[Federal Register Volume 76, Number 62 (Thursday, March 31, 2011)]
[Notices]
[Pages 17819-17825]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-7621]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-930]
Circular Welded Austenitic Stainless Pressure Pipe From the
People's Republic of China: Preliminary Results of Antidumping Duty
Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
DATES: Effective Date: March 31, 2011.
SUMMARY: The Department of Commerce (``the Department'') is conducting
the first administrative review of the
[[Page 17820]]
antidumping duty order on circular welded austenitic stainless pressure
pipe (``austenitic pipe'') from the People's Republic of China
(``PRC''). The period of review (``POR'') is September 5, 2008, through
February 28, 2010. The Department has preliminarily determined that
sales have not been made below normal value (``NV'') by the respondent
during the POR. Interested parties are invited to comment on these
preliminary results. We intend to issue the final results of this
review no later than 120 days from the date of publication of this
notice.
FOR FURTHER INFORMATION CONTACT: Brandon Farlander or Patrick O'Connor,
AD/CVD Operations, Office 4, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, NW., Washington, DC 20230, telephone: (202) 482-
0182 or (202) 482-0989 respectively.
SUPPLEMENTARY INFORMATION:
Background
On March 17, 2009, the Department published in the Federal Register
the antidumping duty order on austenitic pipe from the PRC.\1\ On March
1, 2010, the Department published a notice of opportunity to request an
administrative review of the austenitic pipe order.\2\
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\1\ See Antidumping Duty Order: Circular Welded Austenitic
Stainless Pressure Pipe from the People's Republic of China, 74 FR
11351 (March 17, 2009).
\2\ See Antidumping or Countervailing Duty Order, Finding, or
Suspended Investigation; Opportunity To Request Administrative
Review, 75 FR 9162 (March 1, 2010).
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The Department received a timely request for an administrative
review of the austenitic pipe order from Zhejiang Jiuli Hi-Tech Metals
Co., Ltd. (``Jiuli TC'') on March 31, 2010, in accordance with section
751(a) of Tariff Act of 1930, as amended (the ``Act''). On April 27,
2010, the Department published in the Federal Register a notice of
initiation of an administrative review of the austenitic pipe order.\3\
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\3\ See Initiation of Antidumping and Countervailing Duty
Administrative Reviews and Request for Revocation in Part, 75 FR
22107 (April 27, 2010).
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The Department issued its initial and supplemental questionnaires
to Jiuli TC from May to December 2010. The Department received
questionnaire responses from June to December 2010. On July 30, 2010,
Petitioners \4\ submitted comments to the Department regarding certain
submissions and responses of Jiuli TC.
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\4\ Petitioners are Bristol Metals, LLC; Felker Brothers
Corporation; Marcegaglia U.S.A., Inc.; and Outokumpu Stainless
Products.
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On September 15, 2010, the Department released a letter to
interested parties which listed potential surrogate countries and
invited interested parties to comment on surrogate country and
surrogate value (``SV'') selection. Between August and October 2010,
Petitioners and Jiuli TC submitted publicly available SV information,
as well as comments and rebuttal comments on the selection of a
surrogate country and SVs. For a discussion of the selection of the
surrogate country, see ``Surrogate Country'' section below.
On November 19, 2010, pursuant to section 751(a)(3)(A) of the Act,
the Department extended the time period for completing the preliminary
results of review by 120 days.\5\
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\5\ See Circular Welded Austenitic Stainless Pressure Pipe From
the People's Republic of China: Extension of the Time Limit for the
Preliminary Results of the Antidumping Duty Administrative Review,
75 FR 70908 (November 19, 2010).
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From January 10 to January 14, 2011, the Department conducted a
verification of Jiuli TC in the PRC. On January 26 and 27, 2011, the
Department verified Jiuli TC's U.S. affiliate in Houston, Texas.
Scope of the Order
The merchandise covered by the order is circular welded austenitic
stainless pressure pipe not greater than 14 inches in outside diameter.
This merchandise includes, but is not limited to, the American Society
for Testing and Materials (``ASTM'') A-312 or ASTM A-778
specifications, or comparable domestic or foreign specifications. ASTM
A-358 products are only included when they are produced to meet ASTM A-
312 or ASTM A-778 specifications, or comparable domestic or foreign
specifications. Excluded from the scope are: (1) Welded stainless
mechanical tubing, meeting ASTM A-554 or comparable domestic or foreign
specifications; (2) boiler, heat exchanger, superheater, refining
furnace, feedwater heater, and condenser tubing, meeting ASTM A-249,
ASTM A-688 or comparable domestic or foreign specifications; and (3)
specialized tubing, meeting ASTM A-269, ASTM A-270 or comparable
domestic or foreign specifications.
