Color Television Receivers From the Republic of Korea; Preliminary Results and Termination in Part of Antidumping Duty Administrative Reviews

DEPARTMENT OF COMMERCE

International Trade Administration

[A-580-008]

Color Television Receivers From the Republic of Korea;

Preliminary Results and Termination in Part of Antidumping Duty

Administrative Reviews

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of Preliminary Results and Termination in Part of

Antidumping Duty Administrative Reviews.

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SUMMARY: In response to requests by interested parties, the Department

of Commerce (the Department) is conducting administrative reviews of

the antidumping duty order on color television receivers (CTVs) from

the Republic of Korea. The reviews (sixth and seventh, respectively)

cover exports of this merchandise to the United States during the

periods April 1, 1988 through March 31, 1989, and April 1, 1989 through

March 31, 1990. The review of Quantronics Manufacturing

[[Page 9006]] Company is being terminated in the sixth (88-89) review.

Based on our review of the remainder of these exports, we preliminarily

find the existence of dumping margins for all reviewed companies with

the exception of Samsung Electronics Co., Ltd. (Samsung), which had a

de minimis margin in both of our reviews. We invite interested parties

to comment on these preliminary results.

3EFFECTIVE DATE: February 16, 1995.

FOR FURTHER INFORMATION CONTACT: Anne D'Alauro or Richard Herring,

Office of Countervailing Compliance, Import Administration,

International Trade Administration, U.S. Department of Commerce, 14th

Street and Constitution Avenue, NW., Washington, DC 20230; telephone:

(202) 482-2786.

SUPPLEMENTARY INFORMATION:

Background

On March 31, 1989, the Department published in the Federal Register

a notice of ``Opportunity to Request Administrative Review'' (54 FR

13211) of the antidumping duty order on CTVs from the Republic of Korea

for the period April 1, 1988 through March 1, 1989 (sixth review). The

United Electrical Workers of America, Independent, International

Brotherhood of Electrical Workers, International Union of Electronic,

Electrical, Salaried, Machine and Furniture Workers, AFL-CIO, and the

Industrial Union Department, AFL-CIO (the Unions), the petitioners in

this proceeding, Zenith Electronics Corporation, a domestic interested

party, two respondents, Cosmos Electronics Company Ltd. (Cosmos), and

Samsung, and an importer of color television receivers from Tongkook

General Electronics Co., Ltd (Tongkook), and Samwon Electronics, Inc.

(Samwon), requested an administrative review of the antidumping duty

order for this period. For the subsequent (seventh) review period,

April 1, 1989 through March 31, 1990, the opportunity notice was

published on April 10, 1990 (55 FR 13302). With the exception of the

importer of Tongkook and Samwon, the same interested parties requested

a review of the seventh period. In addition, the respondent Goldstar

Company, Ltd. (Goldstar), also requested a review of its exports for

the seventh period.

On May 24, 1989, the Department published a notice of initiation of

the sixth review which covered seven companies including Tongkook,

Samwon, Cosmos, Goldstar, Daewoo Electronics Co., Ltd. (Daewoo),

Quantronics Manufacturing Company, Ltd. (Quantronics), and Samsung. On

June 1, 1990, we published a notice of initiation for the seventh

review (55 FR 22366) for the same seven manufacturers.

The requests for review with respect to Goldstar for both periods

were withdrawn on May 23, 1994. Because all the requesting parties for

these reviews withdrew their requests for Goldstar, on June 29, 1994,

the Department terminated the reviews of Goldstar (59 FR 33486)

pursuant to 19 CFR Sec. 353.22(a)(5). On August 19, 1994, the final

results of review with respect to Daewoo for both periods were

separately issued (59 FR 40519). The request for review with respect to

Quantronics for the seventh period was timely withdrawn pursuant to

section 353.22(a)(5) and was terminated on July 31, 1990 (55 FR 31089).

On October 7, 1994, the request for review of Quantronics made by

Zenith Electronics Corporation for the sixth period was withdrawn.

Pursuant to 19 CFR Sec. 353.22(a)(5), the Department has the discretion

to extend the period during which requests for review may be withdrawn.

Because withdrawal of the request does not burden the Department or

unfairly prejudice another party, in this notice we are terminating the

sixth administrative review with respect to Quantronics pursuant to 19

CFR Sec. 353.22(a)(5).

The Department is now conducting these administrative reviews in

accordance with section 751 of the Tariff Act of 1930, as amended (the

Tariff Act).

