Notice of Final Determination of Sales at Less Than Fair Value: Static Random Access Memory Semiconductors From the Republic of Korea

DEPARTMENT OF COMMERCE

International Trade Administration

[A-580-828]

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

Static Random Access Memory Semiconductors From the Republic of Korea

AGENCY: Import Administration, International Trade Administration, U.S.

Department of Commerce.

EFFECTIVE DATE: February 23, 1998.

FOR FURTHER INFORMATION CONTACT: Robert Blankenbaker or Thomas F.

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

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

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

telephone: (202) 482-0989 or (202) 482-3814.

APPLICABLE STATUTE: 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, as

amended (the Act), by the Uruguay Round Agreements Act (URAA). In

addition, unless otherwise indicated, all citations to the Department's

regulations are to 19 CFR part 353 (April 1, 1996).

SUPPLEMENTARY INFORMATION:

Final Determination

We determine that static random access memory semiconductors

(SRAMs) from the Republic of Korea are being sold in the United States

at less than fair value (LTFV), as provided in section 735 of the Act.

The estimated margins are shown in the ``Suspension of Liquidation''

section of this notice.

Case History

Since the preliminary determination in this investigation

(Preliminary Determination of Sales at Less Than Fair Value and

Postponement of Final Determination: Static Random Access Memory

Semiconductors from the Republic of Korea, 62 FR 51437 (October 1,

1997)), the following events have occurred: In November and December of

1997, we verified the Samsung Electronics Co. Ltd. (``Samsung''), and

Hyundai Electronics Industries Co. Ltd. (``Hyundai''), questionnaire

responses. On December 17, 1997, the Department issued its report on

the verification findings for Hyundai. On December 18, 1997, the

Department issued its report on the verification findings for Samsung.

The petitioner and the respondents, Hyundai, Samsung and LG Semicon

Co. Ltd. (``LGS''), submitted case briefs on December 30, 1997, and

rebuttal briefs on January 5, 1998. In addition, five interested

parties, Compaq Computer Corporation (``Compaq''), Cypress

Semiconductor Corporation (``Cypress''), Digital Equipment Corporation

(``Digital''), Integrated Device Technology (``IDT''), and Motorola,

Inc. (``Motorola''), submitted rebuttal briefs on January 7, 1998. We

held a public hearing on January 16, 1998.

Scope of Investigation

The products covered by this investigation are synchronous,

asynchronous, and specialty SRAMs from Korea, whether assembled or

unassembled. Assembled SRAMs include all package types. Unassembled

SRAMs include processed wafers or die, uncut die, and cut die.

Processed wafers produced in Korea, but packaged, or assembled into

memory modules, in a third country, are included in the scope;

processed wafers produced in a third country and assembled or packaged

in Korea are not included in the scope.

The scope of this investigation includes modules containing SRAMs.

Such modules include single in-line processing modules (``SIPs''),

single in-line memory modules (``SIMMs''), dual in-line memory modules

(``DIMMs''), memory cards, or other collections of SRAMs, whether

unmounted or mounted on a circuit board.

We have determined that the scope of this investigation does not

include SRAMs that are physically integrated with other components of a

motherboard in such a manner as to constitute one inseparable amalgam

(i.e., SRAMs soldered onto motherboards). For a detailed discussion of

our determination on this issue, see Comment 6 in the ``Interested

Party Comments'' section of this notice and the memorandum to Louis

Apple from Tom Futtner dated February 13, 1998.

The SRAMs within the scope of this investigation are currently

classified under the subheadings 8542.13.8037 through 8542.13.8049,

8473.30.10 through 8473.30.90, and 8542.13.8005 of the Harmonized

Tariff Schedule of the United States (``HTSUS''). Although the HTSUS

subheadings are provided for convenience and customs purposes, the

written description of the scope of this investigation is dispositive.

Period of Investigation

The period of investigation (``POI'') is January 1, 1996, through

December 31, 1996.

Facts Available

On June 16, 1997, LGS, notified the Department that it was

withdrawing from further participation in this investigation. For

purposes of the preliminary determination, the Department assigned an

adverse facts available rate of 55.36 percent. This margin was higher

than the preliminary margin calculated for either respondent in this

investigation.

