[Federal Register Volume 63, Number 236 (Wednesday, December 9, 1998)]
[Notices]
[Pages 67855-67857]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-32728]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-583-816]
Stainless Steel Butt-Weld Pipe Fittings From Taiwan: Final
Results of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of Final Results of Antidumping Duty Administrative
Review.
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SUMMARY: On June 5, 1998, the Department of Commerce (``the
Department'') published the preliminary results of the administrative
review of the antidumping duty order on certain stainless steel butt-
weld pipe fittings from Taiwan. This review covers one manufacturer and
exporter of the subject merchandise. The period of review (``POR'') is
June 1, 1996 through May 31, 1997. Based on our analysis of the
comments received, we have changed the results from those presented in
the preliminary results of review.
EFFECTIVE DATE: December 9, 1998.
FOR FURTHER INFORMATION CONTACT: Becky Hagen or Bob Bolling, AD/CVD
Enforcement Group III--Office 7, Import Administration, International
Trade Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, NW, Room 7866, Washington, DC 20230; telephone
(202) 482-1102 or (202) 482-3434, respectively.
SUPPLEMENTARY INFORMATION:
The Applicable Statute
Unless otherwise indicated, all citations to the statute are
references to the provisions effective January 1, 1995, the effective
date of the amendments made to the Tariff Act of 1930 (``the Act'') by
the Uruguay Round Agreements Act (``URAA''). In addition, unless
otherwise indicated, all citations to the Department's regulations are
to 19 CFR Part 353.
Background
On June 5, 1998, the Department published in the Federal Register
the preliminary results of the administrative review of the antidumping
duty order on certain stainless steel butt-weld pipe fittings from
Taiwan (63 FR 30710). On September 30, 1998, the Department extended
the time limit for the final results to December 2, 1998, in accordance
with the Act. See Butt-Weld Pipe Fittings from Taiwan; Extension of
Time Limits for Antidumping Duty Administrative Review (63 FR 54108,
October 8, 1998). The Department has now completed this administrative
review in accordance with section 751 of the Act.
Scope of the Review
The products subject to this review are certain stainless steel
butt-weld pipe fittings, whether finished or unfinished, under 14
inches inside diameter.
Certain stainless steel butt-weld pipe fittings (``pipe fittings'')
are used to connect pipe sections in piping systems where conditions
require welded connections. The subject merchandise is used where one
or more of the following conditions is a factor in designing the piping
system: (1) Corrosion of the piping system will occur if material other
than stainless steel is used; (2) contamination of the material in the
system by the system itself must be prevented; (3) high temperatures
are present; (4) extreme low temperatures are present; (5) high
pressures are contained within the system.
Pipe fittings come in a variety of shapes, with the following five
shapes the most basic: ``elbows,'' ``tees,'' ``reducers,'' ``stub
ends,'' and ``caps.'' The edges of finished pipe fittings are beveled.
Threaded, grooved, and bolted
[[Page 67856]]
fittings are excluded from this review. The pipe fittings subject to
this review are classifiable under subheading 7307.23.00 of the
Harmonized Tariff Schedule of the United States (``HTSUS''). These
HTSUS item numbers are provided for convenience and customs purposes.
The written descriptions remain dispositive.
Pipe fittings manufactured to American Society of Testing and
Materials specification A774 are included in the scope of this order.
The POR is June 1, 1996 through May 31, 1997. This review covers
sales of certain stainless steel butt-weld pipe fittings from Taiwan by
Ta Chen Stainless Pipe Co., Ltd. (``Ta Chen'').
Analysis of Comments Received
We gave interested parties an opportunity to comment on the
preliminary results. We received comments from Ta Chen, exporters of
the subject merchandise (``respondent'') and rebuttal comments from
petitioner, Flowline Division of Markovitz Enterprises Inc.
Comments
Comment 1: Ta Chen argues that the Department made a clerical
programming error in the margin calculation program by setting cost of
manufacture (``TOTCOMCV'') equal to Ta Chen's total constructed value
(``TOTCV''). Respondent argues that Ta Chen's cost of manufacture
(``TOTCOMCV'') should be set equal to Ta Chen's total cost of
manufacture (``TOTCOM''). The petitioner did not comment on this
argument.
Department's Position: We agree with respondent and have corrected
this error for the final results. The final margin program now sets the
cost of manufacture equal to total cost of manufacture. For a more
specific discussion of the change that the Department has made in its
final margin program, please see the Department's analysis memorandum
and final antidumping duty margin calculation program.
