Large Power Transformers from France; Final Results of Antidumping Administrative Review

DEPARTMENT OF COMMERCE

International Trade Administration

[A-427-030]

Large Power Transformers from France; 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; large power transformers from France.

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

SUMMARY: On May 2, 1995, the Department of Commerce (the Department)

published the preliminary results of its administrative review of the

antidumping finding on large power transformers (LPTs) from France. The

review covers one manufacturer/exporter and the period June 1, 1993

through May 31, 1994.

We gave interested parties an opportunity to comment on our

preliminary results. Based on our analysis of the comments received, we

have changed the results from those presented in the preliminary

results of review.

EFFECTIVE DATE: December 7, 1995.

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

Maureen Flannery, Office of Antidumping Compliance, International Trade

Administration, U.S. Department of Commerce, 14th Street and

Constitution Avenue, N.W., Washington, D.C. 20230; telephone: (202)

482-4733.

SUPPLEMENTARY INFORMATION:

Background

The Treasury Department published in the Federal Register an

antidumping finding on LPTs from France on June 14, 1972 (37 FR 11772).

On June 7, 1994, we published in the Federal Register (59 FR 29411) a

notice of opportunity to request an administrative review of the

antidumping finding on LPTs from France covering the period June 1,

1993 through May 31, 1994.

In accordance with 19 CFR 353.22(a), Jeumont Schneider

Transformateurs (JST) requested that we conduct an administrative

review of its sales. We published a notice of initiation of this

antidumping duty administrative review on July 15, 1994 (59 FR 36160).

On May 2, 1995, the Department published the preliminary results in

the Federal Register (60 FR 21499). The Department has now conducted

the review in accordance with section 751 of the Tariff Act of 1930, as

amended (the Tariff Act).

Scope of the Review

Imports covered by the review are shipments of LPTs; that is, all

types of transformers rated 10,000 kVA (kilovolt-amperes) or above, by

whatever name designated, used in the generation, transmission,

distribution, and utilization of electric power. The term

``transformers'' includes, but is not limited to, shunt reactors,

autotransformers, rectifier transformers, and power rectifier

transformers. Not included are combination units, commonly known as

rectiformers, if the entire integrated assembly is imported in the same

shipment and entered on the same entry and the assembly has been

ordered and invoiced as a unit, without a separate price for the

transformer portion of the assembly. This merchandise is currently

classifiable under the Harmonized Tariff Schedule (HTS) item numbers

8504.22.00, 8504.23.00, 8504.34.33, 8504.40.00, and 8504.50.00. The HTS

item numbers are provided for convenience and Customs purposes. The

written description remains dispositive.

This review covers one manufacturer/exporter of transformers, JST,

and the period June 1, 1993, through May 31, 1994.

Applicable Statute and Regulations

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

Department's regulations are in reference to the provisions as they

existed on December 31, 1994.

Analysis of the Comments Received

We gave interested parties an opportunity to comment on the

preliminary results of review. We received comments from JST and

petitioner, ABB Power T&D Co. Inc. We received rebuttal briefs from JST

and petitioner.

Comment 1: Petitioner argues that the dumping margin should be

calculated in U.S. dollars, and that the Department's regulations

require conversion of foreign currency into U.S. dollars based on the

exchange rate prevailing on the date of sale. Petitioner cites 19 CFR

353.60(a) (1994), which states that the Department is to convert ``a

foreign currency into the equivalent amount of United States currency

at the rates in effect on the dates described in * * * 353.50.''

Petitioner also cites 19 CFR 353.50, arguing that this section

indicates the time for calculating constructed value, and thus

determining the currency conversion rate, is the date of sale.

Petitioner argues that the Department, in calculating constructed

value and making adjustments to U.S. price and foreign market value,

improperly converted several costs JST incurred in U.S. dollars into

French francs. Petitioner argues that the instructions in the

Department's questionnaire clearly state that JST was to report its

expenses in the currency in which those expenses were incurred.

Petitioner further argues that the U.S. Department of Commerce,

International Trade Administration, Antidumping Manual instructs the

Department to convert any expenses not incurred in U.S. dollars into

their dollar-denominated equivalent. Petitioner states that the

Department's regulations prescribe the rate to be used to accomplish

this conversion under 19 CFR 353.60(a).