Section 776(a)(2) of the Act provides that ``if an interested party

or any other person: (A) Withholds information that has been requested

by the administering authority; (B) fails to provide such information

by the deadlines for the submission of the information or in the form

and manner requested, subject to subsections (c)(1) and (e) of section

782; (C) significantly impedes a proceeding under this title; or (D)

provides such information but the information cannot be verified as

provided in section 782(i), the administering authority shall, subject

to section 782(d), use the facts otherwise available in reaching the

applicable determination under this title.''

In addition, section 776(b) of the Act provides that if the

Department finds that an interested party ``has failed to cooperate by

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

information,'' the Department may use information that is adverse to

the interests of the party as the facts otherwise available. The

statute also provides that such an adverse inference may be based on

secondary information, including information drawn from the petition.

(See also Statement of Administrative Action accompanying the URAA,

H.R. Rep. No. 316, 103d Cong., 2d Sess. 870 (SAA).) The failure of LG

to reply to the Department's questionnaire or to provide a satisfactory

explanation of their conduct demonstrates that they have failed to act

to the best of their ability in this investigation. Thus, the

Department has determined that, in selecting among the facts otherwise

available to these companies, an adverse inference is warranted.

In accordance with our standard practice, as adverse facts

available, we are assigning to LG the higher of: (1) The highest margin

stated in the notice of initiation; or (2) the highest margin

calculated for any respondent in this investigation. In this case, this

margin is 55.36 percent, which is the highest margin stated in the

notice of initiation.

Section 776(c) of the Act provides that, when the Department relies

on secondary information (such as the petition) in using the facts

otherwise

[[Page 8935]]

available, it must, to the extent practicable, corroborate that

information from independent sources that are reasonably at its

disposal. When analyzing the petition, the Department reviewed all of

the data the petitioner relied upon in calculating the estimated

dumping margins, and adjusted those calculations where necessary. (See

Initiation Checklist, dated March 17, 1997.) These estimated dumping

margins were based on a comparison of constructed value (CV) to U.S.

price, the latter of which was based on price quotations offered one

company in Korea. The estimated dumping margin, as recalculated by the

Department, was 55.36 percent. For purposes of corroboration, the

Department re-examined the price information provided in the petition

in light of information developed during the investigation and found

that it has probative value. (See the Memorandum to Tom Futtner from

the Team dated September 23, 1997, for a detailed explanation of

corroboration of the information in the petition.)

Time Period for Cost and Price Comparisons

Section 777A(d) of the Act states that in an investigation, the

Department will compare the weighted average of the normal values to

the weighted average of the export prices or constructed export prices.

Generally, the Department will compare sales and conduct the sales

below cost of production test using annual averages. However, when

prices have moved significantly over the course of the POI, it has been

the Department's practice to use shorter time periods. See, e.g., Final

Determination of Sales at Less Than Fair Value: Erasable Programmable

Read Only Memories (EPROMs) from Japan, 51 FR 39680, 39682 (October 30,

1986), Final Determination of Sales at Less Than Fair Value: Dynamic

Random Access Memory Semiconductors of One Megabit and Above From the

Republic of Korea, 58 FR 15467, 15476 (March 23, 1993) (``DRAMs Final

Determination'').

We invited comments from interested parties regarding this issue.

An analysis of these comments revealed that all parties agreed that the

SRAMs market experienced a significant and consistent price decline

during the POI. Accordingly, in recognition of the significant and

consistent price declines in the SRAMs market during the POI, the

Department has compared prices and conducted the sales below cost of

production test using quarterly instead of annual data.

Normal Value Comparisons

To determine whether sales of SRAMs from the Republic of Korea to

the United States were made at less than normal value, we compared the

Constructed Export Price (CEP) and Export Price (EP) to the Normal

Value (NV), as described in the ``Constructed Export Price'', ``Export

Price'' and ``Normal Value'' sections of this notice, below. In

accordance with section 777A(d)(1)(A)(i) of the Act, we calculated

weighted-average CEPs and EPs for comparison to weighted-average NVs.

