the United States
unassembled as a ``kit.'' A ``kit'' is understood to mean a packaged
combination of component parts that contain, at the time of
importation, all the necessary component parts to fully assemble a
final, finished scaffolding.
1.315 inch O.D. and 0.035 inch wall thickness (gage 20)
1.315 inch O.D. and 0.047 inch wall thickness (gage 18)
1.315 inch O.D. and 0.055 inch wall thickness (gage 17)
1.315 inch O.D. and 0.065 inch wall thickness (gage 16)
1.315 inch O.D. and 0.072 inch wall thickness (gage 15)
1.315 inch O.D. and 0.083 inch wall thickness (gage 14)
1.315 inch O.D. and 0.095 inch wall thickness (gage 13)
1.660 inch O.D. and 0.047 inch wall thickness (gage 18)
1.660 inch O.D. and 0.055 inch wall thickness (gage 17)
1.660 inch O.D. and 0.065 inch wall thickness (gage 16)
1.660 inch O.D. and 0.072 inch wall thickness (gage 15)
1.660 inch O.D. and 0.083 inch wall thickness (gage 14)
1.660 inch O.D. and 0.095 inch wall thickness (gage 13)
1.660 inch O.D. and 0.109 inch wall thickness (gage 12)
1.900 inch O.D. and 0.047 inch wall thickness (gage 18)
1.900 inch O.D. and 0.055 inch wall thickness (gage 17)
1.900 inch O.D. and 0.065 inch wall thickness (gage 16)
1.900 inch O.D. and 0.072 inch wall thickness (gage 15)
1.900 inch O.D. and 0.095 inch wall thickness (gage 13)
1.900 inch O.D. and 0.109 inch wall thickness (gage 12)
2.375 inch O.D. and 0.047 inch wall thickness (gage 18)
2.375 inch O.D. and 0.055 inch wall thickness (gage 17)
2.375 inch O.D. and 0.065 inch wall thickness (gage 16)
2.375 inch O.D. and 0.072 inch wall thickness (gage 15)
2.375 inch O.D. and 0.095 inch wall thickness (gage 13)
2.375 inch O.D. and 0.109 inch wall thickness (gage 12)
2.375 inch O.D. and 0.120 inch wall thickness (gage 11)
2.875 inch O.D. and 0.109 inch wall thickness (gage 12)
2.875 inch O.D. and 0.134 inch wall thickness (gage 10)
2.875 inch O.D. and 0.165 inch wall thickness (gage 8)
3.500 inch O.D. and 0.109 inch wall thickness (gage 12)
3.500 inch O.D. and 0.148 inch wall thickness (gage 9)
3.500 inch O.D. and 0.165 inch wall thickness (gage 8)
4.000 inch O.D. and 0.148 inch wall thickness (gage 9)
4.000 inch O.D. and 0.165 inch wall thickness (gage 8)
4.500 inch O.D. and 0.203 inch wall
[[Page 32552]]
thickness (gage 7)
The pipe subject to this investigation is currently classifiable
in Harmonized Tariff Schedule of the United States (``HTSUS'')
statistical reporting numbers 7306.19.1010, 7306.19.1050,
7306.19.5110, 7306.19.5150, 7306.30.1000, 7306.30.5025,
7306.30.5032, 7306.30.5040, 7306.30.5055, 7306.30.5085,
7306.30.5090, 7306.50.1000, 7306.50.5050, and 7306.50.5070. However,
the product description, and not the HTSUS classification, is
dispositive of whether the merchandise imported into the United
States falls within the scope of the investigation.
[FR Doc. 2012-13230 Filed 5-31-12; 8:45 am]
BILLING CODE 3510-DS-P