JST argues that neither the antidumping statute nor the

Department's regulations require that dumping analysis be dollar-

denominated. JST argues that section 772 of the Tariff Act defines U.S.

price, but does not state that U.S. price is to be a dollar-denominated

price, and thus no statutory provision compels, or addresses, the

question of whether the Department must convert prices or costs stated

in foreign currency into U.S. dollars. JST further argues that 19 CFR

353.60(a) similarly prescribes a method for converting foreign currency

into dollars, but does not require dollar-denominated calculations.

JST argues that a calculation of U.S. price in a foreign currency

is unusual, but not unlawful, and that, given the facts of this case, a

French franc-denominated analysis is the best way of determining the

degree to which either of JST's U.S. sales was sold at less than

foreign market value. JST argues that the methodology is consistent

with the basic rule that governs the Department's antidumping analysis,

i.e., that a foreign

[[Page 62809]]

producer's U.S. price and foreign market value are to be determined

using data in the books and records of that producer, kept in the

normal course of trade, as long as such data do not distort the

producer's actual prices or costs.

Department's Position: We disagree with both parties, in part.

There is no requirement, in either the statute or the regulations, that

the dumping margin be calculated in U.S. dollars. Nevertheless, when

certain elements of the dumping calculation were paid in U.S. dollars,

and other elements in a foreign currency or currencies, it is the

Department's longstanding practice to convert foreign currency amounts

into U.S. dollars before calculating dumping margins, in accordance

with the rates established in 19 CFR 353.60(a). In this case, prices

were set, and paid, in U.S. dollars. Therefore, for these final

results, we have used the U.S. dollar price paid by the U.S. customer

as the basis of U.S. price, and converted expenses incurred in French

francs to U.S. dollars on the date of the U.S. sale. We have used the

date of sale, i.e., the date on which the terms of the sale were set,

as the date on which we have converted all foreign currency

transactions.

Comment 2: Petitioner claims that the use of JST's exchange rate

guarantees in calculating a dumping margin is not in accordance with

law. Petitioner argues that the Court of International Trade has held

that gains from exchange contracts cannot be used to increase U.S.

price, and at best a respondent may treat those gains or expenses

solely as indirect selling expenses on its U.S. sales. Petitioner cites

Thyssen Stahl AG v. United States, Slip Op. 95-78 (Ct. Int'l Trade

April 27, 1995) (Thyssen), where the court reversed the Department's

determination to treat gains from an exchange rate contract as a

circumstance-of-sale adjustment. Petitioner states that the court noted

that the antidumping statute did not provide for such an adjustment and

the Department's implementing regulations ``did not contemplate

currency hedging,'' and that the court rejected the respondent's theory

that the antidumping law is designed to compare a respondent's overall

return or profit between its U.S. and foreign market sales. Petitioner

notes that, instead, the court in Thyssen held that exchange rate gains

and losses could be considered indirect selling expenses.

Petitioner notes that the Thyssen court relied heavily on

Torrington Co. v. United States, 832 F.Supp. 379, 391-92 (Ct. Int'l

Trade 1993) (Torrington), in which the court reversed the Department's

adjustment to U.S. price to take into account a currency guarantee.

JST states that the petitioner has misread the Torrington and

Thyssen decisions. JST argues that the court's finding in Torrington

was clearly limited to the conclusion that the respondent's currency

hedging expenses were not directly related to the specific sales under

review. JST argues that the court similarly found that Thyssen had

failed to demonstrate the requisite direct relationship to the U.S.

sales under consideration. JST concludes that neither the Torrington

nor the Thyssen decision limits the Department's ability to treat any

difference between JST's transaction-specific exchange rate guarantees

and the exchange rate on the date of sale as a direct selling credit

for which an adjustment to foreign market value must be made.

