Color Television Receivers From the Republic of Korea; Final Results of Changed Circumstances Antidumping Duty Review

DEPARTMENT OF COMMERCE

International Trade Administration

[A-580-008]

Color Television Receivers From the Republic of Korea; Final

Results of Changed Circumstances Antidumping Duty Review

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of affirmative final determination of changed

circumstances antidumping duty review and revocation of order in part.

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SUMMARY: This changed circumstances review covers one manufacturer,

Samsung Electronics Corporation. The International Brotherhood of

Electrical Workers; the International Union of Electronic, Electrical,

Salaried, Machine and Furniture Workers (AFL-CIO); and the Industrial

Union Department (AFL-CIO) are collectively the ``petitioners.''

On December 31, 1997, the Department of Commerce published the

preliminary results of the changed circumstances review of the

antidumping duty order on color television receivers from the Republic

of Korea. At that time, the Department preliminarily determined to

partially revoke this antidumping duty order with respect to Samsung

Electronics Corporation. Based on our analysis of the record evidence,

including interested party comments, we have determined that changed

circumstances warrant revocation of the antidumping duty order on color

television receivers from the Republic of Korea, as it applies to

Samsung Electronics Corporation.

EFFECTIVE DATE: September 2, 1998.

[[Page 46760]]

FOR FURTHER INFORMATION CONTACT: Irene Darzenta Tzafolias or Mark

Manning, Office of AD/CVD Enforcement, Office 4, Import Administration,

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

Street and Constitution Avenue, N.W., Washington, D.C. 20230;

telephone: (202) 482-0922 and 482-3936, respectively.

SUPPLEMENTARY INFORMATION:

Applicable Statute and Regulations

Unless otherwise indicated, all citations to the statute are

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

date of the amendments made to the Tariff Act of 1930 (the Act) by the

Uruguay Round Agreements Act (URAA). In addition, unless otherwise

indicated, all citations to the Department's regulations are to the

regulations as codified at 19 CFR Part 353 (April 1, 1997). Although

the new regulations do not apply in these final results, they are

cited, where appropriate, as a statement of the Department's current

practice. See 62 FR 27296, 27378 (May 19, 1997).

Background

On April 30, 1984, the Department of Commerce (the Department)

published in the Federal Register (49 FR 18336) the antidumping duty

order on color television receivers (CTVs) from the Republic of Korea

(Korea).

On July 20, 1995, the Department received a request by Samsung

Electronics Corporation (Samsung) for a changed circumstances review to

consider revocation of the antidumping duty order, as it applies to

Samsung. The petitioners opposed this request. In its revocation

request, Samsung cited three reasons why the Department should revoke

the antidumping duty order. First, the timing of certain court

decisions on previous administrative reviews of this order prevented

Samsung from filing in a timely manner for revocation under Section

751(a) of the Act. Second, Samsung was found not to be dumping CTVs in

the United States during the six consecutive years in which Samsung had

shipments from Korea. Third, Samsung has not shipped CTVs to the United

States since early 1991. Zenith Electronics Corporation, a domestic

interested party, and petitioners, filed objections to Samsung's

request on August 4 and August 11, 1995, respectively.

Pursuant to Samsung's request, the Department initiated this

changed circumstances review on June 24, 1996. See Color Television

Receivers From the Republic of Korea: Initiation of Changed

Circumstances Antidumping Duty Administrative Review and Consideration

of Revocation of Order (in Part) (61 FR 32426, June 24,

1996).1 On July 16, 1996, the Department issued to the

parties a draft changed circumstances questionnaire for comment. We

received comments from petitioners and Samsung on July 30, 1996, and

August 6, 1996, respectively. On December 6, 1996, the Department

issued a changed circumstances questionnaire to Samsung, who filed its

response on February 24, 1997. Petitioners submitted their comments on

Samsung's questionnaire response on June 17, 1997. Subsequently, both

petitioners and Samsung submitted several additional comments.

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\1\ In a separate but related proceeding, the Department

investigated whether Samsung and other Korean television producers

were circumventing the antidumping duty order on CTVs from Korea

through their production facilities in Mexico. Pursuant to an

application filed by petitioners on August 11, 1995, the Department

initiated the anti-circumvention inquiry on January 19, 1996 (61 FR

1339, January 19, 1996). On December 31, 1997, pursuant to

petitioners' request, the Department terminated the anti-

circumvention inquiry with respect to all companies.

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On December 31, 1997, the Department issued its affirmative

preliminary results in this changed circumstances review of the

antidumping order on CTVs from Korea, partially revoking this order

with respect to Samsung. See Color Television Receivers From Korea;

Preliminary Results of Changed Circumstances Antidumping Duty

Administrative Review (62 FR 68256, December 31, 1997). Petitioners,

Samsung, and LG Electronics (LGE) submitted comments to the Department

concerning the preliminary determination on February 13, 1998 and March

6, 1998. A public hearing was held on March 18, 1998, to allow

interested parties the opportunity to express their views directly to

the Department. Additional information was submitted on March 30, 1998,

and comments were filed by petitioners and Samsung on April 7, 1998,

and May 8, 1998, respectively. This review was conducted in accordance

with Section 751(b) of the Act.

Scope of Order

Imports covered by this order include CTVs, complete and

incomplete, from the Republic of Korea. This merchandise is

classifiable under the 1997 Harmonized Tariff Schedule (HTS) as item

8528.12.04, 8528.12.08, 8528.12.12, 8528.12.16, 8528.12.20, 8528.12.24,

8528.12.28, 8528.12.32, 8528.12.36, 8528.12.40, 8528.12.44, 8528.12.48,

8528.12.52, 8528.12.56, 8528.12.62, 8528.12.64, 8528.12.68, 8528.12.72,

8528.12.76, 8528.12.80, 8528.12.84, and 8528.12.88. The order covers

all CTVs regardless of HTS classification. The HTS subheadings are

provided for convenience and for customs purposes. The Department's

written description of the scope of the order remains dispositive.

Scope of the Review

Imports covered by this review pertain to merchandise as defined by

the ``Scope of the Order'' section above that was produced by Samsung.

Intent to Revoke In Part

Section 751(d) of the Act provides that the Department may revoke

an antidumping order, in whole or in part, after conducting a review

under Section 751(a) or 751(b). 19 U.S.C. 1675(d)(1) (1995). This

changed circumstances review is being conducted pursuant to Section

751(b) of the Act. The Department's regulations at 19 CFR 353.25(d)

permit the Department to conduct a changed circumstances review under

19 CFR 353.22(f) when there is sufficient information to warrant a

review. We stated in the initiation notice that the unique

circumstances presented by Samsung in this proceeding constitute

changed circumstances sufficient to warrant a review under Section

751(b) of the Act and 19 CFR 353.22(f).

Although this review is being conducted pursuant to Sections

353.25(d) and 353.22(f) of the Department's regulations, for guidance

we have relied upon the criteria contained in Section 353.25(a) as a

starting point from which to analyze the case, in addition to any other

factors raised by the parties. Section 353.25(a) states that the

Secretary may revoke an order in part if the Secretary concludes that

(1) a manufacturer or reseller covered at the time of revocation by the

order has sold the subject merchandise at not less than foreign market

value (LTFMV) for a period of at least three consecutive years, (2) it

is not likely that those persons will in the future sell the

merchandise at LTFMV, and (3) the manufacturer or reseller agrees in

writing to the immediate reinstatement of the order if the Secretary

concludes that the manufacturer or reseller, subsequent to the

revocation, sold the merchandise at LTFMV. In the preliminary

determination, the Department found that Samsung met all three of the

above requirements. At that time, we encouraged interested parties to

submit comments concerning whether Samsung was not likely to sell the

subject merchandise at LTFMV in the future.

[[Page 46761]]

With respect to the issue of likelihood, in past cases, we have

considered ``such other factors as conditions and trends in the

domestic and home market industries, currency movements, and the

ability of the foreign entity to compete in the U.S. marketplace

without LTFV sales.'' See Brass Sheet and Strip from Germany; Final

Results of Antidumping Duty Administrative Review and Determination Not

to Revoke in Part (61 FR 49727, 49730; September 23, 1996) (Brass Sheet

and Strip) and Notice of Final Results of Antidumping Duty

Administrative Review and Determination Not To Revoke Order In Part:

Dynamic Random Access Memory Semiconductors of One Megabyte or Above

From the Republic of Korea (62 FR 39809, 39810; July 24, 1997) (DRAMS).

Other criteria the Department has considered in past cases include the

existence of trade restrictions on the sale of the foreign like product

in third world countries and the industry's development of new

technologies in its analysis of the likelihood of future dumping. See,

e.g., Television Receivers, Monochrome and Color, from Japan; Final

Results of Antidumping Duty Administrative Review and Determination Not

To Revoke in Part (54 FR 35517, 35519; August 28, 1989) (TVs from

Japan). As stated in TVs from Japan, the market forces described above

are important in cases, such as this one, where there have been no

shipments of subject merchandise for several years, and there is

therefore little information regarding a respondent's current pricing

practices with regard to the subject merchandise. See TVs from Japan at

35519.

Based upon our analysis of the information on the record of this

case, Samsung has not sold the subject merchandise at LTFMV for a

period of six consecutive years (i.e., April 1, 1985 through March 31,

1991). We consider this to be an important indicator of Samsung's

expected pricing practices in the future. In addition, Samsung has

agreed in writing to its immediate reinstatement in the order if the

Secretary concludes that Samsung, subsequent to the revocation, sells

the merchandise at LTFMV.

With respect to whether Samsung is not likely to resume dumping, we

have examined the information submitted after issuing the preliminary

results. We continue to find that the record supports the conclusion

that Samsung is not likely to sell the subject merchandise at LTFMV in

the future. As more fully explained below, our analysis of whether

Samsung is not likely to resume selling CTVs in the U.S. market at

LTFMV focuses on conditions and trends in the U.S. and Korean CTV

markets, the effects of the Asian economic downturn on Samsung, the

movements of the Korean won and other Southeast Asian currencies,

Samsung's ability to compete in the United States without LTFMV sales,

trade restrictions concerning CTVs in third countries, and the

potential impact of new technologies, specifically high definition

television.

Analysis of Comments Received

Part I--General Comments

Comment 1: Legal Entitlement to a Changed Circumstances Review

Petitioners claim that Samsung missed the opportunity to request

revocation under 19 CFR 353.25(b) and is therefore ineligible for

revocation pursuant to a changed circumstances review under Section

751(b) of the Act and Section 353.25(d) of the Department's

regulations. Petitioners argue that the statute and the regulations

provide two methods to request revocation. Pursuant to Section 751(a)

and 19 CFR 353.25(a)-(c), the Department may consider a respondent's

request for revocation if the respondent has made sales at LTFMV for

three consecutive years in the immediately preceding review periods.

The Department also will consider a request for revocation pursuant to

Section 751(b) and 19 CFR 353.22(f) and 353.25(d) based on other

``changed circumstances.''

Petitioners claim that, in this case, Samsung had the opportunity

to request revocation pursuant to Section 751(a) and 19 CFR 353.25(a)-

(c), but failed to make such a request in a timely manner.

Specifically, petitioners argue that Samsung should have requested

revocation in April 1991 for the eighth review, by which time the

Department had already published its final results in the fourth and

fifth reviews and had determined that Samsung's dumping margins were de

minimis. Furthermore, despite the outcome of litigation in the fourth

review, the Department announced in the final results of the fifth

review, published in March 1991, that it did not agree with the Court

of International Trade's decision in Daewoo Electronics Co. v. United

States, 13 CIT 253, 712 F. Supp. 931 (1989) (Daewoo), and was

consequently calculating its margins for Samsung pursuant to its

standard practice. Based upon the Department's standard commodity tax

methodology, Samsung was able to obtain de minimis margins in the

fourth and fifth reviews. Since the final results of these reviews were

known to Samsung in March 1991, coupled with the Department's

announcement that it did not intend to follow the lower court's

decision in Daewoo, petitioners argue that Samsung clearly had the

basis to certify that it would have no sales at LTFMV in the eighth

review. According to petitioners, Samsung should have requested

revocation in April 1991, but it failed to do so.

Petitioners also argue that although the final results of the sixth

and seventh reviews were not published by the Department until 1996,

this should not have prevented Samsung from requesting revocation in

April 1991 for the eighth review. If Samsung had done so, petitioners

argue, the Department would have known in April 1991 that the results

of the sixth and seventh reviews could have an impact on whether

Samsung would be allowed to obtain revocation in the eighth review.

Presumably, the petitioners reason, the Department could have changed

its administrative process and conducted the sixth, seventh, and eighth

reviews simultaneously to determine whether Samsung had three

consecutive years of no dumping.

