Stainless Steel Bar from India; Preliminary Results of Antidumping Duty Administrative Review and New Shipper Review

DEPARTMENT OF COMMERCE

International Trade Administration

[A-533-810]

Stainless Steel Bar from India; Preliminary Results of

Antidumping Duty Administrative Review and New Shipper Review

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of preliminary results of 1997-1998 antidumping duty

administrative review and new shipper review of stainless steel bar

from India.

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SUMMARY: In response to requests from Bhansali Bright Bars Pvt. Ltd.

and Venus Wire Industries Limited, the Department of Commerce is

conducting an administrative review of the antidumping duty order on

stainless steel bar from India. In response to requests from Sindia

Steels Limited, Chandan Steel Limited, and Madhya Pradesh Iron & Steel

Company, the Department of Commerce is conducting a new shipper review

of the antidumping duty order on stainless steel bar from India. These

reviews cover sales of stainless steel bar to the United States during

the period February 1, 1997, through January 31, 1998.

[[Page 63289]]

We have preliminarily determined that, during the period of review,

Venus Wire Industries Limited, Sindia Steels Limited, and Madhya

Pradesh Iron & Steel Company made sales below normal value and that

Bhansali Bright Bars Pvt. Ltd. and Chandan Steel Limited did not make

sales below normal value. If these preliminary results are adopted in

our final results of administrative review and new shipper review, we

will instruct the Customs Service to assess antidumping duties equal to

the difference between the export price and the normal value.

Interested parties are invited to comment on these preliminary

results. Parties who submit argument are requested to submit with the

argument (1) a statement of the issue and (2) a brief summary of the

argument.

EFFECTIVE DATE: November 12, 1998.

FOR FURTHER INFORMATION CONTACT: Zak Smith or James Breeden, Office 1,

AD/CVD Enforcement, Import Administration, International Trade

Administration, U.S. Department of Commerce, 14th Street and

Constitution Avenue, NW., Washington DC 20230; telephone (202) 482-0189

or (202) 482-1174, respectively.

SUPPLEMENTARY INFORMATION:

Applicable Statute

Unless otherwise indicated, all citations to the Tariff Act of

1930, as amended (``the Act''), are references to the provisions

effective January 1, 1995, the effective date of the amendments made to

the Act by the Uruguay Round Agreements Act (``URAA''). In addition,

all references to the Department of Commerce's (``the Department's'')

regulations are to 19 CFR part 351 (April 1998).

Background

On February 23 and February 25, 1998, the Department received

requests from Bhansali Bright Bars Pvt. Ltd. (``Bhansali'') and Venus

Wire Industries Limited (``Venus'') to conduct an administrative review

of the antidumping duty order on stainless steel bar from India. The

Department published in the Federal Register, on March 23, 1998, a

notice of initiation of an administrative review of Bhansali and Venus

covering the period February 1, 1997, through January 31, 1998 (63 FR

13837).

On February 19, 1998, Sindia Steels Limited (``Sindia'') requested

that we conduct a new shipper review. Sindia's request was followed by

similar requests from Chandan Steel Limited (``Chandan'') and Madhya

Pradesh Iron and Steel Company (``Madhya'') on February 27, 1998. We

published the notice of initiation for this new shipper review on April

7, 1997 (63 FR 16972). This new shipper review covers the same period

as the administrative review and, pursuant to section 751(a) of the Act

and 19 CFR 351.214(j)(3), is being conducted concurrently with the

administrative review.

On August 14 and October 30, 1998, the Department initiated sales

below cost investigations of Madhya and Bhansali, respectively. A sales

below cost analysis of Bhansali is not included in this notice because

the sales below cost investigation was initiated shortly before

issuance of these preliminary results. A sales below cost analysis of

Madhya is not included in this notice because Madhya did not submit the

requested cost information in a timely manner (see, Facts Available,

below).

Scope of Reviews

Imports covered by these reviews are shipments of stainless steel

bar (``SSB''). SSB means articles of stainless steel in straight

lengths that have been either hot-rolled, forged, turned, cold-drawn,

cold-rolled or otherwise cold-finished, or ground, having a uniform

solid cross section along their whole length in the shape of circles,

segments of circles, ovals, rectangles (including squares), triangles,

hexagons, octagons, or other convex polygons. SSB includes cold-

finished SSBs that are turned or ground in straight lengths, whether

produced from hot-rolled bar or from straightened and cut rod or wire,

and reinforcing bars that have indentations, ribs, grooves, or other

deformations produced during the rolling process.

Except as specified above, the term does not include stainless

steel semi-finished products, cut length flat-rolled products (i.e.,

cut length rolled products which if less than 4.75 mm in thickness have

a width measuring at least 10 times the thickness, or if 4.75 mm or

more in thickness having a width which exceeds 150 mm and measures at

least twice the thickness), wire (i.e., cold-formed products in coils,

of any uniform solid cross section along their whole length, which do

not conform to the definition of flat-rolled products), and angles,

shapes and sections.

