[Federal Register Volume 64, Number 249 (Wednesday, December 29, 1999)] [Notices] [Pages 73007-73013] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 99-33665] ======================================================================= ----------------------------------------------------------------------- DEPARTMENT OF COMMERCE International Trade Administration [A-570-846] Brake Rotors From the People's Republic of China: Preliminary Results of Third New Shipper Review and Preliminary Results and Partial Rescission of Second Antidumping Duty Administrative Review AGENCY: Import Administration, International Trade Administration, Department of Commerce. SUMMARY: On May 28, 1999, the Department of Commerce published notices of initiation of the third new shipper review and second administrative review of the antidumping duty order on brake rotors from the People's Republic of China. The reviews cover nine exporters of the subject merchandise to the United States. The period of review is April 1, 1998, through March 31, 1999. The Department of Commerce is also rescinding the administrative review with respect to three exporters of the subject merchandise which withdrew their requests for review in a timely manner and for which no other interested party requested a review. Interested parties are invited to comment on these preliminary results. EFFECTIVE DATE: December 29, 1999. FOR FURTHER INFORMATION CONTACT: Brian Smith or Terre Keaton, Import Administration, Internation Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C. 20230; telephone: (202) 482-1766 or (202) 482-1280, respectively. The Applicable Statute Unless otherwise indicated, all citations to the Tariff Act of 1930, as amended (``the Act''), are references to the provisions effective January 1, 1995, the effective date of the amendments made to the Act by the Uruguay Round Agreements Act. In addition, unless otherwise indicated, all citations to the Department of Commerce's (``the Department's'') regulations are to 19 CFR Part 351 (1998). SUPPLEMENTARY INFORMATION: For the nine respondents that submitted full responses to the antidumping questionnaire and have preliminarily been found to be entitled to a separate rate, we have preliminarily determined that U.S. sales have not been made below normal value (``NV''). If these preliminary results are adopted in our [[Page 73008]] final results of these reviews, we will instruct the Customs Service to assess no antidumping duties on entries from the nine exporters from the People's Republic of China (``PRC'') that cooperated in these reviews (including the one new shipper reviewed) for which the importer-specific assessment rates are zero or de minimis (i.e., less than 0.50 percent). Background On April 30, 1999, the following eleven exporters requested an administrative review pursuant to section 751(a)(1) of the Act and 19 CFR 351.213(b): (1) Jilin Provincial Machinery & Equipment Import & Export Corporation (``Jilin''); (2) Laizhou Auto Brake Equipments Factory (``LABEF''); (3) Longjing Walking Tractor Works Foreign Trade Import & Export Corporation (``Longjing''); (4) Longkou Haimeng Machinery Co. (``Haimeng''); (5) Quingdao (Gren) Co. (``GREN''); (6) Yantai Chen Fu Machinery Co., Ltd. (``Chen Fu''); (7) Yantai Import & Export Corporation (``Yantai''); (8) Yantai Winhere Auto-Part Manufacturing Co. (``Winhere''); (9) Yenhere Corporation (``Yenhere''); (10) Zibo Botai Machinery Manufacturing Co. (``Zibo''); and (11) Zibo Luzhou Automobile Parts Co. (``ZLAP''). On April 30, 1999, the Department received a timely request from Laizhou Hongda Auto Replacement Parts Co., Ltd. (``Laizhou Hongda''), Auto Replacement Parts Co., Ltd. (``Laizhou Hongda''), in accordance with section 751(a)(2)(B) of the Act and 19 CFR 351.214(c), for a new shipper review of this antidumping duty order. In its April 30, 1999, request for review, Laizhou Hongda certified that it did not export the subject merchandise to the United States during the period covered by the original less-than-fair-value (``LTFV'') investigation, and that it is not affiliated with any company which exported subject merchandise to the United States during the period of investigation. Laizhou Hongda also certified that its export activities are not controlled by the central government of the PRC. Pursuant to 19 CFR 351.214(b)(2)(iv), Laizhou Hongda submitted documentation establishing the date on which the merchandise was first entered for consumption in the United States, the volume of that shipment, and the date of the first sale to an unaffiliated customer in the United States. Laizhou Hongda also agreed to waive the time limits applicable to the new shipper review and to permit the Department to conduct the new shipper review concurrently with the administrative