# Color Picture Tubes From Japan; Preliminary Results of Antidumping Administrative Review > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/fr%3A97-3361 ## Record - **Collection:** Federal Register - **Document type:** Notice - **Published:** February 11, 1997 - **Citation:** 62 FR 6168 ## Text DEPARTMENT OF COMMERCE International Trade Administration [A-588-609] Color Picture Tubes From Japan; Preliminary Results of Antidumping Administrative Review AGENCY: Import Administration, International Trade Administration, Department of Commerce. ACTION: Notice of preliminary results of antidumping duty administrative review of color picture tubes from Japan. ----------------------------------------------------------------------- [[Page 6169]] SUMMARY: In response to a request by the petitioners, the Department of Commerce (the Department) is conducting an administrative review of the antidumping duty order on color picture tubes (CPTs) from Japan. The period of review (POR) is January 1, 1995 through December 31, 1995. The review indicates the existence of dumping margins during this period. We have preliminarily determined that subject merchandise has been sold at less than normal value (NV) during the POR. If these preliminary results are adopted in our final results of administrative review, we will instruct the U.S. Customs Service to assess antidumping duties on entries during the POR. Interested parties are invited to comment on these preliminary results. EFFECTIVE DATE: February 11, 1997. FOR FURTHER INFORMATION CONTACT: Charles Riggle or Kris Campbell, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, N.W., Washington D.C. 20230; telephone (202) 482-4733. Applicable Statute 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, 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). Background On January 26, 1996, the Department published in the Federal Register (61 FR 2488) a notice of ``Opportunity To Request an Administrative Review'' of the antidumping duty order on CPTs from Japan (52 FR 44171 (November 18, 1987)). In accordance with 19 C.F.R. 353.22(a), the petitioners, the International Association of Machinists and Aerospace Workers, International Union of Electronic, Electrical, Salaried, Machine & Furniture Workers, AFL-CIO, Industrial Union Department AFL-CIO, requested that we conduct an administrative review of sales of CPTs from Japan by Mitsubishi Electric Corporation (MELCO). We published a notice of initiation of this antidumping duty administrative review on February 20, 1996 (61 FR 6347), covering the period January 1, 1995 through December 31, 1995. Because it was not practicable to complete this review within the normal time frame, on October 25, 1996, we published in the Federal Register our notice of extension of the time limit for these preliminary results to January 30, 1997 (61 FR 55271). The deadline for the final results will continue to be 120 days after publication of these preliminary results. Scope of Review Imports covered by this review are shipments of CPTs from Japan. CPTs are defined as cathode ray tubes suitable for use in the manufacture of color televisions or other color entertainment display devices intended for television viewing. This merchandise is classifiable under the Harmonized Tariff Schedule (HTS) item numbers 8540.11.00.10, 8540.11.00.20, 8540.11.00.30, 8540.11.00.40, 8540.11.00.50 and 8540.11.00.60. Although the HTS item numbers are provided for convenience and customs purposes, our written description of the scope of this proceeding is dispositive. Verification In accordance with section 782(i) of the Act, we verified information provided by MELCO by using standard verification procedures, including onsite inspection of the manufacturer's facilities, the examination of relevant sales and financial records, and selection of original documentation containing relevant information. We conducted the verification at the company's headquarters in Kyoto, Japan, from September 17 through September 20, 1996. Our verification results are outlined in the public version of the verification report. See Memorandum from Case Analyst to File, dated December 27, 1996. Product Comparisons We calculated NV on a monthly weighted-average basis. Where possible, we compared U.S. sales to sales of identical merchandise in Japan. For U.S. sales in which identical merchandise was not sold during the relevant contemporaneous period, we compared U.S. sales to the most similar foreign like product on the basis of characteristics listed in MELCO's April 1, 1996 response to section A of our questionnaire. Constructed Export Price We calculated a constructed export price (CEP) for MELCO's U.S. transactions, in accordance with section 772(b) of the Act, because sales to the first unrelated purchaser took place after importation into the United States. We calculated CEP based on the packed, ex-warehouse price from the U.S. subsidiary to unrelated customers. We made deductions from CEP for U.S. packing in the United States, international freight, foreign inland freight, marine insurance, U.S. customs duties, U.S. inland freight insurance and U.S. inland freight. In accordance with section 772(d)(1) of the Act, we deducted from CEP the following selling expenses that related to economic activity in the United States: commissions, direct selling expenses, including advertising, warranties, credit expenses, discounts, rebates, and indirect selling expenses, including inventory carrying costs, and further manufacturing. We also made an adjustment for CEP profit in accordance with section 772 (d)(3) of the Act. Normal Value In order to determine whether there was a sufficient volume of sales in the home market to serve as a viable basis for calculating NV, we compared respondent's volume of home market sales of the foreign like product to the volume of U.S. sales of the subject merchandise, in accordance with section 773(a)(1)(C) of the Act. Since respondent's aggregate volume of home market sales of the foreign like product was greater than five percent of its aggregate