# 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

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## Record

- **Collection:** Federal Register
- **Document type:** Uncategorized Document
- **Published:** January 13, 1994

## Text

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]
BILLING CODE 3510-DS-M

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