JST argues that the production and sale of LPTs varies from most

other merchandise that is subject to antidumping orders. JST explains

that producers bid to supply transformers more than a year before the

transformers will be delivered. Because the bid is a firm commitment to

supply a high-cost transformer at a specific price, JST states that it

always arranges for a project-specific exchange rate guarantee before

it bids on a contract to supply an LPT to a U.S. customer. JST states

that the transaction-specific exchange rate guarantees that it secured

on its review-period sales to the United States are different from

general currency hedges. JST argues that the exchange rate guarantees

at issue transform JST's review-period sales to the United States into

French franc-denominated sales against which the company could control

the French franc costs that it incurred during the design, production,

test and delivery cycle. JST states that the Department verified that

JST maintains detailed transaction-specific French franc-denominated

accounts for both the revenues and costs associated with each of its

LPT sales. JST argues that a standard dumping calculation based on

dollar-denominated U.S. sales would grossly distort the Department's

antidumping analysis if the currency conversion were at a rate that

differed significantly from the guaranteed rate of exchange that JST

secured for each of its U.S. sales, because it would understate the

amount actually expected and received by JST. JST cites to the Uruguay

Round Agreements Act, Statement of Administrative Action at 172, to

argue that it is current Department practice, where a company

demonstrates that a sale of foreign currency on forward markets is

directly linked to a particular export sale, to use the rate of

exchange in the forward currency sale agreement.

JST argues that, if the Department decides to treat its exports as

dollar-denominated sales and decides to convert the French franc-

denominated constructed value to dollars at the Federal Reserve

exchange rate in effect on the date of sale, the Department must make

an adjustment to foreign market value for direct selling credit. JST

argues that the result of the credit adjustment is the same as treating

the transaction as a foreign currency sale at the guaranteed exchange

rate.

Department's Position: We disagree with both parties, in part. The

court's decisions in Thyssen and Torrington do not disallow the use of

a circumstance-of-sale adjustment in this case. The court in both

Thyssen and Torrington stated that the respondents could not link the

sales in question to specific exchange rate guarantee contracts. The

facts of this case differ because there is a specific guarantee for

each sale to the United States. JST has placed on the record evidence

that there was an exchange rate guarantee directly associated with each

of its sales to the United States. (See JST's questionnaire response at

tabs A-2 and B-2.) At verification, we examined the price in the

contract in U.S. dollars, the price the customer paid in U.S. dollars,

and the amount JST received from its bank in French francs. (See

verification exhibit Sales-4.) While the price to be paid in U.S.

dollars by the customer remained constant, JST used an exchange rate

guarantee to secure a certain exchange rate for each of its sales.

Because the price paid by the customer was set and paid in U.S.

dollars, for these final results we have used the price paid in U.S.

dollars for purposes of calculating U.S. price. Because of the gain JST

earned on these U.S. sales due to exchange rate guarantees, which were

directly linked to specific sales of LPTs, we have made a circumstance-

of-sale adjustment to foreign market value to account for that gain.

Comment 3: Petitioner argues that the Department understated JST's

profit on its home market sales. Petitioner argues that JST improperly

excluded data from a certain type of transformer from its home market

sales and the Department based its home market profit calculation on

the data that excluded transformers of this type. Petitioner states

that the transformers in question are within the scope of the finding

and JST has provided no scope-related information to explain why this

type of transformer should be excluded.

JST stated that the home market and the U.S. sales of LPTs, other

than the

[[Page 62810]]

type in question, were sold and manufactured, and the revenue

associated with them was booked, on a comparable time frame, normally a

year or more after the ``sale'' was made. JST states the sales of the

transformer type in question were not only sold, but were manufactured

and delivered five years before the review period. JST argues that the

profit realized on these sales has nothing to do with market conditions

at any time during the period in which the LPTs under review were sold,

manufactured or delivered.

Department's Position: We agree with JST. The profit the Department

calculates for constructed value should be based on the profit the

respondent experiences on comparable sales reasonably contemporaneous

to the sales of subject merchandise under review. The transformers

excluded from the profit calculation were sold significantly before the

sales to the United States. Although the profit was realized during the

period of review, the market conditions and expected return on those

sales are not relevant to the market conditions during the time the LPT

sales under review were made, because so much time had elapsed since

the sale of the home market LPTs in question. Therefore, we are

continuing to exclude the data on the transformers in question in our

profit calculation.

Comment 4: Petitioner argues that JST understated the actual amount

of its pre-bid expenses for purposes of calculating cost of

manufacture. Petitioner points out that JST calculated its pre-bid

expenses by taking its total annual pre-bid expenses and allocating

those expenses on a per-unit basis across all its sales for that year.