review. On May 20, 1998, the Department initiated an administrative review covering the eleven PRC exporters mentioned above (see Initiation of Antidumping and Countervailing Duty Administrative Review and Request for Revocation in Part (64 FR 28973, May, 1999)). In accordance with section 751(a)(2)(B) of the Act and 19 CFR 351.214(d), we initiated a new shipper review covering Laizhou Hongda. See Brake Rotors from the People's Republic of China: Initiation of New Shipper Antidumping Duty Review, 64 FR 28982 (May 28, 1999). On June 8, 1999, we issued a questionnaire to each PRC company which requested a new shipper or administrative review. On July 1, 1999, the Department provided the parties an opportunity to submit publicly available information (``PAI''), through August 16, 1999, for consideration in these preliminary results. On July 13, 1999, GREN and Jilin requested an extension of time to file their responses to the antidumping duty questionnaire. On July 14, 1999, the Department granted the extension request made by GREN and Jilin. On July 15, 1999, Chen Fu, Longjing and ZLAP withdrew their requests for review in accordance with 19 CFR 351.213(d). On July 15, and 22, 1999, the remaining nine PRC companies \1\ submitted their questionnaire responses. On July 26, 1999, the petitioner \2\ submitted comments on the questionnaire responses. --------------------------------------------------------------------------- \1\ These nine PRC exporters are (1) Jilin; (2) LABEF; (3) Laizhou Hongda; (4) Haimeng; (5) GREN; (6) Yantai; (7) Winhere; (8) Yenhere; and (9) Zibo. \2\ The petitioner is the Coalition for the Preservation of American Brake Drum and Rotor Aftermarket Manufacturers. --------------------------------------------------------------------------- On August 11, 1999, the respondents requested an extension of time until August 31, 1999, to submit PAI in this proceeding. On August 12, 1999, the Department extended the time for both the respondents and the petitioner to submit PAI to August 31, 1999. On August 13, 1999, the petitioner objected to the extension arguing that the Department was denying the petitioner due process. On August 26, 1999, the Department responded to petitioner's concerns (see Memorandum to the File, dated August 24, 1999). On August 31, 1999, the respondents submitted PAI for use in valuing the factors of production. The petitioner elected not to submit PAI. Instead, the practitioner requested: (1) that the Department conduct verification of all companies which submitted antidumping questionnaire responses in this proceeding; (2) that the Department conduct a verification at the Ministry of Foreign Trade and Economic Cooperation (``MOFTEC'') and Ministry of Machinery Industry (``MMI''); and (3) that the Department include in this proceeding the Department's MMI verification report, and accompanying verification exhibits, from the LTFV investigation. On September 7, 1999, the petitioner submitted rebuttal comments on PAI. On September 10, 1999, the Department notified the petitioner by letter that the Department had rejected the petitioner's August 31, 1999, request to include in the record of this proceeding the MMI verification report or exhibits obtained in the LTFV proceeding because the information in question was not relevant to the separate rates issue of whether government control existed with respect to the export activities of the respondent companies involved in this proceeding. The Department issued supplemental questionnaires to the respondents during September 18-27, 1999. In October, November, and December 1999, the Department received supplemental questionnaire responses from the respondents. Scope of Review The products covered by these reviews are brake rotors made of gray cast iron, whether finished, semifinished, or unfinished, ranging in diameter from 8 to 16 inches (20.32 to 40.64 centimeters) and in weight from 8 to 45 pounds (3.63 to 20.41 kilograms). The size parameters (weight and dimension) of the brake rotors limit their use to the following types of motor vehicles: automobiles, all-terrain vehicles, vans and recreational vehicles under ``one ton and a half,'' and light trucks designated as ``one ton and a half.'' Finished brake rotors are those that are ready for sale and installation without any further operations. Semi-finished rotors are those on which the surface is not entirely smooth, and have undergone some drilling. Unfinished rotors are those which have undergone some grinding or turning. These brake rotors are for motor vehicles, and do not contain in the casting a logo of an original equipment manufacturer (``OEM'') which produces vehicles sold in the United States (e.g., General Motors, Ford, Chrysler, Honda, Toyota, Volvo). Brake rotors covered in these reviews