Preliminary Affirmative Determination of Scope Inquiry on Antidumping Duty Orders on Certain Circular Welded Non-Alloy Steel Pipe From Brazil, the Republic of Korea, Mexico and Venezuela

DEPARTMENT OF COMMERCE

[A-201-805, A-580-809, A-351-809, A-307-805]

Preliminary Affirmative Determination of Scope Inquiry on

Antidumping Duty Orders on Certain Circular Welded Non-Alloy Steel Pipe

From Brazil, the Republic of Korea, Mexico and Venezuela

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of preliminary affirmative determination of scope

inquiry.

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SUMMARY: We preliminarily determine that (1) pipe certified to American

Petroleum Institute (API) 5L line pipe specifications (API 5L line pipe

or line pipe) and (2) pipe certified to both the API 5L line pipe

specifications and the less stringent American Standard Testing and

Materials (ASTM) A-53 standard pipe specifications (dual-certified

pipe), when actually used as certain circular welded non-alloy steel

pipe (standard pipe), and falling within the physical parameters

outlined in the scope of the orders, are within the scope of the

antidumping duty orders on standard pipe from Brazil, the Republic of

Korea, Mexico and Venezuela. We will direct the U.S. Customs Service to

suspend liquidation of these products as follows: (1) All dual-

certified pipe and API 5L line pipe falling within the physical

parameters outlined in the scope of the orders that enter without an

end-use certificate and (2) all dual-certified pipe and API 5L line

pipe falling within the physical parameters outlined in the scope of

the orders that enter with an end-use certificate certifying end use in

a standard pipe application. No suspension of liquidation is required

for dual-certified pipe and API 5L line pipe that enters with an end-

use certificate certifying end use in a line pipe application.

Interested parties are invited to comment on this preliminary

determination.

EFFECTIVE DATE: January 13, 1994.

FOR FURTHER INFORMATION CONTACT:Kimberley Huffman at (202) 482-0780 or

Wendy Frankel at (202) 482-5253, Office of Antidumping Compliance,

Import Administration, International Trade Administration, U.S.

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

Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

Background

On April 23, 1993, the petitioners in the original less-than-fair-

value investigations (Allied Tube & Conduit Corporation, Sawhill

Tubular Division, Tex-Tube Division American Tube Company, Century Tube

Corporation, Laclede Steel Company, LTV Tubular Products Company,

Sharon Tube Company, Western Tube & Conduit Corp., Wheatland Tube

Company, and CSI Tubular Products, Inc.) filed anticircumvention

petitions with the Department of Commerce (the Department) arguing,

pursuant to section 781(c) of the Tariff Act of 1930, as amended (the

Act) and 19 CFR 353.29(g) (1992), that exports from Korea, Mexico and

Brazil of API 5L line pipe and dual-certified pipe are circumventing

the antidumping duty orders on standard pipe when they are actually

used in standard pipe applications. The Department determined that a

scope inquiry pursuant to 19 CFR 353.29(i) was the appropriate approach

to address the issues raised by petitioners.

Exports of standard pipe from Venezuela were the subject of a

concurrent antidumping investigation. The scope of the resulting

affirmative order is exactly the same as that of Mexico, Korea and

Brazil. For this reason, even though in their original petition for an

anticircumvention investigation petitioners did not request that

imports from Venezuela be examined, we determined in our October 25,

1993, recommendation memorandum, on file at the Central Records Unit,

room B099, of the Department of Commerce Main Building, that it is

appropriate in the context of the present scope inquiry to clarify

whether imports of line pipe and dual-certified pipe, when actually

used as standard pipe and fall within the physical parameters outlined

in the scope of the orders, are within the scope of the antidumping

duty order on standard pipe from Venezuela.

The scope of the order on standard pipe from Taiwan, another

concurrent investigation, differs from that of the remaining orders.

See 57 FR 49454 (1992). Therefore, this scope determination does not

apply to the scope of the Taiwanese order.