Petitioner questions whether the denominator is accurate, given that at

verification the Department found that JST had misreported the number

of LPTs sold during the period of review. Petitioner also questions

whether the pre-bid expenses for each of the units are identical across

markets and asserts that, because JST's sales in its home market are

far more regular than its export sales, it is possible that JST could

have no pre-bid expenses for its home market sales. Petitioner contends

that the best method for allocating these pre-bid expenses is on the

basis of design hours. Petitioner argues that, because the export units

are custom-designed, they would require more design hours, and thus

likely more costs, to develop a bid.

JST contends that it properly reported, and the Department properly

calculated, pre-bid expense. JST contends that at verification the

Department reviewed the quantity of transformers that it produced

during each year involved in the review period (i.e., 1992, 1993, and

1994), and that these data were provided in JST's ``final test'' log

for each calendar year, which reconciled with JST's annual financial

statements. JST further contends that even though there were problems

with the sales volume and value data, there is no reason to question

the validity of the final test data which were verified and used to

allocate pre-bid expenses.

JST asserts that petitioner misunderstands the pre-bid expenses

that it incurs. JST states that it incurs in the aggregate more pre-bid

expenses on business that it loses than on business that it wins, and

that each transformer that is sold must absorb an allocated portion of

total pre-bid expenses, including those on failed bids. Regarding

petitioner's assertion that pre-bid expenses should be allocated based

on design costs incurred after the bid has been won, JST argues that

petitioner ignores the ``bid-but-not-won'' problem, and assumes a

correlation between design costs or transformer size and pre-bid

expenses where none exists.

Department's Position: We disagree in part with both petitioner and

JST. As petitioner noted, at verification we encountered considerable

difficulties in verifying JST's sales volume and value. However, as

stated in the verification report, JST allocated its pre-bid expenses

based on the number of units tested during the year, a figure we did

verify, finding no discrepancies. The sales volume and value data

differ from the testing report data. The sales volume and value data

cover only subject merchandise sold during the period of review, while

the testing reports cover all transformers which were completed during

the years during which the subject merchandise was produced.

We agree with petitioner that pre-bid expenses might not be

identical across markets. However, there is insufficient data on the

record to determine whether more pre-bid expenses are incurred on home

market or export sales. We disagree with petitioner that allocating by

design hours would most accurately capture pre-bid expense, because

there is not a clear correlation between design hours and pre-bid

expense. As we found at verification, pre-bid expenses include other

expenses associated with bids (see Verification Report at p. 15), and,

therefore, are not necessarily incurred relative to design hours.

Furthermore, as JST pointed out, a substantial portion of its pre-bid

expenses are incurred for failed bids, and must be allocated to other

LPTS. Because there is no correlation between pre-bid expenses and

sales, we have determined that the most reasonable way to allocate pre-

bid expenses is on the cost of sales, since it avoids distortions which

could be created by allocating pre-bid expenses on number of units or

design hours.

Comment 5: JST argues that, in calculating the profit ratio on home

market sales, the Department understated the cost of manufacture

incurred by JST on its home market sales because it did not include

pre-bid expenses associated with these sales. As a result, JST claims,

the Department overstated the profit ratio on its home market sales,

which in turn led to an overstatement of profit for constructed value.

JST states that, in its normal accounting, it treats pre-bid expenses

as an indirect selling expense. However, in submitting costs for the

LPTs sold in the United States, JST treated pre-bid expenses as a cost

of manufacture in accordance with Department practice. JST argues there

must be a consistency between the way cost of manufacture is calculated

for U.S. sales and for home market sales, and that pre-bid expenses

should therefore be included in the home market cost of manufacture.

JST argues that the Department should allocate pre-bid expenses on a

per unit basis.

Petitioner states that JST has failed to submit sufficient

information to make the adjustment to cost of manufacture for home

market pre-bid expenses for purposes of the profit calculation.

Petitioner argues that the suggested adjustment to pre-bid expenses

implies that pre-bid expenses for home market and export sales are the

same. Petitioner states that pre-bid expenses also include ``exchange

rate guaranty premiums,'' which would be incurred only on export sales.