The subject imports are normally classified in subheadings
7306.40.5005; 7306.40.5040; 7306.40.5062; 7306.40.5064; and
7306.40.5085 of the Harmonized Tariff Schedule of the United States
(``HTSUS''). They may also enter under HTSUS subheadings 7306.40.1010;
7306.40.1015; 7306.40.5042; 7306.40.5044; 7306.40.5080; and
7306.40.5090. The HTSUS subheadings are provided for convenience and
customs purposes only, the written description of the scope of the
order is dispositive.
Verification
As provided in section 782(i) of the Act, we verified the
information provided by Jiuli TC using standard verification procedures
including on-site inspection of the manufacturer's facilities and the
examination of relevant sales and financial records. Our verification
results are outlined in the PRC and U.S. verification reports,\6\ the
public versions of which are available in the Central Records Unit,
Room 7046 of the main Department building.
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\6\ See memoranda to the file through Howard Smith, Program
Manager, AD/CVD Operations, Office 4, entitled ``Verification of the
Questionnaire Responses of Zhejiang Jiuli Hi-Tech Metals Co., Ltd.''
(``PRC verification report'') and ``Verification of the
Questionnaire Responses of Zhejiang Jiuli Hi-Tech Metals Co., Ltd.'s
(``Jiuli TC'') U.S. affiliate Jiuli USA, Inc.'', dated February 25,
2011.
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Affiliation and Collapsing
Based on the evidence presented in Jiuli TC's questionnaire
responses and at verification, which is that Jiuli TC owns 75 percent
of Huzhou Jiuli Welded Stainless Steel Pipe Co., Ltd. (``Jiuli SD
Co.''), we preliminarily find affiliation between Jiuli TC and Jiuli SD
Co. pursuant to section 771(33)(E) of the Act.
In addition, pursuant to 19 CFR 351.401(f), the Department will
treat affiliated producers as a single entity, or ``collapse'' them,
where: (1) The producers have production facilities for producing
similar or identical products that would not require substantial
retooling of either facility in order to restructure manufacturing
priorities; and (2) there is a significant potential for manipulation
of price or production. In determining whether a significant potential
for manipulation exists, 19 CFR 351.401(f)(2) states that the
Department may consider various factors, including: (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; and (iii) whether the operations of the affiliated
firms are intertwined 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.
The Department preliminarily concludes that the totality of the
record evidence supports collapsing Jiuli TC and Jiuli SD Co. into a
single entity, pursuant to 19 CFR 351.401(f)(1) and (2). Accordingly,
the Department preliminarily based its margin
[[Page 17821]]
calculation on information submitted pertaining to Jiuli TC and Jiuli
SD Co. For further discussion on the Department's decision to collapse
Jiuli TC with Jiuli SD Co., see the memorandum to Abdelali Elouaradia,
Office Director, ``Whether to Collapse Zhejiang Jiuli Hi-Tech Metals
Co., Ltd. and Huzhou Jiuli Welded Stainless Steel Pipe Co., Ltd.'',
dated concurrently with this notice.\7\
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\7\ We are treating Zhejiang Jiuli Hi-Tech Metals Co., Ltd. and
Huzhou Jiuli Welded Stainless Steel Pipe Co., Ltd. as the combined
entity, ``Jiuli TC.''
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Non-Market Economy Treatment
In every case conducted by the Department involving the PRC, the
PRC has been treated as a non-market economy (``NME'') country. In
accordance with section 771(18)(C)(i) of the Act, any determination
that a foreign country is an NME country shall remain in effect until
revoked by the administering authority. No party has challenged the
designation of the PRC as an NME country in this review. Accordingly,
the Department calculated NV in accordance with section 773(c) of the
Act, which applies to NME countries.
Surrogate Country
When the Department reviews imports from an NME country, section
773(c)(1) of the Act directs it to base NV, in most circumstances, on
the NME producer's factors of production (``FOPs'') valued in a
surrogate market-economy country or countries considered to be
appropriate by the Department. In accordance with section 773(c)(4) of
the Act, in valuing the FOPs, the Department shall utilize, to the
extent possible, the prices or costs of FOPs in one or more market-
economy countries that are: (A) At a level of economic development
comparable to that of the NME country, and (B) significant producers of
comparable merchandise. Further, pursuant to 19 CFR 351.408(c)(2), the
Department will normally value all FOPs in a single country, except for
labor.
During this review, the Department identified India, the
Philippines, Indonesia, Thailand, Ukraine, and Peru as a non-exhaustive
list of countries that are at a level of economic development
comparable to the PRC and for which good quality data is most likely
available.\8\ Once the countries that are economically comparable to
the PRC have been identified, the Department selects an appropriate
surrogate country by determining whether an economically comparable
country is a significant producer of comparable merchandise and whether
the data for valuing FOPs are both available and reliable.
