Silicon Metal From Brazil; Amended Final Results of Antidumping Duty Administrative Review

DEPARTMENT OF COMMERCE

International Trade Administration

[A-351-806]

Silicon Metal From Brazil; Amended Final Results of Antidumping

Duty Administrative Review

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Amended final results of antidumping duty administrative

review.

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SUMMARY: The Department of Commerce (the Department) is amending its

final results of review, published on January 14, 1997, of the

antidumping duty order on silicon metal from Brazil, to reflect the

correction of ministerial errors in those final results. The period

covered by these amended final results is the period July 1, 1994

through June 30, 1995.

EFFECTIVE DATE: October 17, 1997.

FOR FURTHER INFORMATION CONTACT: Fred Baker, Alain Letort, or John

Kugelman, AD/CVD Enforcement Group III--Office 8, Import

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

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

Washington, D.C. 20230, telephone 202/482-2924 (Baker), 202/482-4243

(Letort), or 202/482-0649 (Kugelman), fax 202/482-1388.

SUPPLEMENTARY INFORMATION:

Applicable Statute and Regulations

Unless otherwise indicated, all citations to 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).

Background

The Department published the final results of the fourth

administrative review, covering the period July 1, 1994 through June

30, 1995, of the antidumping duty order on silicon metal from Brazil on

January 14, 1997 (62 FR 1970) (Fourth Review Final Results). The

respondents are Companhia Brasileira Carbureto de Calcio (CBCC),

Companhia Ferroligas Minas Gerais-Minasligas (Minasligas),

[[Page 54088]]

Eletrosilex Belo Horizonte (Eletrosilex), Rima Industrial S.A. (RIMA),

and Camargo Correa Metais (CCM). The petitioners are American Alloys,

Inc., Elken Metals, Co., Globe Metallurgical, Inc., SMI Group, and SKW

Metals & Alloys.

On January 31, 1997, Minasligas and RIMA filed clerical error

allegations. On February 4, 1997, the petitioners filed clerical error

allegations with respect to Eletrosilex, Minasligas, RIMA, and CBCC. On

February 6, 1997, Eletrosilex filed clerical error allegations. On

February 7, 1997, petitioners filed a response to the clerical error

allegations submitted by Minasligas and RIMA. Also on February 7, 1997,

RIMA submitted a response to the petitioners' clerical error

allegations. On February 11, 1997, CBCC submitted a response to

petitioners' clerical error allegations. On February 13, 1997,

petitioners submitted a response to Eletrosilex's clerical error

allegations. Pursuant to the CIT's order, we are now addressing the

ministerial allegations and amending our final results of the fourth

review. See American Silicon Technologies et al., v. United States,

Slip Op. 97-113, August 18, 1997.

Scope of Review

The merchandise covered by this review is silicon metal from Brazil

containing at least 96.00 percent but less than 99.99 percent silicon

by weight. Also covered by this review is silicon metal from Brazil

containing between 89.00 and 96.00 percent silicon by weight but which

contains a higher aluminum content than the silicon metal containing at

least 96.00 percent but less than 99.99 percent silicon by weight.

Silicon metal is currently provided for under subheadings 2804.69.10

and 2804.50 of the Harmonized Tariff Schedule (HTS) as a chemical

product, but is commonly referred to as a metal. Semiconductor grade

silicon (silicon metal containing by weight not less than 99.99 percent

silicon and provided for in subheading 2804.61.00 of the HTS) is not

subject to the order. HTS item numbers are provided for convenience and

for U.S. Customs purposes. The written description remains dispositive

as to the scope of product coverage.

Clerical Error Allegations

Comment 1

Minasligas argues that the Department erred in its calculation of

its cost of production/constructed value (COP/CV) by failing to offset

Minasligas' financial expenses with its financial income. That

Minasligas had short-term financial income, Minasligas argues, is

evident from its 1994 financial statement. Minasligas argues that there

are three categories of financial income which the Department

erroneously determined not to allow as an interest income offset. The

first is ``income from short term applications,'' which Minasligas

alleges the Department disallowed as an offset because it mistook it to

be compensation for inflation. In fact, Minasligas argues, the record

shows that the effects of inflation are reflected on the financial

statements through the recording of monetary correction of fixed

assets, shareholders equity, and other accounts subject to such

correction. Thus, Minasligas argues, the Department cannot interpret

Minasligas' submissions or its financial statements to indicate that

inflation is included in ``income from short term applications.''

The second category of income which the Department erroneously

failed to include as an offset to Minasligas' financial expenses,

Minasligas argues, is the category ``exchange gains.'' Minasligas

argues that the Department should include exchange gains as an offset

to financial expenses because it included exchange losses as a

financial expense.

The third category of income which the Department erroneously

failed to include as an offset to financial expenses, Minasligas

argues, is the category ``gains on monetary correction.'' Minasligas

argues that the Department should include this category of income as an

offset to financial expenses because it included an amount for monetary

correction of loans (i.e., the inflation adjustment on monetary

liabilities) in financial expenses.