Petitioner claims that, because JST did not provide export-related pre-

bid expenses separately from home market-related pre-bid expenses, an

accurate calculation of home market pre-bid expenses cannot be made.

Department's Position: JST's comment indicates a misunderstanding

of the Department's calculation of profit. The Department calculates

profit for constructed value by multiplying the cost of production

(cost of manufacture plus selling, general, and administrative expenses

(SG&A)) of the U.S. sale by a ratio of home market profit to the cost

of production of home market sales. The home market SG&A includes

indirect selling expenses, which is where JST normally includes pre-bid

expenses. However, for the preliminary results we inadvertently did not

include an amount for pre-bid expense in either cost of manufacture or

SG&A expenses for purposes of our profit calculation. We do agree that,

in order not to

[[Page 62811]]

overstate profit, we must include an amount for pre-bid expense in home

market cost of production. As noted in our response to Comment 4,

above, JST did not provide sufficient information to differentiate

between home market-related and export-related pre-bid expenses.

Therefore, we have allocated pre-bid expense to home market cost of

manufacture based on cost of sales.

Comment 6: Petitioner contends that the Department made an error

in calculating JST's credit expense. Petitioner states that the

Department based JST's credit expense on the time between the invoice

date and payment date and that this is inconsistent with Department

practice of using the time period between shipment date and payment

date.

Department's Position: We agree with the petitioner, and have

recalculated the credit expense for the LPT sales to the United States

to reflect the time period between shipment and payment.

Comment 7: Petitioner asserts that the use of JST's economic report

to derive the cost of materials for Sale 1 understates cost of

materials for this unit since this report may not reconcile exactly to

the cost accounting system. Petitioner argues the Department should

derive a cost of materials figure using the total cost of materials

from the cost accounting system.

JST argues that it keeps economic reports for each transformer,

while the cost accounting system is specific to individual orders,

which may include costs for more than one transformer. JST argues that,

when the accounting records for an order do not provide the detailed

costs for each transformer covered by the order, the detail is

available from the economic reports. JST argues that the economic

report does in fact reconcile to the cost accounting system ``to within

very few French francs.'' JST argues the information it supplied to the

Department yields a fully reconciled materials cost. JST states that

the differences in materials cost between the economic report and the

cost accounting system were explained during verification.

Department's Position: We agree with JST. During the verification,

we examined the economic report and its relationship to the cost

accounting system. We determined that using the economic report was the

most reasonable method of deriving the cost of materials for this sale

because the economic report is transformer-specific, and the

differences between costs reflected in the economic report and the

actual material costs for the specific transformer were minimal. (For

further details, see proprietary memorandum to the file dated June 30,

1995.)

Comment 8: JST argues that the Department did not correct an error

regarding JST's calculation of home market cost of sales, which was

discovered at verification. As a result, JST asserts that the actual

manufacturing cost incurred on home market sales is understated,

thereby causing the calculation of profit to be overstated. JST argues

that the verification report mistakenly notes that the error did not

affect JST's cost of home market sales.

Petitioner contends that JST's claim for an adjustment to home

market cost of sales for this additional expense should be rejected.

Petitioner argues that there is no information about this expense on

the record. Petitioner argues that, without such information, the

Department cannot legally determine that the expense relates to home

market sales. Petitioner also argues that this information was untimely

submitted.

Department's Position: We agree with JST. At verification we asked

JST to show us how it had arrived at the figures used in its profit

calculation. In response to our request, JST prepared a worksheet

showing how the figures in its questionnaire responses traced to the

cost system. JST stated that, after it made adjustments for

depreciation and labor, and excluded a certain type of transformer, it

arrived at a figure different from what it had reported in the

questionnaire response. It showed the amount of this difference on the

profit worksheet, labeling it as an ``Other Adjustment.'' Therefore,

while we noted in the verification report that the ``Other Adjustment''

amount ``should have been an expense,'' it is more accurate to

characterize the amount as a correction of an error in the response.

Correction of such errors can be the result of verification and is not

untimely information as the petitioner asserts.

As explained in the verification report, we verified the total home

market costs and adjustments to those costs, as presented on the home

market profit worksheet at verification. (See verification exhibit

cost-18.) We were satisfied as to the accuracy of the corrected cost of

sales calculation, as shown on the home market profit worksheet.

