Preliminary Determination of Sales at Less Than Fair Value: Certain Carbon Steel Butt-Weld Pipe Fittings From Malaysia

DEPARTMENT OF COMMERCE

[A-557-808]

Preliminary Determination of Sales at Less Than Fair Value:

Certain Carbon Steel Butt-Weld Pipe Fittings From Malaysia

agency: Import Administration, International Trade Administration,

Department of Commerce.

effective date: October 4, 1994.

for further information contact: Thomas McGinty or Peter Wilkniss,

Office of Countervailing Investigations, Import Administration, U.S.

Department of Commerce, 14th Street and Constitution Avenue, NW.,

Washington, DC 20230; telephone (202) 482-5055 and (202) 482-0588,

respectively.

preliminary determination: We preliminarily determine that imports of

certain carbon steel butt-weld pipe fittings (``pipe fittings'') from

Malaysia are being, or are likely to be, sold in the United States at

less than fair value, as provided in section 733 of the Tariff Act of

1930, as amended (the Act). The estimated margins are shown in the

``Suspension of Liquidation'' section of this notice.

Case History

Since the initiation of this investigation on March 21, 1994, (59

FR 14148, March 25, 1994), the following events have occurred.

On April 14, 1994, the U.S. International Trade Commission (ITC)

issued an affirmative preliminary injury determination (see, ITC

Investigation No. 731-TA-691).

In accordance with 19 CFR 353.42(b) (1994), on April 29, 1994, the

Department of Commerce (the Department) issued its antidumping duty

questionnaire to Malaysia Mining Corporation Pipe & Fitting Sdn Bhd

(MMCPNF), the Malaysian company identified by both petitioner and the

U.S. Embassy in Malaysia (by cable to the Department) as the primary

exporter of the subject merchandise to the U.S. during the POI.

On May 27, 1994, the Department received a letter from the

Government of Malaysia stating that MMCPNF was placed in receivership

in October 1993, ceased production at that time, and is currently in

the process of selling its assets. Therefore, MMCPNF would not be

responding to the Department's antidumping duty questionnaire.

On June 3, 1994, the Department received a letter from petitioner

in which the petitioner named another Malaysian producer of pipe

fittings, Taiyo Steel Corporation (Taiyo). In order to ensure that all

potential respondents were identified, we then cabled the U.S. Embassy

in Malaysia a second time requesting information on Taiyo and any other

Malaysian producers of pipe fittings. The U.S. Embassy responded that

no company by that name could be found and identified no other

Malaysian producers of pipe fittings.

On June 30, 1994, petitioner requested a 50-day postponement of the

preliminary determination. The request was granted by the Department on

July 19, 1994 (59 FR 37961, July 26, 1994).

On August 4, 1994, the Department received an amendment to the

petition alleging that critical circumstances exist with respect to

imports of pipe fittings from Malaysia. In accordance with section

735(a)(3) of the Act, on August 12, 1994, the Department issued a

letter to MMCPNF requesting monthly volume and value shipment data for

the period January 1, 1992, through September 27, 1994. The Department

has received no reply to this request.

Scope of Investigation

The products covered by this investigation are certain carbon steel

butt-weld pipe fittings (``pipe fittings'') having an inside diameter

of less than fourteen inches (355 millimeters), imported in either

finished or unfinished condition. Pipe fittings are formed or forged

steel products used to join pipe sections in piping systems where

conditions require permanent welded connections, as distinguished from

fittings based on other methods of fastening (e.g., threaded, grooved,

or bolted fittings). Butt-weld fittings come in a variety of shapes

which include ``elbows,'' ``tees,'' ``caps,'' and ``reducers.'' The

edges of finished pipe fittings are beveled, so that when a fitting is

placed against the end of a pipe (the ends of which have also been

beveled), a shallow channel is created to accommodate the ``bead'' of

the weld which joins the fitting to the pipe. These pipe fittings are

currently classifiable under subheading 7307.93.3000 of the Harmonized

Tariff Schedule of the United States (``HTSUS'').

Although the HTSUS subheading is provided for convenience and

customs purposes, our written description of the scope of this

proceeding is dispositive.

Period of Investigation

The period of investigation is September 1, 1993, through February

28, 1994.

Best Information Available

MMCPNF did not respond to our questionnaire. Therefore, we have

based our preliminary determination on best information available (BIA)

pursuant to section 776(c) of the Act, which provides that the

Department shall use BIA when a company identified by the Department as

a respondent refuses to provide requested information.