The Department initiated its scope inquiry on June 7, 1993, and

granted interested parties the formal opportunity to comment on whether

API 5L line pipe and dual-certified pipe, when used in standard pipe

applications and falling within the physical parameters outlined in the

scope of the orders, are within the class or kind of merchandise

subject to the orders. We received comments on July 6, 1993, from

petitioners and six respondents, and rebuttal comments on July 19,

1993. In addition, the Department later provided interested parties the

opportunity to meet individually with the Acting Assistant Secretary

for Import Administration to further discuss how the Department should

properly resolve this inquiry. Petitioners and five respondents

participated in the meetings. Due to the significant difficulty

presented by this scope inquiry, we have determined that it is

appropriate to issue a preliminary determination.

Under 19 CFR 353.29(i), the Department first examines the

descriptions of the subject merchandise contained in the petition, the

initial investigations, and the Department's and ITC's determinations.

The regulations provide that if it determines these descriptions are

not dispositive, the Department will consider the factors provided for

under 19 CFR 353.29(i)(2), known commonly as the Diversified Products

criteria. See Diversified Products Corp. versus United States, 572 F.

Supp. 883 (CIT 1983).

In our recommendation memorandum, of October 25, 1993, we found

that the specifications of API 5L line pipe and dual-certified pipe

encompass the less demanding specifications for standard pipe. We

determined that it was unclear as to whether the orders ``included API

5L line pipe and dual-certified pipe within the scope whenever those

categories of pipe are actually used in a standard pipe application''

based upon the following: the overlap in physical parameters, the

Department's conclusion that both dual-certified pipe and line pipe can

be and sometimes are actually used in standard pipe applications, and

the ambiguity in the orders and descriptions of the subject merchandise

from the original investigations. See the Department's Recommendation

Memorandum dated October 25, 1993. Therefore, on October 27, 1993, the

Department requested that the interested parties comment on the

Diversified Products criteria provided for under 19 CFR 353.29(i)(2).

These criteria include: (i) The physical characteristics of the

product; (ii) the expectations of the ultimate purchasers; (iii) the

ultimate use of the product; and (iv) the channels of trade. See 19 CFR

353.29(i)(2). The following interested parties filed comments and

rebuttals on November 22, 1993, and December 3, 1993, respectively:

Allied Tube & Conduit Corporation, Sawhill Tubular Division, Tex-Tube

Division American Tube Company, Century Tube Corporation, Laclede Steel

Company, LTV Tubular Products Company, Sharon Tube Company, Western

Tube & Conduit Corp., Wheatland Tube Company, and CSI Tubular Products,

Inc., collectively referred to as petitioners; Mannesmann Pipe & Steel

Corporation; Korea Iron and Steel Association, Dongbu Steel Co., Ltd.,

Hyundai Steel Pipe Co., Ltd., Korea Steel Pipe Co., Ltd., Pusan Steel

Pipe Co., Ltd. and Union Steel Manufacturing Co., Ltd. (Korea),

collectively referred to as the Korean respondents; and HYLSA, S.A. de

C.V., referred to as HYLSA.

Analysis

General Issues: The purpose of the Department's scope inquiry is to

determine whether dual-certified pipe and API 5L line pipe, when used

in a standard pipe application and which fall within the physical

parameters outlined in the scope of the orders, are within the scope of

the orders. See the Department's October 25, 1993, Recommendation

Memorandum.

In this regard, respondents argue initially that the Department has

improperly read into the scope a possible use requirement and that to

determine that line and dual-certified pipe are covered on this basis

would amount to an impermissible expansion of the scope of the orders.

In support of this position, the Korean respondents distinguish between

what they refer to as a pipe product's ``chief end use'' and the

``actual use'' to which the pipe is put. They argue that within the

pipe industry it is recognized that line and dual-certified pipe (as

well as standard pipe) are intended for use in certain applications--

their ``chief end uses''--a fact which is made explicit by their

industry labeling. The Korean respondents argue that the orders exclude

these categories of pipe based upon an assumption that these chief end

uses differ from those of standard pipe, without reference to the

question of how they are actually used. They cite Ipsco, Inc. versus

United States, 715 F. Supp. 1104 (CIT 1989), to argue that absent such

an explicit reference to actual use, the Department may not concern

itself now with actual use. Therefore, the Korean respondents argue

that there is no basis for the Department to resort to the Diversified

Products criteria under 19 CFR 353.29(i)(2).