The SSB subject to this order is currently classifiable under

subheadings 7222.10.0005, 7222.10.0050, 7222.20.0005, 7222.20.0045,

7222.20.0075, and 7222.30.0000 of the Harmonized Tariff Schedule of the

United States (``HTSUS''). Although the HTSUS subheadings are provided

for convenience and customs purposes, our written description of the

scope of this order is dispositive.

Use of Facts Otherwise Available

Section 782(e) of the Act provides that the Department shall not

decline to consider information that is submitted by an interested

party and that is necessary to the determination but which does not

meet all the applicable requirements established by the Department if--

(1) The information is submitted by the deadline established for

its submission,

(2) The information can be verified,

(3) The information is not so incomplete that it cannot serve as a

reliable basis for reaching the applicable determination,

(4) The interested party has demonstrated that it acted to the best

of its ability in providing the information and meeting the

requirements established by the Department with respect to the

information, and

(5) The information can be used without undue difficulties.

On September 3, 1998, Madhya requested a one week extension in

which to submit its responses to Section D (Cost of Production and

Constructed Value) of the original questionnaire and to the

Department's supplemental questionnaire. In support of its request,

Madhya stated that it needed additional time because it was having

difficulty responding to both questionnaires at the same time. We

granted its request. On the date the responses were due, we received an

additional request for an extension from Madhya's counsel. Counsel

explained that, as of this date, it had not received the questionnaire

responses from Madhya; in fact, counsel had ``not heard from them.'' We

granted the request. Finally, on September 14, 1998, the date the

questionnaire responses were due, we received a request for a third

extension. The only reasoning supplied to the Department was that the

responses from India had not yet been provided to counsel. Because we

did not receive an adequate explanation or reasoning as to why the

extension was needed, we did not grant the request. Nonetheless, Madhya

submitted its responses on September 17, 1998. However, because Madhya

failed to meet an already extended deadline and provided no explanation

as to why it did not meet the extended deadline, we rejected its

response as untimely.

We must therefore consider whether the submitted information

already on the record is usable under section 782(e) of the Act. The

information that Madhya failed to provide would have been the first

comprehensive cost information to be used in the Department's cost

[[Page 63290]]

investigation. Thus, the information currently on the record is so

incomplete that it cannot serve as a reliable basis for reaching

preliminary results (see, Elemental Sulphur From Canada: Preliminary

Results of Antidumping Duty Administrative Review, 62 FR 969 (January

7, 1997). Therefore, in accordance with section 776(a) of the Act and

19 CFR 351.308(a), we must use facts otherwise available.

In determining the appropriate facts available to apply to Madhya's

sales, we have preliminarily determined that Madhya failed to cooperate

by not acting to the best of its ability to comply with a request for

information under section 776(b) of the Act. Specifically, as described

above, Madhya failed to submit its questionnaire responses on time and

failed to provide adequate reasons for the delays, despite having been

advised by its counsel of the importance of meeting the Department's

deadlines. Therefore, we have applied adverse facts available to

calculate Madhya's margin.

As adverse facts available, we have preliminarily assigned a margin

of 12.45 percent to Madhya's sales of the subject merchandise. This

margin is the ``all others'' rate established in the less-than-fair-

value (``LTFV'') investigation. Information from prior segments of the

proceeding constitutes secondary information and section 776(c) of the

Act provides that the Department shall, to the extent practicable,

corroborate that secondary information from independent sources

reasonably at its disposal. The Statement of Administrative Action

(``SAA'') provides that ``corroborate'' means simply that the

Department will satisfy itself that the secondary information to be

used has probative value (see, H.R. Doc. 316, Vol. 1, 103d Cong., 2d

Sess. 870 (1994)).

To corroborate secondary information, the Department will, to the

extent practicable, examine the reliability and relevance of the

information to be used. However, unlike other types of information,

such as input costs or selling expenses, there are no independent

sources for calculated dumping margins. Thus, in an administrative

review, if the Department chooses as adverse facts available a

calculated dumping margin from a prior segment of the proceeding, it is

not necessary to question the reliability of the margin for that time

period. With respect to the relevance aspect of corroboration, however,

the Department will consider information reasonably at its disposal as

to whether there are circumstances that would render a margin

inappropriate. Where circumstances indicate that the selected margin is

not appropriate as adverse facts available, the Department will

disregard the margin and determine an appropriate margin (see, e.g.,

Fresh Cut Flowers from Mexico; Final Results of Antidumping Duty

Administrative Review, 61 FR 6812, 6814 (Feb. 22, 1996) (where the

Department disregarded the highest margin as adverse facts available

because the margin was based on another company's uncharacteristic

business expense resulting in an unusually high margin)).