Petitioners argue that the Department's calculation of Minasligas'

financial expenses was correct. It cites the final results notice in

which the Department stated:

[A]lmost all of Minasligas' reported ``interest income''

consists of items that are totally unrelated to interest income. The

financial statements for Minasligas and its parent, Delp Engenharia

Mecanica S.A. (Delp), demonstrate that over 95 percent of both

companies' reported ``interest income'' consists of ``monetary

variation,'' ``monetary correction,'' and ``income from short-term

applications.'' The Department's verification report for Minasligas

in the immediately preceding review clarifies that ``financial

applications'' (which would include ``income from short-term

applications'') refers to compensation for inflation. At no point

has Minasligas demonstrated for the record that the amounts reported

for these categories of income constitute interest income derived

from short-term investments of working capital. Nor has Minasligas

demonstrated that the claimed interest income was derived from

short-term investments of working capital merely by stating in its

rebuttal brief that its net interest income exceeded its net

interest expense.

Similarly, the financial statements submitted by Minasligas show

that the category ``interest received'' included inter alia, (1)

charges paid by customers for Delp's granting of delayed payment

terms, which are really sales revenue; (2) discounts obtained from

suppliers; (3) dividends received; and (4) exchange gains or losses.

See Minasligas' April 30, 1996 SQR at 37 and exhibit 19. These items

clearly do not represent interest income from short-term

investments.

For the above reasons, we have reduced Minasligas' interest

income by the total amount of the items incorrectly included therein

by Minasligas (see Final Analysis Memorandum from Fred Baker to the

File).

See Fourth Review Final Results, at 1974. Based on the analysis in

the final results, petitioners argue that the Department's calculation

of Minasligas' interest expense was neither a ministerial nor a non-

ministerial error.

Department's Position: As petitioners have noted, we addressed this

issue in the final results of the fourth review. Our treatment of

Minasligas' financial income was intentional, and not a ministerial

error. The disagreement Minasligas has expressed is in regard to our

analysis, and is thus not a proper subject for review under the

ministerial errors correction process.

Comment 2

Minasligas argues that the Department made a ministerial error in

its revaluation of Minasligas' beginning inventory. The Department,

based on Minasligas' October 15, 1996 submission, revalued Minasligas'

beginning inventory in order to account for hyperinflation that

occurred prior to the start of the period of review (POR). The raw

material costs Minasligas reported in its October 15, 1996 submission,

it argues, were its inventory of both ferrosilicon and silicon metal.

Minasligas states that the Department did not request that Minasligas

report silicon metal inventory separately, nor could Minasligas have

done so because it does not maintain separate inventory records.

Minasligas argues that the Department mistakenly overstated the

adjustment to the reported silicon metal costs by calculating an

inflation adjustment on raw materials for the entire company, and

applying the additional costs entirely to silicon metal, rather than

proportionately to subject and non-subject merchandise.

Petitioners argue that there is no evidence on the record, and

Minasligas has cited to none, to support Minasligas' claim. For this

reason, petitioners argue,

[[Page 54089]]

the Department should reject Minasligas' argument. Furthermore,

petitioners point out that in its April 30, 1996 supplemental

questionnaire response, Minasligas stated that it maintains separate

inventories for charcoal. Thus, petitioners argue, Minasligas' argument

that it does not maintain separate inventory records for its raw

materials is contradicted by other information on the record, at least

with respect to charcoal.

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

with Minasligas that the revalued costs should be allocated to silicon

metal so that ferrosilicon costs are not attributed to silicon metal,

and that it would be an error not to perform an allocation where one is

warranted. However, we agree with petitioners that Minasligas has cited

to no evidence on the record that the inventory volumes and values

Minasligas reported in its October 15, 1996 submission were its entire

inventory of raw materials used in the production of both ferrosilicon

and silicon metal. Our review of the record indicates that the figures

for charcoal Minasligas' reported in its October 15, 1996 submission

reflects its entire inventory for charcoal, but the figures it reported

in its October 15, 1996 submission for woodchips, quartz, and carbon

electrodes reflects only the inventory used in the production of

silicon metal. We made this determination based on the value of

material inputs Minasligas reported in tab 8 of its April 30, 1996

submission (where Minasligas reported the value of its inputs for

silicon metal), as compared to the material input values Minasligas

reported in its October 15, 1996 submission, which Minasligas now

alleges reflects its entire inventory of the four inputs. These two

exhibits demonstrate that the cost figures Minasligas reported for

woodchips, quartz, and carbon electrodes in the production of silicon

metal in tab 8 of its April 30, 1996 submission are identical to those

it reported in its October 15, 1996 submission. However, such is not

the case for charcoal. Furthermore, other evidence on the record

indicates that the consumption volume figures Minasligas reported for

charcoal were used in the production of silicon metal and ferrosilicon

(see tab 18 (exhibit 36c) of its April 30, 1996 submission). Therefore

in these amended final results, we have performed an allocation of the

revalued costs only for charcoal. We performed the allocation based on

the volume of charcoal consumed in the production of silicon metal

relative to the volume of charcoal consumed in the production of

ferrosilicon. See the amended final results analysis memorandum for our

calculations.