Petitioners claim that because Samsung missed its opportunity to

request revocation pursuant to Section 751(a) and 19 CFR 353.25(a)-(c),

it is not eligible for revocation through a changed circumstances

review pursuant to Section 751(b) and 19 CFR 353.22(f) and 353.25(d).

Petitioners claim that, in the past, the Department has conducted

changed circumstances reviews only in cases where domestic parties had

no interest in maintaining the order, or where the request for

revocation was otherwise warranted but could not be obtained through

the normal revocation procedure. In this case, petitioners contend that

Samsung is prohibited from requesting revocation through a changed

circumstances review because it failed to request such a review through

the normal regulatory procedures (i.e., 19 CFR 353.25(a)-(c)).

Moreover, petitioners assert that Samsung is requesting a changed

circumstances review on the basis of the discontinuance of dumping and

cessation of shipments, something that the Department has never done

before. Petitioners contend that Samsung is specifically trying to

avoid the mandate of the law by improperly relying on this alternative

method for revocation. Petitioners assert that the Department's

regulations were revised to prohibit revocation based on no shipments

in recent time periods because the Department recognized that the

absence of shipments by a respondent, even after

[[Page 46762]]

an initial period of no dumping, was not a reliable indication that the

respondent was not likely to dump in the future.

Lastly, petitioners argue that a negative determination in this

changed circumstances review is consistent with the World Trade

Organization's (WTO's) Antidumping Agreement. Petitioners claim that

Article 11 of the Antidumping Agreement provides only basic guidelines

concerning the duration and review of antidumping duties. Beyond

outlining broad principles, Article 11 is silent as to any factors or

considerations that should be taken into account by member countries'

authorities during a review of the need to maintain antidumping duties.

Therefore, petitioners contend that the Antidumping Agreement gives to

each member country's authorities the responsibility and discretion to

establish specific rules for the authorities to evaluate the issue of

revocation. In this capacity, the Department has promulgated

regulations at 19 CFR 353.25(a)-(c) that set forth the criteria

respondents must meet to obtain revocation. Petitioners conclude that

the Department's decision to withhold revocation under its applicable

regulations is in compliance with Article 11.

Samsung claims that the Department's revocation regulations failed

to operate as intended with respect to Samsung because of the timing of

certain court decisions and the systematic failure of the Department to

comply with its regulatory obligation to complete administrative

reviews within 365 days. Specifically, Samsung cites the following six

reasons: (1) the Department improperly determined in 1988 that Samsung

had an above de minimis margin in the third review; (2) the margin in

the third review was not reduced to de minimis until 1995; (3) the

Department amended its revocation regulations in April 1989 to require

that producers file revocation requests only in the anniversary month

immediately following three consecutive years of no sales at LTFMV; (4)

the Department did not issue its final determinations in the fourth and

fifth reviews until June 1990 and March 1991, respectively--in each

case, two years after the 365-day deadline for completion; (5) the

Court of Appeals for the Federal Circuit issued a decision that

resulted in de minimis margins in the third through eighth reviews; and

(6) the Department did not issue final results for the sixth and

seventh reviews until February 1996, six and five years late,

respectively. As a result, Samsung learned for the first time that it

had become eligible to request revocation under the new regulations

long after April 1989, the ``opportunity month'' for requesting such a

review, had passed. However, Samsung states that it does not seek

revocation on the basis that its revocation requests under the new

regulations were timely. Rather, certain facts relied on in those

requests are relevant changed circumstances.

Samsung also argues that under Article 11 of the WTO Antidumping

Agreement, the Department ``shall review the need for the continued

imposition of the duty, where warranted, . . . upon request by any

interested party which submits positive information substantiating the

need for a review.'' Samsung asserts that this provision contains no

time limit in which parties must request a review and establishes no

procedural bars to prevent parties from obtaining a review.

Furthermore, Article 11 states that ``an antidumping duty shall remain

in force only as long as and to the extent necessary to counteract

dumping which is causing injury.'' According to Samsung, under Article

11, the Department is obligated to revoke an order when ``dumping which

is causing injury'' no longer occurs. Given that Samsung has received

de minimis margins for a period of six years and has discontinued

shipments since 1991, Samsung maintains that the Department must,

pursuant to Article 11, revoke the order with respect to Samsung.

Samsung further argues that the House Report on the URAA explains

that ``the changes are made to conform United States law more

specifically to the provisions of the Agreement.'' Samsung contends

that the House Report indicates that Congress recognized that the

Department must comply with the WTO Antidumping Agreement's provisions

governing revocation. Therefore, Samsung asserts that the Department's

changed circumstances review provision authorizes it to conduct

revocation reviews where warranted and to revoke orders that are no

longer necessary, and does not limit the Department to examining only

those situations in which the domestic industry is no longer interested

in an order.

Department's Position: We disagree with petitioners' claim that,

because Samsung missed the opportunity to request revocation under 19

CFR 353.25(b), it is therefore ineligible for revocation pursuant to a

changed circumstances review under Section 751(b) of the Act and

Sec. 353.25(d) of the Department's regulations. A review based upon

changed circumstances, as provided under Sec. 353.25(d) of the

regulations, is a separate and distinct procedure from that of a

revocation review provided for under Secs. 353.25(a)-(c). In the

Department's view, the failure to meet a procedural requirement for a

review under Secs. 353.25(a)-(c) cannot act as a bar to a changed

circumstances review where a company satisfies the requirements for

such a review. Thus, if the facts demonstrate that changed

circumstances exist sufficient to warrant a review, the Department has

authority, under the statute and regulations, to conduct such a review

(see Section 751(b) of the Act and 19 CFR 353.22(f)(1)). In this case,

the facts clearly demonstrate that there were changed circumstances

sufficient to warrant a changed circumstances review. As noted in the

Notice of Initiation, these changed circumstances are (1) the decision

of the Court of Appeals for the Federal Circuit in Daewoo Electronics

Col, Ltd., et al. v. United States, 6 F.3d 1511 (Fed. Cir. 1993), cert.

denied, 114 S. Ct. 2672 (1994), which Samsung claims made it possible

for the first time for it to contemplate the possibility of de minimis

margins for three or more consecutive review periods; (2) as a direct

result of that decision, Samsung was able to establish that it had not

been dumping CTVs in the United States for six consecutive years; and

(3) Samsung has not shipped CTVs to the U.S. since 1991.

Furthermore, petitioners have misunderstood the intended purpose of

the procedural requirement that a respondent seeking revocation submit

a timely request for revocation under Sec. 353.25(b). The requirement

of a timely filed request is not meant to bar consideration of a

company-specific revocation for respondent. Rather, the purpose of the

regulatory requirement is to ensure that the Department has adequate

time to address the issues of revocation, to prepare for and conduct a

proper verification as required under Sec. 353.25(c)(2)(ii), and to

ensure that all parties to the proceeding are provided with an

opportunity to comment on the issues of revocation. Thus, the

Department's decision to grant a changed circumstances review does not

frustrate the purpose of the antidumping law or prejudice the parties

to the proceeding. To the contrary, it is a reasonable exercise of the

Department's authority, consistent with Section 751(b) of the Act and

the Department's regulations.

We also disagree with petitioners' contention that revocation is

not warranted because the Department's regulations prohibit revocation

based upon no shipments. First, we have based revocation upon Samsung's

six

[[Page 46763]]

consecutive years of zero or de minimis margins and a determination

that resumption of dumping by Samsung is not likely, not the absence of

shipments.2 Furthermore, in amending its regulations on

revocation, the Department stated that, in determining whether an order

should be revoked under a changed circumstances review, the Department

``may consider among other things periods of no shipments.''

Antidumping Duties, Final Rule, 54 FR 12742, 12758 (Mar. 28, 1989).

Thus, Samsung's lack of CTV shipments from Korea to the United States

does not prohibit the Department from revoking the order as to Samsung.

To the contrary, that fact may be taken into consideration.

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\2\ In 1991, Samsung ceased, and has not resumed, shipping CTVs

from Korea to the United States. See Color Television Receivers From

the Republic of Korea; Final Results of Antidumping Duty

Administrative Review, 59 FR 13700 (Mar. 23, 1994); Color Television

Receivers From the Republic of Korea; Final Results of Antidumping

Duty Administrative Review, 60 FR 38987 (July 31, 1995); and Color

Television Receivers From the Republic of Korea; Final Results of

Antidumping Duty Administrative Review, 61 FR 59402 (Nov. 22, 1996).

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Comment 2: Revocation Of The Order In Full

LGE, a Korean producer of the subject merchandise and an interested

third party, argues that four significant changed circumstances exist

since the imposition of the Korean CTV order nearly 14 years ago that

warrant the revocation in full of the antidumping duty order on CTVs

from Korea. First, LGE claims that there have been no commercially

significant imports of CTVs from Korea since approximately 1989,

despite zero or very low cash deposit rates for all major Korean

exporters during this period. Therefore, LGE contends that the

antidumping duty order offers no legitimate commercial benefit to the

United States industry. Second, LGE states that the Department's

administrative reviews established a pattern of sustained reduction,

and ultimately virtual elimination, of the dumping margins found by the

Department in its margin calculations for all Korean producers. Third,

LGE asserts that Mexico has supplanted Korea and other Asian nations as

the dominant supplier of CTVs to the U.S. market because many Korean,

Japanese, and American CTV companies have shifted their production

facilities that serve the U.S. market to Mexico. Fourth, due to the

emergence of Mexico as the leading supplier of CTVs sold in the U.S.

market, LGE doubts whether there continues to exist an industry engaged

in the manufacture of CTVs--as distinct from color picture tubes (CPTs)

and other components--in the United States.

Petitioners contend that, apart from the fact that LGE is unable to

satisfy the basic requirements of the regulations and that LGE has been

found to be dumping above de minimis levels during one of the last

periods for which a review was conducted, LGE's comments fail on

several grounds. First, LGE has not participated in this review except

tangentially. Second, LGE has not addressed the significant changes

caused by the recent economic downturn facing Korea which would cause

it, like Samsung, to export its excess production capacity at LTFMV to

obtain foreign exchange to service its debt. Third, petitioners contend

that LGE, like Samsung, has not demonstrated that it is not likely to

resume dumping, and therefore revocation must be denied.

Department's Position: In this case the Department initiated a

changed circumstances review solely with respect to Samsung based upon

specific facts demonstrating changed circumstances sufficient to

warrant a review as to Samsung. Accordingly, this changed circumstances

administrative review was not conducted with respect to any other

company. Thus, the Department's determination in this review pertains

exclusively to Samsung.

Part II--Likelihood Comments

Comment 3: Conditions And Trends In The United States Market

Petitioners argue that Samsung is likely to resume dumping CTVs in

the U.S. market because U.S. CTV prices are steadily declining and will

fall below foreign market value in the near future. Petitioners state

that Samsung's weighted-average price data indicates that, for almost

all screen sizes, particularly the large sizes, Samsung's U.S. prices

have steadily decreased. More broadly, petitioners note that, although

Samsung's prices fell in both the U.S. and Korean markets from 1991

through 1997, its U.S. prices fell approximately twice as fast as those

in Korea. In addition, petitioners claim that the data Samsung obtained

from the Electronics Industries Association (EIA), which lists the

overall U.S. market sales volumes and average unit prices from 1954

through 1998 (projected), demonstrate significant, and continuing,

price declines. Petitioners also claim that the price decline in the

U.S. market will accelerate as Southeast Asian CTV producers respond to

their need for increased revenue, precipitated by the Asian economic

situation, by flooding the U.S. market with significantly discounted

CTVs. Petitioners conclude that, as a result of declining U.S. prices,

amplified by competition among cheap Southeast Asian imports, Samsung

will be forced to lower its U.S. prices below foreign market value and

resume dumping.

Petitioners also claim that the changing pattern of demand in the

U.S. market makes Samsung likely to resume dumping CTVs, especially in

the large (25- and 27-inch) and very large (31-inch and greater)

product segments. In support of their argument, petitioners provide

their estimates, by screen size, of demand in the U.S. CTV market from

1996 through the year 2000. Based on these estimates, petitioners

contend that the U.S. market will exhibit growth in the large and very

large product segments, while decreasing in the small (13-inch and

less) and medium (19- and 20-inch) product segments.

In light of these data, petitioners argue that Samsung is currently

adjusting its domestic production to reflect the shift in United States

demand toward large and very large CTVs. As evidence of Samsung's

shifting production pattern, petitioners provide their estimate of

Samsung's Korean CPT production capacity, on a screen size basis,

through the year 2000. According to petitioners, examination of these

estimates indicates that Samsung is increasing its Korean production of

large and very large-sized CPTs, while cutting back its Korean

production of small and medium-sized CPTs. This point is especially

relevant, state petitioners, because Samsung's CPT plant in Mexico can

only produce medium-sized CPTs. Thus, Samsung could reserve its Mexican

operations for production of medium-sized CTVs, which is the segment of

the U.S. market petitioners claim is showing considerable decline,

while exporting small and large CTV sizes directly to the United States

from Korea.