As discussed above, it is not necessary to question the reliability

of a calculated margin from a prior segment of the proceeding. Further,

there are no circumstances indicating that this margin is inappropriate

as facts available. Therefore, we preliminarily find that the 12.45

percent rate is corroborated.

United States Price

In calculating the price to the United States, we used export price

(``EP''), in accordance with section 772(a) of the Act, because the

subject merchandise was sold directly to the first unaffiliated

purchaser in the United States prior to importation into the United

States and use of constructed export price was not otherwise indicated.

We calculated EP based on either the CIF or C&F price to the United

States. In accordance with section 772(c)(2) of the Act, we made

deductions, as appropriate, for foreign inland freight, international

freight, marine insurance, brokerage and handling, and clearing and

forwarding.

All five respondents claimed an upward adjustment to EP for a

``duty drawback'' program. In the preliminary results of the first

administrative review of this order, we analyzed the functioning of

this duty drawback program and found that it did not meet the

Department's criteria for an upward adjustment to EP (see, 62 FR 10540

at 10541, March 7, 1997). We maintained our position in the final

results (see, 62 FR 37030, July 10, 1997). We have reexamined the

program in regard to the five respondents, and have found no reason to

deviate from our previous decision. As stated in Certain Welded Carbon

Standard Steel Pipes and Tubes from India (62 FR 47632 at 47635,

September 10, 1997), ``we determine whether an adjustment to U.S. price

for a respondent's claimed duty drawback is appropriate when the

respondent can demonstrate that it meets both parts of our two-part

test. There must be: (1) A sufficient link between the import duty and

the rebate, and (2) a sufficient amount of raw materials imported and

used in the production of the final exported product.'' Because the

respondents did not demonstrate a sufficient link between the import

duty and the rebate, we have not made an adjustment to EP.

Normal Value

In order to determine whether there was a sufficient volume of

sales in the home market to serve as a basis for calculating normal

value (``NV''), we compared the respondents' volume of home market

sales of the foreign like product to the volume of U.S. sales of the

subject merchandise, in accordance with section 773(a) of the Act. When

home market sales were determined to be insufficient in quantity to

permit a proper comparison with sales to the United States, we compared

the respondents' volume of third country sales of the foreign like

product to the volume of U.S. sales of the subject merchandise, in

accordance with section 773(a)(1)(C) of the Act.

For Bhansali and Chandan, because the aggregate volume of home

market sales of the foreign like product was greater than five percent

of the aggregate volume of U.S. sales of the subject merchandise, we

determined that the home market provides a viable basis for calculating

NV. Therefore, in accordance with section 773(a)(1)(B)(i) of the Act,

we based NV for these companies on the prices at which the foreign like

product was first sold to unaffiliated customers for consumption in the

exporting country, in the usual commercial quantities and in the

ordinary course of trade.

For Venus and Sindia, because the aggregate volume of home market

sales of the foreign like product was not greater than five percent of

the aggregate volume of U.S. sales of the subject merchandise, we

determined that the home market was not appropriate for calculating NV.

Therefore, we examined these companies' sales to third country markets.

Both Venus and Sindia had more than one third country market that

satisfied the criteria of section 773(a)(1)(B)(ii) of the Act. To

select among these markets, we considered the criteria outlined in 19

CFR 351.404(e): The similarity of the foreign like product exported to

each third country versus subject merchandise exported to the United

States; the volume of sales to the third countries; and other factors

that we considered appropriate. For Venus, we chose Belgium as the

third country market. Although it was not the largest third country

market, the merchandise sold to Belgium was more similar to the

merchandise sold by Venus to the United States. In the case

[[Page 63291]]

of Sindia, we selected Canada. Again, Canada was not the largest third

country market, but the merchandise sold there was more similar to the

merchandise sold to the United States and the Canadian sales were

contemporaneous with U.S. sales, while sales to the largest third

country were not. Both Venus' aggregate sales of the foreign like

product to its second largest third country market and Sindia's

aggregate sales of the foreign like product to Canada were greater than

five percent of their sales, by volume, of the subject merchandise to

the United States (see the Memoranda to Richard Moreland dated October

2, 1998, ``Selection of Third Country Comparison Market,'' which are

available in the public records of the Department's Central Records

Unit, Room B-099.).

Level of Trade

In accordance with section 773(a)(1)(B) of the Act, to the extent

practicable, we determine NV based on sales in the comparison market at

the same level of trade (``LOT'') as the EP transaction. The NV LOT is

that of the starting-price sales in the comparison market. For EP, the

U.S. LOT is also the level of the starting-price sale, which is usually

from exporter to importer.