We disagree. Besides providing a physical description of standard

pipe, the orders state that ``[s]tandard pipes and tubes are intended

for the low pressure conveyance of water, steam, natural gas,'' and

other related uses, as well as light load bearing and mechanical

applications. Antidumping Orders, 57 FR 49452, 49453 (1992) (emphasis

added). The issue raised by respondents, which the Department's

recommendation memorandum did not directly address, concerns the proper

interpretation to be given the phrase ``are intended for'' certain

uses. Respondents are correct that, in using this phrase in the orders,

the Department did not expressly refer to actual use (nor did we refer

to actual use in the orders wherein we appeared to exclude line pipe

and certain dual or triple certified pipe). At the same time, however,

as indicated in our recommendation memorandum, neither did the

Department expressly limit the phrase ``are intended for'' to ``chief

end uses'' nor stenciling indicative of standard pipe. Thus, as a

threshold matter, the orders and the descriptions from the underlying

investigations do not preclude the Department from considering the

actual end use to which a particular type of pipe product (regardless

of stenciling) is put in determining whether that type of product is

``intended for use'' as standard pipe and, therefore, covered by the

orders on standard pipe.

The issue herein closely resembles the issue addressed in Ipsco, a

case arising from a scope inquiry concerning oil country tubular goods

(OCTG) from Canada. The Department had defined the subject merchandise

as, ```hollow steel products of circular cross-section intended for use

in drilling for oil and gas.''' Ipsco, 715 F. Supp. at 1105 (quoting

OCTG from Canada, 51 FR 21,782, 21,1783 (1986)) (emphasis added by

Court). At issue was whether, later, the Department had reasonably

clarified the scope of the orders, and in particular the phrase

``intended for use in drilling for oil and gas,'' as covering not only

API specification OCTG pipe but ```all other pipe with [certain

specified] characteristics used in OCTG applications. . . .''' Ipsco at

1105 (quoting the Department's unpublished scope ruling). In reaching

this determination, the Department also provided an additional

description of the covered merchandise, and instituted an end-use

certification procedure. See Ipsco.

The Court of International Trade (Court) upheld the Department's

determination, disagreeing with ``plaintiffs' contention that a pipe's

stencil or marking should be regarded as conclusive evidence of the

pipe's intended use * * * when such pipe possesses all of the physical

characteristics which would enable it to be used as OCTG.'' Id. at

1108. The Court added:

Although stencilling or marking may be strong evidence of what

the manufacturer considers to be the product's intended use, such

labelling does not necessarily reflect an importer or end-user's

view of the product's intended use, nor does it prevent the pipe

from actually being used as OCTG. As indicated in the record, a

knowledgeable engineer may use for drilling purposes any pipe that

meets the minimum requirements for OCTG.

Id.

The Court went so far as to hold that the Department ``acted

reasonably in rejecting plaintiffs' suggested approach which would

allow manufacturers and importers to evade the imposition of duties by

simply labelling OCTG pipe as non-OCTG pipe sharing the same physical

characteristics.'' Id. The Court's decision endorsed the Department's

argument that ``the stencilling or marking of pipe is a voluntary

practice which is not required by the API or any other governmental or

private authority, [and] . . . the labelling and marking of pipe as

standard or line pipe is meaningless within the context of these

orders.'' Id. at 1107-08.

Thus, a central issue in Ipsco, as here, concerned the meaning of

the phrase ``intended for use'' in certain specified applications.

