[Federal Register Volume 75, Number 224 (Monday, November 22, 2010)]
[Notices]
[Pages 71072-71075]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-29384]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-201-805]
Initiation and Preliminary Results of Antidumping Duty Changed
Circumstances Review: Certain Circular Welded Non-Alloy Steel Pipe From
Mexico
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: In response to a request for an expedited changed
circumstances review from Tuberia Nacional, S.A. de C.V. (TUNA) and
Lamina y Placa Comercial, S.A. de C.V. (Lamina y Placa), the Department
of Commerce (the Department) is initiating a changed circumstances
review of the antidumping duty order on certain circular welded non-
alloy steel pipe (CWP) from Mexico pursuant to section 751(b) of the
Tariff Act of 1930, as amended (the Act) and 19 CFR 351.216 and
351.221(c)(3). We have preliminarily concluded that Lamina y Placa is
the successor-in-interest to TUNA and, as a result, should be accorded
the same treatment previously given to TUNA with respect to the
antidumping duty order on CWP from
[[Page 71073]]
Mexico. Interested parties are invited to comment on these preliminary
results.
DATES: Effective Date: November 22, 2010.
FOR FURTHER INFORMATION CONTACT: Mark Flessner or Robert James, AD/CVD
Operations, 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) 482-6312 or (202) 482-0649, respectively.
Background
The Department published an antidumping duty order on CWP from
Mexico on November 2, 1992. See Notice of Antidumping Duty Orders:
Certain Circular Welded Non-Alloy Steel Pipe from Brazil, the Republic
of Korea (Korea), Mexico, and Venezuela, and Amendment to Final
Determination of Sales at Less Than Fair Value: Certain Circular Welded
Non-Alloy Steel Pipe from Korea, 57 FR 49453 (November 2, 1992).
On May 17, 2010, both TUNA and Lamina y Placa filed a request for a
changed circumstances review of the antidumping duty order on CWP from
Mexico. TUNA and Lamina y Placa claim that Lamina y Placa is the
successor-in-interest to TUNA in accordance with section 751(b) of the
Act and 19 CFR 351.216 and provided documentation supporting its
assertion.
On June 30, 2010, the Department issued a questionnaire to TUNA and
Lamina y Placa seeking additional information related to their request
for a changed circumstances review. On July 28, 2010, TUNA and Lamina y
Placa filed their response to the questionnaire. On August 31, 2010,
the Department issued a supplemental questionnaire to TUNA and Lamina y
Placa.
On September 10, 2010, TUNA and Lamina y Placa submitted their
supplemental questionnaire response. On September 21, 2010 and
September 27, 2010, TUNA and Lamina y Placa provided further
information clarifying the ownership structure and legal status of both
entities as requested by the Department. See Memorandum to the File,
dated October 14, 2010.
In response to TUNA's and Lamina y Placa's request, the Department
is initiating a changed circumstances review of this order.
Scope of the Order
The merchandise covered by this order is circular welded non-alloy
steel pipes and tubes, of circular cross-section, not more than 406.4
millimeters (16 inches) in outside diameter, regardless of wall
thickness, surface finish (black, galvanized, or painted), or end
finish (plain end, beveled end, threaded, or threaded and coupled).
These pipes and tubes are generally known as standard pipes and tubes
and are intended for the low-pressure conveyance of water, steam,
natural gas, and other liquids and gases in plumbing and heating
systems, air conditioning units, automatic sprinkler systems, and other
related uses, and generally meet ASTM A-53 specifications. Standard
pipe may also be used for light load-bearing applications, such as for
fence tubing, and as structural pipe tubing used for framing and
support members for reconstruction or load-bearing purposes in the
construction, shipbuilding, trucking, farm equipment, and related
industries. Unfinished conduit pipe is also included in this order. All
carbon steel pipes and tubes within the physical description outlined
above are included within the scope of this order, except line pipe,
oil country tubular goods, boiler tubing, mechanical tubing, pipe and
tube hollows for redraws, finished scaffolding, and finished conduit.