are not certified by OEM producers of vehicles sold in the United States. The scope also includes composite brake rotors that are made of gray cast iron, which contain a steel [[Page 73009]] plate, but otherwise meet the above criteria. Excluded from the scope of the reviews are brake rotors made of gray cast iron, whether finished, semifinished, or unfinished, with a diameter less than 8 inches or greater than 16 inches (less than 20.32 centimeters or greater than 40.64 centimeters) and a weight less than 8 pounds or greater than 45 pounds (less than 3.63 kilograms or greater than 20.41 kilograms). Brake rotors are classifiable under subheading 8708.39.5010 of the Harmonized Tariff Schedule of the United States (``HTSUS''). Although the HTSUS subheading is provided for convenience and customs purposes, the written description of the scope of these reviews is dispositive. Period of Reviews The period of review (``POR'') covers the period April 1, 1998, through March 31, 1999. Rescission The Department's regulations at 19 CFR 351.213(d)(1) provide that the Department may rescind an administrative review if a party that requested a review withdraws the request within 90 days of the date of publication of the notice of initiation of the requested review. Chen Fu, Longjing, and ZLAP withdrew their request for an administrative review on July 15, 1999, which is within the 90-day deadline. The Department has determined to grant the request to rescind this administrative review with respect to Chen Fu, Longjing, and ZLAP, because these companies withdrew their requests for review in a timely manner and because no other interested party requested a review of these companies. Accordingly, for POR entries made by these PRC companies, the Department will instruct the Customs Service to assess ad valorem duties at the rates applicable at the time of entry. Separate Rates In proceedings involving non-market economy (``NME'') countries, the Department begins with a rebuttable presumption that all companies within the country are subject to government control and thus should be assessed a single antidumping duty deposit rate. Of the nine respondents that submitted questionnaire responses, one of the PRC companies, Winhere, is wholly owned by private individuals. Three respondents (i.e., Haimeng, Laizhou Hongda and Zibo) are joint ventures between PRC and foreign companies. Another respondent, Yenhere, is a limited liability corporation in the PRC. The four other respondents are either wholly owned by ``all the people'' (i.e., Jilin and Yantai) or collectively owned (i.e., GREN and LABEF). Thus, for all nine respondents, a separate rates analysis is necessary to determine whether the exporters are independent from government control (see Notice of Final Determination of Sales at Less Than Fair Value: Bicycles From the People's Republic of China (``Bicycles'') 61 FR 56570 (April 30, 1996)). To establish whether a firm is sufficiently independent from government control to be entitled to a separate rate, the Department analyzes each exporting entity under a test arising out of the Final Determination of Sales at Less than Fair Value: Sparklers from the People's Republic of china, 56 FR 20588 (may 6, 1991) and amplified in the Final Determination of Sales at Less Than Fair Value: Silicon Carbide from the People's Republic of China, 59 FR 22585 (May 2, 1994) (``Silicon Carbide''). Under this separate rates criteria, the Department assigns separate rates in NME cases only if the respondent can demonstrate the absence of both de jure and de facto governmental control over export activities. 1. De Jure Control Each respondent has placed on the administrative record documents to demonstrate absence of de jure control, including the ``Law of the People's Republic of China on Industrial Enterprises Owned by the Whole People,'' adopted on April 13, 1988 (`'the Industrial Enterprises Law''); ``The Enterprise Legal Person Registration Administrative Regulations,'' promulgated on June 13, 1988; the 1990 ``Regulation Governing Rural Collectively-Owned Enterprises of PRC''; the 1992 ``Regulations for Transformation of Operational Mechanisms of State- Owned Industrial Enterprises'' (``Business Operation Provisions''); and the 1994 ``Foreign Trade Law of the People's Republic of China.'' As in prior cases, we have analyzed these laws and have found them to establish sufficiently an absence of de jure control of companies ``owned by the whole people,'' privately owned enterprises, joint ventures, stock companies including limited liability companies, and collectively owned enterprises. See, e.g., Final Determination of Sales at Less than Fair Value: Furfuryl Alcohol from the People's Republic of China (``Furfuryl Alcohol'') 60 FR 22544 (May 8, 1995), and Preliminary Determination of Sales at Less Than Fair Value: Certain Partial- Extension Steel Drawer Slides with Rollers from the People's Republic of China 60 FR 29571 (June 5, 1995). We have no new information in this proceeding which would cause us to reconsider this determination with regard to the nine respondents mentioned above. 