Scope of Reviews

Imports covered by this review include CTVs, complete and

incomplete, from the Republic of Korea. The order covers all CTVs

regardless of tariff classification. During the period of review, the

subject merchandise was classified under item numbers 684.9246,

684.9248, 684.9250, 684.9252, 684.9253, 684.9255, 684.9256, 682. 9258,

684.9262, 684.9263, 684.9270, 684.9275, 684.9655, 684.9656, 684.9658,

684.9660, 684.9663, 684.9864, 684.9866, 687.3512, 687.3513, 687.3513,

687.3514, 687.3516, 687.3518, and 687.3520 of the Tariff Schedules of

the United States Annotated (TSUSA). This merchandise is currently

classifiable under item numbers 8528.10.80, 8529.90.15, 8529.90.20, and

8540.11.00 of the Harmonized Tariff Schedule (HTS). Although the HTS

and TSUSA item numbers are provided for convenience and Customs

purposes, our written description of the scope remains dispositive.

Best Information Available (BIA)

Two companies, Tongkook and Samwon, failed to respond to the

original questionnaires sent by the Department for both review periods.

One firm, Cosmos, failed to respond to our supplemental questionnaire

for both review periods after going out of business. In deciding what

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

into account whether a party fails to provide requested information.

When a company fails to provide the information requested in a timely

manner, or otherwise significantly impedes the Department's review, the

Department considers that company to be uncooperative, and generally

assigns to that company the higher of (a) the highest rate for any

company from any previous review or the original investigation, or (b)

the highest rate for a responding firm with shipments during the

current period. See Final Results of Antidumping Duty Administrative

Review, Antifriction Bearings (Other than Tapered Roller Bearings) and

Parts Thereof from the Federal Republic of Germany, et al. (56 FR

31692; July 11, 1994). See also Allied-Signal Aerospace Co. v. United

States, 996 F.2d 1195, 1191-92 (Fed. Cir. 1993), and Krupp Stahl AG et

al. v. United States, 822 F. Supp. 789 (CIT 1993). For Tongkook and

Samwon, the companies which failed to provide any information to the

Department, we have used the highest rate from the original less-than-

fair value (LTFV) investigation of 16.57 percent as their BIA rate

because this rate is higher than the highest rate in the current

reviews. For Cosmos, we have instead applied ``second-tier'' BIA, used

for cooperative companies, because Cosmos provided reasonable and

timely responses until the time of its business failure. Second-tier

BIA rates comprise the higher of (1) the highest rate (including the

``all others'' rate) ever applied to that company from any prior review

or the LTFV investigation, or (2) the highest rate calculated for any

other company in the current review. Id. Because the only previous rate

of 2.24 percent calculated for Cosmos from the immediately preceding

review is higher than the rates calculated in the current reviews,

Cosmos has been assigned a ``second-tier'' BIA rate of 2.24 percent.

Request for Revocation

On November 12, 1993, Samsung submitted a request for revocation in

the sixth administrative review which it based on having established,

in conjunction with its anticipated de [[Page 9007]] minimis result in

the sixth review, three years of sales at not LTFV. Pursuant to

Sec. 353.25(b) of the Department's regulations, parties must submit

their revocation request during the opportunity month for the

administrative review which the respondent reasonably believes could

establish their eligibility for revocation. See Exportaciones Bochica/

Floral v. United States, 802 F. Supp. 447, aff'd without opinion, 996

F.2d 317 (1993). Therefore, in Samsung's case, even though the 1986-

1987 (fourth) and the 1987-1988 (fifth) reviews had not been completed,

Samsung should have filed its request during April of 1989, the

opportunity month for the sixth review period. Such a filing would have

preserved its right to revocation in the sixth review. The Department

has carefully considered Samsung's reasons for failing to file their

revocation request in a timely manner. One reason involves their

inability to speculate in April of 1989 on unknown results in reviews

four and five. However, unknown results in the previous reviews is not

a valid reason for delaying a request for revocation. The regulation

requires the revocation request to be filed in the anniversary month of

the order if it is to be considered in the review requested that month.

Id.

In addition, Samsung argues that although reviews four and five

ultimately resulted in de minimis rates, an assumption would have had

to be made that the litigation (in the first administrative review)

involving the tax pass-through methodology, and affecting reviews four

and five, would be resolved in a way that would result in calculation

and allocation methodologies favorable to Samsung. It argues that

because the issue regarding the correct tax methodology was not

officially resolved until September 1993, it was not until that time

that recognition could actually be given to final results in the fourth

and fifth reviews. The Department, however, is not persuaded by

Samsung's argument that the unknown results of ongoing litigation is an

acceptable explanation for tardiness. The Department has consistently

indicated that it is not its policy to await the results of pending

court actions in making such decisions. See, Certain Fresh Cut Flowers

from Colombia; Final Results of Antidumping Duty Administrative Review,

and Notice of Revocation of Order (in Part) (59 FR 15159; March 31,

1994). In any case, given that the final results of reviews four and

five were known to be de minimis on June 27, 1990 and March 27, 1991,

respectively, the uncertain effect of litigation regarding the tax

pass-through methodology on these results is an unconvincing

explanation for Samsung's failure to file its revocation request until

approximately two-and-a-half years after the de minimis results. For

these reasons, we are preliminarily denying Samsung's revocation

request.