Standard pipe that is dual or triple certified/stenciled that enters
the United States as line pipe of a kind used for oil or gas pipelines
is also not included in this order.
Imports of the products covered by this order are currently
classifiable under the following Harmonized Tariff Schedule of the
United States (HTSUS) subheadings: 7306.30.10.00, 7306.30.50.25,
7306.30.50.32, 7306.30.50.40, 7306.30.50.55, 7306.30.50.85, and
7306.30.50.90. Although the HTSUS subheadings are provided for
convenience and customs purposes, our written description of the scope
of this order is dispositive.
Initiation of Antidumping Duty Changed Circumstances Review
Pursuant to section 751(b)(1) of the Act, the Department will
conduct a changed circumstances review upon receipt of a request from
an interested party or receipt of information concerning an antidumping
duty order which shows changed circumstances sufficient to warrant a
review of the order. On May 17, 2010, TUNA and Lamina y Placa submitted
their request for a changed circumstances review, claiming Lamina y
Placa is the successor-in-interest to TUNA. In its submission, TUNA and
Lamina y Placa explain that a majority of TUNA's assets were
transferred to an affiliated company, Temple de Monterrey, S.A. de C.V.
(Temple de Monterrey) on September 30, 2009. TUNA and Lamina y Placa
state Temple de Monterrey was subsequently acquired by Lamina y Placa
on December 28, 2009. See TUNA's and Lamina y Placa's submission, dated
May 17, 2010 at 3 and Exhibits 1 and 2. As a result of the asset
transfer and corporate merger, TUNA and Lamina y Placa clarify that all
of TUNA's assets previously transferred to Temple de Monterrey are now
held by Lamina y Placa. Id. However, TUNA and Lamina y Placa also
maintain that the merger did not dissolve TUNA as a legal entity, and
while TUNA does not currently have manufacturing or selling activities,
it does retain ownership of certain buildings and land. See TUNA's and
Lamina y Placa's submission, dated September 27, 2010 at 2 and Exhibit
1.
No other interested parties commented on TUNA's and Lamina y
Placa's submissions. Based on the information submitted by TUNA and
Lamina y Placa, the Department has determined that changed
circumstances sufficient to warrant a review exist. See 19 CFR
351.216(d). The Department also finds that expedited action is
warranted in accordance with 19 CFR 351.221(c)(3)(ii), and therefore we
are publishing a notice of initiation and preliminary results for this
changed circumstances review concurrently. See Ball Bearings and Parts
Thereof from Japan: Initiation and Preliminary Results of Changed-
Circumstances Review, 71 FR 14679 (March 23, 2006).
Preliminary Results
In antidumping duty changed circumstances reviews involving a
successor-in-interest determination, the Department typically examines
several factors including, but not limited to: (1) Management; (2)
production facilities; (3) supplier relationships; and (4) customer
base. See Brass Sheet and Strip from Canada: Final Results of
Antidumping Duty Administrative Review, 57 FR 20460, 20462 (May 13,
1992) and Certain Cut-to-Length Carbon Steel Plate from Romania:
Initiation and Preliminary Results of Changed Circumstances Antidumping
Duty Administrative Review, 70 FR 22847 (May 3, 2005) (Plate from
Romania). While no single factor or combination of factors will
necessarily be dispositive, the Department generally will consider the
new company to be the successor to the predecessor if the resulting
operations are essentially the same as those of the predecessor
company. See, e.g., Industrial Phosphoric Acid from Israel: Final
Results of Antidumping Duty Changed Circumstances Review, 59 FR 6944,
6945 (February 14, 1994), and Plate from Romania, 70 FR 22847.
[[Page 71074]]
Thus, if the record evidence demonstrates the new company operates as
the same business entity as the predecessor company with respect to the
production and sale of the subject merchandise, the Department may
assign the new company the cash deposit rate of its predecessor. See,
e.g., Fresh and Chilled Atlantic Salmon from Norway: Final Results of
Changed Circumstances Antidumping Duty Administrative Review, 64 FR
9979, 9980 (March 1, 1999).