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\8\ See Memorandum from Carole Showers, Director, Office of
Policy, to Howard Smith, Program Manager, AD/CVD Operations, Office
4, ``Request for a List of Surrogate Countries for an Administrative
Review of the Antidumping Duty Order on Circular Welded Austenitic
Stainless Pressure Pipe'' (August 30, 2010).
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The Department has preliminarily determined that it is appropriate
to use India as a surrogate country pursuant to section 773(c)(4) of
the Act based on the following: (A) It is at a level of economic
development comparable to the PRC; (B) it is a significant producer of
comparable merchandise.\9\ Also, there is reliable data from India that
can be used to value the FOPs. Thus, the Department calculated NV using
publicly available Indian prices when available and appropriate to
value the FOPs of Jiuli TC.\10\
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\9\ See the financial statements of Ratnamani Metals & Tubes,
Ltd. (``Ratnamani'') and Jindal SAW, Ltd. (``Jindal'') for the
fiscal year January 1, 2009, through March 31, 2010, in Petitioners'
October 12, 2010 SV submission at Exhibits 10 and 11. Ratnamani's
and Jindal's financial statements at 2, 39, 41, 42, and 44 and at
19, 26-29, 71, and 72, respectively, demonstrate that these
companies produce merchandise both identical and comparable to
subject merchandise. Hence, based on Ratnamani's and Jindal's
production experience during the POR, we determine that India is a
significant producer of identical and comparable merchandise.
\10\ See Memorandum to the File from Brandon Farlander and
Patrick O'Connor, International Trade Compliance Analysts, AD/CVD
Operations, Office 4, ``Administrative Review of Circular Welded
Austenitic Stainless Pressure Pipe from the People's Republic of
China: Surrogate Value Memorandum,'' (March 25, 2011) (``Surrogate
Value Memorandum'').
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In accordance with 19 CFR 351.301(c)(3)(ii), interested parties may
submit publicly-available information to value FOPs until 20 days after
the date of publication of the preliminary results of this review.\11\
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\11\ In accordance with 19 CFR 351.301(c)(1), for the final
results of this administrative review, interested parties may submit
factual information to rebut, clarify, or correct factual
information submitted by an interested party less than ten days
before, on, or after, the applicable deadline for submission of such
factual information. However, the Department notes that 19 CFR
351.301(c)(1) permits new information only insofar as it rebuts,
clarifies, or corrects information placed on the record. The
Department generally will not accept the submission of additional,
previously absent-from-the-record alternative surrogate value
information pursuant to 19 CFR 351.301(c)(1). See Glycine from the
People's Republic of China: Final Results of Antidumping Duty
Administrative Review and Final Rescission, in Part, 72 FR 58809
(October 17, 2007) and accompanying Issues and Decision Memorandum
at Comment 2.
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Separate Rates
In proceedings involving NME countries, the Department holds a
rebuttable presumption that all companies within the country are
subject to government control and thus should be assessed a single
antidumping duty rate. It is the Department's policy to assign all
exporters of subject merchandise in an NME country this single rate
unless an exporter can demonstrate that it is sufficiently independent
so as to be entitled to a separate rate. Exporters can demonstrate this
independence through the absence of both de jure and de facto
governmental control over export activities. The Department analyzes
each entity exporting the subject merchandise under the test announced
in the Final Determination of Sales at Less Than Fair Value: Sparklers
from the People's Republic of China, 56 FR 20588 (May 6, 1991)
(``Sparklers''), as further developed in Notice of 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'').
However, if the Department determines that a company is wholly foreign-
owned or located in a market economy, then a separate rate analysis is
not necessary to determine whether it is independent from government
control.\12\
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\12\ See Notice of Final Determination of Sales at Less Than
Fair Value: Creatine Monohydrate From the People's Republic of
China, 64 FR 71104, 71105 (December 20, 1999) (where the respondent
was wholly foreign-owned and thus qualified for a separate rate).
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Jiuli TC provided evidence that it is a publicly traded company on
the Shenzhen Stock Exchange with Jiuli Group Joint Stock Ltd., a
Chinese entity, as its primary shareholder.\13\
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\13\ See Jiuli TC's Section A response, dated June 7, 2010, at
3-5 and PRC verification report at 5.
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Thus, the Department has analyzed whether Jiuli TC has demonstrated
the absence of de jure and de facto governmental control over its
export activities.
a. Absence of De Jure Control
The Department considers the following de jure criteria in
determining whether an individual company may be granted a separate
rate: (1) An absence of restrictive stipulations associated with an
individual exporter's business and export license; (2) legislative
enactments decentralizing control of companies; and (3) other formal
measures by the government decentralizing control of companies.\14\
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\14\ See Sparklers, 56 FR at 20589.