Comment 3

Minasligas argues that the Department made a ministerial error by

double-counting packing costs in COP/CV. It argues that the Department

added packing costs to a COP which already included packing costs. It

argues that the Department failed to deduct home-market packing costs

from the cost of manufacture (COM) before adding U.S. packing costs in

calculating CV.

Petitioners argue that information on the record indicates that the

Department double-counted only the labor and machine costs for packing,

and not the cost of packing materials. Department's Position: We agree

with petitioners that we double-counted only the labor and machine

costs for packing, and not the material costs. In these amended final

results of review we have revised our calculations of COP and CV so as

not to double-count labor and machine costs. See the amended final

results analysis memorandum for our calculations.

Comment 4

Minasligas argues the Department made three errors in calculating

profit for CV. The first alleged error was that the Department based

profit on Minasligas' financial statement data, rather than on the

actual profit calculated on above-cost sales of subject merchandise.

Minasligas argues that this was an error because the statute directs

the Department to add to CV the ``actual amounts incurred and realized

by the specific exporter or producer being examined in the

investigation or review for selling, general, and administrative

expenses, and for profits, in connection with the production and sale

of a foreign like product, in the ordinary course of trade for

consumption in the foreign country* * *'' 19 U.S. 1677b(e)(2)(A). Based

on this statutory language, Minasligas argues that the Department is

required to calculate profit based on above-cost sales wherever

possible.

Furthermore, Minasligas argues that in calculating profit based on

above-cost sales, the Department erred by limiting the calculation to

only the sales of regular grade silicon metal. Rather, Minasligas

argues, the Department should have included sales of both regular and

high-purity grade silicon metal even if all the U.S. sales to be

compared to CV are regular-grade silicon metal. Minasligas contends

that the Department has in the past based profits on the entire foreign

like product, and not on a subset of the subject merchandise. In

support of this contention, it cites Antifriction Bearings (Other than

Tapered Roller Bearings) and Parts Thereof from France, Germany, Italy,

Japan, Singapore, and the United Kingdom; Final Results of Antidumping

Duty Administrative Reviews, 62 F.R. 2081, 2112-2114 (January 15,

1997), where the Department rejected a respondent's argument that where

there are no appropriate identical or family matches (and hence the

Department uses CV), there are no sales of ``a foreign like product''

to calculate a profit margin. In further support of this contention,

Minasligas cites Professional Electric Cutting Tools from Japan; Final

Results of Antidumping Duty Administrative Review, 62 F.R. 386, 389-390

(January 3, 1997), in which the Department stated, ``For purposes of

calculating CV and CEP profit, we interpret the term `foreign like

product' to be inclusive of all merchandise sold in the home market

which is in the same general class or kind of merchandise as that under

consideration,'' and Notice of Final Determination of Sales at Less

than Fair Value: Large Newspaper Printing Presses and Components

Thereof, Whether Assembled or Unassembled, from Japan, 61 F.R. 38139,

38145-38147 (July 23, 1996), in which the Department stated,

``[Respondent] is incorrect to suppose that because we did not find

home-market sales which provided practicable price-to-price matches, no

foreign like product existed. The foreign like product . . . did exist,

as revealed by our examination of . . . equipment sold in the home

market for purposes of the Department's home-market viability test.''

The second alleged error the Department made was using an allegedly

incorrect total profit figure to calculate Minasligas' profit ratio. In

calculating the total profit figure, the Department included the line

item for interest income found on Minasligas' 1994 financial statement.

Minasligas argues that it was an error for the Department to reject the

line item for interest income as an offset to financial expenses

(presumably because it was unrelated to production of the foreign like

product ) but to include it in the calculation of profit. It argues

that if the interest income is unrelated to production then it cannot

be used for the purpose of calculating CV.

The third alleged error that the Department made was its failure to

apply the profit cap required by the statute. Minasligas argues that

the

[[Page 54090]]

statute allows profit to be calculated in one of three ways:

(i) the actual amounts incurred and realized by the specific

producer for profits, in connection with the production and sale for

consumption in the foreign country, of merchandise that is in the same

general category of products as the subject merchandise;

(ii) the weighted average of the actual amounts incurred and

realized by producers that are subject to the review for profits in

connection with the production and sale of a foreign like product, in

the ordinary course of trade, for consumption in the foreign country;

or

(iii) the amounts incurred for profits based on any other

reasonable method, except that the amount allowed for profit may not

exceed the amount normally realized by exporters or producers in

connection with the sale, for consumption in the foreign country, of

merchandise that is in the same general category of products as the

subject merchandise.

