Chrome-Plated Lug Nuts From the People's Republic of China; Final Results of Antidumping Administrative Review

DEPARTMENT OF COMMERCE

[A-570-808]

Chrome-Plated Lug Nuts From the People's Republic of China; Final

Results of Antidumping Administrative Review

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of Final Results of the Antidumping Duty Administrative

Review of Chrome-Plated Lug Nuts from the People's Republic of China.

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SUMMARY: On April 20, 1995, the Department of Commerce (the Department)

published in the Federal Register the preliminary results of its 1991-

1992 and 1992-1993 administrative reviews of the antidumping duty order

on chrome-plated lug nuts (lug nuts) from the People's Republic of

China (PRC) (60 FR 19720). These reviews cover shipments of this

merchandise to the United States during the periods April 18, 1991,

through August 31, 1992, and September 1, 1992, through August 31,

1993. We gave interested parties an opportunity to comment on our

preliminary results. Based upon our analysis of the comments received

we have changed the results from those presented in the preliminary

results of review.

EFFECTIVE DATE: October 20, 1995.

FOR FURTHER INFORMATION CONTACT: Donald Little, Elisabeth Urfer, or

Maureen Flannery, Office of Antidumping Compliance, Import

Administration, International Trade Administration, U.S. Department of

Commerce, 14th Street and Constitution Avenue, N.W., Washington D.C.

20230; telephone (202) 482-4733.

Applicable Statute and Regulations

Unless otherwise stated, all citations to the statute and to the

Department's regulations are references to the provisions as they

existed on December 31, 1994.

SUPPLEMENTARY INFORMATION:

Background

The Department published in the Federal Register an antidumping

duty order on lug nuts from the PRC on April 24, 1992 (57 FR 15052). On

September 11, 1992, and September 7, 1993, the Department published in

the Federal Register (57 FR 41725 and 58 FR 47116), respectively,

notices of opportunity to request administrative reviews of the

antidumping duty order on lug nuts from the PRC covering the periods

April 18, 1991, through August 31, 1992, (91-92 review) and September

1, 1992, through August 31, 1993 (92-93 review).

For the 91-92 review, in accordance with 19 CFR 353.22(a)(1994),

the petitioner, Consolidated International Automotive, Inc.

(Consolidated), requested that we conduct an administrative review of

China National Automotive Industry I/E Corp.; China National Machinery

& Equipment Import and Export Corporation, Jiangsu Co., Ltd. (Jiangsu);

Rudong Grease Gun Factory (Rudong); China National Automotive Industry

Shanghai Automobile Import & Export Corp. (Shanghai Automobile); Chu

Fong Metallic Industrial Corporation (Chu Fong); and San Chien Electric

Industrial Works, Ltd. (San Chien). We published a notice of initiation

of this antidumping duty administrative review on October 22, 1992 (57

FR 48201).

For the 92-93 review, in accordance with 19 CFR 353.22(a),

Consolidated requested that we conduct an administrative review of

China National Automotive Industry I/E Corp; Jiangsu; China National

Automobile Import and Export Corp., Yangzhou Branch (Yangzhou); Rudong;

Ningbo Knives & Scissors Factory (Ningbo); Shanghai Automobile; and

Tianjin Automotive Import and Export Co. (Tianjin). In accordance with

19 CFR 353.22(a), Krossdale Accessories, Inc. requested a review of its

supplier, China National Machinery & Equipment Import & Export Corp.,

Nantong Branch (Nantong). We published a notice of initiation of this

antidumping duty administrative review on October 18, 1993 (58 FR

53710).

On April 20, 1995, the Department published in the Federal Register

the preliminary results of its 1991-1992 and 1992-1993 administrative

reviews of the antidumping duty order on lug nuts from the PRC (60 FR

19720). There was no request for a hearing. The Department has now

conducted these reviews in accordance with section 751 of the Tariff

Act of 1930, as amended (the Tariff Act).

Scope of Review

On April 19, 1994, the Department issued its ``Final Scope

Clarifications on Chrome-Plated Lug Nuts from Taiwan and the PRC.'' The

scope, as clarified, is described in the subsequent paragraph. All lug

nuts covered by these reviews conform to the April 19, 1994, scope

clarification.