Samsung characterizes the U.S. CTV market as stable and non-

cyclical. As evidence, Samsung relies on the data it obtained from the

EIA, which indicates that sales volumes in the U.S. CTV market,

measured in units, have been steady throughout the 1990's, and that

average unit prices have shown only slight erosion since 1993. Samsung

also claims that this stability is mirrored in its own U.S. market

prices for its Mexican-made CTVs.

Samsung responds to petitioners' allegation that it is adjusting

its Korean production to reflect the growth in U.S. market demand for

large and very large CTVs by making three points. First, Samsung states

that during the eight administrative reviews in which it

[[Page 46764]]

shipped CTVs to the United States from Korea, it never exported CTVs

with screen sizes of 25 inches or more. Thus, Samsung states there is

no basis on which to conclude that it would resume dumping large screen

size CTVs since it never dumped them in the first place. Second,

Samsung claims it has no need to ship large screen size CTVs from Korea

to the United States because it can fully serve the large screen size

market segment through its Mexican operations. Samsung notes that the

Department verified in the now terminated anti-circumvention proceeding

that all four of its production lines in Mexico can produce CTVs with

screen sizes ranging from 25 to 31 inches. Third, Samsung asserts that

its Korean CPT facilities cannot produce conventional CPTs (4:3 width-

to-height ratio) for certain large screen sizes. For these reasons,

Samsung concludes that it is not adjusting its Korean production

operations to service better the U.S. market.

Department's Position: We disagree with petitioners' claim that

Samsung is likely to resume dumping in the U.S. CTV market because,

according to petitioners, U.S. prices are steadily declining and will

fall below foreign market value in the near future. The U.S. CTV

industry is a non-cyclical, mature industry historically characterized

by modestly declining prices. Although declining U.S. prices and a

competitive U.S. market were factors in rejecting requests for

revocation in certain past cases, the evidence on the record of this

case concerning U.S. market conditions is significantly different from

that in past cases and does not support a similar conclusion.

For example, in DRAMS, the Department noted that the global DRAM

industry is highly cyclical in nature with periods of sharp upturn and

downturn in market prices. In the year prior to the July 1997 final

results of administrative review, the world market experienced a year-

long downturn, resulting in depressed prices and increased DRAM supply,

from which it had not fully recovered by the time of the final results.

We concluded that, due to price fluctuations, there was a large degree

of uncertainty about the market's future direction. See DRAMS at 39816

and 39817. As discussed more fully below, the CTV industry is not

characterized by the large cyclical swings found in the DRAMS industry

and, therefore, does not experience periods of significantly depressed

prices. See Samsung's February 13, 1998, submission at Exhibit H.

In another case, TVs from Japan, we found that prices in the U.S.

television market had declined steadily during the six-year period

immediately preceding the 1989 final determination not to revoke the

order, imported televisions from countries other than Japan (many sold

at LTFMV) had increased as a percentage of U.S. consumption, and that

the competitive pricing pressures in the United States had become

stronger with the emergence of Taiwan and Korea as significant

television producers and exporters. We also noted in TVs from Japan

that these market factors are important where there have been no

shipments for many years, therefore limiting (Japanese) respondents'

U.S. pricing information. See TVs from Japan at 35519.

However, TVs from Japan is substantially different from the current

review because, in this case, we have evidence of how Samsung would

price (compete) in a U.S. market characterized by significant dumped

imports (i.e., Samsung's pricing behavior in the U.S. market during the

1980s when it competed against dumped television receivers from Taiwan,

Japan, and other Korean producers). When making our determination in

TVs from Japan we did not have evidence indicating how the Japanese

respondents requesting revocation (Sanyo and Hitachi) would compete in

a U.S. market characterized by significant dumping, because they had

stopped shipping before the orders on television receivers from Taiwan

and Korea were issued. See Analysis Memorandum dated August 25, 1998.

Therefore, even if Samsung were to resume shipments and compete against

potentially dumped imports from Japan, Taiwan, and other Korean

producers, the fact that Samsung received de minimis margins while

competing against dumped imports during the period 1985 through 1991,

supports a conclusion that Samsung is not likely to resume sales at

LTFMV.

In a third case, Brass Sheet and Strip, we characterized the U.S.

market for the subject merchandise as being mature, known for its price

competitiveness, and a ``desirable market for foreign exporters, by

virtue of its large size relative to other markets.'' See Brass Sheet

and Strip at 49731. However, the Department's decision to reject the

respondent's request for revocation was based on other significant

factors, such as the respondent's under-utilized home market capacity,

the severe decrease in shipments of subject merchandise to the United

States since the imposition of the order, the appreciating home market

currency, and the existence of a U.S. processing plant that required

subject merchandise as feedstock. Unlike in Brass Sheet and Strip, the

current review is not characterized by the combination of factors which

support a conclusion that the respondent is likely to resume sales at

LTFMV.

Samsung provided data it obtained from the EIA listing the total

quantity, value, and the percentage of household penetration of sales

in the U.S. CTV market from 1954 to 1998 (projected). See Samsung's

February 13, 1998, submission at Exhibit H. Close examination of these

data indicates that from 1980 through 1998, the annual average unit

price for the U.S. CTV market has decreased, except for a period of

five consecutive years, from 1989 to 1993, when prices increased.

Specifically, these data indicate that CTV prices, as measured by the

average annual rate of change, declined at a rate of 2.79 percent from

1980 to 1988, increased at a rate of 1.71 percent from 1989 to 1993,

and decreased at a rate of 2.61 percent from 1994 through 1998. In

addition, the EIA data shows that CTVs have held a household

penetration of approximately 98 percent since 1993. The low rates of

annual change in average unit prices, the fact that 12 of the last 18

years have been marked by modestly declining prices, and that the CTV

market has had full household penetration since 1993, are consistent

with the view that the U.S. CTV industry is a non-cyclical, mature

industry.

Furthermore, we note that Samsung's own data supports our

characterization of the U.S. CTV market. As noted above, Samsung placed

on the record data concerning its prices of Mexican-produced CTVs sold

in the U.S. market for the period 1991 through 1997. These data

indicate that, as petitioners note, Samsung's prices in the U.S. market

declined during this period.

Samsung received de minimis margins during the period April 1985

through March 1991. During the first four years, from 1985 to 1988, we

note that the U.S. CTV industry experienced declining prices. Since the

Department normally considers declining U.S. prices to be a factor that

increases the likelihood of continued sales at LTFMV, we note that

Samsung has demonstrated its ability to sell CTVs in the United States

at fair value even in the face of these declining prices.

Furthermore, we disagree with petitioners' claim that Samsung is

changing its Korean production to match what petitioners characterize

as a shift in U.S. demand toward large and very large CTVs.

Petitioners' basis for this argument is that, according to their

estimates, Samsung is increasing its

[[Page 46765]]

production of large and very large CPTs, which will eventually have to

be exported in the form of a completed CTV. As more fully discussed in

Comment 4 below, we conclude that a change in CPT production does not

necessarily produce a corresponding change in CTV production. In

addition, we note that Samsung's Korean CPT facilities cannot produce

conventional CPTs for certain large screen sizes. More importantly, we

agree with Samsung that its Mexican facilities fully serve the U.S.

market with respect to CTVs ranging in screen size from 13 to 31

inches. We note that Samsung has an incentive to continue serving the

U.S. market from Mexico, for all screen size CTVs because, among other

things, such CTVs can receive duty-free treatment under the North

American Free Trade Agreement (NAFTA), provided the merchandise meets

the appropriate rules of origin, while CTVs from Korea are subject to

import duties.

Lastly, petitioners have argued that the shift in U.S. demand

toward large and very large CTVs, in combination with their estimate

that Samsung is increasing Korean production of large and very large

CPTs, is an incentive for Samsung to resume sales at LTFMV in the

United States. As mentioned above, we disagree that an increase in

large-size CPT production necessarily corresponds to an increase in

large-size CTV production in Korea. Moreover, although we agree with

petitioners that the large and very large CTV market segments are

likely to continue to grow over time, while the smaller CTV segments

are likely to shrink, it is not clear that this trend provides Samsung

with any additional incentive to resume sales at LTFMV. It is not

unreasonable to assume that, over the history of the CTV industry,

demand has shifted toward larger screen sizes as each new, and larger,

screen size was introduced as a result of technology advances. During

its six-year period of de minimis margins in the 1980's, it is

reasonable to assume that Samsung faced a similar shifting of demand

toward screen sizes that were at that time the upper end of the CTV

market, but was able to compete without LTFMV sales.

Comment 4: Home Market Conditions And Samsung's Korean Production

Capacity

Petitioners argue that the Korean CTV market is in a depression and

that prices are declining, although not as fast as in the U.S. market.

Petitioners contend that this price decline and Korean demand decrease,

coupled with Samsung's excess CTV capacity in Korea, will force Samsung

to export its excess production to the United States at LTFMV.

Citing a newspaper article entitled ``1998 Home Electronics Product

Forecast,'' which provides an overview of the state of the Korean

consumer electronics industry and its prospects for 1998, petitioners

state that in 1997, Korean demand for CTVs fell by 50,000 units, and,

due to the economic slowdown triggered by the Asian economic situation,

is expected to fall by another 5-10 percent in 1998. See petitioners'

submission dated February 13, 1998, at Enclosure 10. Continuing their

citation of the article, petitioners state that Korean CTV producers

are expected to increase exports in order to sell production no longer

being absorbed by the domestic market.

Petitioners also contend that Samsung has excess CTV capacity in

Korea and that Samsung will dispose of this excess production by

exporting it, most likely to the United States, at LTFMV. Petitioners

state that Samsung and the other Korean producers expanded their

capacity during the years preceding the Asian economic downswing. In

order to calculate the aggregate Korean excess CTV capacity,

petitioners subtract Korean CTV demand from Korean CPT capacity, for

the years 1985 through 1996. Petitioners maintain that because the

Korean market cannot absorb the excess CPT production, this excess must

be exported as completed CTVs. Furthermore, petitioners state that the

condition of excess CPT production over CTV demand in Korea will only

increase as demand falls due to the Korean economy slowing as a result

of the Asian economic situation. Korea's excess capacity, petitioners

state, has contributed to a world-wide oversupply that has resulted in

depressed CTV market conditions across the globe.

Petitioners contend that Samsung, in its position as one of the

major Korean CTV producers and as a direct result of its history of

expansion, helped create the current situation of excess capacity

existing in the Korean CTV industry. Although Samsung's excess capacity

contributed to the world-wide oversupply of CPTs, petitioners maintain

that Samsung will not reduce its Korean CPT production in view of its

dire need to raise hard currencies. On the contrary, petitioners claim,

Samsung will postpone any domestic cuts in CPT production and, as

newspaper articles have reported, increase its exports of CTVs to

enhance revenue flow.

Petitioners also argue that Samsung's sales data concerning its CTV

exports from Korea to third countries do not support its claim that it

has no incentive to export Korean-produced CTVs to the United States.

Although Samsung's data do indicate that exports to Russia, Iran and

the United Arab Emirates increased substantially between 1995 and 1996,

the data for the first half of 1997 indicate that, when annualized,

Samsung's exports to these countries significantly declined. This trend

in declining third country exports, petitioners claim, proves

inaccurate Samsung's characterization of these markets as ``fast

growing'' and further supports petitioners'' argument that Samsung has

an incentive to export its excess CTV capacity to the United States.

Samsung disagrees with petitioners' argument that a decline in the

Korean market's demand will lead to increased pressure to export CTVs

to the United States. Samsung observes that the 50,000 unit decrease

experienced in 1997, as referenced by petitioners, is an insignificant

decrease considering that the Korean market exceeded 2.3 million units

in that year. In regard to the 5-10 percent projected decline in 1998,

Samsung notes that even if such a decline occurs, it will be offset by

a concomitant decline in the market share of foreign CTV suppliers

(currently about 7 percent) which will find it much more difficult to

sell in Korea due to the devaluation of the won. Therefore, Samsung

reasons, even if overall demand declines, Samsung can gain market share

at the expense of more costly foreign CTVs, and not be faced with

unsold inventory which would generate pressure to export. Moreover,

Samsung states that even if it did face increased pressure to export

CTVs due to a decline in domestic demand, there is no reason to assume

such exports would go to the United States since Samsung's Korean

facilities already serve other third countries with growing demand.