See 19 U.S.C. 1677b(e)(2)(B). Minasligas argues that the Department's

method of calculating profit does not comport with either items (i) or

(ii), and therefore must have been (iii). Thus, Minasligas argues, the

statutory profit cap applies, but the amount the Department calculated

for profit exceeded this cap because it exceeded the amount normally

realized by other exporters or producers.

Petitioners retort that the Department did not make an error in the

calculation of Minasligas' profit. First, they contend that the statute

requires not that sales of subject merchandise be used in the

calculation of profit (as Minasligas claims), but that actual amounts

for profits ``in connection with the production and sale of a foreign

like product'' be used. See 19 U.S.C. 1677(16). Second, petitioners

argue that the Department's regulations define the term ``ministerial

error'' as ``an error in addition, subtraction, or other arithmetic

function, clerical error resulting from inaccurate copying, duplication

or the like, and any other type of unintentional error which the

Secretary considers ministerial.'' Based on this definition,

petitioners argue that the Department's calculation of profit was not a

ministerial error. Indeed, petitioners argue, the Department's analysis

memorandum demonstrates that it acted intentionally when it calculated

profit as it did. Third, petitioners argue that the Department does not

have on the record of the review the information necessary to calculate

a profit cap in accordance with the statute. Thus, petitioners argue,

the Department properly calculated Minasligas' profit on a facts-

available basis because the Statement of Administrative Action states

that the Department may do so under such circumstances.

Department's Position: We agree with petitioners that our

calculation of profit did not constitute a clerical error. Our

calculation of profit used in the programming is identical to that

described in the final results analysis memorandum for Minasligas. See

the January 24, 1997 analysis memorandum, pp. 4 and 5.

Comment 5

Minasligas argues that the Department erred in its calculation of

CV by calculating general and administrative expenses (G&A), profit,

and financial expense ratios as a percentage of cost of goods sold

(which does not include value-added taxes) and applying these ratios to

a COM which includes value-added taxes. It argues that since the value-

added taxes are not reflected anywhere as a cost on Minasligas' audited

financial statements, it would be inappropriate to calculate a G&A,

profit, or financial expense ratio from its financial statements and

then apply the ratio to a COM which includes value-added taxes.

Similarly, RIMA and Eletrosilex argue that the Department erred in its

calculation of CV by calculating G&A and financial expense ratios as a

percentage of cost of goods sold (COGS) from their 1994 financial

statements (which do not include value-added taxes and depreciation

expenses) and applying them to a COM which does include value-added

taxes and depreciation expenses. RIMA also argues that the Department

erred in its calculation of financial expenses by calculating a ratio

which includes late payment fees, and applying it to a COM which also

includes late payment fees. By so doing, RIMA argues, the Department

double-counted late payment fees.

Furthermore, Minasligas argues that the Department's calculation of

CV was inconsistent with the statute because the G&A and interest

expense values used in CV are different from those used in COP.

Minasligas argues that because 19 U.S.C. Sec. 1677b(e)(2)(A) requires

the Department to base selling, general, and administrative expenses on

the actual amounts incurred and realized in production of the foreign

like product, and because the actual amount of G&A and interest does

not differ for the product between CV and COP, the Department's method

was a violation of the statute.

Petitioners argue, with respect to Eletrosilex, that the Department

made no error in its calculations. It argues that the Department did

not, contrary to Eletrosilex's claims, calculate its G&A ratio from

Eletrosilex's financial statements. Instead, petitioners state, the

Department used the monthly G&A expenses that Eletrosilex reported in

exhibit 36 of its October 20, 1995 questionnaire response. With respect

to Eletrosilex's financial expenses, petitioners argue that the COM

does not include the depreciation that the Department calculated, nor

does it include the ICMS tax (a value-added tax).

Department's Position: We agree with respondents that where the

COGS recorded on the financial statements do not include value-added

taxes or depreciation, the COM values used to calculate profit, G&A,

and interest for CV should be net of value-added taxes or depreciation

in order to avoid overstating these expenses. Therefore, in these

amended final results of review, we have calculated CV using G&A,

profit, and interest expense figures for Minasligas and RIMA based on a

COM that is net of value-added taxes and (for RIMA) net of

depreciation. We also agree with RIMA that because late payment fees

were included in the financial expenses reported on its financial

statement, we would double count late payment fees by including them in

the COM used to calculate interest expenses. Therefore, in these

amended final results, we have removed the late payment fees from the

financial expenses in calculating RIMA's financial expense ratio.

With respect to Eletrosilex, we agree with petitioners that, in the

final results, we did not include all value-added taxes in the COM used

to calculate Eletrosilex's interest expenses for CV. (We included only

the IPI, and not the ICMS.) Therefore, in these amended final results

of review, we have removed the IPI from the COM used to calculate

interest. Furthermore, we also agree with petitioners that we did not

calculate Eletrosilex's G&A from its financial statement, but instead

used the monthly G&A figures it submitted in exhibit 36 of its October

20, 1995 questionnaire response. However, we disagree with petitioners

that the COM we used to calculate Eletrosilex's interest was net of

depreciation. Therefore in these amended final results, we have

calculated Eletrosilex's interest using a COM that is net of

depreciation.