Imports covered by these reviews are one-piece and two-piece

chrome-plated lug nuts, finished or unfinished. The subject merchandise

includes chrome-plated lug nuts, finished or unfinished, which are more

than 11/16 inches (17.45 millimeters) in height and which have a

hexagonal (hx) size of at least 3/4 inches (19.05 millimeters) but not

over one inch (25.4 millimeters), plus or minus 1/16 of an inch (1.59

millimeters). The term ``unfinished'' refers to unplated and/or

unassembled chrome-plated lug nuts. The subject merchandise is used for

securing wheels to cars, vans, trucks, utility vehicles, and trailers.

Zinc-plated lug nuts, finished or unfinished, and stainless-steel

capped lug nuts are not included in the scope of this review. Chrome-

plated lock nuts are also not subject to this review.

Chrome-plated lug nuts are currently classified under subheading

7318.16.00.00 of the Harmonized Tariff Schedule (HTS). Although the HTS

subheading is provided for convenience and customs purposes, the

written description of the scope of this proceeding is dispositive.

These reviews cover the periods April 18, 1991, through August 31,

1992, and September 1, 1992, through August 31, 1993. The 91-92 review

covers six producers/exporters of Chinese lug nuts. The 92-93 review

covers eight producers/exporters of Chinese lug nuts.

Analysis of Comments Received

We gave interested parties an opportunity to comment on the

preliminary results. We received a case brief from petitioner, and a

rebuttal brief from respondents, Rudong and Nantong.

Comment 1: Petitioner concurs with the Department's decision to use

best

[[Page 48688]]

information available (BIA) with respect to Rudong and the non-

responding firms. Petitioner asserts that for the 91-92 review, the

response by Rudong was incomplete with regard to factor information on

packing costs, that the Department treated Rudong as a non-shipper, and

that the Department applied BIA due to Rudong's incomplete response to

the Department's questionnaire.

Petitioner states that for the 92-93 review, of the seven firms

that were potential respondents, the Department again determined that

one firm, Rudong, had responded to the Department's requests for

information, but had reported no direct exports to the United States.

Petitioner contends that, as in 91-92 review, Rudong provided deficient

factor information, and that the Department correctly used BIA to apply

the PRC rate of 45.41 percent. Petitioner argues that the remaining six

companies did not respond to the Department's questionnaires and

received either a PRC or company-specific rate based on the highest

rate ever calculated in either the investigation of sales at less-than-

fair-value (LTFV) or the previous review, 45.41 percent. Petitioner

notes that Jiangsu, which had previously been investigated, received a

company-specific rate. Petitioner states that the named exporter in the

92-93 review, Nantong, responded to the questionnaire and received a

separate rate; however, the company-specific rate and the PRC rate are

identical.

Rudong and Nantong disagree with petitioner's positions that it is

appropriate to use BIA with respect to Rudong and Nantong, and they

disagree that the Department correctly applied the factors of

production methodology in these reviews. They argue that Rudong was

fully responsive to the Department's requests for information, and,

contrary to petitioner's claims, provided full factors of production

information. They maintain that the reported factors data, and not BIA

or other factors data used for the preliminary results, should be used

by the Department for the final results of these proceedings.

Rudong and Nantong disagree with the Department and the

petitioner's claims that Rudong did not provide proper information on

packing costs. They state that Rudong provided packing data in its

August 3, 1994 submission. Rudong and Nantong maintain that the

Department erred in its assessment that Rudong did not provide factor

information for transporting steel wire rod. They further maintain the

Department should use the surrogate information contained in the Indian

publication Steel Scenario which they submitted, rather than Indian

import statistics, to value steel.

Department's Position: We disagree with both petitioner and

respondent, in part. During the 91-92 review Rudong did not export lug

nuts to the United States; therefore, we treated Rudong as a non-

shipper and applied the PRC rate of 42.42 percent, the highest rate for

any firm in the LTFV investigation. We did not apply BIA to Rudong. For

the remaining five companies, none of which responded to our requests

for information, we applied a BIA rate of 42.42 percent. In deciding

what to use as BIA, 19 CFR 353.37(b) provides that the Department may

take into account whether a party refused to provide requested

information. Thus, the Department determines on a case-by-case basis

what is BIA. When a company refuses to provide the information

requested in the form required, or otherwise significantly impedes the

Department's review, the Department will normally assign to that

company the higher of (1) The highest rate for any firm in the

investigation or prior administrative reviews of sales of subject

merchandise from that same country; or (2) the highest rate found in

the review for any firm. When a company has cooperated with the

Department's request for information but fails to provide the

information requested in a timely manner or in the form required, the

Department will normally assign to that company the higher of either:

(1) The highest margin calculated for that company in any previous

review or the original investigation; or (2) the highest calculated

margin for any respondent that supplied an adequate response for the

current review. (See Final Results of Antidumping Duty Administrative

Reviews and Revocation in Part of an Antidumping Duty Order:

Antifriction Bearings (Other than Tapered Roller Bearings) and Parts

Thereof From France, et. al. (58 FR 39729, (July 26, 1993).) Therefore,

we applied as BIA to the firms which did not respond to our

questionnaire a PRC rate based on BIA which was the highest rate for

any firm in the investigation, or the 91-92 review.

During the 92-93 review, we calculated a rate for Nantong, the only

exporter that submitted a questionnaire response. Since Rudong produced

the merchandise sold by Nantong, we compared Nantong's United States

price with Rudong's foreign market value (FMV). We calculated FMV based

on Rudong's factors of production. Rudong generally complied with our

requests for information; however, Rudong did not report the amount of

the steel input purchased from each supplier and packing weights. While

Rudong did provide the information we requested with regard to types of

materials used in packing, Rudong did not provide kilogram weights of

packing materials, which we needed to value the input materials. The

questionnaire specifically asks respondents to prove actual material

usage, and requests specifically that respondents provide the method of

allocating packing costs for each unit of the subject merchandise. (See

Letter, with Attachment, from Bernard Carreau to Lu Dong Grease Gun

Factory, dated March 4, 1994). Because Rudong did not provide this

information, as BIA, we applied a rate of one percent of the cost of

production to determine packing costs. This percentage was used in the

Final Determination of Sales at Less than Fair Value: Tapered Roller

Bearings from Italy (52 FR 24198, June 29, 1987). This methodology is

consistent with the Department's valuation of packing in the Final

Results of Antidumping Duty Administrative Review: Tapered Roller

Bearings from the People's Republic of China (56 FR 67590, December 31,

1991). We also applied partial BIA in calculating transportation costs

between the factory and its steel suppliers, because, while Rudong

provided distances from its suppliers, it did not provide the

percentage purchased from each. Without such information we could not

allocate purchases to specific suppliers. In our supplemental

questionnaire we specifically asked Rudong to supply the quantity

supplied for each input in those instances where there was more than

one supplier of the input. (See Letter from Bernard Carreau to Jiangsu

Rudong Grease Gun Factory, dated July 12, 1994.) As BIA, we used the

longest distance between the factory and any of its suppliers of steel.

We disagree with Rudong and Nantong with regard to which source we

should use to value steel. Rudong stated in its supplemental

questionnaire response that it uses international standard steel #1010,

which is a low carbon steel with a carbon content of .08 to .13

percent. The Indian import statistics are more specific in that they

indicate the carbon content of the steel. The HTS category we used,

7213.39, ``other bars & rods by weight less than .25 percent carbon,''

covers the low carbon steel used by Rudong to produce lug nuts. By

contrast, Steel Scenario does not specify either the carbon content of

the steel or other chemicals present in the steel. In addition, Steel

[[Page 48689]]

Scenario prices include taxes and levies, without indicating the amount

of taxes and levies included. Therefore, since the Indian import

statistics are more specific to the type of steel used in the

production of lug nuts, we have continued to use them for these final

results.

Because it did not export during the 92-93 period of review we

treated Rudong as a nonshipper. We applied BIA to the companies that

did not respond to our requests for information. Because the rate

calculated for Nantong was the highest rate in this or any other

review, or from the investigation of sales at LTFV, the calculated rate

for Nantong and the PRC rate are identical. Petitioner correctly notes

that we determined that Nantong received a separate rate. However, we

disagree that it is appropriate to continue assigning a separate rate

to Jiangsu. The test to determine whether to treat an entity as

separate from the state was established 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) and was amplified in the Final

Determination of Sales at Less Than Fair Value: Silicon Carbide from

the People's Republic of China (59 FR 22585, May 2, 1994). Under this

policy, exporters in non-market economies are entitled to separate,

company-specific margins when they can demonstrate an absence of

government control, both in law and in fact, with respect to exports.