Samsung also asserts that petitioners use the phrase ``excess CPT

capacity'' in a misleading manner, attempting to imply that Samsung,

and the other Korean producers, have unutilized capacity which will

force them to export CTVs. While Samsung does not contest that its

Korean CPT production capacity exceeds its Korean CTV sales, it asserts

that this larger CPT production exists because its Korean CPT

production is export-oriented--i.e., the CPTs not incorporated into

CTVs sold in Korea are exported and sold to unrelated CTV producers in

various third countries. Samsung claims that its Korean CPT production

capacity is fully utilized and, as evidence, provides a chart listing

its Korean CPT capacity, production, and utilization rates since 1993.

Samsung explains that this chart

[[Page 46766]]

indicates that, by 1997, Samsung reduced its CPT capacity by a

significant amount and experienced high utilization rates throughout

the five-year period. Samsung explains that these utilization rates are

the functional equivalent of full capacity, after accounting for yield

loss and maintenance downtime. Based on the above reasons, Samsung

concludes that petitioners' implication that it has substantial unused

CPT capacity which would force it to export CTVs to the United States

is incorrect.

Samsung also acknowledges that its Korean CTV production is larger

than its domestic CTV sales. Samsung states that this is because its

CTV production, as with its CPT production, is export-oriented.

Specifically, Samsung states that its Korean CTV facilities produce

CTVs for sale in Russia, the Middle East, and Africa. Samsung further

states that its CTV facility is fully utilized due to its Korean sales

and export sales to these third country markets. To support its claim,

Samsung provides a chart listing its CTV capacity, production, and

utilization rates from 1993 through 1997. Samsung explains that this

chart indicates that its CTV facility operated at or in excess of full

capacity during this period. Therefore, Samsung concludes that,

assuming petitioners' theory was correct and it did have unused CPT

capacity, Samsung does not have any excess CTV production capacity in

Korea which could be used to absorb the alleged excess CPT capacity.

Samsung also provides 1996 data showing the total quantity of

Korean-produced CTVs sold domestically and in third countries. Samsung

asserts that these data show that its overall export strategy for Korea

is well diversified and, specifically, that the markets in Russia,

Iran, and the United Arab Emigrates are ``fast growing.'' Samsung

concludes that even if there is a modest decline in Korean CTV demand,

Samsung can offset that decline with exports to alternative third

country markets. Samsung argues further that in Steel Wire Rope From

the Republic of Korea; Final Results of Antidumping Duty Administrative

Review and Revocation in Part of Antidumping Duty Order, 62 FR 17171,

at 17174 (April 9, 1997) (Steel Wire Rope 1997) and Frozen Concentrated

Orange Juice From Brazil; Final Results and Termination in Part of

Antidumping Duty Administrative Review; Revocation in Part of the

Antidumping Duty Order, 56 FR 52510 (October 2, 1991), the Department

considered a respondent's showing that it was not ``solely dependent on

the United States for financial viability'' as an important factor in

granting revocation.

Furthermore, Samsung states that if petitioners are correct in

their theory that, when Samsung's Korean CPT production capacity

exceeds its domestic CTV sales, it will be forced to increase its CTV

exports to the United States, then this theory must equally apply to

Samsung's Mexican operations. Citing the Department's 1997 verification

report of Samsung's Mexican facilities, generated in the context of the

now terminated anti-circumvention inquiry of CTVs from Korea, Samsung

states that these documents clearly indicate that its CPT capacity in

Mexico far exceeds its Mexican CTV capacity. Samsung asserts that,

according to petitioners' theory, the larger Mexican CPT capacity

should place substantial pressure on Samsung to export CTVs to the

United States from Mexico, rather than from Korea. Petitioners, Samsung

concludes, have ignored this implication of their theory.

Department's Position: Although we agree with petitioners that

prices in the Korean CTV market have been falling and that the current

economic slowdown may increase this trend, we cannot conclude that it

is likely that Samsung will export its production normally absorbed by

the Korean market, but now left unsold, to the United States at LTFMV.

According to Samsung's data, petitioners are correct that Samsung's

annual, weighted-average market prices in Korea declined at a small

rate over the 1991 through 1997 period (averaged across all screen

sizes). See Analysis Memorandum dated August 25, 1998. However, this

rate of price decline is much smaller than that exhibited in other

cases where revocation was ultimately denied. See, e.g., DRAMS at 39816

and 39817 and Brass Sheet and Strip at 49730. Furthermore, Samsung's

Korean and U.S. market price data, in addition to overall U.S. market

price data, indicate that the CTV industry, in both Korea and the

United States, exhibits a trend of consistent, yet gradual, price

declines. Unlike DRAMS, the CTV industry is a mature, non-cyclical

industry. Thus, the steep price declines that occurred in other

industries that contributed to the Department's decision not to grant

revocation are not present in the CTV industry.

Petitioners' claim that the current economic situation will cause a

decrease in demand and accelerate the decline in prices in the Korean

CTV market. Assuming that a decrease in demand occurs, we note that

Samsung has several options from which to choose in meeting a potential

slow-down in home market CTV demand. For example, Samsung could reduce

its CTV production, discount its Korean CTV prices to stimulate

consumer spending, or export unsold CTVs to third country markets. In

regard to petitioners' claim that unsold Korean CTV production is

likely to be exported to the U.S. market and sold at LTFMV, we note

that Samsung has provided evidence that its Korean CTV facilities serve

viable third country markets other than the United States. Therefore,

we do not find that a potential decline in Korean CTV demand supports a

conclusion that Samsung is likely to resume sales at LTFMV in the U.S.

market.

Petitioners also claim that Samsung has excess CTV capacity in

Korea and that Samsung will dispose of this excess production by

exporting it, most likely to the United States, at LTFMV. In past

cases, we have examined a respondent's production capacity when

considering revocation. For example, in Brass Sheet and Strip, the

Department found that excess capacity existed in the home market

``because [the respondent's] level of new orders had been

unsatisfactory.'' With ``capacity utilization in the home market under

threat'' from decreased new orders and increased pressure from imports

into the home market, combined with a plant in the United States that

processed the subject merchandise, among other factors described above,

we determined that the respondent had an incentive to resume sales in

the United States at LTFMV. See Brass Sheet and Strip at 49731.

In the instant case, petitioners claim that Samsung has excess CTV

capacity in Korea by subtracting Korean CTV demand from aggregate

Korean CPT production capacity. We note that subtracting CTV demand

from CPT production is not an appropriate method to calculate excess

CTV capacity. Rather, examining the capacity utilization rate of CTV

production facilities is a more meaningful measure. Furthermore,

petitioners' methodology is not consistent with, or as accurate as the

one used in Brass Sheet and Strip, where we examined directly the

degree to which the respondent was utilizing its production capacity

for subject merchandise. Even if it were, we note that petitioners

applied this methodology on a Korea-wide basis, rather than

specifically to Samsung. Furthermore, we learned in the terminated

anti-circumvention inquiry that Samsung produces its CPTs through its

subsidiary company, Samsung Display Devices-Mexicana, S.A., which sells

its CPTs not only to Samsung's own CTV production facilities, but also

[[Page 46767]]

to unaffiliated CTV manufacturers. See memorandum to the file, dated

August 12, 1998, that transmits the verification report of the November

20-21, 1997, verification of Samsung-Mexico to the record of this

review. For this reason, Samsung's CPT production is not captive for

Samsung's CTV production only. Thus, the one-to-one relationship

between CPT production and CTV production capacity relied upon by

petitioners distorts the analysis of whether Samsung has excess CTV

production capacity. For this reason, we do not find petitioners'

methodology to be an accurate or meaningful way of measuring unutilized

capacity for Samsung. To the contrary, following petitioners'

rationale, we find Samsung's claims with respect to the export

orientation of its CPT production to be more reasonable.

We agree with Samsung that the proper method of determining whether

it has excess CTV production capacity is to examine whether its current

CTV production facilities are fully utilized. To this end, Samsung

provided its production, capacity, and resulting utilization rates for

its CPT and CTV facilities from 1993 through 1997 in Exhibits 20 and 21

of its March 6, 1998 submission. The utilization rates presented by

Samsung are the functional equivalent of full capacity, after

accounting for yield loss and maintenance downtime. In our view, excess

capacity would exist if Samsung's current facilities were underutilized

or if Samsung were building additional CTV production facilities during

a time when there was no unmet demand, either domestically or abroad,

that would absorb the additional output. In this case, Samsung has not

announced, nor have petitioners alleged, that Samsung is currently

building, or will build in the future, additional CTV production

facilities in Korea. In fact, Samsung's utilization charts indicate

that it significantly reduced both CPT and CTV capacity in 1997.

Therefore, we find that Samsung's high utilization rates indicate that

its does not have excess CTV production capacity at this time that,

according to petitioners, would have to be exported and likely sold in

the U.S. market at LTFMV.

Comment 5: The Effects of the Asian Economic Downturn on Samsung

Petitioners claim that the recent Asian economic slowdown has

affected Samsung in three ways: (1) foreign creditors are requesting

repayment of loans in hard currencies, rather than in the depreciated

Korean won; (2) foreign lenders are reluctant to offer new loans to

Samsung so that it can roll-over its current debt; and (3) the drastic

depreciation of the won makes repayment of foreign debt in hard

currencies very expensive. These effects, state petitioners, are

especially relevant because Samsung is currently operating under a very

heavy debt load as a result of financing both its Korean and global

expansion throughout the 1980's and 1990's with foreign debt. This

large amount of debt is illustrated by the Samsung Group's 1997 debt-

to-equity ratio of 267 percent. Petitioners contend that the

combination of this large amount of debt, coupled with the negative

effects of the Asian economic situation, has forced Samsung to enter a

``debt-service mode'' and consequently maximize revenues, rather than

profits, in order to make loan repayments and survive. To obtain the

hard currency revenue it needs to survive, petitioners argue that

Samsung will dramatically increase its exports of all its products from

Korea to the United States, with CTVs leading the export drive.

Pursuant to its need to maximize hard currency revenue, petitioners

state that Samsung will face enormous pressure to lower its prices,

thereby increasing the quantity sold and enhancing revenues.

Petitioners cite the economic theory concerning the behavior of firms

in ``debt-service'' mode, which states that a firm seeking to maximize

revenue, as opposed to profits, is required to lower prices below the

total unit cost of production. As long as the producer's price exceeds

the marginal cost of production, the firm will enhance cash flow even

if the price is below the total unit cost. Petitioners state that this

type of pricing behavior is especially relevant because the CTV

industry is capital-intensive and characterized by high startup costs

and high fixed costs. Thus, the marginal cost of an additional unit

being produced is well below that unit's total cost. Because of

Samsung's need to raise hard currency to pay off foreign debt, and its

excess production capacity that the Korean CTV market cannot absorb,

petitioners conclude that Samsung is likely to export Korean CTVs to

the United States and to price them below foreign market value.

Samsung disagrees with petitioners' portrayal of its foreign debt

situation, claiming that it has not defaulted on any loans and has no

difficulty obtaining additional debt and equity financing in the

international marketplace. As support for its assertions, Samsung

provided documentation showing recent security offerings, renewals and

an extension of credit, and a lease agreement.

In response to petitioners' argument that Samsung is likely to dump

CTVs because it is heavily in debt and has a large debt-to-equity

ratio, Samsung provided its fiscal year end debt-to-equity ratio from

1984 through 1997. Samsung points out that during the period 1985

through 1991, when it received de minimis margins on the CTVs it

shipped directly from Korea to the United States, its debt-to-equity

ratio exceeded the 1997 rate. Additionally, although Samsung ceased

shipments to the United States in 1991, its debt-to-equity ratio in

1991 through 1993 was higher than its current ratio. Samsung claims

that under petitioners' theory, it would have desperately needed to

export CTVs from Korea to the United States from 1991 to at least 1993

because it was in a ``debt-service mode'' at that time. The fact that

it did not, Samsung asserts, disproves petitioners' claims.

Furthermore, Samsung makes the point that the 1997 debt-to-equity ratio

cited by petitioners is lower than the 1996 ratios for Philips

Electronics N.V. and Thompson-CSF, the parent companies of two U.S. CTV

producers. Samsung doubts that petitioners would claim that these two

companies were in a ``debt-service mode'' in 1996 which compelled them

to adopt a strategy of exporting CTVs below the cost of production in

order to maximize revenue and survive.