There, the Department interpreted the phrase as permitting an inquiry

into how the pipe at issue was actually used. Here, the Department

determines that the phrase, when read in conjunction with the remainder

of the scope descriptions in the orders, does not clearly include or

exclude line pipe or dual-certified pipe falling within the physical

parameters outlined in the scope of the orders which is actually used

in standard pipe applications. Thus, we must resort to a Diversified

Products analysis.

Physical Characteristics: Respondents argue that the physical

differences between standard pipe and line pipe/dual-certified pipe are

significant enough to warrant a determination that standard pipe and

line pipe/dual-certified pipe constitute separate classes or kinds of

merchandise, especially due to such factors as (1) chemical

composition, (2) end finish and couplings and (3) weight and

dimensional tolerances. We note that, although certain respondents

discuss dual-certified pipe separately from line pipe, respondents

argue generally that dual-certified pipe falls within the class or kind

of merchandise of line pipe, which they claim is separate from standard

pipe (regardless of the actual use of a particular pipe).

According to respondents, with regard to chemical composition, the

allowable chemical tolerances for carbon, manganese, phosphorus and

sulfur are different for line pipe and standard pipe. Respondents

assert that the requirements for end finish and couplings also differ

significantly between the two kinds of pipe. For example, the coupling

diameter under API 5L specifications is, on average, 17.09 percent

greater than the coupling diameter required under ASTM A-53

specifications. Similarly, the specified end taper finish for ASTM A-53

standard pipe (0.750'' per foot) is more than ten times that mandated

for API 5L specifications (0.0625'' per foot). With regard to weight

and dimensional tolerances, respondents point out that ASTM A-53

specifications permit a larger variance in diameter than API 5L

specifications. The API 5L specifications impose an upper limit on

variance in wall thickness, while ASTM A-53 does not. For weight

tolerances, ASTM A-53 specifications permit a lower limit variance of

up to 10 percent, while API 5L specifications permit a lower limit

variance in weight of no more than 3.5 percent (a 65 percent difference

between the two standards). Finally, with regard to length, the minimum

allowable length of ASTM A-53 standard pipe is 12 feet, while the

minimum permissible length under API 5L specifications is 9 feet.

All the respondents agree that physical characteristics constitute

a very important factor in this analysis. The Korean producers conclude

that ``[p]hysical characteristics * * * are the bedrock on which the

Department--and petitioners--originally excluded line and dual-stencil

pipe from the scope of the investigation.''

Petitioners argue that pipe made to either the API 5L line pipe

specifications or the dual-certified specifications meets the physical

characteristic requirements set forth in the scope of the orders.

Petitioners argue that respondents are misdirected in emphasizing the

differences between pipe meeting API specifications and ASTM

specifications with regard to chemical composition, end finish and

weight and thickness tolerances. First, the physical description of

standard pipe set forth in the scope language of the orders cover

standard pipe that ``generally'' (not exclusively) meets the ASTM A-53

specifications. Thus, the physical description is not limited to A-53

standard pipe. Second, the scope language expressly includes pipe

meeting the physical description expressed therein, regardless of wall

thickness, surface finish and end finish. Therefore, according to

petitioners, the differences in these characteristics are irrelevant to

the scope inquiry. Because dual-certified pipe meets both the A-53

specifications and the API 5L specifications, petitioners assert, it

meets the physical description of the pipe described in the scope of

the orders. Further, pipe which meets the API 5L specifications also

meets the physical description of the pipe described in the scope

because the higher specifications of API 5L encompass the A-53

specifications.

The Department determines that line pipe and dual-certified pipe

(within the physical parameters outlined in the scope of the orders),

when used in standard pipe applications, have the same primary physical

characteristics as standard pipe. As stressed above, we are only

concerned with clarifying whether line and dual-certified pipe which is

actually used in standard pipe applications and fall within the

physical parameters outlined in the scope of the orders is within the

scope of the orders on standard pipe. Nevertheless, as the scope of the

orders indicates and as the Department discussed in its recommendation

memorandum, it is important to note that the overlap between the

physical characteristics of line and dual-certified pipe and standard

pipe exists both for line and dual-certified pipe which is actually

used as standard pipe and for other line and dual-certified pipe as

well. The physical description of standard pipe contained in the orders

read, in part, as follows:

The merchandise subject to this investigation is circular welded

non-alloy steel pipes and tubes of circular cross-section, not more

than 406.4mm (16 inches) in outside diameter, regardless of wall

thickness, surface finish (black, galvanized, or painted), or end

finish (plain end, bevelled end, threaded, or threaded and coupled).