Evidence supporting, though not requiring, a finding of de jure absence

of government control includes: (1) An absence of restrictive

stipulations associated with an individual exporter's business and

export licenses; (2) any legislative enactments decentralizing control

of companies; and (3) any other formal measures by the government

decentralizing control of companies. De facto absence of government

control with respect to exports is based on four factors: (1) Whether

each exporter sets its own export prices independently of the

government and without the approval of a government authority; (2)

whether each exporter retains the proceeds from its sales and makes

independent decisions regarding the disposition of profits or financing

of losses; (3) whether each exporter has the authority to negotiate and

sign contracts and other agreements; and (4) whether each exporter has

autonomy from the government regarding the selection of management.

While Jiangsu did receive a separate rate under our old test, because

Jiangsu did not respond to our request for information in this review,

we were unable to determine whether it is appropriate to assign Jiangsu

a separate rate under the current test.

Comment 2: Petitioner contends that the finding that Nantong is

entitled to a separate rate does not equate to finding that the Chinese

industry is market-oriented. Petitioner argues that Nantong is but one

member of an industry that has been unresponsive to the Department's

requests for information.

Department's Position: We agree with petitioner that a finding that

an entity is entitled to a separate rate does not equate to a finding

that the industry is market oriented; however, in neither the 91-92

review nor the 92-93 review did any party make a claim that the Chinese

lug nut industry is a market-oriented industry.

Comment 3: Rudong and Nantong contend that there is a mathematical

error in the calculation of the surrogate value for steel based on the

Indian import statistics.

Department's Position: We agree and have changed our calculation

accordingly.

Final Results of Reviews

As a result of the comments received, we have changed the results

from those presented in our preliminary results of review:

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

Margin

Manufacturer/exporter Time period (percent)

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

China National Machinery &

Equipment Import & Export Corp.,

Nantong Branch................... 09/01/92-08/31/93 44.99

PRC Rate.......................... 04/18/91-08/31/92 42.42

09/01/92-08/31/93 44.99

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The Department shall determine, and the Customs Service shall

assess, antidumping duties on all appropriate entries. Individual

differences between United States price and FMV may vary from the

percentages stated above. The Department will issue appraisement

instructions directly to the Customs Service.

Furthermore, the following deposit rates will be effective upon

publication of the final results of these administrative reviews for

all shipments of lug nuts from the PRC entered, or withdrawn from

warehouse, for consumption on or after the publication date, as

provided for by section 751(a)(1) of the Act: (1) For Nantong, which

has a separate rate, the cash deposit rate will be the company-specific

rate published for the most recent (1992-1993) period; (2) for Jiangsu,

which was previously investigated and given a separate rate, but did

not respond to our request for information to determine whether it

still qualified for a separate rate under our current test, the cash

deposit rate, which is based on BIA, will be the PRC rate published for

the most recent (1992-1993) period; (3) for the companies named above

which did not respond to our questionnaire (China National Automotive

Industry I/E Corp., Yangzhou, Ningbo, Shanghai Automobile, San Chien,

Chu Fong and Tianjin) and for all other PRC exporters, the cash deposit

rate will be the PRC rate for the most recent (1992-1993) period; (4)

for Rudong, which was a nonshipper and has not been found eligible for

a separate rate, the cash deposit rate will be the PRC rate for the

most recent (1992-1993) period; and (5) for non-PRC exporters of

subject merchandise from the PRC, the cash deposit rate will be the

rate applicable to the PRC supplier of that exporter.

These deposit rates, when imposed, shall remain in effect until

publication of the final results of the next administrative review.

This notice also serves as a final reminder to importers of their

responsibility under 19 CFR 353.26 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.

This notice also serves as a reminder to parties subject to

administrative protective orders (APOs) of their responsibility

concerning the disposition of proprietary information disclosed under

APO in accordance with 19 CR 353.34(d)(1). Timely written notification

of the return/destruction of APO materials or conversion to judicial

protective order is hereby requested. Failure to comply with the

regulations and the terms of an APO is a sanctionable violation.

[[Page 48690]]

These administrative reviews and notice are in accordance with

section 751(a)(1) of the Tariff Act (19 U.S.C. 1675(a)(1)) and 19 CFR

353.22.

Dated: September 13, 1995.

Susan G. Esserman,

Assistant Secretary for Import Administration.

[FR Doc. 95-23334 Filed 9-19-95; 8:45 am]

BILLING CODE 3510-DS-P