In order to determine whether we should base price-averaging groups

on customer types, we conducted an analysis of the prices submitted by

the respondents. This analysis does not indicate that there was a

consistent and uniform difference in prices between customer types.

Accordingly, we have not based price comparisons on customer types.

On January 8, 1998, the Court of Appeals for the Federal Circuit

issued a decision in CEMEX v. United States, 1998 WL 3626 (Fed. Cir.).

In that case, based on the pre-URAA version of the Act, the Court

discussed the appropriateness of using constructed value (CV) as the

basis for foreign market value when the Department finds home market

sales to be outside the ordinary course of trade. The Uruguay Round

Agreements Act (URAA) amended the definition of sales outside the

ordinary course of trade to include sales below cost. See Section

771(15) of the Act. Because the court's decision was issued so close to

the deadline for completing this final determination, we have not had

sufficient time to evaluate and apply the decision to the facts of this

post-URAA case. For these reasons, we have determined to continue to

apply our policy regarding the use of CV when we have disregarded

below-cost sales from the calculation of normal value.

In making our comparisons, in accordance with section 771(16) of

the Act, we considered all products sold in the home market, fitting

the description specified in the ``Scope of Investigation'' section of

this notice, above, to be foreign like products for purposes of

determining appropriate product comparisons to U.S. sales. Where there

were no sales of identical merchandise in the home market to compare to

U.S. sales, we compared U.S. sales to the next most similar foreign

like product, based on the characteristics listed in Sections B and C

of the Department's antidumping questionnaire.

Level of Trade and Constructed Export Price Offset

In the preliminary determination, the Department determined that

there was sufficient evidence on the record to establish a distinction

in level of trade between the U.S. CEP sales and the home market sales

used for normal value as well as to justify a CEP offset for each of

the two respondents. We found no evidence at verification to warrant a

change from that preliminary determination. Accordingly, we have made a

CEP offset for each of the respondents in this final determination. For

further discussion, see ``General Comment 5'' in the ``Interested Party

Comments'' section of this notice.

Constructed Export Price

A. Hyundai

We used CEP in accordance with section 772(b) of the Act, because

the sales to unaffiliated purchasers were made after importation. We

calculated CEP based on packed prices, f.o.b. the U.S. affiliate's

warehouse to the first unaffiliated purchaser in the United States. We

made the following deductions from the starting price (``gross unit

price''): foreign inland freight, brokerage and handling; international

freight; and U.S. brokerage, handling and inland freight. We made

additional deductions, in accordance with section 772(d) (1) and (2) of

the Act, for: commissions; credit, inventory carrying costs, and other

indirect and direct selling expenses; and bank and extended test

charges. Pursuant to section 772(d)(3) of the Act, the price was

further reduced by an amount for profit, to arrive at the CEP. The

amount of profit deducted was calculated in accordance with section

772(f) of the Act.

B. Samsung

We used CEP in accordance with section 772(b) of the Act, because

the sales to unaffiliated purchasers were made after importation. We

calculated CEP based on packed prices, f.o.b. the U.S. affiliate's

warehouse to the first unaffiliated purchaser in the United States. We

made the following deductions from the starting price (``gross unit

price''): Foreign inland freight, brokerage, handling, and banking

charges; international freight and insurance; and U.S. inland freight,

brokerage, handling, insurance, and banking charges. We made additional

deductions, in accordance with section 772(d) (1) and (2) of the Act

for commissions, credit, advertising, and royalty expenses; inventory

carrying costs and other direct and indirect

[[Page 8936]]

selling expenses. We also deducted U.S. repacking costs. Pursuant to

section 772(d)(3) of the Act, the price was further reduced by an

amount for profit, to arrive at the CEP. The amount of profit deducted

was calculated in accordance with section 772(f) of the Act.

Export Price

For the Export Price (EP) sales by Samsung, we made deductions from

the gross unit price for the following expenses: foreign inland

freight, brokerage, handling, and banking charges; international

freight and insurance; and U.S. inland freight, brokerage, handling,

and banking charges.