Lastly, Samsung states that even assuming it had to export goods

from Korea to the United States in order to survive, petitioners never

provide evidence as to why Samsung must export CTVs, rather than other

products it manufacturers, to service its debt. Samsung claims that

relying on revenue from U.S. CTV sales would be a poor strategy and

could not play a significant role in servicing its debt because its CTV

sales in the U.S. market account for a small portion of its overall

corporate sales. As support for this claim, Samsung provides

documentation showing that its total 1996 CTV sales in the United

States by its Mexican subsidiary accounted for a very minor portion of

its total 1996 corporate sales.

Department's Position: We disagree with petitioners' allegation

that as a result of the Asian economic downturn and its debt burden,

Samsung is currently in a ``debt-service mode'' and, in order to

service its debt, is compelled to adopt a strategy of exporting CTVs

below the cost of production, thereby maximizing hard currency revenue.

Although Samsung may be facing a high debt burden in light of the

current economic downturn, the lack of CTV shipments from Korea to the

United States during the 1991 to 1993 period,

[[Page 46768]]

when Samsung's debt-equity-ratio was higher than the current level,

does not support petitioners' contention that Samsung is likely to

export Korean CTVs to the United States because of its current debt

situation.

As an initial matter, we note that, of the numerous newspaper

articles petitioners submitted to the record of this proceeding

concerning the effects of the Asian economic downturn on Korean

companies and the Korean economy in general, the majority of articles

reported the statements and actions of the Samsung Group, while only a

few discussed how the decline specifically affected Samsung, the

company subject to this review, and described what actions the company

is taking in light of the situation. Petitioners, through their

reliance on articles reporting the response of the Samsung Group, have

implied that the actions of the group are synonymous with the actions

of individual companies within the group, such as Samsung. Given that

the Samsung Group consists of approximately 80 individual companies

(see petitioners' February 13, 1998 submission at Enclosure 20)

producing a wide array of products and services, we find that in this

case the actions of the group are of limited value in our analysis of

whether Samsung is likely to resume dumping CTVs in the U.S. market.

Of the few newspaper articles submitted by petitioners that

specifically discuss Samsung, all of them indicate that Samsung intends

to increase its Korean exports of a variety of products. Although the

most commonly mentioned products designated by Samsung to lead its

export drive are kitchen and household appliances, semiconductors, and

telecommunications equipment, two articles include large screen and

digital CTVs on this list. These articles, however, do not state the

destination of the increased CTV exports and fail to mention that

Samsung's Korean CTV operations are historically export-oriented,

serving markets in Africa, the Middle East, and the republics of the

former Soviet Union. However, in our preliminary determination, we

stated that the issue of central importance in the final results of

this review is whether Samsung is likely to resume dumping in the

absence of an antidumping duty order, assuming that shipments occur.

Therefore, arguments that Samsung will resume shipments directly from

Korea are not enough.

The foundation of petitioners' argument that Samsung is likely to

resume dumping as a result of the Asian economic downswing is their

assumption that Samsung is currently operating under an extraordinary

amount of debt. According to petitioners, this debt load, in

conjunction with the drastic depreciation of the won, has made it very

difficult for Samsung to obtain new loans and service its current debt.

As a result, petitioners contend that Samsung must maximize revenues in

order to survive, and will do so by exporting CTVs at LTFMV to the

United States.

In response, Samsung stated that it has not defaulted on any loans

and provided evidence that demonstrates it is able to obtain additional

debt and equity financing in the international marketplace. Moreover,

Samsung has shown that its debt load, as measured by its debt-to-equity

ratio, was actually much higher in previous periods than it is now.

From 1985 through 1991, when it received de minimis margins, Samsung

had debt-to-equity ratios significantly higher than the 1997 ratio

cited by petitioners. See Samsung's March 6, 1998 submission at 20. See

also the August 25, 1998, Analysis Memorandum. Furthermore, from 1991

to 1993, which were the first three years in which Samsung had ceased

CTV shipments to the United States, Samsung's ratio was even higher

than the 1985 to 1991 period.

Thus, the facts of this case do not support petitioners' theory

that Samsung's current level of debt would compel Samsung to resume

shipments of CTVs from Korea to the United States at LTFMV. As Samsung

correctly states, petitioners' theory implies that because Samsung was

servicing substantial debt during the 1985 to 1993 period, it must have

sold CTVs in the U.S. market at LTFMV, which it did not do. Since

Samsung had significantly higher debt-to-equity ratios during periods

in which it had de minimis margins or no shipments, we are not

persuaded by petitioners' arguments.

Comment 6: Currency Movements

Petitioners argue that CTV producers in Malaysia, Singapore,

Thailand, and Indonesia are competitively advantaged over Samsung

because the currencies of these countries devalued to a greater extent

than the won during the Asian economic decline. Moreover, petitioners

claim that because CTV producers in these countries are also in a

``debt-service mode'' and have greater excess capacity than Samsung,

they can be expected to flood the U.S. market with deeply discounted

CTVs. In order to stay competitive and maximize revenue, petitioners

maintain that Samsung will have to match the U.S. prices of its

Southeast Asian competitors, which will quickly be reduced to dumping

levels.

According to petitioners, the currencies of Malaysia, Singapore,

Thailand, and Indonesia significantly depreciated against the U.S.

dollar from the last half of 1997 through January 1998, as the Asian

economic situation unfolded. Citing the exchange rates from this

period, petitioners assert that the magnitude of the Southeast Asian

devaluations often surpassed that of the Korean won. Moreover,

petitioners observe, that since reaching its nadir on December 23,

1997, the won appreciated by 28 percent while the Malaysian ringgit,

Thai baht, and Singapore dollar depreciated by 9 percent, 13 percent,

and 3 percent, respectively. Petitioners claim that the won's recent

appreciation vis-a-vis the other Southeast Asian currencies permits

producers in these countries to discount their U.S. prices to a greater

extent than Samsung. Petitioners state that the reduction in export

value resulting from the depreciation of the won will not be enough to

prevent Samsung from selling at LTFMV because it will have to

drastically lower its U.S. prices to match the deeply discounted prices

of its Asian competitors. Petitioners further state that, since

Samsung's costs and prices are denominated in the relatively stronger

won, and because some of Samsung's parts and components are not sourced

locally in Korea, the same devaluation that provides a margin of safety

in price comparisons correspondingly results in a rise in costs of

production, which will increase the likelihood of sales at LTFMV in the

United States.

Second, petitioners argue that the excess capacity of producers in

Malaysia, Singapore, Thailand, and Indonesia, as measured by aggregate

Southeast Asian CPT capacity minus aggregate Southeast Asian CTV

demand, is greater than the combined excess capacity of the Korean

producers. For this reason, petitioners assert that the Southeast Asian

producers will dispose of their excess inventory by exporting it to the

United States. Petitioners state that the ensuing rounds of competitive

pricing among the imports will drive down the U.S. market price of CTV

imports in all screen size categories, and that Samsung, in order to

stay competitive, will be forced to match these prices, which will most

likely be below normal value.

Third, petitioners state that the Southeast Asian suppliers, unlike

Samsung and the other Korean CTV producers, are not currently subject

to a U.S. antidumping duty order. Therefore, petitioners state, they

are not

[[Page 46769]]

constrained to sell at normal value in the United States and are free

to reduce their export prices to whatever level is necessary to dispose

of their excess capacity. Petitioners also claim that Southeast Asian

CTV producers, like Korean producers, are struggling under large debt

burdens and are motivated to maximize revenue by increasing exports to

the United States. Petitioners conclude that the fierce competition

among increasing cheap Asian imports will force suppliers in the U.S.

market to engage in rounds of head-to-head price reductions. According

to petitioners, Samsung's need to maximize revenue will force it to

participate in the price reductions, leading Samsung to sell CTVs at

LTFMV.

In regard to currency movements, Samsung states that it received de

minimis margins in the fourth through eighth administrative review

periods (April 1986 through March 1991), which were periods when the

Korean won appreciated against the dollar compared to the exchange

rates prevailing in calendar year 1985.

Samsung responds to petitioners' allegation by stating that the CTV

producers in Southeast Asia are primarily subsidiaries of foreign

multinational companies that would not undermine their significant

North American operations by shipping CTVs from their Southeast Asian

facilities to the United States. Samsung provides a chart indicating

that the producers in Malaysia, Indonesia, Thailand, Singapore, and the

Philippines are subsidiaries of Japanese, Korean, and American CTV

manufacturers. Samsung argues that the facilities within Southeast Asia

primarily serve the Asian markets rather than the U.S. market, because

the Asian plants are at a competitive disadvantage to plants in the

United States and Mexico due to higher shipping and inventory costs, as

well as the five percent U.S. import duty on CTVs. Samsung asserts that

it makes no economic sense for these multinational producers to ship

CTVs to the United States from Southeast Asia and thereby undercut

their significant North American operations.

Furthermore, Samsung observes that U.S. import statistics for

January through November 1997 indicate that approximately 90 percent of

CTV exports from Southeast Asia to the U.S. market were of the small

and medium screen sizes. See petitioners' February 13, 1998 submission

at 39 for the above-referenced statistics. Petitioners, Samsung notes,

have made the argument that, since the U.S. demand is growing for large

and very large CTVs, Samsung has adjusted its Korean production to

reflect this shift and can be expected to export these sizes should the

Department grant revocation. Samsung states that petitioners have also

made the argument that stiff competition from Southeast Asian producers

will drive down U.S. prices to dumping levels because these producers

have excess capacity that will be exported to the United States and

enjoy a competitive advantage over Samsung due to the currencies of

Southeast Asia depreciating to a greater extent than the Korean won.

However, Samsung asserts, the import statistics indicate that exports

from Southeast Asia currently compete in segments of the U.S. market

(i.e., small and medium screen sizes) which petitioners argue will not

be the primary target of Samsung's Korean exports.

Samsung claims that Singapore was the one country that exported

significant volumes of larger size CTVs to the United States during the

January to November 1997 period. Samsung states that Philips, Sanyo,

Toshiba, and Mitsubishi, the primary producers in Singapore, will do

nothing to undercut their North American production facilities.

Moreover, Samsung asserts that producers in Singapore are at a

comparative disadvantage vis-a-vis Samsung and the other Korean

producers because the Korean won depreciated further than the

Singaporean dollar did in 1997. Samsung also states that, although the

won depreciated more than the Singapore dollar, it depreciated

approximately the same as the Thai baht and Malaysian ringgit since

December 1996. This roughly equivalent depreciation, Samsung argues,

provides no competitive advantage to producers in Thailand or Malaysia.

Samsung, however, does acknowledge that the Indonesian rupiah

depreciated more than any other Southeast Asian currency. Although this

drastic depreciation would imply a competitive advantage for Indonesian

producers, Samsung dismisses this implication by stating that Indonesia

is not a meaningful supplier of CTVs to the United States.

Lastly, Samsung argues that many producers in Southeast Asia often

purchase many CTV parts from related and unrelated producers outside

the region. Samsung surmises that Southeast Asian producers may not be

able to lower significantly their cost of production in dollar terms,

or reduce their final dollar price, because these parts account for the

bulk of the cost of production of CTVs and the dollar cost of these

parts is not affected by the depreciation of the local currencies.

Department's Position: We disagree with petitioners' argument that

Samsung is likely to sell CTVs in the U.S. market at LTFMV because the

currencies of other Southeast Asian countries have depreciated further

than the Korean won, thereby granting a competitive advantage to CTV

producers in these countries, who can be expected to flood the U.S.

market with deeply discounted imports and drive down U.S. prices to

extremely low levels.

Petitioners' argument that Samsung is likely to resume sales at

LTFMV because of the recent currency movements precipitated by the

Asian economic downswing is based upon the assumption that Korean and

other CTV producers essentially compete against one another only on the

basis of price. Due to this assumption, petitioners argue that a

greater depreciation in Southeast Asian currencies vis-a-vis the won

necessarily means that Samsung will have to lower its U.S. price to

stay competitive with CTV producers from these countries who export

subject merchandise to the United States and are benefitting from the

deeper currency depreciations. We disagree with petitioners' assumption

that CTV producers compete only on the basis of price. We note that

CTVs are not commodity products; they are produced in several different

sizes, vary in quality, are visually distinct due to differently styled

cabinets, and contain different types and quantities of features.

Certain producers can also command a price premium on their CTVs due to

brand name recognition. For these reasons, it is plausible to conclude

that consumers include differences in size, features, brand name, and

other factors into their decision when purchasing a CTV. Therefore, we

find that CTV producers compete against one another with respect to

more than price alone.

The ramification of petitioners' argument that CTV producers

compete only on the basis of price is that if a foreign producer lowers

its U.S. price, as may happen from a home market currency devaluation,

then all other producers must fully match this price decrease or they

will be uncompetitive, eventually lose market share and possibly exit

the market. Due to the product differentiation discussed above, it is

reasonable to assume that a price reduction by one CTV producer does

not necessarily mean that competitors must follow suit to the same

degree. The strength of a brand name or feature mix may be sufficient

to allow a producer to

[[Page 46770]]

remain competitive, even in the face of decreasing prices by

competitors.