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The evidence provided by Jiuli TC supports a preliminary finding of
de jure absence of governmental control based on the following: (1) An
absence of restrictive stipulations associated with the individual
exporter's business and export licenses; (2) the existence of
applicable legislative enactments
[[Page 17822]]
decentralizing control of Chinese companies; and (3) the implementation
of formal measures by the government decentralizing control of Chinese
companies.\15\
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\15\ See Jiuli TC's Section A response, dated June 7, 2010, at
3-5 and PRC verification report at 5-7.
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b. Absence of De Facto Control
The Department 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 are subject to
the approval of a governmental agency; (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 disposition of profits or financing of
losses.\16\ The Department has determined that an analysis of de facto
control is critical in determining whether respondents are, in fact,
subject to a degree of governmental control which would preclude the
Department from assigning separate rates.
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\16\ See Silicon Carbide, 59 FR at 22586-87; see also Notice of
Final Determination of Sales at Less Than Fair Value: Furfuryl
Alcohol From the People's Republic of China, 60 FR 22544, 22545 (May
8, 1995).
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The evidence provided by Jiuli TC supports a preliminary finding of
de facto absence of governmental control based on statements and
supporting documentation showing that the company: (1) Set its own
export prices independent of the government and without the approval of
a government authority; (2) has the authority to negotiate and sign
contracts and other agreements; (3) maintains autonomy from the
government in making decisions regarding the selection of management;
and (4) retains the proceeds of its export sales and makes independent
decisions regarding disposition of profits or financing of losses.\17\
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\17\ See Jiuli TC's Section A response, dated June 7, 2010, at
5-7 and PRC verification report at 7-9.
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Therefore, the evidence placed on the record of this review by
Jiuli TC demonstrates an absence of de jure and de facto government
control under the criteria identified in Sparklers and Silicon Carbide.
Accordingly, the Department has preliminarily granted Jiuli TC separate
rate status.\18\
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\18\ See ``Preliminary Results of Review'' section below.
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Fair Value Comparison
In accordance with section 777A(d)(2) of the Act, to determine
whether sales of austenitic pipe to the United States by Jiuli TC were
made at less than NV, the Department compared the weighted-average
export price (``EP'') and constructed export price (``CEP'') to NV, as
described in the ``U.S. Price'' and ``Normal Value'' sections of this
notice.
U.S. Price
In accordance with section 772(a) of the Act, the Department used
EP as the basis for U.S. price for Jiuli TC's sales where the first
sale to unaffiliated purchasers was made prior to importation. In
accordance with section 772(c) of the Act, the Department calculated EP
for Jiuli TC by deducting inland freight from the plant to the port,
domestic brokerage and handling, international freight and marine
insurance expenses from the starting price charged to the first
unaffiliated customer in the United States.\19\ In accordance with
section 772(b) of the Act, the Department used CEP as the basis for
U.S. price for Jiuli TC's sales where Jiuli TC first sold subject
merchandise to its affiliated company in the United States (Jiuli USA,
Inc.), which in turn sold subject merchandise to unaffiliated U.S.
customers. In accordance with section 772(b) of the Act, CEP is the
price at which the subject merchandise is first sold (or agreed to be
sold) in the United States before or after the date of importation by
or for the account of the producer or exporter of such merchandise or
by a seller affiliated with the producer or exporter, to a purchaser
not affiliated with the producer or exporter, as adjusted under
sections 772(c) and (d) of the Act. The Department calculated CEP for
Jiuli TC based on prices to unaffiliated purchasers in the United
States and made deductions, where applicable, from the U.S. sales price
for movement expenses (inland freight from the plant to the port and
domestic brokerage and handling), in accordance with section
772(c)(2)(A) of the Act.\20\ In accordance with section 772(d)(1) of
the Act, the Department deducted early payment discounts, credit
expenses and indirect selling expenses from the U.S. price, all of
which relate to commercial activity in the United States. Also, the
Department deducted CEP profit, in accordance with sections 772(d)(3)
and 772(f) of the Act. Additionally, for the expenses that were either
provided by an NME vendor or paid for using an NME currency, the
Department based the expenses on SVs, as appropriate. For details
regarding the CEP calculation, see Jiuli TC Analysis Memorandum.
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\19\ See memorandum from Brandon Farlander and Patrick O'Connor,
International Trade Compliance Analysts, AD/CVD Operations, Office
4, to the File, ``Administrative Review of Circular Welded
Austenitic Stainless Pressure Pipe from the People's Republic of
China: Preliminary Analysis Memorandum for Zhejiang Jiuli Hi-Tech
Metals Co., Ltd.'' (March 25, 2011) (``Jiuli TC Analysis
Memorandum'').
\20\ See Jiuli TC Analysis Memorandum.