These pipes and tubes are generally known as standard pipe, though

they may also be called structural or mechanical tubing in certain

applications.

Clearly, virtually all line and dual-certified pipe possess these

physical characteristics. To the extent a particular shipment or piece

of line pipe does not possess different characteristics which would

impede its use in a standard pipe application (a condition which does

not apply to most line pipe), these physical characteristics would

enable any line or dual-certified pipe to be used in a standard pipe

application.

Having said the above, respondents are correct that chemical

composition, end finish and couplings and weight and dimensional

tolerances can be somewhat different between ASTM A-53 specifications

and API 5L specifications. However, the significance of these

observations is undermined by the above-noted overlap in primary

physical characteristics among the various types of pipe and by

specific language in the orders relating to these characteristics.

Regarding the latter point, the scope of the orders covers standard

pipe regardless of wall thickness, surface finish or end finish. Thus,

unique tolerances with respect to these characteristics cannot affect

our determination of whether a product is standard pipe (as that term

is understood in the orders). Moreover, even with respect to

acknowledged physical characteristics of standard pipe, uniquely

stringent tolerances that exceed ASTM A-53 specifications should not

prevent a product which is being used in standard pipe applications

from being considered standard pipe, provided that the product meets

all of the standard pipe specifications as expressed in the orders.

Therefore, the Department preliminarily determines that line pipe

and dual-certified pipe which fall within the physical parameters

outlined in the scope of the orders, when used in standard pipe

applications, have the same primary physical characteristics as

standard pipe; such pipe generally meets the physical description

listed in the scope of the orders, a fact which supports inclusion

within the class or kind of merchandise for standard pipe.

Expectations of the Ultimate Purchasers: The Korean producers argue

that line pipe and dual-stenciled pipe are manufactured to more

exacting standards than standard pipe. The API specifications governing

the chemistry, weight, outside diameter, marking and so forth of line

pipe were established by the American Petroleum Institute for the

peculiar needs of the oil, gas, pipeline and utility industries. Thus,

purchasers of these line pipe products expect such products to be fit

for use in these industries. Dual-stenciled API 5L/ASTM A-53 pipe is

manufactured to conform to the more stringent API specifications, which

automatically qualify it for the lower ASTM specifications applicable

to standard pipe. Thus, purchasers of dual-stenciled pipe expect it to

meet the API standards but also to have added flexibility because it is

additionally marked with the ASTM certification. Finally, the Korean

producers assert that imported dual-certified pipe is not being sold

exclusively or predominantly to customers for standard pipe uses.

HYLSA argues that the differing expectations of ultimate purchasers

of dual-stenciled API-5L line pipe, as compared with ASTM A-53 standard

pipe, may be inferred, in part, from (a) the fact that some users only

use dual-stenciled pipe, and (b) the physical differences between the

two products. Pipe is produced to meet API-5L specifications at home

and abroad because there is a market demand for the physical

characteristics of API-5L line pipe. Unless there were distinct

expectations on the part of the ultimate purchasers with regard to

dual-stanciled line pipe, manufacturers would just produce the less

costly ASTM A-53 standard pipe.

Petitioners state that the ultimate purchasers of dual-certified

pipe and API-5L line pipe have a critical expectation when they

purchase such pipe from one of the countries involved in this scope

proceeding. That critical expectation is that they are purchasing a

pipe that will perform a standard pipe application at the lowest cost.

More specifically, the purchasers of dual-certified pipe and API-5L

line pipe simply want a product that meets the A-53 specification for

use in a standard pipe application. Therefore, petitioners assert that

the line pipe and dual-certified products being sold to standard pipe

customers are intended for, and in fact are now being used for, the

same standard pipe applications that were previously met by A-53 pipe.