Normal Value

In order to determine whether there was a sufficient volume of

sales in the home market to serve as a viable basis for calculating NV,

we compared each respondent's aggregate volume of home market sales of

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

subject merchandise, in accordance with section 773(a)(1)(C) of the

Act. Each respondent's aggregate volume of home market sales of the

foreign like product was greater than five percent of its aggregate

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

determined that the home market was viable for each respondent.

Based on a cost allegation presented in the petition, the

Department found reasonable grounds to believe or suspect that home

market sales by Samsung and Hyundai were made at prices below their

respective costs of production (``COPs''). As a result, the Department

initiated an investigation to determine whether either respondent made

home market sales during the POI at prices below its COP, within the

meaning of section 773(b) of the Act.

We calculated COP as the sum of each respondent's cost of materials

and fabrication for the foreign like product, plus amounts for SG&A and

packing costs, in accordance with section 773(b)(3) of the Act. We used

the respondents' reported COPs, adjusted as discussed below, to compute

quarterly weighted-average COPs for the POI. We compared the weighted-

average COPs to home market sales of the foreign like product as

required under section 773(b) of the Act in order to determine whether

these sales had been made at prices below COP. On a product-specific

basis, we compared COPs to the home market prices, less any applicable

movement charges, discounts, and packing expenses.

In determining whether to disregard home market sales made at

prices below the COP, we examined whether: (1) Within an extended

period of time, such sales were made in substantial quantities; and (2)

such sales were made at prices which permitted the recovery of all

costs within a reasonable period of time in the normal course of trade.

When 20 percent or more of a respondent's sales of a given product

during the POI were at prices below the COP, we found that sales of

that model were made below cost in ``substantial quantities'' within an

extended period of time, in accordance with section 773(b)(2) (B) and

(C) of the Act. To determine whether prices provided for recovery of

costs within a reasonable period of time, we tested whether the prices

which were below the per unit cost of production at the time of the

sale were above the weighted average per unit cost of production for

the POI, in accordance with section 773(b)(2)(D) of the Act. When we

found that a substantial quantity of sales during the POI were below

cost and not at prices that provided for recovery of costs within a

reasonable period of time, we disregarded the below cost sales in the

calculation of NV.

When NV was based on prices, we made appropriate adjustments to

those prices. First, we deducted home market inland freight and home

market packing costs and we added U.S. packing costs.

When there were differences in the merchandise to be compared, we

made adjustments in accordance with section 773(a)(6)(C)(ii) of the Act

to account for those differences. When appropriate, we made

circumstance-of-sale adjustments in accordance with section

773(a)(6)(C)(iii) of the Act. For purposes of CEP sales comparisons, we

deducted home market indirect expenses.

When there were no above cost home market sales for comparison, NV

was based on CV. In accordance with section 773(e)(1) of the Act, we

calculated CV based on the sum of each respondent's cost of materials,

fabrication, SG&A, profit, and U.S. packing costs. In accordance with

section 773(e)(2)(A) of the Act, we based SG&A expenses and profit on

the amounts incurred and realized by each respondent in connection with

the production and sale of the foreign like product in the ordinary

course of trade, for consumption in the foreign country.

Although we generally relied, in our COP and CV calculation, on the

data submitted by respondents, we made adjustments in the allocation of

both research and development (``R&D''), the treatment of foreign

exchange gains and losses, G&A expenses and interest expense as

discussed below.

Hyundai

For those comparison products for which there were sales above the

COP, we based NV on delivered prices to home market customers. We made

deductions for inland freight, imputed credit expenses and banking

charges, and home market direct and indirect selling expenses. As

indirect selling expenses, we included inventory carrying costs and

other indirect selling expenses, up to the amount of indirect selling

expenses incurred on U.S. sales, in accordance with 19 CFR

353.56(b)(2).

For all price-to-price comparisons, we deducted home market packing

costs and added U.S. packing costs, in accordance with section

773(a)(6) of the Act. In addition, where appropriate, we made

adjustments to NV to account for differences in physical

characteristics of the merchandise, in accordance with 773(a)(6)(C)(ii)

of the Act and 19 CFR 353.57.

For price-to-CV comparisons, we made deductions, where appropriate,

for credit expenses and banking charges. We also deducted home market

indirect selling expenses, including inventory carrying costs and other

indirect selling expenses, up to the amount of indirect selling

expenses incurred on U.S. sales, in accordance with 19 CFR

353.56(b)(2).