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Normal Value
Section 773(c)(1) of the Act provides that the Department shall
determine NV using an FOP methodology if the merchandise is exported
from an NME country and the information does not permit the calculation
of NV using home-market prices, third-country prices, or constructed
value under section 773(a) of the Act. The Department bases NV on FOPs
because the presence of government controls on various aspects of NMEs
renders price comparisons and the calculation of production costs
invalid under the Department's normal methodologies.\21\
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\21\ See, e.g., Preliminary Determination of Sales at Less Than
Fair Value, Affirmative Critical Circumstances, In Part, and
Postponement of Final Determination: Certain Lined Paper Products
from the People's Republic of China, 71 FR 19695, 19703 (April 17,
2006), unchanged in Notice of Final Determination of Sales at Less
Than Fair Value, and Affirmative Critical Circumstances, In Part:
Certain Lined Paper Products From the People's Republic of China, 71
FR 53079 (September 8, 2006).
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Under section 773(c)(3) of the Act, FOPs include, but are not
limited to: (1) Hours of labor required; (2) quantities of raw
materials employed; (3) amounts of energy and other utilities consumed;
and (4) representative capital costs, including depreciation. The
Department based NV on FOPs and consumption quantities reported by
Jiuli TC for materials, energy, labor and packing.
Factor Valuation Methodology
In accordance with section 773(c) of the Act, the Department
calculated NV based on FOP data reported by Jiuli TC. To obtain the
input costs used to calculate NV, the Department multiplied the
reported per-unit factor-consumption rates by publicly available Indian
SVs. As appropriate, the Department adjusted input prices by including
freight costs to make them delivered prices. Specifically, the
Department added to Indian import SVs a surrogate freight cost using
the shorter of the reported distance from the domestic supplier to the
respondent's factory or the distance from the nearest seaport to the
respondent's factory where appropriate. This adjustment is in
accordance with the Court of Appeals for the Federal Circuit's decision
in
[[Page 17823]]
Sigma Corp. v. United States, 117 F.3d 1401, 1407-08 (Fed. Cir. 1997).
A detailed description of all SVs used for Jiuli TC can be found in the
Surrogate Value Memorandum.
In selecting SVs, the Department considered the quality,
specificity, and contemporaneity of the data.\22\ Further, in
accordance with section 773(c)(1) of the Act and Departmental practice,
the Department selected, to the extent practicable, SVs which are non-
export average values, contemporaneous with the POR, product-specific,
and tax-exclusive.\23\ In the instant review, the Department used
Indian import statistics from the Global Trade Atlas (``GTA''), as
published by Global Trade Information Services, and other publicly
available Indian sources in order to calculate SVs for Jiuli TC's FOPs
(i.e., direct materials, energy, packing materials) and certain
movement expenses. The record shows that data in the GTA Indian import
statistics, as well as those from the other Indian sources, are
contemporaneous with the POR, product-specific, and tax-exclusive.\24\
In those instances where we could not obtain publicly available
information contemporaneous to the POR with which to value factors, we
adjusted the SVs using, where appropriate, the Indian Wholesale Price
Index as published in the International Monetary Fund's International
Financial Statistics.\25\
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\22\ See, e.g., Fresh Garlic From the People's Republic of
China: Final Results of Antidumping Duty New Shipper Review, 67 FR
72139 (December 4, 2002) and accompanying Issues and Decision
Memorandum at Comment 6; Final Results of First New Shipper Review
and First Antidumping Duty Administrative Review: Certain Preserved
Mushrooms From the People's Republic of China, 66 FR 31204 (June 11,
2001) and accompanying Issues and Decision Memorandum at Comment 5.
\23\ See, e.g., Notice of Preliminary Determination of Sales at
Less Than Fair Value, Negative Preliminary Determination of Critical
Circumstances and Postponement of Final Determination: Certain
Frozen and Canned Warmwater Shrimp From the Socialist Republic of
Vietnam, 69 FR 42672, 42682 (July 16, 2004), unchanged in Final
Determination of Sales at Less Than Fair Value: Certain Frozen and
Canned Warmwater Shrimp From the Socialist Republic of Vietnam, 69
FR 71005 (December 8, 2004).
\24\ See Surrogate Value Memorandum at Exhibit 1.
\25\ See, e.g., Certain Kitchen Appliance Shelving and Racks
From the People's Republic of China: Preliminary Determination of
Sales at Less Than Fair Value and Postponement of Final
Determination, 74 FR 9591, 9600 (March 5, 2009), unchanged in
Certain Kitchen Appliance Shelving and Racks From the People's
Republic of China: Final Determination of Sales at Less than Fair
Value, 74 FR 36656 (July 24, 2009).