Comment 2: Ta Chen argues that inventory carrying costs associated
with time on the water should not be included in U.S. indirect selling
expenses deducted from U.S. price. It asserts that only indirect
selling expenses associated with economic activity occurring in the
United States should be deducted from U.S. price pursuant to
determining net price. Respondent states that the preliminary results
added the ocean time in transit between Ta Chen's plant in Tainan,
Taiwan and Ta Chen International's (``TCI'') warehouses in Long Beach,
California to Ta Chen's reported inventory carrying costs. It argues
that that inventory carrying cost is not associated with economic
activity in the United States, and therefore should not be included in
U.S. indirect selling expenses.
Petitioner argues that, while it is true that the amendments to the
dumping statute now only recognize those indirect selling expenses
associated with economic activity occurring in the United States, it is
not true that ``time on the water'' necessarily took place outside the
United States. Additionally, petitioner argues, the Department's
Antidumping Manual (``AD Manual'') notes that foreign inventory
carrying costs do not form part of the constructed export price
(``CEP'') deduction, and the AD Manual makes no mention of the costs
incurred once a product leaves the foreign country. Petitioner asserts
that Ta Chen revised its reported inventory carrying costs at
verification to include ``time on the water'' in the calculations,
which was accepted by the Department. They argue that the Department's
inclusion of ``time on the water'' is consistent with its past
practice, and does not constitute an unintentional error.
Department's Position: We agree with Ta Chen that the inventory
carrying costs incurred for the time on the water between Taiwan and
the United States should not be deducted from the price used to
calculate CEP. The Department has addressed this issue in the past in
Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts
Thereof From France, Germany, Italy, Japan, Romania, Singapore, Sweden,
and the United Kingdom; Final Results of Antidumping Duty
administrative Reviews, 63 FR 33320, 33344 (June 18, 1998) and Color
Picture Tubes From Japan; Final Results of Antidumping Duty
Administrative Review, 62 FR 34201, 34206 (June 25, 1997). In both
instances, the Department stated that it is clear from the Statement of
Administrative Action (``SAA'') that under section 772(d) of the Act we
should deduct from CEP only those expenses associated with commercial
activity in the United States which relate to the resale to an
unaffiliated purchaser. In Color Picture Tubes From Japan, we further
explained that the SAA indicates CEP ``is now calculated to be, as
closely as possible, a price corresponding to a price between non-
affiliated exporters and importers.'' 62 FR at 34207 (quoting SAA at
823). Section 351.402(b) of the Department's new regulations
1 codifies this principle, stating that we will make
adjustments under section 772(d) for expenses associated with
commercial activity in the United States, no matter where it was
incurred. Therefore, consistent with section 772(d) and the SAA, we
deduct only those expenses representing activities undertaken to make
the sale to the unaffiliated customer in the United States. We
ordinarily do not deduct indirect expenses incurred in selling to the
affiliated U.S. importer. See, e.g., 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, 11834 (March 13, 1997);
Gray Portland Cement and Clinker From Mexico; Final Results of
Antidumping Duty Administrative Review, 62 FR 17148, 17168 (April 9,
1997).
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\1\ Although this review was conducted under the Department's
old regulations at 19 CFR part 353, section 351.701 of the new
regulations states that the old regulations will apply to reviews
requested before the new regulations take effect to the extent the
old regulations ``were not invalidated by the URAA.'' Here, the old
regulations governing exporter sales price deductions are not in
conformity with the requirements of the URAA, therefore the new
regulations at 351.402(b) apply to this CEP deduction issue.
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We do not consider the portion of Ta Chen's inventory carrying
costs during the period of transit to be associated with commercial
activity in the United States. These expenses were incurred from the
date of exportation to the date the affiliated importer received the
subject merchandise in the United States and, therefore, relate to the
sale to Ta Chen's U.S. affiliate and not to the sale to the
unaffiliated customer. See Certain Stainless Wire Rods From France:
Amended Final Results of Antidumping Duty Administrative Review (Steel
Wire Rods), 62 FR 25915, 25916 (May 12, 1997). Accordingly, for these
final results we have not deducted such costs from the CEP.
Comment 3: Ta Chen argues that the CEP profit calculation
erroneously imputes a profit on TCI's direct expenses and commission
payments in the United States. It states that the CEP profit
calculation should only be an imputed profit on Ta Chen's indirect
selling expenses occurring in the United States, not on U.S. direct
selling expenses and commissions.