volume of U.S. sales for the subject merchandise, we determined that the home market was viable. Therefore, we have based NV on home market sales. We based NV on the packed, delivered price to unrelated purchasers in the home market. Where applicable, we made adjustments to home market prices for discounts, rebates, technical service expenses, pre-sale warehouse expenses, and royalties. To adjust for differences in circumstances of sale between the home market and the United States, we deducted post- sale inland freight and credit expense from NV in accordance with section 773(a)(6)(C) of the Act. In accordance with 19 C.F.R. 353.56(b), we made an adjustment to NV for indirect selling expenses in the home market to offset the sum of commissions in the United States. In order to adjust for differences in packing between the two markets, we deducted home market packing costs from NV and added U.S. packing costs. We compared U.S. sales of CPTs to NV based on constructed value (CV) when MELCO did not have contemporaneous home market sales of CPTs with which we could compare the U.S. sale. We calculated CV in accordance with section 773(e) of the Tariff Act. We included the cost of materials, labor, general expenses, profit and packing. Where appropriate, we [[Page 6170]] made adjustments to CV, in accordance with 19 C.F.R. 353.56, for differences in circumstances of sale. The home market and CV databases that MELCO submitted did not contain matches for certain U.S. sales. See Memorandum from Analyst to File: Preliminary Results for MELCO, January 30, 1997. Therefore, in accordance with section 776 of the Act, we applied a rate based on the facts available to these sales. Given the nature and extent of the deficiency, we have selected the weighted-average rate that we calculated for all other sales in this review (1.92 percent) as facts available. See section 776(a) of the Act. Level of Trade and CEP Offset As set forth in section 773(a)(7) of the Act and in the Statement of Administrative Action (H.R. Doc. 316, Vol. 1, 103d Cong., 2d Sess. (1994)) (SAA) at 829-831, to the extent practicable, we will calculate NV based on sales at the same level of trade as the U.S. sale. In this review, we were unable to find comparison sales at the same level of trade as the U.S. sales. Accordingly, we compared the sales in the United States to sales at a different level of trade in the comparison market. In accordance with section 773(a)(7)(A) of the Act, if we compare a U.S. sale with a home market sale made at a different level of trade, we will adjust the NV to account for this difference if two conditions are met. First, there must be differences between the actual selling functions performed by the seller at the level of trade of the U.S. sale and at the level of trade of the comparison market sale used to determine NV. Second, the differences must affect price comparability as evidenced by a pattern of consistent price differences between sales at the different levels of trade in the market in which NV is determined. For CEP sales, section 773(a)(7)(B) of the Act establishes the procedures for making a CEP ``offset'' when two conditions exist: (1) NV is established at a level of trade which constitutes a more advanced stage of distribution than the level of trade of the CEP; and (2) the data available do not provide an appropriate basis for a level- of-trade adjustment. We based the level of trade of CEP sales on the price in the United States after making the CEP deductions under section 772(d) but before making the deductions under section 772(c). Where home market sales served as the basis for NV, we determined the NV level of trade based on starting prices in the home market. Where NV was based on CV, we determined the NV level of trade based on the level of trade of the sales from which we derived SG&A and profit for CV. In order to determine whether sales in the comparison market are at a different level of trade than the CEP, we examined whether the comparison sales were at different stages in the marketing process than the CEP. We made this determination on the basis of a review of the distribution system in the comparison market, including selling functions, class of customer, and the level of selling expenses for each type of sale. Different stages of marketing necessarily involve differences in selling functions, but differences in selling functions, even substantial ones, are not alone sufficient to establish a difference in the level of trade. Similarly, while customer categories such as ``distributor'' and ``wholesaler'' may be useful in identifying different levels of trade, they are insufficient in themselves to establish that there is a difference in the level of trade. See Certain Corrosion-Resistant Carbon Steel Flat Products and Certain Cut-to- Length Carbon Steel Plate from Canada: Preliminary Results of Antidumping Duty Administrative Review, 61 FR 51896 (October 4, 1996). MELCO requested that we make a level-of-trade adjustment, or a CEP offset if we could not quantify a level-of-trade adjustment, because sales in the home market involved a more advanced level of trade than the level of trade of the CEP. Our analysis of the reported selling expenses, selling functions, and customer classes of U.S. and home market sales demonstrates that the home market sales are distributed through a more advanced marketing stage than that involved at the level of trade of the CEP. Because we compared CEP sales to home market sales at a different level of trade, we examined whether a level-of-trade adjustment was appropriate. In this case, we were unable to quantify price differences involving comparisons of sales made at different levels of trade because the same level of trade as that of the CEP did not exist in the home market. Therefore, we could not determine whether there was a pattern of consistent price differences between the levels of trade based on respondent's home market sales of merchandise under review. Because we were unable to quantify a level-of-trade adjustment based on a