2. De Facto Control As stated in previous cases, there is some evidence that certain enactments of the PRC central government have not been implemented uniformly among different sectors and/or jurisdictions in the PRC. See Silicon Carbide and Furfuryl Alcohol. Therefore, the Department has determined that an analysis of de facto control is critical in determining whether the respondents are, in fact, subject to a degree of governmental control which would preclude the Department from assigning separate rates. The Department typically considers four factors in evaluating whether each respondent is subject to de facto governmental control of its export functions: (1) whether the export prices are set by, or subject to the approval of, a governmental authority; (2) whether the respondent has authority to negotiate and sign contracts and other agreements; (3) whether the respondent has autonomy from the government in making decisions regarding the selection of management; and (4) whether the respondent retains the proceeds of its export sales and makes independent decisions regarding the disposition of profits or financing of losses (see Silicon Carbide and Furfuryl Alcohol). Each of the nine respondents asserted the following: (1) It establishes its own export prices; (2) it negotiates contracts without guidance from any governmental entities or organizations; (3) it makes its own personnel decisions; and (4) it retains the proceeds of its export sales, uses profits according to its business needs, and has the authority to sell its assets and to obtain loans. Additionally, the respondents' questionnaire responses indicate that company-specific pricing during the POR does not suggest coordination among exporters. This information supports a preliminary finding that there is de facto absence of governmental control of the export functions of the respondents. See Pure Magnesium from the People's Republic of China: Preliminary Results of Antidumping Duty New Shipper Administrative Review, 62 FR 55215 (October 23, 1997). Consequently, we have preliminarily determined that each [[Page 73010]] of the respondents has met the criteria for the application of separate rates. Fair Value Comparisons To determine whether sales of the subject merchandise by each respondent to the United States were made at LTFV, we compared the export price (``EP'') to the NV, as described in the ``Export Price'' and ``Normal Value'' sections of this notice, below. Export Price We used EP methodology in accordance with section 772(a) of the Act, because the subject merchandise was sold directly to unaffiliated customers in the United States prior to importation and constructed export price methodology was not otherwise indicated. 1. Haimeng, Jilin, LABEF, Winhere, Yenhere and Zibo We calculated EP based on packed, FOB foreign port prices to the first unaffiliated purchaser in the United States. Where appropriate, we made deductions from the starting price (gross unit price) for foreign inland freight and foreign brokerage and handling in the PRC, in accordance with section 772(c) of the Act. Because foreign inland freight and foreign brokerage and handling fees were provided by NME service providers or paid for in a NME currency, we based those charges on surrogate rates from India (see ``Surrogate Country'' section below). To value foreign inland trucking charges, we used the average inflation-adjusted 1994 truck freight rate contained in the Indian periodical The Times of India. We have used this same rate in numerous NME cases in which India has been selected as the primary surrogate (see, e.g., Notice of Final Determinations of Sales at Less Than Fair Value: Brake Drums and Brake Rotors from the People's Republic of China, 62 FR 9160, 9163 (February 28, 1997)). To value foreign brokerage and handling expenses, we relied on public information reported in the antidumping investigation of stainless steel wire rod from India (see Brake Rotors from the People's Republic of China: Rescission of Second New Shipper Review and Final Results and Partial Rescission of First Antidumping Duty Administrative Review, 64 FR 61581, 61584 (November 12, 1999) (Brake Rotors First Administrative Review)). 