Certain Cut-to-Length Carbon Steel Plate from Sweden: Preliminary Results of Antidumping Duty Administrative Review

DEPARTMENT OF COMMERCE

International Trade Administration

[A-401-805]

Certain Cut-to-Length Carbon Steel Plate from Sweden: Preliminary

Results of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of preliminary results of Antidumping Duty

Administrative Review.

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SUMMARY: In response to requests from interested parties, the

Department of Commerce (the Department) is conducting an administrative

review of the antidumping duty order on certain cut-to-length carbon

steel plate from Sweden. This review covers one manufacturer/exporter

of the subject merchandise to the United States and the period August

1, 1995 through July 31, 1996. SSAB failed to submit a response to our

questionnaire. As a result, we have preliminarily determined to use

facts otherwise available for cash deposit and appraisement purposes.

We invite interested parties to comment on these preliminary

results. Parties who submit comments in this proceeding are requested

to submit with each argument (1) A statement of the issue and (2) a

brief summary of the argument.

EFFECTIVE DATE: May 14, 1997.

FOR FURTHER INFORMATION CONTACT: Elizabeth Patience or Steve Jacques,

Import Administration, International Trade Administration, U.S.

Department of Commerce, 14th Street and Constitution Avenue, N.W.,

Washington, D.C. 20230; telephone: (202) 482-3793.

APPLICABLE STATUTE AND REGULATIONS: Unless otherwise indicated, all

citations to the Tariff Act of 1930, as amended (the Act), are

references to the provisions effective January 1, 1995, the effective

date of the amendments made to the Act by the Uruguay Round Agreements

Act (URAA). In addition, unless otherwise indicated, all citations to

the Department's regulations are to the current regulations, as amended

by the interim regulations published in the Federal Register on May 11,

1995 (60 FR 25130).

SUPPLEMENTARY INFORMATION:

Background

On August 19, 1993, the Department published in the Federal

Register (58 FR 44168) the antidumping duty order on certain cut-to-

length carbon steel plate from Sweden. On August 30, 1996, Bethlehem

Steel Corporation, U.S. Steel Group (a Unit of USX Corporation), Inland

Steel Industries Inc., Gulf States Steel Inc. of Alabama, Sharon Steel

Corporation, Geneva Steel, and Lukens Steel Company, petitioners,

requested a review for SSAB Svenskt Stal AB (SSAB). On September 3,

1996, SSAB also requested a review for its exports of subject

merchandise. On September 17, 1996, in accordance with 19 C.F.R.

353.22(c), we initiated the administrative review of this order for the

period August 1, 1995, through July 31, 1996 (61 FR 48882). The

Department is now conducting this administrative review in accordance

with section 751(a) of the Act.

Scope of the Review

Certain cut-to-length plate includes hot-rolled carbon steel

universal mill plates (i.e., flat-rolled products rolled on four faces

or in a closed box pass, of a width exceeding 150 millimeters but not

exceeding 1,250 millimeters and of a thickness of not less than 4

millimeters, not in coils and without patterns in relief), of

rectangular shape, neither clad, plated nor coated with metal, whether

or not painted, varnished, or coated with plastics or other nonmetallic

substances; and certain hot-rolled carbon steel flat-rolled products in

straight lengths, of rectangular shape, hot rolled, neither clad,

plated, nor coated with metal, whether or not painted, varnished, or

coated with plastics or other nonmetallic substances, 4.75 millimeters

or more in thickness and of a width which exceeds 150 millimeters and

measures at least twice the thickness, as currently classifiable in the

HTS under item numbers 7208.40.3030, 7208.40.3060, 7208.51.0030,

7208.51.0045, 7208.51.0060, 7208.52.0000, 7208.53.0000, 7208.90.0000,

7210.70.3000, 7210.90.9000, 7211.13.0000, 7211.14.0030, 7211.14.0045,

7211.90.0000, 7212.40.1000, 7212.40.5000, 7212.50.0000. Included are

flat-rolled products of non-rectangular cross-section where such cross-

section is achieved subsequent to the rolling process (i.e., products

which have been worked after rolling)--for example, products which have

been beveled or rounded at the edges. Excluded is grade X-70 plate.

These HTS item numbers are provided for convenience and Customs

purposes. The written description remains dispositive.

The period of review (POR) is August 1, 1995, through July 31,

1996.

Use of Facts Otherwise Available

Following the initiation of this review, the Department sent

respondent a questionnaire seeking information necessary to conduct a

review of any shipments that firm may have made to the United States

during the POR. SSAB did not respond to the questionnaire. Because

necessary information is not available on the record for the POR as a

result of SSAB withholding the requested information, we must make our

preliminary determination based on facts otherwise available (section

776(a) of the Act).