Petitioner argues that it is the Department's policy to use total
U.S. selling expenses, including direct selling expenses and
commission, in the derivation of CEP profit.
[[Page 67857]]
Department's Position: The Department agrees with petitioner. Ta
Chen argues that the Department should not impute a CEP profit on Ta
Chen's U.S. direct selling expenses and commissions. Instead, Ta Chen
asserts that the Department should only impute CEP profit on Ta Chen's
indirect selling expenses occurring in the United States. Respondent's
proposed methodology is directly contrary to the plain language of
Section 772(d)(3) of the Act. Section 772(d)(3) provides that the
Department shall reduce the starting price used to establish CEP by the
profit allocated to the expenses described in section 772(d)(1)&(2).
Section 772(d)(1) lists the following expenses:
(A) Commissions for selling the subject merchandise in the United
States;
(B) Expenses that result from, and bear a direct relationship to,
the sale, such as credit expenses, guarantees and warranties;
(C) Any selling expenses that the seller pays on behalf of the
purchaser; and
(D) Any selling expenses not deducted under * * * (A), (B), or (C)
[above].
Further, for purposes of calculating the applicable percentage,
section 772(f)(2)(B) defines total U.S. expenses as those expenses
deducted under section 772(d)(1)&(2). Therefore, contrary to Ta Chen's
argument, the plain language of the statute directs the Department to
deduct from CEP the profit allocated to all U.S. expenses, including
U.S. direct selling expenses and commissions. Thus, the Department has
not changed the CEP profit methodology used in the Preliminary Results.
Final Results of Review
As a result of this review, we determine that the following margin
exists for the period June 1, 1996 through May 31, 1997:
------------------------------------------------------------------------
Weighted-
average
Producer/manufacturer/exporter margin
(percent)
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Ta Chen.................................................... 0.34
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The Department shall determine, and the U.S. Customs Service shall
assess, antidumping duties on all appropriate entries. The Department
shall issue appraisement instructions directly to the Customs Service.
For assessment purposes, we have calculated importer-specific duty
assessment rates for the merchandise based on the ratio of the total
amount of antidumping duties calculated for the examined sales during
the POR to the total entered value of sales examined during the POR. As
a result of this review, we have determined that the importer-specific
duty assessment rate is necessary.
Furthermore, the following deposit requirements shall be effective
upon publication of this notice of final results of review for all
shipments of certain stainless steel butt-weld pipe fittings from
Taiwan, entered, or withdrawn from warehouse, for consumption on or
after the publication date, as provided for by section 751(a)(1) of the
Tariff Act: (1) No cash deposit will be required for the reviewed
company because its rate, stated above, is de minimis; (2) for
previously investigated or reviewed companies not listed above, the
cash deposit rate will continue to be the company-specific rate
published for the most recent period; (3) if the exporter is not a firm
covered in this review, or the original LTFV investigations, but the
manufacturer is, the cash deposit rate will be the rate established for
the most recent period for the manufacturer of the merchandise; and (4)
if neither the exporter nor the manufacturer is a firm covered in these
reviews, the cash deposit rate for this case will continue to be 51.03
percent, the ``All Others'' rate made effective by the LTFV
investigation. These deposit requirements shall remain in effect until
publication of the final results of the next administrative review.
This notice serves as a final reminder to importers of their
responsibility under 19 CFR 353.26 to file a certificate regarding the
reimbursement of antidumping duties prior to liquidation of the
relevant entries during this review period. Failure to comply with this
requirement could result in the Secretary's presumption that
reimbursement of antidumping duties occurred and the subsequent
assessment of double antidumping duties.
This notice also serves as a reminder to parties subject to
administrative protective order (``APO'') of their responsibility
concerning the disposition of proprietary information disclosed under
APO in accordance with section 353.34(d) of the Department's
regulations. Timely notification of return/destruction of APO materials
or conversion to judicial protective order is hereby requested. Failure
to comply with the regulations and the terms of an APO is a
sanctionable violation.
This administrative review and notice are in accordance with
sections 751(a)(1) and 777(i)(1) of the Act (19 U.S.C. 1675(a)(1) and
1677(f)(i)(1)).
Dated: December 2, 1998.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 98-32728 Filed 12-8-98; 8:45 am]
BILLING CODE 3510-DS-P