2. GREN and Yantai We calculated EP based on packed, CIF, U.S. or FOB foreign port prices to the first unaffiliated purchaser in the United States. Where appropriate, we made deductions from the starting price (gross unit price) for foreign inland freight and foreign brokerage and handling in the PRC, marine insurance and international freight, in accordance with section 772(c) of the Act. As all foreign inland freight and foreign brokerage and handling fees were provided by NME service providers or paid for in a NME currency, we valued these services using the Indian surrogate values discussed above. For marine insurance, we used public information reported in the antidumping investigation of sulfur dyes, including sulfur vat dyes, from India (see Brake Rotors First Administrative Review, 64 FR at 61584). For ocean freight, we used a 1996 price quote (adjusted for inflation) from a U.S. shipping company to calculate an average price for shipping. We did so because GREN used NME carriers and Yantai paid freight expenses to a U.S. freight forwarder which then contracted with NME carriers to ship the subject merchandise to the United States. 3. Laizhou Hongda We calculated EP based on packed, CIF U.S. port prices to the first unaffiliated purchaser in the United States. Where appropriate, we made deductions from the starting price (gross unit price) for foreign inland freight and foreign brokerage and handling in the PRC, marine insurance and international freight, in accordance with section 772(c) of the Act. As all foreign inland freight and foreign brokerage and handling fees were provided by NME service providers or paid for in a NME currency, we valued these services using the Indian surrogate values discussed above. For marine insurance, we used public information as reported in the antidumping investigation of sulfur dyes, including sulfur vat dyes, from India (see Brake Rotors First Administrative Review at 64 FR 61584). To value ocean freight, we used Laizhou Hongda's reported expense because Laizhou Hongda used market- economy freight carriers (see, e.g., Brake Rotors from the People's Republic of China: Final Results of Antidumping Duty New Shipper Review, 64 FR 9972, 9974 (March 1, 1999). Normal Value A. Non-Market Economy Status In every case conducted by the Department involving the PRC, the PRC has been treated as a NME country. None of the parties to this proceeding has contested such treatment. Accordingly, we calculated NV in accordance with section 773(c) of the Act, which applies to NME countries. B. Surrogate Country Section 773(c)(4) of the Act requires the Department to value a NME producer's factors of production, to the extent possible, in one or more market economy countries that (1) are at a level of economic development comparable to that of the NME country, and (2) are significant producers of comparable merchandise. India and Indonesia are among the countries comparable to the PRC in terms of overall economic development (see Memorandum from the Office of Policy to Irene Darzenta Tzafolias, dated June 24, 1999, which was included in the Department's July 1, 1999, letter sent to the interested parties in this proceeding for the submission of PAI). In addition, based on PAI placed on the record, India is a significant producer of the subject merchandise. Accordingly, we considered India the primary surrogate country for purposes of valuing the factors of production as the basis for NV because it meets the Department's criteria for surrogate country selection. Where we could not find surrogate values from India, we valued those factors using values from Indonesia. C. Factors of Production In accordance with section 773(c) of the Act, we calculated NV based on the factors of production. We used factors reported by companies in the PRC that produced brake rotors for export to the United States during the POR through reviewed exporters. To calculate NV, the reported unit factor quantities were multiplied by publicly available Indian or Indonesia values. In a September 7, 1999, submission, the petitioner alleged that there is widespread tax evasion in India and, therefore, insisted that the Department only subtract excise duties, levies and sales taxes from Indian domestic material prices used by the Department if the Indian brake rotor producers demonstrated that they paid their excise and sales taxes related to such materials used in production during the POR. In these preliminary results, we have not used Indian domestic prices to value the material inputs (see discussion below). Therefore, we do not deem it necessary to address the petitioner's allegation at this time. In addition, the petitioner requested that the Department not deduct an amount for duty drawback from the cost of inputs used to produce brake rotors which are exported from India, based on information submitted by the respondents which indicates that Indian [[Page 73011]] brake rotor exporters are entitled to duty drawback if they used imported inputs to produce the exported finished