In accordance with 19 CFR 351.221(c)(3)(i), we preliminarily
determine that Lamina y Placa is the successor-in-interest to TUNA. In
its submissions, TUNA and Lamina y Placa provide documentation showing
the transfer of production and sales operations from TUNA to Lamina y
Placa resulted in little or no change in management, production
facilities, supplier relationships, or customer base.
In its initial submission, dated May 17, 2010, TUNA and Lamina y
Placa state: (1) The production of subject merchandise at Lamina y
Placa is managed by the same individuals who previously managed
production operations of subject merchandise at TUNA prior to the
merger; (2) subject merchandise produced by Lamina y Placa is in the
same location and at the same capacity as produced by TUNA before the
merger; (3) Lamina y Placa consumes the same material inputs as TUNA
did, sourced from the same major suppliers; and (4) Lamina y Placa
sells merchandise to the same customer base to which TUNA made sales.
TUNA and Lamina y Placa further explain that the ultimate ownership
of the production facilities remain the same, and did not change as a
result of the transfer of a majority of TUNA's assets to Temple de
Monterrey, and the latter's eventual merger with Lamina y Placa.
Additionally, TUNA and Lamina y Placa point out that the Department has
previously collapsed both companies into a single producer entity in
the 1998-1999 administrative review of this order (i.e., the most
recently completed administrative review of TUNA). See TUNA's and
Lamina y Placa's submission, dated May 17, 2010 at 6, citing Circular
Welded Non-Alloy Steel Pipe From Mexico: Preliminary Results and
Partial Rescission of Antidumping Duty Administrative Review, 65 FR
77560, 77562 (December 20, 2000) (1998-1999 Preliminary Results);
unchanged in Circular Welded Non-Alloy Steel Pipe From Mexico: Final
Results of Antidumping Duty Administrative Review, 66 FR 21311 (April
30, 2001) and unchanged in Circular Welded Non-Alloy Steel Pipe From
Mexico: Amended Final Results of Antidumping Duty Administrative
Review, 66 FR 37454 (July 18, 2001).
In performing our analysis, we first examined the organization
charts showing the management structure and ownership information for
TUNA, Lamina y Placa and Temple de Monterrey both prior to and after
the merger of Temple de Monterrey into Lamina y Placa. See TUNA's and
Lamina y Placa's submissions, dated May 17, 2010 (Exhibit 3), July 28,
2010 (Exhibit 4), September 10, 2010 (Exhibit 1) and September 21, 2010
(Exhibits 1 and 2). TUNA and Lamina y Placa note that the management of
TUNA's pipe facility did not change between TUNA's asset transfer to
Temple de Monterrey and Temple de Monterrey's merger into Lamina y
Placa. The only significant changes involve transfers of personnel from
other affiliated entities, the promotion of Lamina y Placa employees to
higher positions and the creation of new positions. As such, Lamina y
Placa's management structure after the merger of Temple de Monterrey,
for the most part, resembles its previous management structure. See
TUNA's and Lamina y Placa's submissions, dated July 28, 2010 at 5-6 and
Exhibit 4.
Second, we reviewed production data of subject merchandise from
production facilities of both Lamina y Placa and TUNA covering periods
prior to and following the asset transfer and corporate merger. Data
show both entities maintained the same production capacity. See TUNA's
and Lamina y Placa's submissions, dated May 17, 2010 and July 28, 2010
at Exhibits 4 and 5, respectively.
Third, we examined the list of major input suppliers to TUNA for
the production of subject merchandise prior to the transfer of a
majority of its assets to Temple de Monterrey. We compared this to the
list of suppliers of major inputs to Lamina y Placa for the production
of subject merchandise following the transfer of TUNA's assets and
found both lists were identical. See TUNA's and Lamina y Placa's
submission, dated May 17, 2010 at Exhibit 5. Meanwhile, TUNA and Lamina
y Placa clarified that Lamina y Placa also maintained relationships
with additional suppliers for other material, finished goods and
services. See TUNA's and Lamina y Placa's submission, dated July 28,
2010 at Exhibit 6.