The Department recognizes that the ultimate purchaser of line or

dual-certified pipe receives a product that is certified to perform a

more demanding application, i.e., a line pipe application. At the same

time, some purchasers of line and dual-certified pipe expect to use it

and actually do use it in a standard pipe application. (Neither the

Korean respondents nor HYLSA attempt to contravene petitioners'

evidence that imported dual-certified pipe and imported line pipe are

being sold to customers for standard pipe uses.) Bearing in mind that

this scope inquiry is only concerned with purchasers who actually use

line pipe or dual-certified pipe in a standard pipe application and

which fall within the physical parameters outlined in the scope of the

orders, we find that the expectations of these purchasers with respect

to such purchases are that the higher specification product will be put

to the same use as standard pipe which is manufactured to the lower

ASTM specifications. This type of purchase can occur when prices in the

pipe market permit the substitution, in standard pipe applications, of

line pipe or dual-certified pipe for standard pipe.

Our focus here is not on the consumer expectations the manufacturer

anticipates at the time of production, but rather on the actual

expectations of the ultimate purchaser of the merchandise at issue

here, i.e., line pipe and dual-certified pipe when actually used in a

standard pipe application. Cf. IPSCO, 715 F. Supp. at 1108. Thus,

HYLSA's analysis of why a producer would produce to the more demanding

specifications is irrelevant. Similarly, the Korean producers'

assumption that the purchaser is using the pipe in a line pipe

application makes their argument inapposite. Finally, we do not need to

address here the Korean producers' assertion that imported dual-

certified pipe is not being sold exclusively or predominantly to

customers for standard pipe uses. It is sufficient to note that the

parties do not dispute that some such sales are occurring.

Ultimate Use of the Product: Respondents' main argument regarding

ultimate use is that the Department's analysis should be ``directed at

the product generally, not at the disposition or end use of any

particular entries.'' As support, the Korean respondents cite the

Department's Final Determination of Sales at Less Than Fair Value:

Uranium from the Ukraine and Tajikistan, 58 FR 36,640, 36,644 (1994),

which states:

Every product has alternative uses or the potential for

alternative uses. For purposes of a class or kind analysis, it is

the Department's responsibility to determine not the number of

alternative uses but rather the significance of any or all of those

alternatives.

According to the Korean respondents, the primary or ``significant''

use of line and dual-certified pipe has always been and is now in the

oil, gas and utility industries, i.e., it is a line pipe use. The

Korean respondents argue that it is this use, as under Customs law,

that determines the products' proper class or kind, not the specific

uses of an isolated minority of entries.

Respondents also contest petitioners' claims that all or most line

pipe or dual-stenciled pipe is being used for standard pipe

applications. HYLSA adds that petitioners' argument is premised

fundamentally on the unsubstantiated claim that dual-certified pipe is

only used as standard pipe. HYLSA acknowledges that by virtue of its

physical characteristics, dual-certified pipe is suitable for and may

be used in standard pipe applications. However, that possibility does

not alter the fact that it is still line pipe.

Petitioners assert that the petition provides a description of the

uses of standard pipe that is consistent with the one published in the

antidumping duty orders. Although no specific exclusions were listed in

the petition, petitioners argue that the scope includes and excludes

specific ``classes or kinds'' of pipes based on end use, and therefore

end use is the determining factor of the scope. According to

petitioners, the term ``standard pipe,'' as used, covers a group of

piper products used for a particular group of purposes. The orders

include pipe used for other purposes such as line pipe, oil country

tubular goods, boiler tubing, mechanical tubing, pipe and tube hollows

for redraws, finished scaffolding, and finished conduit. Petitioners

assert that each of these categories of pipe describes a particular use

of pipe that is different from a standard pipe application. Therefore,

they assert that pipe used in one of the excluded uses, such as in a

line pipe application, is not covered. However, pipe that is capable of

being used for line pipe, but which is actually used as standard pipe,

is specifically covered by the orders. This includes dual-certified

pipe and API 5L pipe.