Moreover, there are many factors that, in combination, constitute

the competitive position of a producer in relation to its competitors.

The relative strength of a producers' home market currency is only one

such factor. While a devaluation of the other Southeast Asian

currencies may make producers in these countries more competitive in

the U.S. market, it also increases these producers' cost of capital and

imported inputs, and may cause home market prices and costs to rise.

For example, if a producer in Indonesia imports a large percentage of

the parts and components used to produce a CTV in Indonesia, the deep

depreciation of the rupiah may increase the production costs to a

degree that might actually diminish this producers' overall competitive

position rather than enhance it. Therefore, while it is correct that a

depreciating currency may tend to decrease the pressure for a

respondent to make LTFMV sales in the U.S. market, these linkages are

not absolute and must not be considered in isolation. With respect to

this case, there is very little information on the record concerning

Samsung's home market costs or to what degree Samsung and the other

Southeast Asian producers import parts and components used in the

production of CTVs. Therefore, there is not sufficient evidence on the

record to say conclusively how the exchange rate movements of the won

and other Southeast Asian currencies have affected the competitive

position of Samsung and CTV producers in these countries.

Petitioners assert that the Southeast Asian currencies depreciated

further than the Korean won, which grants a competitive advantage to

producers in these countries. Although this may have been the situation

in December 1997, more recent exchange rate data indicates that this is

no longer the case. We examined the exchange rates for the Singapore

dollar, Indonesian rupiah, Malaysian ringgit, Thai baht, and Korean won

from December 31, 1996, through June 30, 1998. See petitioners'

submission dated February 13, 1998, at 37. See also the Analysis

Memorandum, dated August 25,1998. Using the petitioners' methodology of

indexing each currency's exchange rate data to the spot rate that

prevailed on December 31, 1996, we were able to analyze the relative

depreciations of the five Southeast Asian currencies. We found that by

June 1998, the Singapore dollar and baht depreciated the least,

retaining over 80 percent of their indexed value, while the rupiah

depreciated the most, retaining only 20 percent of its indexed value.

Although the won and ringgit depreciated at different rates over the

length of the period we analyzed, by June 1998, the indexed exchange

rates for these two currencies had converged to roughly the same point,

with each currency retaining over 60 percent of its indexed value.

These data indicate that only one currency, the rupiah, has

consistently depreciated further than the won and, as Samsung points

out, U.S. import statistics provided by petitioners indicate that

Indonesia is not a significant supplier of CTVs to the U.S. market.

Given Samsung's history of receiving zero or de minimis dumping margins

in the face of an appreciating currency (see Samsung's February 13,

1998, submission at 8) and a larger debt burden than the debt

experienced in 1997 (see Comment 5 above), we find that the weight of

the evidence on the record indicates that Samsung is not likely to

resume dumping in the U.S. market.

Petitioners support their main argument that Samsung is likely to

resume sales at LTFMV because the won has depreciated less than the

other Southeast Asian currencies by making several allegations

concerning the CTV producers in other Southeast Asian countries. In

order to address each of petitioners' concerns, we provide the

following discussion.

With respect to petitioners' allegation that Southeast Asian CTV

producers have large excess capacity that will motivate them to dispose

of their surplus inventory by exporting it to the United States, as we

noted in Comment 4 above, subtracting CTV demand from CPT production is

not an appropriate method to calculate excess CTV capacity. Rather,

examining the capacity utilization rate of a company's CTV production

facilities is a more meaningful measure. Since petitioners have not

placed any evidence on the record concerning the utilization rates of

the CTV factories in Southeast Asia, we are not able to agree with

petitioners' conclusion that producers in these countries have excess

capacity.

Petitioners also claim that, because Southeast Asian CTV producers

are not constrained by U.S. antidumping duty orders and are suffering

from the negative effects of the Asian economic situation, they will

increase exports to the United States and engage in aggressive price

reductions that will eventually force Samsung to dump. Petitioners are

correct in that the Department does not currently have any antidumping

duty orders on CTVs from Malaysia, Indonesia, Singapore, or Thailand,

and that Southeast Asian producers therefore do not have an externally

enforced discipline on their pricing behavior. Since there is nothing

on the record of this proceeding to indicate significant increases in

exports and aggressive pricing by Southeast Asian producers, we

disagree with petitioners that the absence of an antidumping duty order

on CTVs from the Southeast Asian countries provides any additional

incentive to producers from these countries to sell their merchandise

at low prices, leading Samsung to eventually sell CTVs at LTFMV.

Finally, since petitioners have placed no data on the record of

this review concerning the financial condition of CTV producers in

Southeast Asia, we cannot agree with petitioners that these producers

carry unmanageable debt loads, are unable to service their current

debt, and are therefore forced to increase their exports to the United

States at very low prices. Therefore, we disagree with petitioners that

these factors, in conjunction with their main argument concerning

currency movements, are likely to force Samsung to compete in the U.S.

market at LTFMV.

Comment 7: Ability To Compete In The United States Market Without LTFMV

Sales

Petitioners argue that Samsung's own cost and pricing data show

that Samsung is likely to sell its CTVs in the U.S. market at below

FMV. In its questionnaire response dated February 24, 1997, Samsung

submitted price and cost information covering the period 1991 through

the first half of 1996 for its sales and expenses of Korean-produced

CTVs in Korea and its sales of Mexican-produced CTVs in the United

States. With respect to its price data, Samsung reported its

distributor sales prices, calculated as a single weighted-average price

for all models within each screen size category. Korean prices and

costs were converted to U.S. dollars with the weighted-average exchange

rate for the first half of 1996.

Using the weighted-average price data reported by Samsung,

petitioners compared U.S. market prices to Korean market prices and

found that the U.S. prices for 25-, 27-, and 31-inch CTVs were

consistently lower than those in Korea throughout the 1991-1996 period.

With respect to 13-, 19-, and 20-inch CTVs, petitioners claim that,

although Samsung's data were more varied throughout the 1991-1996

period, by the first half of 1996, U.S. prices were lower than Korean

prices for these screen sizes. Thus, petitioners contend that these

weighted-average price-to-price comparisons indicate that

[[Page 46771]]

significant dumping margins would exist if Samsung resumed CTV

shipments directly from Korea. Petitioners defend their use of U.S.

prices of Mexican-produced CTVs in their comparisons to Korean CTV

prices because Samsung's cessation of CTV shipments directly from Korea

has made current pricing data of CTVs produced in Korea and sold in the

United States impossible to obtain. Given the competitive market for

CTVs in the United States, petitioners assert it is reasonable to

presume that Samsung's prices in the United States would not vary

depending on the production location.

Furthermore, petitioners claim that the data for the first half of

1996 indicates that Samsung was selling at below its cost of production

in the home market for 31-inch CTVs. In this situation, petitioners

contend that the Department would not rely on Samsung's home market

price to calculate the dumping margin, but would instead resort to

constructed value (CV). Using a CV methodology, based on adding a

profit amount to Samsung's cost of production to determine the

appropriate normal value, petitioners perform a CV-to-price comparison

for 31-inch CTVs and calculate an even higher dumping margin. Moreover,

petitioners argue that the dumping margin based on CV is not eliminated

even if Samsung's cost of production is converted into U.S. dollars at

the significantly depreciated January 1998 exchange rate.

In their case brief, petitioners also compare specific 28- and 32-

inch CTV models sold in Korea and the United States using 1997 retail

prices obtained from a U.S. and Korean consumer electronics catalog.

Petitioners use the January 1998 exchange rate to convert the retail

prices of the Korean models to U.S. dollars, compare the converted

Korean price to the retail price of comparable 32-inch models sold in

the United States, and then calculate dumping margins. Petitioners

state that any true comparison of home market and U.S. prices should be

based on actual selling prices to distributors, with circumstance-of-

sale adjustments, difference-in-merchandise adjustments, and

adjustments for movement charges, data which is only available to

Samsung and has not been provided on the record of this proceeding.

Petitioners contend that these basic comparisons support their claim

that Samsung is likely to resume dumping, especially in the large and

very large screen models, should shipments directly from Korea

recommence.

Petitioners conclude that Samsung's own price data and the retail

price data from Korea and the United States indicate that Samsung

cannot compete in the U.S. market without sales at LTFMV. According to

petitioners, it is entirely predictable that Samsung has resolved to

reenter the U.S. market and, in the face of competing and aggressively

priced imports, will be forced to price its Korean CTVs unfairly.

Petitioners note that Samsung has not sold a Korean-produced CTV in the

United States for nearly seven years. By emphasizing that it has chosen

to supply the U.S. market from Mexico, petitioners maintain that

Samsung has acknowledged that it cannot competitively produce, ship,

and sell CTVs to the United States from Korea. Petitioners conclude

that Samsung's six years of de minimis margins provide no evidence of

any current ability to compete without unfair pricing if the order were

revoked.

Samsung responds to petitioners' allegation that its price and cost

data reveal that dumping is likely to occur by stating that petitioners

have relied upon stale 1996 data for their weighted-average price-to-

price comparisons rather than using the more recent 1997 data Samsung

submitted on the record of this proceeding. For example, Samsung states

that using the price data for the first half of 1997 and the January

1998 exchange rate, the weighted-average price of its 31-inch CTVs sold

in Korea, after being converted in dollar terms, is well below the

weighted-average price for its 31-inch (Mexican-produced) CTVs sold in

the U.S. market.

Samsung further states that any type of weighted-average price-to-

price comparison of Korean CTV models to U.S. CTV models is invalid.

Samsung argues that, although it is true that the price information it

submitted shows that the weighted-average price of all models of a

particular screen size sold in the United States were often lower than

the weighted-average price of all models of that same screen size sold

in Korea, petitioners incorrectly conclude that this is evidence that

dumping would resume. According to Samsung, this conclusion is

erroneous because weighted-average prices mask the fact that individual

model prices within a particular screen size can vary widely. Samsung

elaborates that the model mix and features contained in the models sold

in the United States and Korea are significantly different. Samsung

states that CTVs sold in Korea have a larger number of expensive

features than the models its sells in the United States. In order to

show that the lower U.S. weighted-average prices are accounted for by

the differences in features between U.S. and Korean models, Samsung

conducts a model-to-model comparison of its largest selling U.S. models

(Mexican-produced) to the most physically similar models produced and

sold in the Korean market and makes adjustments for selling expenses,

duty drawback, and physical differences. According to Samsung, these

comparisons indicate that Korean prices did not exceed U.S. prices for

these models.

Using similar logic, Samsung argues that the problems inherent in

comparing weighted-average prices also apply to comparing weighted-

average costs of production. For this reason, Samsung claims that

petitioners' allegation of below-cost sales in the home market is not

valid because that allegation is based on a comparison of weighted-

average costs of production to weighted-average prices, per screen

size.

In regard to petitioners' comparison of specific 28- and 32-inch

models, Samsung claims that these comparisons are invalid for several

reasons. First, petitioners use Korean and U.S. retail prices, rather

than wholesale prices, to demonstrate that Samsung would be likely to

sell CTVs in the United States at dumped prices. Samsung states in its

questionnaire response that it has two levels of trade in the United

States, sales through its U.S. distribution subsidiary and sales

Samsung describes as being to original equipment manufacturer (OEM)

customers. Since it does not sell at the retail level in the United

States, Samsung contends that retail prices should not be used in a

``likely'' dumping calculation. Second, Samsung claims that the Korean

retail prices used by petitioners include special excise tax, value

added tax, and other taxes which together total a significant percent

of the wholesale price. Additionally, Samsung states that the Korean

retail prices do not include the substantial rebates it usually grants

to its customers. Third, Samsung claims that the Korean 28- and 32-inch

models used by petitioners are not comparable to the United States

models because the Korean models have a 16:9 CPT width/height ratio

while the U.S. 32-inch models have a 4:3 ratio. Samsung asserts that

the materials cost of a wide-screen CPT is greater than the cost of

producing a normal screen CPT, and, therefore, any comparisons of these

models at issue for dumping purposes would be distorted.

Samsung argues that its six years of de minimis margins, from the

third through eighth reviews, constitute substantial evidence that it

can compete in the United States market without pricing CTVs at LTFMV.

Samsung notes that

[[Page 46772]]

during this six-year period of no dumping, its level of shipments to

the United States remained substantial, its product mix remained

varied, and it received de minimis margins even during periods of

significant appreciation of the won (the fourth through eighth review

periods). Most importantly, Samsung notes that it has invested millions

of dollars in its Mexican production facilities that can, and do, fully

serve the United States market. Samsung concludes that it has no need

to ship CTVs from Korea to the United States, and even if it did, there

is no evidence indicating that it would dump them on the U.S. market.