Samsung

For those comparisons for which there were sales above the COP, we

based NV on delivered prices to home market customers. We made

deductions for inland freight, imputed credit, advertising, and royalty

expenses, and home market direct and indirect selling expenses. For

indirect selling expenses, we included inventory carrying costs and

other indirect selling expenses, up to the amount of indirect selling

expenses and commissions incurred on U.S. sales, in accordance with 19

CFR 353.56(b)(2). In the case of letter-of-credit sales, we added in

the amount of any duty drawback.

In accordance with section 773(e)(1) of the Act, we calculated CV

based on the sum of the respondent's cost of materials, fabrication,

SG&A, profit and U.S. packing costs. In accordance with section

773(e)(2)(A) of the Act, we based SG&A and profit on the amounts

incurred and realized by the respondent in connection with the

production and sale of the foreign like product in the ordinary course

of trade, for consumption in the home market.

[[Page 8937]]

Currency Conversion

We made currency conversions into U.S. dollars based on the

official exchange rates in effect on the dates of the U.S. sales as

certified by the Federal Reserve Bank. Section 773A(a) of the Act

directs the Department to use a daily exchange rate in order to convert

foreign currencies into U.S. dollars unless the daily rate involves a

fluctuation. It is the Department's practice to find that a fluctuation

exists when the daily exchange rate differs from the benchmark rate by

2.25 percent. The benchmark is defined as the moving average of rates

for the past 40 business days. When we determine that a fluctuation

exists, we substitute the benchmark rate for the daily rate, in

accordance with established practice. Further, section 773A(b) directs

the Department to allow a 60-day adjustment period when a currency has

undergone a sustained movement. A sustained movement has occurred when

the weekly average of actual daily rates exceeds the weekly average of

benchmark rates by more than five percent for eight consecutive weeks.

See Change in Policy Regarding Currency Conversions, 61 FR 9434 (March

8, 1996). Such an adjustment period is required only when a foreign

currency is appreciating against the U.S. dollar. The use of an

adjustment period was not warranted in this case because the Korean Won

did not undergo a sustained movement.

Verification

As provided in section 782(i) of the Act, we verified the

information submitted by Hyundai and Samsung for use in our final

determination. We used standard verification procedures, including

examination of relevant accounting and production records and original

source documents provided by respondents. The verification team

included a semiconductor product expert. The Department has placed on

the record in Room B-099 the following verification reports: (1)

December 19, 1997, ``Verification of Cost of Production and Constructed

Value Data Less Than Normal Value Investigation of Static Random Access

Memory Semiconductors (SRAMS) from Korea-Samsung Electronics Co. Ltd.''

(Samsung Cost Verification Report); (2) December 18, 1997,

``Verification of Home Market Sales Response of Samsung Electronics

Company (SEC) in the Antidumping Investigation of Static Random Access

Memory Semiconductors (SRAMS) from the Republic of Korea'' (Samsung

Home Market Sales Verification Report); (3) December 12, 1997,

``Verification of U.S. Sales Response of Samsung Semiconductor, Inc. in

the Antidumping Investigation of Static Random Access Memory

Semiconductors (SRAMS) from the Republic of Korea'' (Samsung U.S. Sales

Verification Report); (4) December 16, 1997, ``Verification of Cost of

Production and Constructed Value Data Less Than Normal Value

Investigation of Static Random Access Memory Semiconductors (SRAMS)

from Korea-Hyundai Electronics Industries Co. Ltd.'' (Hyundai Cost

Verification Report); (5) December 16, 1997, ``Verification of Home

Market Sales Questionnaire Responses of Hyundai Electronics Industries

in the Antidumping Investigation of Static Random Access Memory

Semiconductors (SRAMS) from the Republic of Korea'' (Hyundai Home

Market Sales Verification Report); and (6) December 16, 1997,

``Verification of the U.S. Sales Questionnaire of Hyundai Electronics

Industries, Static Random Access Memory Semiconductors (SRAMS) from the

Republic of Korea'' (Hyundai U.S. Sales Verification Report).