[[Page 54091]]

Comment 6

Minasligas and RIMA argue that the Department made a clerical error

in the calculation of CV by increasing normal value (NV) by the amount

of U.S. imputed credit expenses, but not reducing NV by the amount of

imputed home-market credit expenses. They argue that the Department

should subtract imputed home-market credit from NV.

Petitioners argue that the Department was correct in not

subtracting home-market credit from NV. They argue that the

Department's practice is to include only actual, not imputed, expenses

in CV. Therefore, petitioners say, because the Department did not

include home-market imputed credit expenses in CV, it would have been

wrong to subtract home-market imputed credit expenses from CV when

making the circumstance-of-sale adjustment for imputed credit.

Department's Position: We agree with respondents that our failure

to subtract imputed credit from the calculation of CV constituted a

ministerial error. It is our practice to make a circumstance-of-sale

adjustment for differences in credit costs between the home and U.S.

markets even in a CV margin calculation. Hence, we have done so in

these amended final results.

Comment 7

Minasligas argues that the Department erred in its computation of

net home-market price and home-market credit by including in the

computation the addition of a variable representing the PIS/COFINS

taxes. The Department included this variable in the preliminary results

of review, but its final results analysis memorandum indicates that the

Department intended to delete it for the final results. Minasligas

argues that the Department did not do so.

Department's Position: We agree, and have corrected this error in

these amended final results.

Comment 8

Minasligas, RIMA, and Eletrosilex argue that the Department erred

by failing to deduct from CV the difference between the ICMS tax due on

home-market sales and on U.S. sales. To support their argument,

Minasligas, RIMA, and Eletrosilex cite the Department as stating in the

final results: ``In order to achieve tax neutrality with respect to the

ICMS tax we should deduct from NV only the amount of the difference

between ICMS tax due on home-market sales and ICMS tax due on U.S.

sales.'' See Fourth Review Final Results at 1983. Furthermore,

Minasligas, RIMA, and Eletrosilex argue that the Department has in the

past stated that its practice is to make circumstance-of-sale

adjustments in price-to-CV as well as price-to-price margin

calculations. See Tapered Roller Bearings and Parts Thereof Finished or

Unfinished from Japan, 52 FR 30700 (August 17, 1987).

Petitioners argue that the language cited by Minasligas, RIMA, and

Eletrosilex applies only to price-to-price comparisons, and not price-

to-CV comparisons. Petitioners argue that the correct interpretation of

the Department's statement cited by Minasligas is governed by another

statement the Department made in the same context: ``This approach is

in accordance with 19 U.S.C. Sec. 1677b(a)(6)(B)(iii).'' This section

of the statute, petitioners argue, refers to price, and not CV. It

states that ``the price described in paragraph (1)(B) shall be * *

*reduced by* * * the amount of any taxes imposed directly upon the

foreign like product or components thereof which have been rebated, or

which have not been collected, on the subject merchandise, but only to

the extent that such taxes are added to or included in the price of the

foreign-like product.''

Department's Position: We disagree with respondents that our

treatment of ICMS taxes in a CV situation constitutes a ministerial

error. We intended to treat ICMS taxes in a CV situation exactly as we

did in the final results. Therefore, this issue is a methodological

issue, and not a proper subject for review under the ministerial errors

correction process.

Comment 9

Minasligas, RIMA, and Eletrosilex argue that the Department made a

clerical error in calculating U.S. imputed credit by dividing the

annual interest rate by 30 rather than 365.

Department's Position: We agree, and have corrected this error in

these amended final results.

Comment 10

RIMA argues that the Department incorrectly calculated

depreciation. In the final results, the Department stated that it based

its calculation of RIMA's depreciation on facts available, and

explained:

As facts available the Department has chosen to use one-half of

the audited total RIMA depreciation expenses for the fiscal year as

RIMA's total POR depreciation expenses, and to allocate to silicon

metal production a share of that total based on the highest monthly

percentage of cost of goods sold accounted for by silicon metal, as

appearing in verification exhibit OH1. We allocated one-twelfth of

this total, in turn, to each month of the POR.

See Fourth Review Final Results, at 1984. RIMA argues that the

Department failed to divide the total depreciation by two as is

necessary if the calculated amount is to be ``one-half of the audited

total RIMA depreciation expenses for the fiscal year,'' as described

above.

Petitioners argue that the Department's calculations, as laid out

in the January 24, 1997 final results analysis memorandum, indicate

that the Department did in fact divide total depreciation by two.

Department's Position: We agree with petitioners. The attachment

labeled ``Calculation of RIMA's Depreciation--4th Review''

in the final results analysis memorandum for RIMA indicates that the

Department did divide the depreciation expenses in half. Thus, we did

not make a clerical error.