On October 21, 1996, the due date for section A of the Department's

questionnaire, SSAB made a timely withdrawal of its request for a

review of this POR. However, because petitioners had also requested an

administrative review, the review is still in progress. Additionally,

SSAB stated it would not be participating in the review and requested

assignment, as facts available, of the first administrative review

margin, 8.28 percent. SSAB also failed to respond to sections B, C and

D of the questionnaire, which were due November 4, 1996.

On January 8, 1997, petitioners requested that the Department

assign to SSAB as facts available, 34 percent, the highest rate from

the antidumping petition. Petitioners argued that this rate was more

appropriate than the average petition rate, 24.23 percent, which was

also used as the best information available in the final determination

of the less than fair value (LTFV) investigation. Because the LTFV rate

had not induced SSAB to cooperate, petitioners argue the Department

should use alternative sources of facts available rates or the

respondent could be in a position to manipulate the administrative

review process by refusing to cooperate when its actual margin of

dumping may exceed the LTFV investigation margin. See Steel Wire Rope

from the Republic of Korea: Final Results of Antidumping Duty

Administrative Review, 61 FR 55964, 55967-68, (October 30, 1996) (Steel

Wire Rope). See Certain Fresh Cut Flowers from Colombia: Final Results

of Antidumping Duty Administrative Reviews, 61 FR 42833, 42835 (August

19, 1996). See Certain Malleable Cast Iron Pipe Fittings from Brazil:

Final Results of Antidumping Duty Administrative Review, 60 FR 41876,

41878 (August 14, 1995). Accordingly, petitioners proposed that the

Department use as facts available the highest rate from the petition

which is a rate of 34 percent.

[[Page 26474]]

On January 16, 1997, respondent submitted a rebuttal to

petitioners' submission. Noting that on September 4, 1996, in the

second administrative review of this order, the Department had

preliminarily determined to apply facts available to SSAB, and that

this decision was based on SSAB's failure to reconcile its cost

response to its audited financial statements, respondent argued that it

is precluded from participating in future administrative reviews until

the Department reconsiders the cost verification standard it applied to

SSAB in the second administrative review, or until the company revises

its cost accounting system to conform to the Department's thinking as

to how the company should maintain its audited financial statements.

Respondent asserted that its withdrawal from participation in the third

review does not stem from an intentional failure to cooperate or a

desire to ``control the review process'' or ``practice injurious price

discrimination to a greater degree than at the time of the LTFV

investigation.'' Rather, respondent argued that the cost accounting

system for SSOX, one of SSAB's two plants producing subject

merchandise, has been rejected by the Department in a prior

administrative review and that SSOX has no alternative method for

reporting costs in the current review. Respondent argued that because

the relevant period for the third administrative review already expired

before SSAB was made aware that the SSOX cost accounting system and

reported costs would be rejected, SSAB had no choice but to withdraw

from participating in the third administrative review. Therefore,

respondent maintains that the Department should reject the petitioners'

request for a 34 percent facts available margin.

Respondent's voluntary withdrawal from this, the third

administrative review, followed the Department's preliminary facts

available determination in the second administrative review, but

preceded the final results of that review. SSAB made no attempt in the

third review to contact the Department to discuss how it should proceed

in responding to section D, the cost of production section of the

questionnaire, nor did it respond to any other section of the

questionnaire. Thus, the Department finds that, in not responding to

the questionnaire, SSAB failed to cooperate by not acting to the best

of its ability to comply with a request for information from the

Department. Therefore, pursuant to section 776(b) of the Act, we may,

in making our determination, use an adverse inference in selecting from

the facts otherwise available. This adverse inference may include

reliance on data derived from the petition, a previous determination in

an investigation or review, or any other information placed on record.

We agree with petitioners that the 24.23 percent margin has not induced

SSAB to cooperate in this review and a higher margin is warranted. Our

decision to use a rate higher than the LTFV rate is consistent with our

decision in the previous segment of the proceeding in which we assigned

the LTFV rate as total adverse facts available because ``* * * while

SSAB did not act to the best of its ability in responding to our cost

information requests, it did cooperate with respect to certain aspects

of this review.'' See Certain Cut-to-Length Carbon Steel Plate from

Sweden, Preliminary Results of Antidumping Duty Administrative Review,

61 FR 51898, 51900 (October 4, 1996); see, also, Certain Cut-to-Length

Carbon Steel Plate from Sweden, Final Results of Antidumping Duty

Administrative Review, 62 FR 18396, 18401 (April 15, 1997).

Accordingly, in this case, because SSAB has not cooperated with any

aspects of this review, we preliminarily assign to SSAB a more adverse

margin of 34 percent, the highest margin from the original petition in

the LTFV investigation.