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Jiuli TC reported that one of its raw material inputs, steel, was
sourced in part from market-economy countries and paid for in market-
economy currencies. Pursuant to 19 CFR 351.408(c)(1), when a respondent
sources inputs from a market-economy supplier in meaningful quantities
(i.e., not insignificant quantities), the Department normally will only
use the actual price paid by the respondent to value those inputs
except when prices may have been distorted by findings of dumping by
the PRC and/or subsidies.\26\ Where the facts developed in either U.S.
or third-country countervailing duty findings include the existence of
subsidies that appear to be used generally (in particular, broadly
available, non-industry specific export subsidies), the Department will
have reason to believe or suspect that prices of the inputs from the
country granting the subsidies may be subsidized.\27\ Information
reported by Jiuli TC demonstrates that it did not purchase significant
quantities (i.e., 33 percent or more) of steel from market-economy
suppliers. Thus, to value steel, the Department weight-averaged the
market-economy purchase price and the appropriate surrogate value for
steel using the market economy and NME percentages of the reported
total volume of purchases.\28\ Where appropriate, we added freight to
the market-economy purchase price of steel.
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\26\ See Antidumping Duties; Countervailing Duties, 62 FR 27296,
27366 (May 19, 1997); see also Tapered Roller Bearings and Parts
Thereof, Finished and Unfinished, From the People's Republic of
China; Final Results of 1998-1999 Administrative Review, Partial
Rescission of Review, and Determination Not To Revoke Order in Part,
66 FR 1953 (January 10, 2001) (``TRBs 1998-1999''), and accompanying
Issues and Decision Memorandum at Comment 1.
\27\ See TRBs 1998-1999 at Comment 1; see also Tapered Roller
Bearings and Parts Thereof, Finished and Unfinished, From the
People's Republic of China; Final Results of 1999-2000
Administrative Review, Partial Rescission of Review, and
Determination Not To Revoke Order in Part, 66 FR 57420 (November 15,
2001), and accompanying Issues and Decision Memorandum at Comment 1;
China National Machinery Imp. & Exp. Corp. v. United States, 293 F.
Supp. 2d 1334, 1338-39 (Ct. Int'l Trade 2003).
\28\ See Antidumping Methodologies: Market Economy Inputs,
Expected Non-Market Economy Wages, Duty Drawback; and Request for
Comments, 71 FR 61716, 61717 (October 19, 2006) (``Antidumping
Methodologies'').
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In accordance with legislative history, the Department continues to
apply its long-standing practice of disregarding SVs if it has a reason
to believe or suspect the source data may be subsidized.\29\ In this
regard, the Department has previously found that it is appropriate to
disregard such prices from India, Indonesia, South Korea and Thailand
because we have determined that these countries maintain broadly
available, non-industry specific export subsidies.\30\ Based on the
existence of these subsidy programs that were generally available to
all exporters and producers in these countries at the time of the POR,
the Department finds that it is reasonable to infer that all exporters
from India, Indonesia, South Korea and Thailand may have benefitted
from these subsidies. Therefore, the Department has not used prices
from Indonesia, South Korea and Thailand in calculating the Indian
import-based SVs.
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\29\ Omnibus Trade and Competitiveness Act of 1988, Conf. Report
to Accompany H.R. 3, H.R. Rep. No. 576, 100th Cong., 2nd Sess.
(1988) at 590.
\30\ See e.g., Carbazole Violet Pigment 23 from India: Final
Results of the Expedited Five-year (Sunset) Review of the
Countervailing Duty Order, 75 FR 13257 (March 19, 2010) and
accompanying Issues and Decision Memorandum at 4-5; Certain Cut-to-
Length Carbon-Quality Steel Plate from Indonesia: Final Results of
Expedited Sunset Review, 70 FR 45692 (August 8, 2005) and
accompanying Issues and Decision Memorandum at 4; Corrosion-
Resistant Carbon Steel Flat Products from the Republic of Korea:
Final Results of Countervailing Duty Administrative Review, 74 FR
2512 (January 15, 2009) and accompanying Issues and Decision
Memorandum at 17, 19-20; Final Affirmative Countervailing Duty
Determination: Certain Hot-Rolled Carbon Steel Flat Products From
Thailand, 66 FR 50410 (October 3, 2001) and accompanying Issues and
Decision Memorandum at 23.
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Additionally, the Department disregarded prices from NME countries.
Finally, imports that were labeled as originating from an
``unspecified'' country were excluded from the average value because
the Department could not be certain that they were not from either an
NME country or a country with general export subsidies.\31\
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\31\ See Polyethylene Terephthalate Film, Sheet, and Strip from
the People's Republic of China: Preliminary Determination of Sales
at Less Than Fair Value, 73 FR 24552, 24559 (May 5, 2008), unchanged
in Polyethylene Terephthalate Film, Sheet, and Strip from the
People's Republic of China: Final Determination of Sales at Less
Than Fair Value, 73 FR 55039 (September 24, 2008).
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On May 14, 2010, the Court of Appeals for the Federal Circuit
(``CAFC'') in Dorbest Ltd. v. United States, 604 F.3d 1363, 1372 (CAFC
2010), found that the {regression-based{time} method for calculating
wage rates, as stipulated by 19 CFR 351.408(c)(3), uses data not
permitted by the statutory requirements laid out in section 773 of the
Act (i.e., 19 U.S.C. 1677b(c)).