In determining what rate to use as BIA, the Department follows a

two-tiered methodology, whereby the Department normally assigns lower

margins to those respondents who cooperated in an investigation and

margins based on more adverse assumptions for those respondents who did

not cooperate in an investigation. According to this methodology, as

outline in the Final Determination of Sales at Less Than Fair Value:

Antifriction Bearings, Other Than Tapered Roller Bearings, from

Germany, 54 FR 18992, 19033 (May 3, 1989), when a company refuses to

provide the information requested in the form required, or otherwise

significantly impedes the Department's investigation, it is appropriate

for the Department to assign to that company the higher of 1) the

highest margin alleged in the petition, or 2) the highest calculated

rate of any respondent in the investigation. (See Allied Signal

Aerospace Co. v. United States, 996 F. 2d 1185,1191-92 (Fed. Cir.

1993).) Because there were no cooperative respondents in this

investigation, we are assigning to all exporters, as BIA, the highest

margin calculated in the petition, adjusted for methodological errors

as explained in the Department's initiation notice. The adjusted rate

is 194.7 percent.

Critical Circumstances

Petitioner has alleged that critical circumstances exist with

respect to imports of the subject merchandise from Malaysia. Section

735(a)(3) of the Act provides that the Department will determine that

critical circumstances exist if:

(A)(i) There is a history of dumping in the U.S. or elsewhere of

the class or kind of merchandise which is the subject of this

investigation, or

(ii) The person by whom, or for whose account, the merchandise was

imported knew or should have known that the exporter was selling the

merchandise which is the subject of the investigation at less than its

fair value, and

(B) There have been massive imports of the class or kind of

merchandise which is the subject of this investigation over a

relatively short period.

Since MMCPNF did not respond to our letter of August 12, 1994, we

preliminarily determine, as BIA, pursuant to section 776(c) of the Act,

that critical circumstances exist with respect to imports of pipe

fittings from Malaysia.

Suspension of Liquidation

In accordance with section 733(d)(1) of the Act and 19 CFR

353.16(c), we are directing the Customs Service to suspend liquidation

of all entries of pipe fittings from Malaysia that are entered, or

withdrawn from warehouse, for consumption on or after the date 90 days

prior to the date of publication of this notice in the Federal

Register. The Customs Service shall require a cash deposit or posting

of a bond equal to the estimated preliminary dumping margin, as shown

below. The suspension of liquidation will remain in effect until

further notice.

------------------------------------------------------------------------

Margin

Manufacturer/producer/exporter percentage

------------------------------------------------------------------------

All companies............................................... 194.70

------------------------------------------------------------------------

ITC Notification

In accordance with section 733(f) of the Act, we have notified the

ITC of our determination. If our final determination is affirmative,

the ITC will determine whether these imports are materially injuring,

or threaten material injury to, the U.S. industry before the later of

120 days after the date of this preliminary determination or 45 days

after our final determination.

Public Comment

In accordance with 19 CFR 353.38(b), we will hold a public hearing,

if requested, to afford interested parties an opportunity to comment on

arguments raised in case or rebuttal briefs. Interested parties who

wish to request a hearing, or to participate in one is requested, must

submit a written request to the Assistant Secretary for Import

Administration, U.S. Department of Commerce, room B-099, within ten

days of the publication of this notice. Tentatively, this hearing will

be held on November 28, 1994, at 1:00 p.m. at the U.S. Department of

Commerce, room 1414, 14th Street and Constitution Avenue, N.W.,

Washington, D.C. 20230. Parties should confirm by telephone the time,

date, and place of the hearing 48 hours before the scheduled time.

Requests should contain: (1) The party's name, address, and

telephone number; (2) the number of participants; and (3) a list of the

issues to be discussed. In accordance with 19 CFR 353.38, case briefs

or other written comments in at least five copies must be submitted to

the Assistant Secretary for Import Administration no later than

November 16, 1994, and rebuttal briefs, no later than November 23,

1994. In accordance with 19 CFR 353.38(b), oral presentations will be

limited to issues raised in the briefs.

If this investigation proceeds normally, we will make our final

determination within 75 days of the signing of this preliminary

determination.

This determination is published pursuant to section 733(f) of the

Act and 19 CFR 353.15(a)(4).

Dated: September 26, 1994.

Susan G. Esserman,

Assistant Secretary for Import Administration.

[FR Doc. 94-24542 Filed 10-3-94; 8:45 am]

BILLING CODE 3510-DS-M