Section 776(b) authorizes the Department to use as adverse facts

available information derived from the petition, the final

determination, a previous administrative review, or other information

placed on the record. Section 776(c) provides that the Department

shall, to the extent practicable, corroborate ``secondary information''

by reviewing independent sources reasonably at its disposal. The SAA,

at 870, makes it clear that ``secondary information'' includes

information from the petition in the less-than-fair-value (LTFV)

investigation and information from a previous section 751 review of the

subject merchandise. The SAA also provides that ``corroborate'' means

simply that the Department will satisfy itself that the secondary

information to be used has probative value. Id.

As noted above, the Department used an average of the petition

rates as total adverse facts available in the previous segment of this

proceeding. The Department explained in that review that it had

corroborated the petition information. For the purposes of these

preliminary results, we continue to regard the petition information as

corroborated, though we intend to consider further, for purposes of the

final results of review, whether or not further corroboration, based on

updated information, is both appropriate and possible.

Duty Absorption

On October 7, 1996, petitioners requested that the Department

determine whether antidumping duties had been absorbed during the POR.

On October 8, 1996, respondent opposed petitioners' request stating

this review is ineligible for an absorption inquiry because the review

was initiated three years, not two or four years, after publication of

the antidumping duty order. Section 751(a)(4) of the Act provides for

the Department, if requested, to determine, during an administrative

review initiated two or four years after publication of the order,

whether antidumping duties have been absorbed by a foreign producer or

exporter subject to the order, if the subject merchandise is sold in

the United States through an importer who is affiliated with such

foreign producer or exporter. Section 751(a)(4) was added to the Act by

the URAA. The Department's interim regulations do not address this

provision of the Act.

For transition orders as defined in section 751(c)(6)(C) of the

Act, i.e., orders in effect as of January 1, 1995, section

351.213(j)(2) of the Department's proposed antidumping regulations

provide that the Department will make a duty absorption determination,

if requested, for any administrative review initiated in 1996 or 1998.

See Notice of Proposed Rulemaking, 61 FR 7308, 7366 (February 27,

1996). The preamble to the proposed antidumping regulations explains

that reviews initiated in 1996 will be considered initiated in the

second year and reviews initiated in 1998 will be considered initiated

in the fourth year. Id. at 7317. Although these proposed antidumping

regulations are not yet binding upon the Department, they do constitute

a public statement of how the Department expects to proceed in applying

section 751(a)(4) of the amended statute. This approach assures that

interested parties will have the opportunity to request a duty

absorption determination on entries for which the second and fourth

years following an order have already passed, prior to the time for

sunset review of the order under section 751(c). Because the order on

subject merchandise from Sweden has been in effect since 1993, this

qualifies as a transition order. Therefore, based on the policy stated

above, the Department will first consider a request for an absorption

determination during a review initiated in 1996. This being a review

initiated in 1996, we are making

[[Page 26475]]

a duty-absorption determination as part of this segment of the

proceeding.

In this case, we are unable to calculate a margin based on SSAB's

response and have therefore determined its dumping margin entirely on

the basis of adverse facts available. We also determined, based on

adverse facts available, that there are margins on all sales. Lacking

other information, we find duty absorption on all sales.

Preliminary Results of the Review

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

of 34 percent exists for SSAB for the period August 1, 1995 through

July 31, 1996. Parties to the proceeding may request disclosure within

five days of the date of publication of this notice. Any interested

party may request a hearing within 10 days of publication. Case briefs

and/or written comments from interested parties may be submitted not

later than 30 days after the date of publication. Rebuttal briefs and

rebuttals to written comments, limited to issues raised in the case

briefs and comments, may be filed not later than 37 days after the date

of publication. Any hearing, if requested, will be held 44 days after

the date of publication, or the first workday thereafter. The

Department will publish the final results of the administrative review,

including the results of its analysis of issues raised in any such

written comments or at a hearing, within 120 days of publication of

these preliminary results.

Upon completion of this administrative review, 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 administrative review for all

shipments of subject merchandise, entered, or withdrawn from warehouse,

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

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

reviewed company will be that established in the final results of this

administrative review; (2) for exporters not covered in this review,

but covered in previous reviews or the original less-than-value (LTFV)

investigation, 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, previous reviews, or the original

LTFV investigation, but the manufacturer is, the cash deposit rate will

be that established for the most recent period for the manufacturer of

the merchandise; and (4) the cash deposit rate for all other

manufacturers or exporters will be 24.23 percent, the ``all others''

rate established in the final notice of the LTFV investigation (58 FR

37213, July 9, 1993).

These requirements, when imposed, shall remain in effect until

publication of the final results of the next administrative review.

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 (19 U.S.C. 1675(a)(1)) and 19 CFR

353.22.

Dated: May 5, 1997.

Robert S. LaRussa,

Acting Assistant Secretary for Import Administration.

[FR Doc. 97-12649 Filed 5-13-97; 8:45 am]

BILLING CODE 3510-DS-P