pattern of consistent price differences, we granted a CEP offset where the comparison sales were at a more advanced level of trade than the sales to the United States, in accordance with section 773(a)(7)(B) of the Act. To calculate the CEP offset, in accordance with section 772(d)(1)(D) of the Act, we considered the home market indirect selling expenses and deducted this amount from NV on home market sales which we compared to U.S. CEP sales. We limited the home market indirect selling expense deduction by the amount of the indirect selling expenses incurred in the United States. Currency Conversion We made currency conversions in accordance with section 773A of the Act. Currency conversions were made at the rates certified by the Federal Reserve Bank. Section 773A(a) directs the Department to use a daily exchange rate to convert foreign currencies into U.S. dollars unless the daily rate involves a ``fluctuation.'' It is our practice to find that a fluctuation exists when the daily exchange rate differs from a benchmark rate by 2.25 percent. See Preliminary Results of Antidumping Duty Administrative Review: Certain Welded Carbon Steel Pipe and Tube from Turkey, 61 FR 35188, 35192 (July 5, 1996). The benchmark rate is defined as the rolling average of the rates for the past 40 business days. Because we found no fluctuation in this case, we believe it is appropriate to use a daily exchange rate for currency conversion purposes. Preliminary Results of the Review As a result of our comparison of the CEP to NV, we preliminarily determine that the following dumping margin exists for the period January 1, 1995 through December 31, 1995: ------------------------------------------------------------------------ Margin Manufacturer/exporter (percent) ------------------------------------------------------------------------ MELCO...................................................... 1.92 ------------------------------------------------------------------------ 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. Any hearing, if requested, will be held approximately 44 days after the publication of this notice. Interested parties may submit written comments (case briefs) within 30 days of the date of publication of this notice. Rebuttal comments (rebuttal briefs), which must be limited to issues raised in the case briefs, may be filed not later than 37 days after the date of publication. The Department will publish a notice of final results of this administrative review, including the results of its analysis of issues raised in any such written comments, within 120 days of publication of these preliminary results. [[Page 6171]] The Department shall determine, and the Customs Service shall assess, antidumping duties on all appropriate entries. Because the inability to link sales with specific entries prevents calculation of duties on an entry-by-entry basis, we have calculated an importer- specific ad valorem duty assessment rate for the merchandise based on the ratio of the total amount of antidumping duties calculated for the examined sales made during the POR to the total customs value of the sales used to calculate those duties. This rate will be assessed uniformly on all entries of that particular importer made during the POR. (This is equivalent to dividing the total amount of antidumping duties, which are calculated by taking the difference between NV and CEP, by the total CEP value of the sales compared, and adjusting the result by the average difference between CEP and customs value for all merchandise examined during the POR.) The Department will issue appraisement instructions directly to the Customs Service. Furthermore, the following cash deposit requirements will be effective upon publication of the final results of this administrative review for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided for by section 751(a)(1) of the Act: (1) For MELCO the cash deposit rate will be the rate established in the final results of this review; (2) if the exporter is not a firm covered in this review, a previous review, or the original less-than-fair value investigation (LTFV), but the manufacturer is, the cash deposit rate will be that which was established for the most recent period for the manufacturer of the merchandise; (3) for non-Japanese exporters of subject merchandise from Japan, the cash deposit rate will be the rate applicable to the Japanese supplier of that exporter; (4) if neither the exporter nor the manufacturer is a firm covered in this or any previous reviews, the cash deposit rate will be 27.93 percent, the ``all others'' rate established in the LTFV investigation, as explained below. These deposit requirements, when imposed, shall remain in effect until publication of the final results of the next administrative review. On May 25, 1993, the Court of International Trade (CIT) in Floral Trade Council v United States, 822 F.Supp. 766 (CIT 1993), and Federal- Mogul Corporation and The Torrington Company v. United States, 822 F.Supp. 782 (CIT) 1993), decided that once an ``All Others'' rate is established for a company it can only be changed through an administrative review. We have determined that, in order to implement these decisions, it is appropriate to reinstate the ``All Others'' rate from the LTFV investigation (or that rate as amended for correction of clerical errors or as a result of litigation) in proceedings governed by antidumping duty orders. Therefore, we are reinstating the ``All Others'' rate made effective by the final determination of sales at LTFV (see Color Pictures Tubes, 52 FR 44171, November 18, 1987). This notice also serves as a preliminary reminder to importers of their responsibility under 19 C.F.R. 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 Act (19 U.S.C. 1675(a)(1)) and 19 C.F.R. 353.22. Dated: January 30, 1997. Robert S. LaRussa, Acting Assistant Secretary for Import Administration. [FR Doc. 97-3361 Filed 2-10-97; 8:45 am] BILLING CODE 3510-DS-P --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A97-3361. Public record. Not legal advice.