The Department is continuing to evaluate options for determining
labor values in light of the recent CAFC decision. However, for these
preliminary results, we have calculated an hourly wage rate to use in
valuing the respondent's reported labor input by averaging industry-
specific earnings and/or wages in countries that are economically
comparable to the PRC and that are significant producers of comparable
merchandise.
For the preliminary results of this review, the Department is
valuing labor
[[Page 17824]]
using a simple average industry-specific wage rate using earnings or
wage data reported under Chapter 5B by the International Labor
Organization (``ILO''). To achieve an industry-specific labor value, we
relied on industry-specific labor data from the countries we determined
to be both economically comparable to the PRC and significant producers
of comparable merchandise. A full description of the industry-specific
wage rate calculation methodology is provided in the Surrogate Value
Memorandum. The Department calculated a simple average industry-
specific wage rate of $1.36 for these preliminary results.
Specifically, for this review, the Department has calculated the wage
rate using a simple average of the data provided to the ILO under Sub-
Classification 28 of the ISIC--Revision 3 standard by countries
determined to be both economically comparable to the PRC and
significant producers of comparable merchandise. The Department finds
the two-digit description under International Standard Industrial
Classification--Revision 3 (``Manufacture of fabricated metal products,
except machinery and equipment'') to be the best available wage rate
surrogate value on the record because it is specific and derived from
industries that produce merchandise comparable to the subject
merchandise. Consequently, we averaged the ILO industry-specific wage
rate data or earnings data available from the following countries found
to be economically comparable to the PRC and significant producers of
comparable merchandise: Ecuador, Egypt, Indonesia, Jordan, Peru, the
Philippines, Thailand, and Ukraine.\32\ For further information on the
calculation of the wage rate, see Surrogate Value Memorandum.
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\32\ Because India (the primary surrogate country) did not
report wage data in ISIC-Revision 3, which was relied upon for
industry-specific wage rates in these preliminary results, it is not
among the countries that the Department considered for inclusion in
the average.
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The Department valued truck freight expenses using a per-unit
average rate calculated from data on the infobanc Web site: http://www.infobanc.com/logistics/logtruck.htm. The logistics section of this
Web site contains inland freight truck rates between many large Indian
cities. The value is contemporaneous with the POR.\33\
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\33\ See Surrogate Value Memorandum at Exhibit 11.
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The Department valued electricity using price data for small,
medium, and large industries, as published by the Central Electricity
Authority of the Government of India in its publication entitled
``Electricity Tariff & Duty and Average Rates of Electricity Supply in
India,'' dated March 2008. These electricity rates represent actual
country-wide, publicly available information on tax-exclusive
electricity rates charged to small, medium, and large industries in
India. We did not inflate this value because utility rates represent
current rates, as indicated by the effective dates listed for each of
the rates provided.\34\ We valued water using the revised Maharashtra
Industrial Development Corporation water rates available at http://www.midcindia.com/water-supply.
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\34\ See Surrogate Value Memorandum at Exhibit 7.
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At verification, we obtained records from one month of the POR
which allow us to calculate a scrap offset that is more specific to
subject merchandise than Jiuli TC's reported scrap offset. We do not,
however, have these records for the entire POR. Because necessary
information is not on the record for the entire POR, pursuant to
section 776(a) of the Act, as facts available, we are basing Jiuli TC's
POR scrap offset for subject merchandise on record information obtained
at verification for one month of the POR. See Surrogate Value
Memorandum.
The Department valued brokerage and handling expenses using a price
list for procedures necessary to export a standardized cargo of goods
in India. The price list is compiled based on a survey of the
procedural requirements for trading a standard shipment of goods by
ocean freight in India that is published in Doing Business 2009: India
by the World Bank. Because these data were current throughout the POR,
we did not inflate the value for brokerage and handling.\35\
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\35\ See Surrogate Value Memorandum at Exhibit 13.
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The Department valued factory overhead, selling, general, and
administrative expenses, and profit using data from two Indian
companies, Ratnamani and Jindal, producers of merchandise both
identical and comparable to the subject merchandise, for the fiscal
year January 1, 2009, through March 31, 2010.\36\
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\36\ See Surrogate Value Memorandum at Exhibit 9. Also note that
Jindal changed its financial reporting period from the calendar year
(January 1 to December 31) to the Indian fiscal calendar year (April
1 to March 31). As a result, Jindal's 2009-2010 financial statement
shows a 15 month period (January 1, 2009, to March 31, 2010) because
it reflects this transition.
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Currency Conversion
The Department made currency conversions into U.S. dollars, in
accordance with section 773A(a) of the Act, based on the exchange rates
in effect on the dates of the U.S. sales as certified by the Federal
Reserve Bank. These exchange rates are available on Import
Administration's Web site at http://ia.ita.doc.gov/exchange/index.html.