Even more recently, on November 3, 1994, Samsung submitted a

request for revocation in the seventh administrative review. For the

same reasons discussed above, and the fact that the Department has not

conducted the verification required for revocation under

Sec. 353.25(c)(2)(ii), the Department is denying Samsung's revocation

request for the seventh administrative review.

United States Price (USP)

For Samsung, we based USP on purchase price in accordance with

section 772(b) of the Tariff Act when CTVs were sold to unrelated

purchasers in the United States prior to importation into the United

States, and because exporter's sales price (ESP) methodology was not

indicated by other circumstances. We based Samsung's USP on ESP as

defined in section 772(c) of the Tariff Act when sales were made to

unrelated parties after importation into the United States.

We calculated purchase price based on the packed, delivered, free

on board (FOB) U.S. port or FOB Korea prices to unrelated customers in

the United States. We made deductions, where applicable, for foreign

inland freight, forwarding, EIAK export fees, ocean freight, Korean

customs clearance fees, marine insurance, U.S. brokerage charges,

wharfage, and U.S. duties. Where applicable, we made an addition for

import duties collected and rebated on imported raw materials used in

merchandise exported to the United States.

We calculated ESP based on the packed, delivered or FOB U.S.

warehouse prices to unrelated customers in the United States. We made

deductions, where applicable, for foreign inland freight, forwarding,

EIAK export fees, ocean freight, customs clearance fees, marine

insurance, U.S. brokerage charges, wharfage, U.S. duties, U.S. inland

freight to the warehouse and for delivery to customers, royalties,

discounts and rebates, commissions to unrelated parties, warranty

expenses, return set losses, advertising, credit, and indirect selling

expenses. Where applicable, we made an addition for import duties

collected and rebated on imported raw materials used in merchandise

exported to the United States.

We adjusted USP for value-added taxes in accordance with our

practice as outlined in Silicon Manganese from Venezuela, Preliminary

Determination of Sales at Less Than Fair Value, 59 FR 31204, June 17,

1994.

There were no other adjustments claimed or allowed.

Foreign Market Value (FMV)

In calculating FMV, the Department used home market price, as

defined in section 773 of the Tariff Act, where sufficient quantities

of such or similar merchandise were sold in the home market to provide

a basis for comparison. Where sufficient quantities of such or similar

merchandise for particular models were not sold in the home market, we

used constructed value in accordance with section 773(a)(2) of the

Tariff Act.

Home market price was based on the packed, delivered prices in the

home market. Where applicable, we made deductions for inland freight,

forwarding, discounts, rebates, credit, technical services, royalties,

advertising and promotion, as well as adjustments for differences in

merchandise and packing. We adjusted FMV for value-added taxes in

accordance with our practice as outlined in Silicon Manganese from

Venezuela, Preliminary Determination of Sales at Less Than Fair Value,

59 FR 31204, June 17, 1994. The company's warehousing expense could not

be tied directly to either a particular customer or sales of the

subject merchandise, and therefore we treated it as an indirect selling

expense.

In light of the Court of Appeals for the Federal Circuit's decision

in Ad Hoc Committee of AD-NM-TX-FL Producers of Gray Portland Cement v.

United States, 13 F.3d 398 (Fed. Cir. 1994), the Department no longer

can deduct home market movement charges from FMV pursuant to its

inherent power to fill in gaps in the antidumping statute. We instead

will adjust for those expenses under the circumstance-of-sale (COS)

provision of 19 CFR 353.56 and the ESP offset provision of 19 CFR

353.56(b) (1) and (2), as appropriate, in the manner described below.

When USP is based on purchase price, we only adjust for home market

movement charges through the COS provision of 19 CFR 353.56. Under this

adjustment, we capture only direct selling expenses, which include

post-sale movement expenses and, in some circumstances, pre-sale

movement expenses. Specifically, we will treat pre-sale movement

expenses as direct expenses if those expenses are directly related to

the home market sales of the merchandise under consideration.