Department's Position: We disagree with petitioners' claim that

Samsung is not able to compete in the U.S. market without LTFMV sales.

In arguing their point, petitioners conduct rough dumping margin

calculations on Samsung's U.S. and home market prices, both on a

weighted-average by screen size basis and on a model-specific basis. We

acknowledge that any type of dumping margin analysis conducted in this

review is problematic due to Samsung's cessation of CTV shipments to

the United States from Korea in early 1991. Unlike the pricing analyses

conducted in past cases such as DRAMS and Brass Sheet and Strip, in

this case a pricing analysis cannot be based on a comparison of home

market and U.S. prices of Korean-produced CTVs, as the latter price is

not available due to the cessation of shipments. Rather, in this case,

the comparison involves home market prices of Korean-produced CTVs to

U.S. prices of Mexican-produced CTVs. It is reasonable to presume that

prices of Mexican- and Korean-produced CTVs reflect the cost structure

of producing CTVs in Mexico and Korea, respectively. While the cost

structures of Mexican and Korean CTVs vary, we conclude that in this

case, use of the U.S. price for Mexican-produced CTVs is a reasonable

surrogate for the U.S. price of Korean-produced CTVs because Samsung's

pricing of its Mexican-produced CTVs sold in a competitive market, such

as the U.S. market, provides some indication of the price for which

Samsung's Korean-produced CTVs would be sold. Moreover, we note that

there are no other pricing data available pertaining to Samsung.

In DRAMS, unlike the instant case, we determined the DRAM industry

to be ``highly cyclical in nature with periods of sharp upturn and

downturn in market prices.'' See DRAMS at 39810. Due to the position of

the United States as the ``world's largest regional market for DRAMs,

with considerable potential growth,'' we determined that companies had

the economic incentive to ``ride out industry downturns'' in order to

maintain market share. See DRAMS at 39819. The fact that DRAM producers

had historically been found to have dumped during downturns supported

our conclusion. However, in this case, we have determined that the U.S.

CTV industry, as described in our discussion of Comment 3 above, is not

highly cyclical and does not have ``periods of sharp downturn and

upturn in market price.'' Rather, the U.S. CTV industry is a

competitive and mature industry, that has reached approximately 98

percent household penetration. Samsung's reported U.S. prices and the

price data it provided for the overall U.S. CTV industry indicate that

this industry is generally stable, exhibiting a historic trend of

modest, annual price decreases. See Comment 3 above. Since Samsung

received de minimis margins during four consecutive years of price

decreases, from April 1985 through March 1988, we determine that it has

demonstrated the ability to compete in the U.S. market without LTFMV

sales.

In their analysis, petitioners compared the weighted-average prices

Samsung reported, by screen size, for its Korean and U.S. sales. Based

on this comparison, petitioners argue that Samsung's Korean prices are

higher than its U.S. prices in the large and very large product

segments, which indicates that dumping would occur given the resumption

of shipments. We disagree with this conclusion. First, we note that

comparing weighted-average prices between the Korean and U.S. markets

is problematic, as Samsung states, because in the CTV industry the

prices of individual models within the same screen size category can

vary widely, the model mix within each screen size is different across

markets, and the types and quantity of features contained in specific

models are significantly different between markets. Since Korean models

may contain a larger number of expensive features, this may account, at

least in part, for the differences in prices observed by petitioners

for the 25-, 27-, and 31-inch CTVs sold in the two markets. Absent

evidence to the contrary on the record of this proceeding, it is not

unreasonable that the Korean weighted-average price for a given screen

size is higher than the U.S. weighted-average price in that same size.

Moreover, the model-to-model comparisons that Samsung conducted, in

order to show that the lower U.S. weighted-average prices are accounted

for by the differences in features between U.S. and Korean models,

showed that after adjusting the initial prices of the Korean and U.S.

models for selling expenses, duty drawback, and physical differences,

the alleged dumping margins suggested by the models' unadjusted prices

were eliminated. See Samsung's letter to the Secretary, dated August

22, 1997, at Exhibit A. These comparisons were done for 13 of Samsung's

largest selling U.S. models, accounting for approximately 50 percent of

its total U.S. sales, and support the conclusion that the petitioners'

analysis cannot be relied upon as a basis to determine that Samsung is

likely to resume sales at LTFMV.

In regard to petitioners' allegation of below-cost sales in Korea,

we agree with Samsung that in the CTV industry, comparing the weighted-

average cost of production to the weighted-average home market price on

a screen size-specific basis is problematic because prices and costs of

production of individual models within the same screen size category

can vary widely due to the differences in the types and quantities of

features contained in specific models. This reasoning is especially

relevant in large and very large screen sizes, which tend to contain

more features than smaller CTVs.

With respect to petitioners' comparison of prices for specific 28-

and 32-inch models sold in the U.S. and Korean markets, we agree with

Samsung that these comparisons are of limited value because these

prices have not been adjusted for taxes, rebates, and other expenses

and that some of the models compared to one another contain CPTs of

different width/height ratios.

In addition, during its six years of de minimis margins, Samsung

exported substantial quantities of subject merchandise in a varied

product mix. See Samsung's submission dated February 13, 1998, at page

8. This fact pattern is different from Brass Sheet and Strip, where we

denied partial revocation of the order because, among other factors,

the respondent had ``severe decreases in shipments of brass sheet and

strip to the U.S. since the imposition of the order,'' culminating in

the respondent selling at not LTFMV a single model in a single

transaction during the eighth administrative review of that order.

Additional evidence that Samsung can compete in the U.S. market without

LTFMV sales is that Samsung's shipments from Korea occurred while the

won was appreciating.

[[Page 46773]]

Comment 8: Third Country Trade Restrictions

Petitioners state that Samsung's Korean CTV operations are

extremely export-oriented and that the United States, due to its open

economy, is the likely recipient of these exports. As evidence,

petitioners note that the United States duty rate on the majority of

imported CTVs is 5 percent, in contrast to the 14 percent external

tariff found within the European Union (EU). More importantly,

petitioners observe that the EU has placed antidumping duties against

Korean and other Southeast Asian CTVs. Specifically, the EU imposed on

Samsung antidumping duties of up to 10.5 percent on small CTVs and 13.7

percent on all other sizes that are shipped directly from Korea. Thus,

petitioners conclude, Samsung faces cumulative ordinary and antidumping

duties on exports to Europe of up to 27.7 percent, as compared to an

antidumping duty deposit of zero and an ordinary duty rate of 5 percent

on exports to the United States.

Petitioners argue that, contrary to Samsung's assertions, its

strategy of localizing production within its major CTV markets around

the world may have more to do with gaining access to markets with

barriers to CTV imports than with relative advantages in terms of

production or shipping costs. Although Samsung claimed in its

questionnaire response that it has not faced any barriers to exporting

CTVs, petitioners maintain that the recurring pattern of having sales

within a third country jump significantly once the local facility began

production supports the thesis that market barriers provided the

incentive to establish local production. Therefore, petitioners

conclude that because Samsung faces significant trade restrictions in

third countries, as its localization strategy implicitly acknowledges,

it has a strong incentive to ship its excess CTV production to the

United States and, in combination with the other factors discussed by

petitioners, sell this merchandise at LTFMV in the U.S. market.

Samsung does not dispute the regular and antidumping duty rates

provided by petitioners for the EU and United States. However, Samsung

notes that these European duties have been in effect since 1990 and

have not compelled Samsung to export CTVs to the United States from

Korea during the last eight years. In regard to barriers to trade in

third countries, Samsung stated in its questionnaire response that it

has not encountered any barriers to trade in third countries that have

made it difficult to sell CTVs in those counties. Samsung claims that

its localization strategy was adopted in order to reduce costs and meet

demand in markets within each localized facility's geographic region.

Department's Position: Although the topic of third country trade

restrictions goes more toward the issue of whether Samsung is likely to

resume shipping, rather than dumping, we provide the following

discussion in order to address fully all of petitioners' concerns.

We disagree with petitioners' argument that tariff barriers in

major CTV markets will motivate Samsung to export CTVs to the United

States from its Korean production facilities and sell such exports at

LTFMV. Petitioners observe that Samsung's Korean exports face

cumulative ordinary and antidumping duties in Europe of up to 27.7

percent, while, if the U.S. antidumping duty order is revoked, such

exports are subject to the smaller 5 percent regular tariff in the

United States. Therefore, petitioners state that it is reasonable to

conclude that a large volume of Samsung's CTV exports from Korea will

be shipped to the United States.

In past cases, we have examined trade restrictions in third country

markets in making its determination on the likelihood of the respondent

resuming sales at LTFMV. In TVs from Japan, we agreed with the

petitioner's argument that since other countries (specifically, the EU)

had instituted more restrictive import controls over consumer products,

the Japanese producers would increasingly depend on sales in the U.S.

market. See TVs from Japan at 35519. However, the issue of whether the

Japanese producers had other, substantial CTV markets besides the U.S.

and EU was not addressed in the final determination of that case. More

recently, we have stated that it is important to examine whether the

respondent is ``solely dependent on the U.S. for financial viability''

and if it made significant sales in other third countries when

considering revocation. See Steel Wire Rope 1997 at 17174. In the case

of Samsung, the facts demonstrate that the company has access to third

country markets and, thus, does not rely solely on the U.S. market.

For example, petitioners' argument that Samsung has an incentive to

resume shipments to the United States because it faces high import

barriers in the EU, a major CTV market, fails to take into account

Samsung's CTV operations in Eastern and Western Europe, which Samsung

states serve the CTV markets of these two regions. See Samsung's

February 24, 1997, submission at Appendix 1. The existence of these

operations limits the importance of EU trade restrictions on Samsung's

Korean-produced CTVs in our analysis of whether Samsung is not likely

to resume dumping in the U.S. market in the absence of an antidumping

duty order.

In addition, petitioners' argument does not take into account that

Samsung's Mexican operations have served the U.S. market since 1991. In

the context of the terminated anti-circumvention inquiry, the

Department verified Samsung's Mexican CTV production facilities. As the

verification report states, the Department found that these facilities

include a CTV assembly plant, parts and components plant, CPT plant, a

proposed glass plant, and several feeder plants established and

operated by unrelated Korean suppliers to Samsung. See the memorandum

to the file, dated August 12, 1998, that transmits the November 26,

1997, verification report to the record of this review. From these

facilities, Samsung produces CTVs ranging from 13 to 31 inches that are

sold throughout North, Central, and South America. During the first

half of 1997, most of the Mexican-produced CTVs exported to the United

States enter the country duty-free under NAFTA tariff preference

provisions. Using the same logic employed by petitioners, that Samsung

will export CTVs to the market with the lowest tariff barriers, we can

only conclude that Samsung will continue to service the U.S. market

from Mexico because CTVs produced in Mexico can enter the U.S. duty-

free under NAFTA, provided they meet NAFTA rules of origin. In addition

to its Korean and Mexican facilities, Samsung also has CTV production

operations in West Europe, East Europe, East Asia, and South East Asia.

See Samsung's February 24, 1997, questionnaire response at Appendix 1.

Because Samsung has access to these markets based upon its localization

process, the third country restrictions to trade are not significant in

this case.

Comment 9: New Technologies--High-Definition Television

Petitioners contend that although this changed circumstances review

should not be used as a surrogate scope inquiry, high-definition

television (HDTV) and other new technologies, are within the scope of

this order and the development of such technology should be factored

into the Department's revocation analysis. Specifically, petitioners

state that HDTV will be capable of producing a video image and

receiving a television

[[Page 46774]]

signal, and that these features in and of themselves are sufficient to

satisfy the scope requirements. In regard to Samsung's claim that HDTVs

will include other features or be used for purposes other than

receiving a broadcast signal, petitioners state that these claims were

not dispositive in the Final Affirmative Scope Ruling--Antidumping Duty

Order on Color Television Receivers from Taiwan (A-583-009); Coach

Master International Corporation, 63 FR 805 (January 7, 1998), and

should not be so here. Furthermore, petitioners assert that the

Department has consistently found that new technologies, such as liquid

crystal diode TVs, are included within the scope of the CTV order. See,

e.g., Television Receiving Sets, Monochrome and Color, from Japan, 56

FR 66841 (December 26, 1991). Petitioners maintain that in these cases,

uncertainties about the future marketing, prices, or demands have never

been dispositive factors in deciding whether these new technologies are

within the scope of the order.