good. A ``duty drawback'' is, by definition, a remission of an amount paid (or to be paid) as an import ``duty'' (i.e., tax). Such a ``drawback'' is often conditional upon exporting a certain volume of product using the imported inputs. The input prices the Department uses do not include Indian taxes because Indian government revenue-collection practices are not relevant to the question of what it would cost a PRC producer to produce the item in question, if the PRC were a market economy country. In this case, the input prices the Department is using based on the PAI specified below are already duty free. Therefore, we have not made any adjustment to these prices for duty drawback. Finally, to calculate surrogate percentages for selling, general and administrative (``SG&A'') expenses, factory overhead and profit, the petitioner requested that the Department use financial data from a group of Indian brake rotor producers, rather than just one Indian brake rotor producer, which are more representative of the experience of the Indian brake rotor industry as a whole. We agree with the petitioner on this point, and have used financial data from five known Indian brake rotor producers to calculate these percentages (see discussion below). The Department's selection of the surrogate values applied in this determination was based on the quality, specificity, and contemporaneity of the data. As appropriate, we adjusted input prices to make them delivered prices. For those values not contemporaneous with the POR and quoted in a foreign currency, we adjusted for inflation using wholesale price indices published in the International Monetary Fund's International Financial Statistics. To value pig iron, we used average values based on import statistics for April 1997-March 1998 from Monthly Statistics of the Foreign Trade of India (``Monthly Statistics'') rather than domestic price data in India from the April 1996-March 1997 financial report of Lamina Foundries (``Lamina'') or from the 1996 financial report of Nagpur Alloy Castings Ltd. (``Nagpur''), because the import data was more contemporaneous with the POR. For iron scrap, steel scrap, ferrosilicon, ferromanganese, lubrication oil and limestone, we used April 1997-March 1998 average values from Monthly Statistics. Certain types of rotors use steel sheet, lug bolts and ball bearing cups. To value steel sheet, we used an April 1997-March 1998 average value from Monthly Statistics. Because we could not obtain a product- specific price from India to value lug bolts (see Bicycles, 61 FR at 19026 (Comment 17)), we used January-October 1998 product-specific import data from the Indonesian government publication Foreign Trade Statistical Bulletin. To value ball bearing cups, we used April 1997- July 1997 import price data from Monthly Statistics. To value coking coal, we used an April 1997-March 1998 import price from Monthly Statistics rather than a price applicable during the fourth quarter of 1996 from the International Energy Agency's Energy Price and Taxes, because the import price was more contemporaneous with the POR. To value firewood, we used a 1990 domestic value from the USAID publication Marketing Opportunities for Social Forestry in Uttar Pradesh, which is the most recent value available for this input. To value electricity, we calculated an average 1996 industrial rate based on data contained in the financial reports of Lamina, Nagpur, and Jayaswals Neco Limited (``Jayaswals''). For a complete analysis of surrogate values, see the Preliminary Results Valuation Memorandum from the Team to the File, dated December 17, 1999 (``Preliminary Results Valuation Memorandum''). We valued labor based on a regression-based wage rate, in accordance with 19 CFR 351.408(c)(3). To value SG&A expenses, factory overhead and profit, we used the 1998-1999 financial data of Kalyanti Brakes Limited (``Kalyani'') combined with the financial data of Indian producers whose data is less contemporaneous with the POR (i.e., the 1996-1997 financial data of Jayaswals, Krishna Engineering Works (``Krishna''), Nagpur, and Rico Auto Industries Limited (``Rico'')). We did so because we determined that it is more appropriate in this instance to calculate surrogate percentage averages which are representative of the experience of known Indian brake rotor producers, rather than to use the financial data of a sole Indian brake rotor producer just because that data is more contemporaneous with the POR as suggested by the respondents. In prior brake rotor administrative reviews, both the petitioner and the respondents have consistently submitted for the Department's consideration financial statements from multiple Indian producers of comparable merchandise which generally have been contemporaneous with the