Comment 11

Petitioners argue that the Department made a clerical error in its

calculations for Eletrosilex by failing to add U.S. imputed credit

expenses to CV.

Department's Position: We agree, and have corrected this error in

these amended final results.

Comment 12

Petitioners argue the Department made a clerical error in its

calculations for Eletrosilex by adding U.S. post-sale warehousing

expenses expressed in Brazilian currency to a CV expressed in U.S.

dollars.

Department's Position: We agree, and have corrected this error in

these amended final results.

Comment 13

Petitioners argue that the Department made a clerical error in its

calculations for CBCC by adding, rather than subtracting, international

freight from United States Price (USP).

Department's Position: We agree, and have corrected this error in

these amended final results.

Comment 14

Petitioners argue that the Department made a clerical error in its

calculations for CBCC by treating the bank charges incurred to finance

some of CBCC's U.S. sales as expressed in U.S. dollars, rather than in

Brazilian currency.

Department's Position: We agree, and have corrected this error in

these amended final results.

Comment 15

Petitioners argue that the Department made a clerical error in its

calculations

[[Page 54092]]

of USP for some of CBCC's U.S. sales by including in the computer field

``BANKCHRG'' only the cost of interest, and not the cost of bank

charges.

Department's Position: We agree, and have corrected this error in

these amended final results.

Comment 16

Petitioners argue that the Department made a clerical error in its

calculations for CBCC by failing to include the depreciation expenses

for all of CBCC's idle furnaces for all months of the POR. This was an

error, petitioners state, because the final results notice says that

the Department included depreciation expenses for idle assets in the

total depreciation expenses. See Fourth Review Final Results, at 1980.

CBCC argues that the Department's calculation was proper because

during part of the POR the furnaces in question were producing a

product other than silicon metal. For the same reason CBCC argues

further that if the Department decides to attribute depreciation for

the furnaces at issue to silicon metal, it should attribute only part

of it to silicon metal, and not all of it, as petitioners argue.

Department's Position: We agree with petitioners that for some

months of the POR we failed to include depreciation for idle assets in

total depreciation, which was a clerical error. We have corrected this

error in these amended final results. We have allocated to the furnaces

at issue a proportion of depreciation expenses equal to the volume of

silicon metal produced by those furnaces relative to the volume of

other products produced by those furnaces during the POR. See the

amended final results analysis memorandum for our calculations.

Comment 17

Petitioners argue that the Department made a clerical error

calculating Minasligas' variable overhead expenses. The Department, in

order to allocate overhead costs to silicon metal, applied a ratio to

Minasligas' total variable overhead amounts as given in exhibit 4 of

Minasligas' October 15, 1996 supplemental questionnaire response.

Petitioners argue that this was an error because the total variable

overhead reported in exhibit 4 had already been allocated to silicon

metal by Minasligas.

Department's Position: We agree, and have corrected this error in

these amended final results.

Comment 18

Petitioners argue that the Department made a clerical error by not

basing RIMA's charcoal costs on the price RIMA paid to its unaffiliated

suppliers, and instead using the material costs RIMA reported in

verification exhibit 7. In the final results the Department stated that

it would base RIMA's charcoal costs on the prices it pays to its

unaffiliated suppliers. See Fourth Review Final Results, at 1985.

RIMA argues that the costs reported in verification exhibit 7 are

from unaffiliated suppliers, and that the Department therefore did not

make a clerical error.

Department's Position: We agree with RIMA. The verification report

says, ``By reviewing the documents pertaining to purchased charcoal,

e.g., the general ledger, supplier's invoices, and payment records, we

confirmed that Rima's per-unit costs were based on the purchase price

from third-party suppliers.'' See October 3, 1996 verification report,

p. 12. Thus, our use of the charcoal costs contained in verification

exhibit 7 does not constitute a clerical error.

Comment 19

Petitioners argue that the Department made a clerical error in its

calculation of RIMA's imputed U.S. credit expenses. RIMA shipped each

of its U.S. sales from its plant to the port of export in lots over a

period of days, and reported to the Department the date of shipment for

each lot. The Department stated in its final results analysis

memorandum for RIMA that it used as the credit period the average

number of days between the shipment date for each lot and the payment

date. However, petitioners argue that the Department did not use the

average credit period.

RIMA argues that the Department used an annual rate, and not a

monthly rate, in its calculation of U.S. imputed credit expenses. Thus,

RIMA argues, the Department should divide the rate used in the

determination of imputed credit by 365 days, not 30 days.

Department's Position: We agree with petitioners that we did not

use the average credit periods in the calculation of U.S. credit,

although the final results analysis memorandum states the contrary. See

July 24, 1997 RIMA final results analysis memorandum, p. 3. We have

corrected this error in these amended final results. For our response

to RIMA's argument that we should calculate credit using a denominator

of 365, see our response to comment 9, above.