Petitioners claim that Samsung has consistently denied throughout

the course of this segment of the proceeding that it would be producing

HDTVs, or any other new television technology, in Korea. As evidence

for their assertion, petitioners cite excerpts from Samsung's

questionnaire response and subsequent submissions where Samsung

characterized its current state of HDTV development as still in the

research and development stage, where mass production was not in the

foreseeable future. In actuality, petitioners argue, Samsung has

invested millions of dollars into developing this technology and has

reached the point where mass production of HDTVs is scheduled to begin

during the second half of 1998. In support of its argument, petitioners

note that Samsung displayed a fully functional HDTV unit at the January

1998 consumer electronics show in Las Vegas, Nevada. Petitioners

explain that the promotional literature Samsung distributed during the

trade show described the new, proprietary digital television chipset

architecture Samsung developed and discussed the long list of features

the HDTV model will contain.

Petitioners also claim that Samsung's argument that HDTV production

will not occur for many years away due to, in part, the long schedule

for transition to digital broadcasting is suspect because Samsung, in

its own promotional literature, includes the Federal Communications

Commission's transition schedule, which states that by May 1999, 20

percent of the U.S. population will be able to receive digital signals

and, by November 2000, digital signal broadcasts will cover 50 percent

of the U.S. population. Petitioners maintain that these numbers

indicate that in just over two years, half of the U.S. television

market will be receiving digital signals and potentially be ready to

purchase a digital receiver.

According to petitioners, the first type of HDTVs sold in the

United States will be projection-style CTVs. Petitioners assert that

because Samsung does not produce projection-style CTVs in Mexico, it

does not currently have the capacity to assemble projection-style HDTVs

in Mexico. However, since Samsung sells and presumably produces the

projection-style CTVs in Korea, combined with the fact that Korea has

recently adopted the advanced television systems committee (ATSC)

standard for digital broadcast, petitioners conclude that Samsung has

the ability and motivation to produce projection-style HDTVs in Korea

for sale in the Korean market and export to the United States.

Petitioners also argue that HDTVs are likely to be sold in the

United States at less than normal value. Petitioners base this

allegation on an estimate by Thomson Consumer Electronics (Thomson)

that the cost of manufacture for a projection-style HDTV will be a

large multiple of the cost of manufacture for a 31-inch CTV. Starting

with Samsung's 1996 cost of production for a 31-inch conventional CTV,

petitioners convert this cost to U.S. dollars using the January 1998

exchange rate, and then inflate this amount by a large multiple to

arrive at an estimate of Samsung's cost of production for a HDTV. Using

Samsung's 1996 financial statement, petitioners calculate amounts for

SG&A expenses, interest expenses, and profit. These amounts are added

to their estimated cost of production to produce a final CV for HDTV.

Petitioners then take Samsung's estimated retail U.S. price range for

HDTVs and reduce it by a certain percentage to adjust for retail

markup. Petitioners claim that without making further adjustments to

the U.S. price to account for freight and other movement expenses

involved in transporting the HDTVs from Korea to the United States, a

CV-to-price comparison indicates that Samsung would be dumping its

HDTVs in the United States.

Samsung argues that HDTV will be outside the scope of the order on

Korean CTVs because this new technology does not meet the four criteria

for determining whether ``later-developed-merchandise'' is within the

scope of an outstanding order. First, with respect to physical

characteristics, Samsung notes that HDTVs use a digital signal

technology, while conventional CTVs use non-compatible analog

technology. HDTV will have a 16:9 width/height ratio compared to a 4:3

ratio for a conventional CTV. HDTV will have advanced hardware and

software that allows it to display roughly twice the resolution of a

conventional CTV. Additionally, HDTV will have the ability for

interactive use and receipt of data services. Second, Samsung claims

that due to the better picture and sound quality, along with the data

service capability, the expectations of an ultimate purchaser of a HDTV

will be vastly different from those of a purchaser of a conventional

CTV. Third, with respect to the ultimate use of HDTV, Samsung contends

that it will differ significantly from a conventional CTV precisely

because of the interactive function and the ability to receive data

transmission, such as stock pricing, home shopping information, and

electronic newspapers. Fourth, Samsung states that it is highly

unlikely that it will sell HDTVs through the same channels of

distribution as it sells conventional CTVs. Since HDTVs will have a

price of over $5,000, Samsung will have to sell HDTVs through dealers

which specialize in high-tech and luxury products, rather than its

current distribution channel of companies selling more affordable

products, such as Circuit City, Best Buy, Sears, and Wal-Mart. For

these reasons, Samsung concludes, HDTVs will not be within the scope of

the order on Korean CTVs and, therefore, the development of such

technology should not be considered a factor in the Department's

revocation analysis.

Samsung states that HDTV is a very new and complicated technology,

and it will take many years for CTV producers to develop the ability to

mass produce HDTV sets. As support, Samsung cites several press

articles that indicate the HDTV market will be characterized by

prohibitively high prices, low sales volume, and slow market

penetration. For these reasons, Samsung states that it does not intend

to produce HDTV in commercial quantities in the reasonably foreseeable

future.

More specifically, Samsung states that commercial production cannot

begin until it completes all three stages of research and development.

Samsung states that it has completed only the first stage, development

of a prototype, as evidenced by the functional unit displayed at the

January 1998 consumer electronics trade show. Samsung claims that the

second and third stages, respectively the development

[[Page 46775]]

verification test and the manufacturing verification test, have yet to

begin. However, Samsung contends that these stages cannot begin until

the ATSC approves the software standards for HDTV. Samsung claims that

this approval is not expected until September 1998.

Samsung contends that in addition to the technical reasons

preventing immediate commercial production, such production is not

feasible until broadcasters have converted to digital signals.

According to the regulations governing this transition, conversion to

digital broadcasting in the United States is not scheduled for

completion until the year 2002, at the earliest. Until the transition

is completed, Samsung argues, the market in the United States will not

be large enough to justify commercial production of HDTVs. Therefore,

due to the technical restrictions and the long transition schedule,

Samsung concludes that commercial production of HDTV in the United

States is at least four years away.

Samsung next argues that when commercial production begins, it will

occur in Mexico, rather than in Korea, because it makes economic sense

to do so. Samsung claims that it will be more expensive to produce

HDTVs in Korea, rather than Mexico, for the following reasons: (1)

Samsung would have to pay freight costs on many of the components used

in its HDTV design because most of the major components are

manufactured in the United States and Japan, (2) shipping,

transportation, and inventory charges would be higher due to the large

size of rear-projection sets, and (3) Samsung would have to pay the

regular 5 percent duty on finished CTVs if HDTV is ultimately

determined to be within the scope of the CTV order. Samsung concludes

that most of these expenses would be avoided if Samsung produced the

HDTV units in Mexico. Lastly, Samsung contends that there is no

material difference in the nature of the assembly facilities in Mexico

and Korea, as the Department verified in the context of the terminated

anti-circumvention inquiry. Samsung claims that in both facilities new

HDTV production lines will need to be constructed and petitioners have

not provided evidence to the contrary. Although petitioners argue that

Samsung's existing production capacity in Korea for rear-projection

convention CTVs offers an economic advantage to locating production of

rear-projection HDTVs in Korea, Samsung states that petitioners have

provided no evidence to substantiate their claim. Samsung states that

petitioners have excellent information sources within the CTV industry

and could have provided factual information concerning the

characteristics or cost of an HDTV production line or the ability of a

producer to utilize and/or convert an existing conventional rear-

projection CTVs production line to produce HDTVs. According to Samsung,

the fact that petitioners did not provide such evidence indicates that

there is no credible reason why Samsung cannot produce HDTVs in Mexico.

Samsung argues that petitioners' estimate of the likelihood of

Samsung dumping HDTVs in the United States is based on wholly

unsubstantiated allegations concerning Samsung's price and cost

structure, which has yet to be established because Samsung has not

started to sell or commercially produce HDTVs. Specifically, Samsung

states that petitioners have no concrete basis for their HDTV cost

allegation, but instead must rely on a cost estimate certified by

Thomson. Furthermore, Samsung states that petitioners' claim that

Thomson's cost of manufacture of a projection-style HDTV is a large

multiple of the cost of a 31-inch CTV, is inherently unreliable given

the enormous technical differences between analog CTV and HDTV. Lastly,

Samsung argues that petitioners' effort to adjust the expected U.S.

retail price for HDTVs to the wholesale level by adjusting for a

``typical retail mark-up'' is problematic given that no retail or

wholesale sales have been made by any producer.

Department's Position: This discussion should not be viewed as a

surrogate scope inquiry. In an official scope inquiry, parties

typically place on the record very technical data, including product

specifications, of a product that has actually been produced and sold

in the United States. There is no such data on the record in this

segment of the proceeding. However, based on the presumption that the

scope covers all CTVs unless expressly excluded, the Department will

consider, as we did in TVs from Japan, the development of new

technology in our analysis of whether it is not likely that Samsung

would renew dumping. See TVs from Japan at 35519.

Although we agree with petitioners that HDTV is presumed to be

subject merchandise within the scope of the order for purposes of this

changed circumstances review, we cannot reasonably conclude, based on

the record evidence, that Samsung is likely to sell HDTV at LTFMV, even

if Samsung were to produce such merchandise in Korea. The fact that an

industry is developing new technologies is not, by itself, a sufficient

argument on which to base a claim that these new technologies are

likely to be dumped. There must be credible evidence to indicate not

only that these new technologies are soon to be introduced into the

U.S. market, but also that such merchandise is likely to be sold at

LTFMV. In TVs from Japan, we found that new technological trends in the

television industry, such as LCD TVs, were likely to be developed and

produced in Japan and that ``the incentive to sell such products at

LTFMV will depend on competitive market pressures.'' See TVs from Japan

at 35519. Furthermore, we stated that ``given the number of companies

currently pursuing new technologies and the high production costs in

Japan combined with the high value of the yen,'' we could not conclude

that there was no likelihood of selling new products at LTFMV in the

future. Id. at 35519. The Department found that the evidence on the

record of that case indicated that new technologies were to be produced

in the home market (Japan), the home market currency (the yen) was

appreciating, home market production costs were high, and that

competition would be strong given the number of companies pursuing such

technology. Based on the totality of the circumstances in that case,

the Department could not conclude that the respondents (Sanyo and

Hitachi) were not likely to sell the new products at LTFMV in the

future.

In this case, the petitioners' arguments with respect to sales of

HDTV being sold at LTFMV are not persuasive. First, HDTV technology has

been under development for more than 10 years and has yet to become

commercially viable. Second, the fact that petitioners' estimate of

Samsung's cost of production for HDTV is based on the cost of

production for an 31-inch analog CTV, which is technically very

different from HDTV, is problematic because it is highly speculative of

the real costs of HDTVs. Samsung has not produced or sold commercial

quantities of HDTV. Moreover, the estimates provided by petitioners

cannot reasonably be relied upon because petitioners have not

demonstrated any cost relation between 31-inch analog CTVs and HDTV,

nor have they explained the derivation or calculation of the large

multiple used in their analysis. Absent some reasonable explanation,

the Department cannot rely on those highly speculative estimates as a

valid indicator of the cost of production for HDTV.

Although in past cases we have found that new technology is

developed in the home market (i.e., TVs from Japan), we

[[Page 46776]]

cannot reach the same conclusion in this case. Specifically, we note

that the bill of materials Samsung provided for its HDTV prototype

revealed that none of the four major components (i.e., the chipset,

CPT, lens, and screen panel) were produced in Korea. In light of the

won's depreciation, the cost of importing these components has risen

and may be a disincentive to Samsung in keeping HDTV production in

Korea. Therefore, based on the evidence on the record, we cannot

conclude that HDTVs, once fully developed by Samsung, will be produced

in Korea or dumped in the United States.

Affirmative Final Determination of Changed Circumstances

Based on the foregoing analysis, we determine, pursuant to Section

353.25(d) of the Department's regulations, that changed circumstances

warrant partially revoking the antidumping duty order on CTVs from

Korea with respect to merchandise exported by Samsung that is also

manufactured by Samsung. Pursuant to our final results, we will

instruct the U.S. Customs Service (Customs) to end the suspension of

liquidation of merchandise subject to the order on CTVs from Korea, as

it applies to Samsung, on or after the publication date of this notice

of final determination, and to refund any estimated antidumping duties

collected, for all unliquidated entries of such merchandise made on or

after the publication date of this notice of final determination. We

will also instruct Customs to pay interest on such refunds in

accordance with Section 778 of the Act.

This final affirmative changed circumstances determination is in

accordance with Section 751(b) of the Act and 19 C.F.R. 353.22(f).

Dated: August 26, 1998.

Joseph A. Spetrini,

Acting Assistant Secretary for Import Administration.

[FR Doc. 98-23669 Filed 9-1-98; 8:45 am]

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