POR. Therefore, we had no reason to question the representativeness of the data being submitted. However, in this proceeding, the respondents submitted the financial statement of only one Indian producer of comparable merchandise (i.e., Kalyani). Because the Department generally prefers surrogate ratios which are based on the financial data of more than a single Indian producer and are more representative of the experience of all known Indian brake rotor producers, the Department has averaged the most recent financial data available for Jayawals, Kalyani, Krishna, Nagpur and Rico to calculate the surrogate ratios for factory overhead, SG&A, and profit. Where appropriate, we removed from the surrogate overhead and SG&A calculations the excise duty amount listed in the financial reports (see Brake Rotors, 62 FR at 9164). We made certain adjustments to the ratios calculated as a result of reclassifying certain expenses contained in the financial reports. In utilizing the financial data of the Indian companies, we treated the line item labeled ``stores and spares consumed'' as part of factory overhead because stores and spares are not direct materials consumed in the production progress. Based on PAL, we considered the modeling materials (i.e., sand, bentonite, coal powder, steel pellets, lead powder, waste oil) to be indirect materials included in the ``stores and spares consumed'' category of the financial statements. We based our factory overhead calculation on the cost of manufacturing. We also included interest and/or financial expenses in the SG&A calculation. In addition, we only reduced interest and financial expenses by amounts for interest income if the Indian financial report noted that the income was short-term in nature. Where a company did not distinguish interest income as a line item within total ``other income,'' we used the ratio of interest income to total other income as reported for the Indian metals industry in the Reserve Bank of India Bulletin to calculate the interest expense amount. For example, if an Indian company's financial statement indicated that the company had miscellaneous receipt or other income under the general category ``other income,'' we applied a ratio (based on data contained in Reserve Bank of India Bulletin) to that miscellaneous receipts or other income figure in the financial statement to determine the amount associated with short-term interest income. To avoid double-counting, we treated the line item ``packing, freight and delivery charges'' as expenses to be valued separately. Specifically, to determine the packing expense, we used the respondents' reported packing factors. [[Page 73012]] We used the respondents' reported distances to determine the foreign inland freight expense. For a further discussion of other adjustments made, see the Preliminary Results Valuation Memorandum. All inputs were shipped by truck. Therefore, to value PRC inland freight, we used the April 1994 truck rate from the Times of India. In accordance with the decision of the Court of Appeals for the Federal Circuit in Sigma Corp. v. United States, 117 F. 3d 1401 (1997), we revised our methodology for calculating source-to-factory surrogate freight for those material inputs that are valued based on CIF import values in the surrogate country. Therefore, we have added to CIF surrogate values from India a surrogate freight cost using the shorter of the reported distances from either the closest PRC port of importation to the factory, or from the domestic supplier to the factory on an input-specific basis. To value adhesive tape, corrugated cartons, nails, polyethylene material for bags, steel strap and steel strip, we used April 1997- March 1998 import values from Monthly Statistics. To value pallet wood, we selected an April 1995-March 1996 import value from Monthly Statistics rather than values obtained after March 1996, because the more contemporaneous values appeared aberrational relative to the overall value of the subject merchandise (see Preliminary Results Valuation Memorandum for further discussion). Preliminary Results of the Review We preliminarily determine that the following margins exist for the nine respondents during the period April 1, 1998, through March 31, 1999: ------------------------------------------------------------------------ Manufacturer/producer/exporter Margin percent ------------------------------------------------------------------------ Jilin Provincial Machinery & 0.00 Equipment Import & Export Corporation. Laizhou Auto Brake Equipments 0.00 Factory. Laizhou Hongda Auto Replacement 0.00 Parts Co., Ltd. Longkou Haimeng Machinery Co........ 0.10 (de minimis) Qingdao (Gren) Co................... 0.49(de minimis) Yantai Import & Export Corporation.. 