General Comments

Comment 1: Depreciation. The petitioner contends that the

Department should continue to use the same depreciation adjustment used

in the preliminary determination because of the following: (1) Samsung

and Hyundai avoided losses on their income statements by changing the

amount of depreciation recorded; and (2) the auditors notes to the

financial statements for both respondents confirms that their reported

depreciation understates their actual costs. As argued by the

petitioner, the object of making such an adjustment is to counteract

the effort by respondents to appear to be showing a profit when prices

fell below costs during 1996.

Samsung states that the Department adjusted the reported

depreciation expenses based on an erroneous assumption that Samsung

changed its depreciation methodology for equipment and machinery in

1996. As argued by Samsung, the change was only a change in accounting

estimate, and not a change in accounting principle. Samsung also states

that the adjustment is not warranted since the reported expenses

reasonably reflected costs and were appropriately reported in the

audited financial statements as required by and consistent with the

Korean generally accepted accounting principles (GAAP). Since its

reported depreciation expenses are conservative compared with

depreciation expenses taken by other semiconductor manufacturers,

Samsung contends these expenses cannot be considered unreasonable and

distortive of costs. Further, Samsung maintains that the accounting

methods used to estimate the change in useful life of the equipment are

prospective, under both U.S. and Korean GAAP. They also do not require

any adjustment for the cumulative effect of the change from the date of

purchase since there has been no change in accounting principle, which

would require that the value of the assets be restated. If the

Department does continue to adjust depreciation, Samsung argues that it

must cumulatively restate the effect of the change based on the data

submitted before verification which was fully verified.

Hyundai argues that the Department should not have adjusted the

company's depreciation expense and methodology. According to Hyundai,

the reported depreciation expenses and methodology are fully consistent

with Korean GAAP. Specifically, Hyundai maintains that if the auditor's

opinion attached to its financial statements documents that all

elements of the financial statement, including depreciation, were fully

prepared in accordance with Korean GAAP. As further claimed by Hyundai,

the reported depreciation expenses also reasonably reflected the cost

of producing SRAMS. For example, the five year useful life period used

by Hyundai in 1996 is appropriate for semiconductor equipment. Finally,

Hyundai claims the depreciation expenses as reported are fully

consistent with the company's historical accounting methodology.

DOC Position. We agree with the petitioner in part. Historically

both respondents have been inconsistent in their approach to special

depreciation. For example, both respondents took advantage of the

special depreciation option available to them under the Korean

Corporate Income tax law in 1995. However, no special depreciation was

taken during this current investigation.

It is the Department's normal practice to use costs recorded in the

books and records of the respondent. Section 773(f)(1)(A) of the Act

states that cost ``shall normally be calculated based on the records of

the exporter or producer of the merchandise, if such records are kept

in accordance with the generally accepted accounting principles of the

exporting country (or the producing country where appropriate) and

reasonably reflect the costs associated with production and sale of the

[[Page 8938]]

merchandise.'' Further, as explained in the SAA, ``[t]he exporter or

producer will be expected to demonstrate that it has historically

utilized such allocations, particularly with regard to the

establishment of appropriate amortization and depreciation periods and

allowances for capital expenditures and other development costs.'' (SAA

at 834.)

In contrast to the previous year, both respondents, for this POI,

elected not to take special depreciation. This represents a failure to

report depreciation expenses in a systematic and rational matter. As a

result, disproportionately greater costs were attributed to products

manufactured from when the special depreciation was taken than

subsequent period when it was not taken. See DRAMs Final Determination.

Therefore, for the final determination, we are making an adjustment to

the respondents' reported depreciation. We are adding only special

depreciation to the reported cost of production.

Comment 2: Interest expense. The petitioner maintains that using

tangible fixed assets as the basis for allocating interest expenses is

more appropriate to measure costs than using either total assets or

cost of sales because of the respondents' heavy use of debt to finance

the purchase of tangible fixed assets and because a larger proportion

of total fixed assets is related to the semiconductor line of business

than to other lines of business.