Therefore, we have accepted respondent's correction of its original

calculation of cost of sales.

Comment 9: Petitioner argues that JST has not demonstrated that its

related-party purchases have been made at arm's length, and as a result

the Department should rely on best information otherwise available

(BIA) to derive the cost of materials for JST's related-party materials

purchases. Petitioner notes that at verification the Department

reviewed JST's related-party purchases of two parts for one of its

sales. Petitioner argues that, for the first of these parts, the

Department compared related-party prices with price quotations from

other companies, but JST did not demonstrate that the parts shown on

these quotations met specifications similar to those of the part

purchased from the related party. Petitioner also points out that the

second part had been purchased from a party also related to JST.

Petitioner states that the Department should use, as BIA, the ratio of

all of JST's purchases from related parties to total purchases,

multiplied by the total cost of materials, with an added amount for

profit. For profit, petitioner suggests the Department use the

percentage petitioner calculated for JST's home market profit.

JST contends that its purchases of components from related parties

were made at arm's length. With regard to the first part, JST argues

that petitioner has produced no information to cast any doubt that this

part was not purchased at arm's length, and that petitioner's claim

that this part may be different from those purchased from unrelated

suppliers is only speculation. With regard to the second part, JST

contends that the purchase is insignificant. JST argues that the

evidence that is available supports an ``arm's-length'' conclusion, and

there is no reason to believe that the price paid was not an arm's-

length price.

Department's Position: We agree with JST. At verification we

examined two parts purchased by JST from related parties. With regard

to the first part we examined detailed price quotations from JST's

suppliers, which clearly showed that the part had been purchased at

arm's length. We agree with petitioner that the comparison parts were

not identical; however, we found that the parts from related and

unrelated suppliers were comparable for purposes of the arm's length

test. With regard to the second part, because custom work was done on

the part in question, thereby making a benchmark unavailable, we could

not determine whether the part was sold at arm's length. However, we

found this part to be of insignificant value. Therefore, because JST

demonstrated that either the sale of the part was made at arm's length,

or the value was insignificant, we find that the purchase prices for

both of these parts are suitable for use in our calculation of the

foreign market value. (See Antifiction Bearings (Other Than

[[Page 62812]]

Tapered Roller Bearings) and Parts Thereof From France, et al.; Final

Results of Antidumping Duty Administrative Reviews, Partial Termination

of Administrative Reviews, and Revocation in Part of Antidumping Duty

Orders, 60 FR 10925, February 28, 1995.)

Comment 10: Petitioner states that the Department should reject

JST's home market direct warranty expense claim and treat warranty as

an indirect selling expense. Petitioner cites the verification report,

which states that JST calculated its reported home market warranty

expense claim based on its warranty experience for both subject and

non-subject merchandise. Petitioner argues that, because warranty

expenses can vary significantly by product, JST's warranty expense

allocation methodology may result in the overstatement of the company's

actual home market LPT warranty expense.

JST argues that, at verification, the Department was given detailed

warranty expense information by year and by transformer type. JST

states that it did report actual warranty expenses incurred on the

subject merchandise and distinguished warranty expenses incurred on

LPTs sold in the home market from warranty expenses sold on exports.

Department's Position: JST reported warranty expense on home market

sales which included both subject and non-subject merchandise. At

verification, we were able to separate warranty expense into three

categories: subject merchandise, non-subject merchandise, and export

sales. We agree with petitioner that we should calculate warranties

based only on subject merchandise. We disagree with petitioner that

warranty expense should be considered an indirect selling expense

because, as we found at verification, warranty expenses are associated

with specific sales. We have thus recalculated warranty expense on home

market subject merchandise and have continued to treat it as a direct

selling expense adjustment to foreign market value.

Comment 11: Petitioner argues that JST improperly allocated shared

production expenses for 1993 by allocating a portion of these expenses

to off-site production labor hours.

JST stated that, because its off-site production was LPT-related,

it properly allocated shared production expenses.