To determine whether NV sales are at a different LOT than EP, we

examine stages in the marketing process and selling functions along the

chain of distribution between the producer and the unaffiliated

customer. If the comparison-market sales are at a different LOT, and

the difference affects price comparability, as manifested in a pattern

of consistent price differences between the sales on which NV is based

and comparison-market sales at the LOT of the export transaction, we

make a LOT adjustment under section 773(a)(7)(A) of the Act. See,

Notice of Final Determination of Sales at Less Than Fair Value: Certain

Cut-to-Length Carbon Steel Plate from South Africa, 62 FR 61731

(November 19, 1997).

In implementing these principles in these reviews, we reviewed

information from each respondent regarding the marketing stage involved

in the reported home market or third country and U.S. sales, including

a description of the selling activities performed by the respondents

for each channel of distribution. Pursuant to section 773(a)(1)(B)(i)

of the Act and the Statement of Administrative Action at 827, in

identifying levels of trade for EP and home market sales, we considered

the selling functions reflected in the starting prices before any

adjustments. We expect that, if claimed levels of trade are the same,

the functions and activities of the seller should be similar.

Conversely, if a party claims that levels of trade are different for

different groups of sales, the functions and activities of the seller

should be dissimilar.

Based on an analysis of the selling functions, class of customers,

and level of selling expenses, we found that the marketing processes in

both the home market or third country and the United States were not

substantially dissimilar for Bhansali, Chandan, Venus, or Sindia.

Therefore, we have preliminarily found that sales in both markets for

each respondent are at the same LOT and consequently, no LOT adjustment

is warranted.

Preliminary Results of the Reviews

As a result of our comparison of EP and NV, we preliminarily

determine the following weighted-average dumping margins:

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

Margin

Manufacturer/Exporter Period (percent)

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

Bhansali................................ 2/1/96-1/31/97 0.00

Venus................................... 2/1/96-1/31/97 0.23

Sindia.................................. 2/1/96-1/31/97 0.19

Chandan................................. 2/1/96-1/31/97 0.00

Madhya.................................. 2/1/96-1/31/97 12.45

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Parties to the proceeding may request disclosure within five days

of the date of publication of this notice. Any interested party may

request a hearing within 30 days of publication. Any hearing, if

requested, will be held 37 days after the publication of this notice,

or the first workday thereafter. Interested parties may submit case

briefs within 30 days of the date of publication of this notice.

Rebuttal briefs, which must be limited to issues raised in the case

briefs, may be filed not later than 35 days after the date of

publication of this notice. The Department will issue the final results

of these administrative and new shipper reviews, which will include the

results of its analysis of issues raised in any such comments, within

120 days of publication of these preliminary results.

Upon completion of these administrative and new shipper reviews,

the Department shall determine, and the Customs Service shall assess,

antidumping duties on all appropriate entries. Individual differences

between EP and NV may vary from the percentages stated above. We have

calculated an importer-specific duty assessment rate based on the ratio

of the total amount of antidumping duties calculated for the examined

sales made during the period of review (``POR'') to the total value of

subject merchandise entered during the POR. In order to estimate the

entered value, we subtracted international movement expenses (e.g.,

international freight) from the gross sales value. This rate will be

assessed uniformly on all entries made during the POR. The Department

will issue appraisement instructions directly to the Customs Service.

The following deposit requirement will be effective upon

publication of the final results of these administrative and new

shipper reviews for all shipments of stainless steel bar from India

entered, or withdrawn from warehouse, for consumption on or after the

publication date, as provided for by section 751(a)(1) of the Act: (1)

The cash deposit rate for the reviewed companies will be the rates

established in the final results of these reviews; (2) if the exporter

is not a firm covered in these reviews, but was covered in a previous

review or the original LTFV investigation, the cash deposit rate will

continue to be the company-specific rate published for the most recent

period; (3) if the exporter is not a firm covered in these reviews, a

previous review, or the original LTFV investigation, but the

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

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

the cash deposit rate for all other manufacturers and/or exporters of

this merchandise, shall be 12.45 percent, the ``all others'' rate

established in the LTFV investigation (59 FR 66915, December 28, 1994).

These requirements, when imposed, shall remain in effect until

publication of the final results of the next administrative review.

This notice also serves as a preliminary reminder to importers of

their responsibility under 19 CFR 351.402(f) to file a certificate

regarding the reimbursement of antidumping duties prior to liquidation

of the relevant entries during this review period. Failure to comply

with this requirement could result in the Secretary's presumption that

reimbursement of antidumping duties occurred and the subsequent

assessment of double antidumping duties.

This administrative review, new shipper review, and notice are in

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

19 CFR 351.213 and 351.214.

Dated: November 2, 1998.

Robert S. LaRussa,

Assistant Secretary for Import Administration.

[FR Doc. 98-30280 Filed 11-10-98; 8:45 am]

BILLING CODE 3510-DS-P