[[Page 9008]] Moreover, in order to determine whether pre-sale movement

expenses are direct, the Department will examine the respondent's pre-

sale warehousing expenses, since the pre-sale movement charges incurred

in positioning the merchandise at the warehouse are, for analytical

purposes, inextricably linked to pre-sale warehousing expenses. If the

pre-sale warehousing constitutes an indirect expense, the expense

involved in getting the merchandise to the warehouse also must be

indirect; conversely, a direct pre-sale warehousing expense necessarily

implies a direct pre-sale movement expense.

When USP is based on ESP, the Department uses the COS adjustment in

the same manner as in purchase price situations. Additionally, under

the ESP offset provision set forth in 19 CFR 353.56(b) (1) and (2), we

will adjust for any pre-sale movement charges which are treated as

indirect selling expenses. Accordingly, because the Department has

preliminarily determined that pre-sale warehousing costs are an

indirect expense, the Department is also treating pre-sale movement

costs as an indirect expense. Therefore, no COS adjustment has been

made for these costs. For ESP sales, an adjustment for indirect costs

has been made under the ESP offset provision.

For ESP comparisons, we also deducted indirect selling expenses

from FMV in an amount not exceeding the indirect selling expenses and

commissions incurred in the U.S. market. For purchase price

comparisons, we added U.S. direct selling expenses including U.S.

advertising, credit, warranties and royalties to FMV. Indirect selling

expenses were deducted from FMV in an amount not exceeding the amount

of commissions paid on U.S. purchase price sales in accordance with 19

CFR 353.56(b)(1).

We calculated constructed value for Samsung by adding material and

fabrication costs, selling, general and administrative expenses (SG&A),

profit, and U.S. packing in accordance with section 773(e) of the

Tariff Act. Since, in both reviews, actual SG&A expenses were greater

than the statutory minimum of 10 percent of the sum of materials and

fabrication costs, we used Samsung's actual SG&A expenses. We used the

statutory minimum of eight percent for profit in the sixth review in

accordance with section 773(e) of the Tariff Act. In the seventh

review, we used Samsung's actual profit experience since it was greater

than eight percent of the cost of production.

No other adjustments were claimed or allowed.

Preliminary Results of the Reviews

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

weighted-average dumping margins for the periods are:

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

Margin percentage

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

Manufacturer/exporter 04/01/88-3/31/ 04/01/89-3/31/

89 90

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

Cosmos.................................... 2.24 2.24

Quantronics............................... Terminated Terminated

Samsung................................... 0.02 0.09

Samwon.................................... 16.57 16.57

Tongkook.................................. 16.57 16.57

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Case briefs and/or written comments from interested parties may be

submitted no later than 30 days after the date of publication of this

notice. Rebuttal briefs and rebuttals to written comments, limited to

issues raised in the case briefs and comments, may be filed no later

than 37 days after the date of publication of this notice.

Within 10 days of the date of publication of this notice,

interested parties to this proceeding may request a disclosure and/or a

hearing. The hearing, if requested, will take place no later than 44

days after publication of this notice. Persons interested in attending

the hearing should contact the Department for the date and time of the

hearing.

The Department will subsequently publish the final results of this

administrative review including the results of its analysis of issues

raised in any such written comments or at a hearing.

The Department shall determine, and the Customs Service shall

assess, antidumping duties on all appropriate entries. The Department

will issue appraisement instructions directly to the Customs Service.

Furthermore, the following deposit requirements will be effective

upon publication of the final results of this administrative review for

all shipments of the subject merchandise from Korea 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 all companies will continue to be the company-specific

rate published in the final determination covering the most recent

period; (2) for merchandise exported by manufacturers or exporters not

covered in this review but covered in previous reviews or the original

LTFV investigation, the cash deposit rate will continue to be the

company-specific rate published in the final determination covering the

most recent period; (3) if the exporter is not a firm covered in this

review, previous reviews, or the original investigation, but the

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

the most recent period for the manufacturer of the merchandise; (4) the

cash deposit rate for all other manufacturers or exporters will be

13.90 percent, the ``all other'' rate established in the original LTFV

investigation by the Department (49 FR 7620, March 1, 1984), in

accordance with the decisions of the Court of International Trade in

Floral Trade Council v. United States, 822 F. Supp. 766 (CIT 1993), and

Federal-Mogul Corporation v. United States, 822 F. Supp. 782 (CIT

1993).

This notice serves as a preliminary 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 administrative review and notice are in accordance with

section 751(a)(1) of the Tariff Act, as amended (19 U.S.C. 1675(a)(1))

and 19 CFR 353.22.

Dated: February 8, 1995.

Susan G. Esserman,

Assistant Secretary for Import Administration.

[FR Doc. 95-3960 Filed 2-15-95; 8:45 am]

BILLING CODE 3510-DS-P