Comment 20

Eletrosilex argues that the Department made a ministerial error in

its treatment of depreciation expenses. Eletrosilex argues that it

explained in its submission that it had taken no depreciation in 1994

in order to compensate, as necessary under Brazilian accounting

principles, for having taken accelerated depreciation in prior years,

and that it had returned to normal depreciation in 1995. In comment 36

of the final results notice, the Department stated that evidence from

Eletrosilex's financial statement indicates that its accounting of

depreciation was not in accordance with Brazilian generally accepted

accounting principles (GAAP). The Department therefore used the

depreciation estimates given by Eletrosilex's independent auditor.

Eletrosilex contends that the Department's determination that its

accounting of depreciation was not in accordance with Brazilian GAAP

constitutes a ministerial error. It argues that the financial statement

made no determination as to whether Eletrosilex's accounting for

depreciation was consistent with Brazilian GAAP in light of the earlier

accelerated depreciation; it merely reflected the current year

accounting. Eletrosilex argues that the Department mistakenly relied

upon the financial statement out of context, instead of relying upon

the actual data submitted by Eletrosilex and the explanation as to why

no depreciation expense was shown for 1994.

Furthermore, Eletrosilex argues that the Department's recalculation

of depreciation was flawed by exaggerating depreciation expense. The

Department used one half of the audited depreciation expenses for all

of 1994 and 1995. Eletrosilex argues that this method was doubly

mistaken. First, the Department used numbers from the column designated

as ``in currency with constant purchase power.'' Eletrosilex states

that this column includes monetary adjustment, and therefore inflates

the true number. Second, it double counts depreciation for 1995 because

the depreciation expense is already included in fixed overhead.

Petitioners argue that the Department correctly determined that

Eletrosilex's accounting of depreciation was not in accordance with

Brazilian GAAP. It bases this argument on a statement contained in the

report of the independent auditor which says that ``the company did not

recognize . . . amounts corresponding to the depreciation of the fixed

assets as required by the accounting principles foreseen in the

CORPORATE'S LEGISLATION and by the main accounting principles.''

Therefore, petitioners argue, the Department was correct in not using

the depreciation expenses that Eletrosilex reported to the Department.

[[Page 54093]]

Furthermore, petitioners argue that because Eletrosilex's 1994

financial statement did not contain any information about depreciation,

the Department was obliged to use Eletrosilex's 1995 financial

statement for information about Eletrosilex's depreciation for both

1994 and 1995. Thus, petitioners argue, the Department was justified in

using the column ``in currency with constant purchase power'' for 1994

because that is how the information was presented in Eletrosilex's 1995

financial statement.

Finally, petitioners argue that information on the record indicates

that the Department did not double count depreciation for all of the

months that Eletrosilex claims it did.

Department's Position: We disagree with Eletrosilex that our

calculation of depreciation is a clerical error. Rather, it is a

methodological issue, and not a proper subject for review under the

ministerial errors correction process. However, we do agree with

Eletrosilex that we double counted depreciation for 1995. Therefore, in

these amended final results of review we have corrected this error. See

our amended final results analysis memorandum for our calculations.

Comment 21

Eletrosilex argues that the Department mistakenly disallowed an

alleged short-term investment as an offset to its financial expenses

because it incorrectly believed the claimed offset to be a capital

gain. Eletrosilex argues that there is no basis for the Department so

to interpret the transaction. It states that the claimed offset at

issue was interest income accrued from bonds purchased as a short-term

investment. The treatment of this short-term investment creating

accrued interest is fully consistent, Eletrosilex argues, with the

Department's traditional treatment of short-term interest as an offset

to financial expenses, and the Department's treatment otherwise in the

final results was based on a mistaken interpretation of the claim.

Petitioners argue that the Department made no ministerial error in

its calculation of Eletrosilex's financial expenses. They argue that it

is a respondent's responsibility to provide a detailed explanation of

any claimed offset to expenses, and that Eletrosilex failed to meet

this responsibility because it failed to provide the information

necessary to distinguish interest income from capital gains.

Furthermore, petitioners argue that the Department acted intentionally

in denying this adjustment. Indeed, the Department specifically

addressed the transaction in question in comment 5 of the final results

notice. See Fourth Review Final Results, at 1974. Thus, petitioners

argue, the Department's denial of this adjustment does not fit the

regulatory definition of a clerical error, which is ``an error in

addition, subtraction, or other arithmetic function, clerical error

resulting from inaccurate copying, duplication, or the like, and any

other type of unintentional error which the Secretary considers

ministerial.'' 19 C.F.R. 353.28(d).

Department's Position: We agree with petitioners that our denial of

this requested offset is not a clerical error. As reflected in the

fourth review final results notice, we intended to deny this

adjustment. See Fourth Review Final Results at 1974.