Fourth, we reviewed the customer lists for TUNA's sales of subject
merchandise prior to the transfer of its assets to Temple de Monterrey
and Lamina y Placa's customers following its merger with Temple de
Monterrey. TUNA and Lamina y Placa explained that prior to the asset
transfer and corporate merger, Lamina y Placa did not operate any
facilities for the production of subject merchandise. However, TUNA and
Lamina y Placa add that TUNA was involved as a toller for Lamina y
Placa, wherein Lamina y Placa placed orders with TUNA for certain
subject and non-subject merchandise and paid TUNA a monthly sum for the
volume of merchandise produced. TUNA and Lamina y Placa state this
arrangement served as a basis for the Department's treatment of Lamina
y Placa as a producer in the 1998-1999 Preliminary Results (unchanged
in the final results and amended final results) and its decision to
collapse both companies as a single entity.\1\ See TUNA's and Lamina y
Placa's submission, dated July 28, 2010 at 1 and 2. As a result, Lamina
y Placa claim that prior to the asset transfer and corporate merger, it
sold merchandise to its own customers, while TUNA sold merchandise to
only a few direct customers. See TUNA's and Lamina y Placa's
submission, dated July 28, 2010 at 7-8 and Exhibit 7. However, since
the asset transfer and corporate merger, Lamina y Placa explains it has
maintained the same customer base while also absorbing TUNA's former
direct customers. Id. at 7-8. Therefore, based on record information,
we preliminarily find that Lamina y Placa's customers include those of
TUNA's prior to the asset transfer and corporate merger.
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\1\ The Department also collapsed a third affiliated company,
Lamina y Placa Monterrey, which engaged in similar tolling
operations.
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For the reasons described above, we preliminarily find that Lamina
y Placa is the successor-in-interest to TUNA in accordance with 19 CFR
351.221(c)(3)(i). As such, Lamina y Placa is entitled to TUNA's cash-
deposit rate with respect to entries of subject merchandise. Should our
final results remain the same as these preliminary results, effective
the date of publication of the final results we will instruct U.S.
Customs and Border Protection to assign entries of merchandise produced
or exported by Lamina y Placa the antidumping duty cash-deposit rate
applicable to TUNA.
Public Comment
Any interested party may request a hearing within 15 days of
publication of this notice. See 19 CFR 351.310(c). Any hearing, if
requested, will be held 22 days after the date of publication of this
notice or the first working day thereafter. Interested parties may
submit
[[Page 71075]]
case briefs not later than 15 days after the date of publication of
this notice. See 19 CFR 351.309(c)(ii). Rebuttal briefs, which must be
limited to issues raised in case briefs, may be filed not later than 20
days after the date of publication of this notice. Parties who submit
case briefs or rebuttal briefs in this changed circumstances review are
requested to submit with each argument: (1) A statement of the issue;
and (2) a brief summary of the argument. Consistent with 19 CFR
351.216(e), we will issue the final results of this changed-
circumstances review no later than 270 days after the date on which
this review was initiated, or within 45 days of publication of these
preliminary results if all parties agree to our preliminary finding.
During the course of this antidumping duty changed circumstances
review, the cash deposit requirements for the subject merchandise
exported and manufactured by Lamina y Placa will continue to be the
all-others rate established in the investigation. See Notice of
Antidumping Duty Orders: Certain Circular Welded Non-Alloy Steel Pipe
from Brazil, the Republic of Korea (Korea), Mexico, and Venezuela, and
Amendment to Final Determination of Sales at Less Than Fair Value:
Certain Circular Welded Non-Alloy Steel Pipe from Korea, 57 FR 49453
(November 2, 1992).
This notice of initiation and preliminary results is published in
accordance with sections 751(b)(1) and 777(i)(1) of the Act, and 19 CFR
351.216 and 19 CFR 351.221(c)(3).
Dated: November 15, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 2010-29384 Filed 11-19-10; 8:45 am]
BILLING CODE 3510-DS-P