0.30(de minimis) Yantai Winhere Auto-Part 0.00 Manufacturing Co. Yenhere Corporation................. 0.00 Zibo Botai Machinery Manufacturing 0.00 Co. PRC-Wide Rate....................... 43.32 ------------------------------------------------------------------------ Parties to the proceeding may request disclosure within five days of the date of publication of this notice. Any interested party may request a hearing within 30 days of publication of this notice. Any hearing, if requested, will be held on March 31, 2000. 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, Room B-099, within 30 days of the date of publication of this notice. Requests should contain: (1) the party's name, address and telephone number; (2) the number of participants; and (3) a list of issues to be discussed. See 19 CFR 351.310(c). Issues raised in the hearing will be limited to those raised in case briefs and rebuttal briefs. Case briefs from interested parties may be submitted not later than March 24, 2000. Rebuttal briefs, limited to issues raised in the case briefs, will be due on March 29, 2000. Parties who submit case briefs or rebuttal briefs in this proceeding are requested to submit with each argument (1) a statement of the issue and (2) a brief summary of the argument. Parties are also encouraged to provide a summary of the arguments not to exceed five pages and a table of statutes, regulations and cases cited. The Department will issue the final results of this administrative and new shipper review, including the results of its analysis of issues raised in any such written briefs or at the hearing, if held, not later than 120 days after the date of publication of this notice. Assessment Rates The Department shall determine, and the Customs Service shall assess, antidumping duties on all appropriate entries. Pursuant to 19 CFR 351.212(b)(1), we will calculate importer-specific ad valorem duty assessment rates based on the ratio of the total amount of the dumping margins calculated for the examined sales to the total entered value of those same sales. In order to estimate the entered value, we will subtract international movement expenses from the gross sales value. In accordance with 19 CFR 351.106(c)(2), we will instruct the Customs Service to liquidate without regard to antidumping duties all entries of subject merchandise during the POR for which the importer-specific assessment rate is zero or de minimis (i.e., less than 0.50 percent). For entries of subject merchandise from those PRC companies for which the Department has rescinded the review, the Customs Service shall assess ad valorem duties at the rates applicable at the time of entry, as stated in the ``Rescission'' section of this notice. For entries subject to the PRC-wide rate, the Customs Service shall assess ad valorem duties at the rate established in the LTFV investigation. The Department will issue appropriate appraisement instructions directly to the Customs Service upon completion of this review. Cash Deposit Requirements Upon completion of this new shipper review, for entries from Laizhou Hongda, we will require cash deposits at the rate established in the final results pursuant to section 751(a)(2)(B)(iii) of the Act and 19 CFR 351.214(e) and as further described below. The following deposit requirements will be effective upon publication of the final results of these administrative and new shipper antidumping duty administrative reviews for all shipments of brake rotors from the PRC entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided by section 751(a)(1) of the Act: (1) the cash deposit rate for each reviewed company will be the rate established in the final results; (2) the cash deposit rate for PRC exporters who received a separate rate in a prior segment of the proceeding but for whom the Department has rescinded the review (i.e., Longjing and ZLAP) will continue to be the rate assigned in that segment of the proceeding; (3) the cash deposit rate for the PRC NME entity (i.e., all other exporters including Chen Fu) will continue to be 43.32 percent; and (4) the cash deposit rate for non-PRC exporters of subject merchandise from the PRC will be the rate applicable to the PRC supplier of that exporter. These requirements, when imposed, shall remain in effect until publication of the final results of the next administrative review. Notification to Importers This notice serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties. These administrative and new shipper administrative reviews and notice are in accordance with section 751(a)(1) and (2)(B) of the Act (19 U.S.C. 1675(a)(1) and (2)(B)) and 19 CFR 351.213 and 351.214. [[Page 73013]] Dated: December 21, 1999. Robert S. LaRussa, Assistant Secretary for Import Administration. [FR Doc. 99-33665 Filed 12-28-99; 8:45 am] BILLING CODE 3510-DS-M