Comment 22

Eletrosilex argues that the Department erred by failing to grant a

duty drawback adjustment. In the final results the Department denied

this adjustment because Eletrosilex did not submit a claim for it until

it submitted its case brief, subsequent to the 180-day regulatory

deadline for submitting factual information. See 19 CFR

Sec. 353.31(a)(1)(ii). Eletrosilex argues that this decision unfairly

distorted reality for no valid reason. It argues that the Department

recognizes that mistakes occur, and has established the ``ministerial

error'' provision for the purpose of correcting its own mistakes.

Therefore, Eletrosilex argues, parties to proceedings should also be

permitted to correct their mistakes where there is no prejudice or

detriment to any of the parties. The oversight in question, Eletrosilex

states, was just such an error. The Department's failure to correct the

error, Eletrosilex argues, is an overly narrow interpretation which

serves no purpose other than to punish Eletrosilex and increase a

dumping margin for U.S. importers.

Petitioners argue that the Department made no ministerial error in

denying Eletrosilex a duty drawback adjustment. The regulatory

definition of ``ministerial error'' is ``an error in addition,

subtraction, or other arithmetic function, clerical error resulting

from inaccurate copying, duplication or the like, and any other type of

unintentional error which the Secretary considers ministerial.'' See 19

CFR Sec. 353.28(d). Furthermore, petitioners argue that the Department

specifically addressed this issue in the final results. See Fourth

Review Final Results, at 1988. Therefore, petitioners argue, the

Department's denial of this adjustment was not a ministerial error.

Department's Position: We agree with petitioners that our denial of

a duty drawback adjustment was not a ministerial error. It is a

methodological issue, and not a proper subject for review under the

ministerial errors correction process.

Comment 23

Eletrosilex argues that the Department used an incorrect amount for

U.S. packing expenses. The final results analysis memorandum states

that it used the packing expense that Eletrosilex submitted on its U.S.

sales file. Eletrosilex argues that in the computer program the

Department used a different amount.

Petitioners argue that the Department used the amount for packing

that appears on Eletrosilex's U.S. sales file, and that therefore the

Department did not make an error.

Department's Position: We disagree with Eletrosilex that we used

the incorrect packing amount. See line 3805 of the final results

program. We acknowledge, however, that our final results analysis

memorandum incorrectly states that we used the figure that Eletrosilex

submitted on its U.S. sales file. In the preliminary results, we

recalculated Eletrosilex's packing figure based on the itemized packing

costs Eletrosilex submitted because the figure it reported on its sales

tape differed from the figure it reported in the narrative section of

its questionnaire response. For our recalculations, see the September

3, 1996 Eletrosilex preliminary results analysis memorandum, p. 2.

Thus, in neither the preliminary nor final results of review did we use

the packing figure Eletrosilex submitted on its U.S. sales file, nor

did we intend to do so. (In their comments on the preliminary results

no party commented on the recalculation of packing.)

In addition to the changes made in the margin calculations in

response to the above comments, we have also made the following changes

to the programming in these amended final results:

For Minasligas and Eletrosilex, we calculated U.S. imputed

credit net of the ICMS tax assessed on the U.S. sale; and,

For Eletrosilex, we used as the unit price of the U.S.

sale the CIF value of the sale in U.S. dollars as given in exhibit 19

of Eletrosilex's October 25, 1995 submission.

Amended Final Results

As a result of our review, we have determined that the following

margins exist for the period July 1, 1994 through June 30, 1995:

[[Page 54094]]

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

Weighted-

average

Producer/manufacturer/exporter margin

(percent)

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

CBCC....................................................... 0.37

CCM........................................................ 35.23

Eletrosilex................................................ 6.68

Minasligas................................................. 43.53

RIMA....................................................... 51.23

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

The Department shall determine, and the U. S. Customs Service shall

assess, antidumping duties on all appropriate entries. The Department

shall issue appraisement instructions directly to the Customs Service.

Furthermore, the following deposit requirements shall be effective

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

all shipments of silicon metal from Brazil 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) the cash deposit

rates for the reviewed companies named above will be the rates

published in these amended final results; (2) for previously

investigated or reviewed 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 these

reviews, or the original less-than-fair-value (LTFV) investigations,

but 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) if neither the exporter nor the manufacturer is a

firm covered in these reviews, the cash deposit rate will continue to

be 91.06 percent, the ``all others'' rate established in the LTFV

investigation. See Final Determination of Sales at Less Than Fair

Value: Silicon Metal from Brazil, 56 FR 26977 (June 12, 1991).

This notice serves as a final reminder to importers of their

responsibility under 19 CFR Sec. 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 order (``APO'') of their responsibility

concerning the disposition of proprietary information disclosed under

APO in accordance with section 353.34(d) of the Department's

regulations. Timely 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.

These amended final results of review and notice are in accordance

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

section 353.28(c) of the Department's regulations.

Dated: October 14, 1997.

Robert S. LaRussa,

Assistant Secretary for Import Administration.

[FR Doc. 97-27632 Filed 10-16-97; 8:45 am]

BILLING CODE 3510-DS-P