Department's Position: We agree with JST. Shared production

expenses for 1993 were properly allocated to all its production because

(1) the off-site production performed by JST was LPT-related, and (2)

of the nature of the shared production expenses. (See proprietary

memorandum to the file dated June 30, 1995.)

Comment 12: Petitioner argues that the Department improperly

included insurance in SG&A, rather than treating it as a movement

charge on JST's U.S. sales.

JST states that the insurance associated with freight was included

in JST's movement charges, and that the general insurance covering

plant and inventory was included in the SG&A charge that JST reported

in its questionnaire response. JST asserts that the Department properly

included both sets of insurance costs in its preliminary dumping

calculation.

Department's Position: We agree with JST. At verification, in our

examination of JST's internal cost sheets, which listed all of JST's

expenses, we found that insurance had not been specifically listed. In

our examination of freight documents, we found that the freight

companies that JST used for shipping transformers to the United States

included, in their charges, amounts for insurance. Therefore, JST

properly reported freight insurance as a movement expense. In our

examination of insurance reported as SG&A, we found that JST had been

charged an amount for all its sales in the year we used to calculate

SG&A. Based on the above information, we conclude that JST has properly

reported insurance as a movement expense or an SG&A expense, depending

on the nature of the insurance.

Comment 13: Petitioner states that the Department correctly

determined that only two entries were covered by this administrative

review. Petitioner notes that during the period of review two JST units

entered into the United States; however, JST requested the Department

review a third unit which JST sold during the period of review.

Petitioner argues that, while the Department has based certain

administrative reviews on sales rather than entries, it has not mixed

entry- and sale-based analyses in the same review, nor has it varied

its methodology from review to review. Petitioner also notes that, at

verification, the Department found that several important components of

the margin calculation for this third sale could not be quantified

because they had not yet been incurred. Petitioner contends that for

its final results the Department should reaffirm its decision to

exclude this unit from this review.

Department's Position: We agree that this sale should not be

included in this administrative review. At verification we examined

this sale in detail; however, we could not verify receipt of payment

for the transformer, or payment of movement expenses and commissions.

In addition, we found that material cost could change due to

adjustments that had not yet been made to materials removed from stock.

Further, our general practice, in purchase price situations, is to

review sales corresponding to shipments or entries made during the

period of review. We have, therefore, not included this sale in our

analysis.

Final Results of Review

As a result of our review, we determine that the following

weighted-average margin exists:

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

Margin

Manufacturer/exporter Period of review (percent)

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

Jeumont Schneider Transformateurs............................................ 06/01/93-05/31/94 1.50

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

The Department shall determine, and the Customs Service shall

assess, antidumping duties on all appropriate entries. Individual

differences between U.S. price and foreign market value may vary from

the percentage stated above. The Department will issue appraisement

instructions on each exporter directly to the Customs Service.

Furthermore, the following deposit requirements will be effective

upon publication of this notice of final results of review for all

shipments of LPTs from France entered, or withdrawn from warehouse, for

consumption on or after the publication date, as provided by section

751(a)(1) of the Tariff Act: (1) The cash deposit rate for the reviewed

company will be the rate listed above; (2) for previously reviewed or

investigated companies not listed above, the cash deposit rate will

continue to be the company-specific rate published for the most recent

period; (3) if the exporter is not a firm covered in this review, a

prior review or the original less-than-fair-value investigation, but

[[Page 62813]]

the manufacturer is, the cash deposit rate will be the rate established

for the most recent period for the manufacturer of the merchandise; and

(4) for all other producers and/or exporters of this merchandise, the

cash deposit rate shall be 24 percent, the rate established in the

first notice of final results of administrative review published by the

Department (47 FR 10268, March 10, 1982). These deposit requirements

shall remain in effect until publication of the final results of the

next administrative review.

This notice 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 subsequent assessment

of double antidumping duties.

Notification to Interested Parties

This notice also serves as a reminder to parties subject to

administrative protective order (APO) of their responsibility

concerning the disposition of proprietary information disclosed under

APO in accordance with 19 CFR 353.34(d). Timely written notification of

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.

This administrative review 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: November 30, 1995.

Paul L. Joffe,

Deputy Assistant Secretary for Import Administration.

[FR Doc. 95-29887 Filed 12-6-95; 8:45 am]

BILLING CODE 3510-DS-P