Preliminary Results of Review
The Department preliminarily determines that the following
weighted-average dumping margin exists:
------------------------------------------------------------------------
Weighted-average
Exporter percent margin
------------------------------------------------------------------------
Zhejiang Jiuli Hi-Tech Metals Co., Ltd./Huzhou 0.01
Jiuli Welded Stainless Steel Pipe Co., Ltd....
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Disclosure
The Department will disclose the calculations performed within five
days of the date of publication of this notice to parties in this
proceeding in accordance with 19 CFR 351.224(b).
Public Comment
Interested parties may submit written comments no later than 30
days after the date of publication of these preliminary results of
review.\37\ Parties that submit comments are requested to submit with
each argument a statement of the issue and a brief summary of the
argument. Rebuttal comments must be limited to the issues raised in the
written comments and may be filed no later than five days after the
deadline for filing case briefs.\38\ Parties submitting written
comments or rebuttals are requested to provide the Department with an
additional copy of those comments on CD-ROM. Any interested party may
request a hearing within 30 days of publication of these preliminary
results.\39\ Any hearing, if requested, ordinarily will be held two
days after the scheduled date for submission of rebuttal briefs.\40\
Parties should confirm
[[Page 17825]]
by telephone the date, time, and location of the hearing two days
before the scheduled date.
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\37\ See 19 CFR 351.309(c)(1)(ii).
\38\ See 19 CFR 351.309(d).
\39\ See 19 CFR 351.310(c).
\40\ See 19 CFR 351.310(d).
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The Department will issue the final results of the administrative
review, which will include the results of its analysis of issues raised
in the briefs, within 120 days of publication of these preliminary
results, in accordance with 19 CFR 351.213(h)(1) unless the time limit
is extended.
Assessment Rates
Pursuant to 19 CFR 351.212, the Department will determine, and U.S.
Customs and Border Protection (``CBP'') shall assess, antidumping
duties on all appropriate entries of subject merchandise in accordance
with the final results of this review. For assessment purposes, in
accordance with 19 CFR 351.212(b)(1), the Department calculated
exporter/importer (or customer)-specific assessment rates for
merchandise subject to this review. Where the respondent has reported
reliable entered values, the Department calculated importer (or
customer)-specific ad valorem rates by aggregating the dumping margins
calculated for all U.S. sales to each importer (or customer) and
dividing this amount by the total entered value of the sales to each
importer (or customer). See 19 CFR 351.212(b)(1). Where an importer (or
customer)-specific ad valorem rate is greater than de minimis, we will
apply the assessment rate to the entered value of the importer's/
customer's entries during the POR. See 19 CFR 351.212(b)(1). Where an
importer (or customer)-specific ad valorem rate is zero or de minimis
(i.e., less than 0.50 percent), the Department will instruct CBP to
liquidate that importer's (or customer's) entries of subject
merchandise without regard to antidumping duties. See 19 CFR
351.106(c)(2).
The Department intends to issue appropriate assessment instructions
directly to CBP 15 days after publication of the final results of this
review. The Department intends to instruct CBP to liquidate entries
containing subject merchandise exported by the PRC-wide entity at the
PRC-wide rate in the final results of this review.
Cash Deposit Requirements
The following cash deposit requirements will be effective upon
publication of the final results of this review for all shipments of
subject merchandise from the PRC entered, or withdrawn from warehouse,
for consumption on or after the publication date, as provided for by
section 751(a)(2)(C) of the Act: (1) For the exporter listed above, the
cash deposit rate will be that established in the final results of this
review (except, if the rate is zero or de minimis, i.e., less than 0.5
percent, a zero cash deposit rate will be required for that company);
(2) for previously investigated or reviewed PRC and non-PRC exporters
not listed above that have separate rates, the cash deposit rate will
continue to be the exporter-specific rate published for the most recent
period; (3) for all PRC exporters of subject merchandise which have not
been found to be entitled to a separate rate, the cash deposit rate
will be the PRC-wide rate of 55.21 percent; and (4) for all non-PRC
exporters of subject merchandise which have not received their own
rate, the cash deposit rate will be the rate applicable to the PRC
exporters that supplied that non-PRC exporter. These deposit
requirements, when imposed, shall remain in effect until further
notice.
Notification to Importers
This notice also serves as a preliminary reminder to importers of
their responsibility under 19 CFR 351.402(f) to file a certificate
regarding the reimbursement of antidumping duties prior to liquidation
of the relevant 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.
The Department is issuing and publishing these preliminary results
of administrative review in accordance with section 777(i)(1) of the
Act, and 19 CFR 351.221(b)(4).
Dated: March 25, 2011.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 2011-7621 Filed 3-30-11; 8:45 am]
BILLING CODE 3510-DS-P