The Department preliminarily determines that when dual-certified

and line pipe are actually used in standard pipe applications and fall

within the physical parameters outlined in the scope of the orders, the

ultimate use of these products is the same as that of standard pipe.

This Diversified Products criterion therefore supports inclusion of

such products in the scope of the orders on standard pipe.

We agree with respondents that it is important to isolate the

primary or most significant use of a product in determining whether its

ultimate use is the same or similar to that of the subject merchandise.

However, we are not here attempting to determine the ultimate use of

all line pipe and dual-certified pipe. We are only concerned with line

and dual-certified pipe which fall within the physical parameters

outlined in the scope of the orders and is actually used in a standard

pipe application. Thus, in order to properly analyze the ultimate use

of line and dual-certified pipe when used in a standard pipe

application, we must compare that use to the ultimate use of standard

pipe.

As identified in the scope, standard pipe is ``intended for the low

pressure conveyance of water, steam, natural gas, and other liquids and

gases in plumbing and heating systems, and other related uses,'' as

well as certain structural and mechanical uses. These uses are

essentially the same as those for the products at issue, i.e., for line

pipe and dual-certified pipe which is actually used in standard pipe

applications. Thus, when properly viewed, respondents' line of argument

does not point toward a determination that line and dual-certified

pipe, when actually used as standard pipe, represent a different class

or kind of merchandise than standard pipe. See, e.g., Smith Corona

Corp. versus United States, 915 F.2d 683, 687 (Fed. Cir. 1990); Final

Scope Ruling; Portable Electric Typewriters From Japan, 55 FR 47,358

(1990), aff'd, Matsushita Elec. Indus. Co. versus United States, 787 F.

Supp. 1461 (CIT 1992).

Moreover, the fact that line pipe and dual-certified pipe--When

actually used as standard pipe--otherwise could have been used to

perform the more demanding line pipe applications is irrelevant. The

primary use--indeed the only use--of the products at issue is in

standard pipe applications.

Channels of Trade: Respondents concede that the channels of trade

overlap in distributors for standard pipe, dual-certified pipe and API

5L line pipe. However, they argue that this fact alone does not support

a determination that line pipe, dual-certified pipe and standard pipe

are a single class or kind of merchandise within the scope of the

orders covering standard pipe.

Petitioners assert that the channels of trade for standard pipe,

API 5L line pipe and dual-certified pipe have traditionally been

similar, though not identical.

The Department agrees that the channels of trade overlap for

standard pipe, dual-certified pipe and line pipe. The Department also

acknowledges in response to respondents' argument that this criterion

alone is not dispositive as to whether API 5L line pipe and dual-

certified pipe fall within the scope of the orders at issue.

Conclusion

Based upon our analysis of the comments provided by all of the

interested parties on the physical characteristics, expectations of the

ultimate purchasers, ultimate use of the product, and the channels of

trade, in accordance with 19 CFR 353.29(i), we preliminary determine

that when API 5L pipe and dual-certified pipe are used in a standard

pipe application and fall within the physical parameters outlined in

the scope of the orders, they are the same class or kind of merchandise

as standard pipe and are therefore included within the scope of the

orders on circular welded non-alloy steel pipe from Mexico, Korea,

Brazil, and Venezuela (case numbers A-201-805, A-580-809, A-351-809 and

A-307-805).

We invite interested parties to comment on this preliminary

determination, and to address the end-use certification process within

30 days of publication of this preliminary determination. Rebuttal

comments are due within 37 days of publication of this preliminary

determination. See 19 CFR 353.29(d)(3). The Department will consider

such comments in reaching its final determination.

This preliminary scope ruling is in accordance with 19 CFR

353.29(d)(3).

Dated: January 6, 1994.

Joseph A. Spetrini,

Deputy Assistant Secretary for Compliance.

[FR Doc. 94-889 Filed 1-12-94; 8:45 am]

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