Samsung and Hyundai state that the Department incorrectly allocated

interest expenses on the basis of fixed assets and not on the cost of

goods sold. As argued by both respondents, the Department has a long-

standing practice of allocating interest expense based on the cost of

goods sold. Samsung argues that allocating interest based on fixed

assets overstates financing costs since it does not account for income

generated by the semiconductor division. Samsung contends that if the

Department continues to allocate interest based on assets, it should

use total assets rather than fixed assets because the Department would

fail to account for the total investment required by its various

business units by limiting the allocation base to fixed assets and

would not account for the value of fixed assets used up in prior years

by allocating interest based on the historical value of fixed assets.

Hyundai also maintains that if the Department continues to allocate

interest based on fixed assets, the Department, first, should use Cost

of Goods Sold (``COGS'') to allocate total consolidated corporate

interest to Hyundai, then Hyundai's total interest can be allocated to

SRAMs based upon the ratio of semiconductor fixed assets to total fixed

assets based on the net book value of the assets rather than the

acquisition cost.

DOC Position. We agree with the respondents that interest expense

should be allocated based on COGS. In our preliminary determination, we

allocated interest expense among the various operating units according

to the proportional share of fixed assets. We have reconsidered this

issue for the final determination and concluded that because the COGS

includes a proportional amount of the depreciation of the assets used

in the production of the merchandise, allocation of financing expenses

on the basis of COGS distributes proportionately more interest expense

to those products having higher capital investment. Moreover, we note

that it has been the Department's longstanding policy to allocate

interest expense on the basis of the COGS of the merchandise subject to

investigation. We also note that, for the 1995-1996 administrative

review of DRAMs, we have allocated interest expenses based on COGS

consistent with the methodology in this case. Therefore, interest

expense will be allocated over COGS since it reasonably apportions the

interest expenses between SRAMs and other products.

Comment 3: Research & Development. Hyundai argues that the

Department overstated R&D expenses by allocating a portion of non-

memory R&D expense to SRAMs. According to Hyundai, the preliminary

determination deviates from the long-standing practice of calculating

product-specific R&D and of excluding R&D relating to non-subject

merchandise from its CV calculations. Additionally, the antidumping

statute precludes the Department from attributing expenses relating to

non-subject merchandise to SRAMs. Moreover, Hyundai states that the

Micron case requires the Department to provide substantial evidence

justifying its departure from its practice. As such, Hyundai argues

that the record in the instant case does not support the Department's

preliminary determination. For example, Hyundai claims the September 8,

1997, Memorandum from Dr. Murzy Jhabvala to Thomas Futtner, ``Cross

Fertilization of Research and Development of Semiconductor Memory

Devices'' (``September 8, 1997 Jhabvala Memo'') and the Micron

submissions, used by the Department in the Preliminary Determination,

do not support an assumption of cross-fertilization.

Hyundai also asserts that its organizational structure and

accounting records clearly distinguish between R&D expenditures for

memory and non-memory products. Hyundai maintains that cross

fertilization of memory and non-memory R&D is extremely unlikely

considering the fundamental differences in product design, marketing

and production.

Samsung argues that R&D costs related to non-memory products should

be excluded because R&D performed for micro and logic products do not

benefit memory products such as SRAMs. Samsung disagrees with the

Department's position, stated in the preliminary determination, that

all R&D conducted for semiconductor products benefits all semiconductor

products and, therefore, aggregate R&D costs should be allocated to all

semiconductor products for purpose of determining the cost of

production and CV. Samsung cites the cases Carbon Steel Flat Products

From France (See Certain Carbon Steel Flat Products from France; Final

Determination of Sales at Less than Fair Value 58 FR 37125 (July 9,

1993) and Cell Site Transceivers from Japan (see Cell Site Transceivers

From Japan; Final Determination of Sales at Less than Fair Value 49 FR

43080 (October 26, 1984), as examples of past cases that the Department

has required R&D be calculated on a product-specific basis. Samsung

also cites Micron, in which the court ordered the Department to

``recalculate Samsung's Cost of Production for the LTFV by allocating

Research & Development costs on a product-specific basis.'' (See Micron

Technology, Inc. v. U.S. 893 F.Supp 21 (CIT 1995)). Furthermore,

Samsung contends the Department's finding that R&D expenses incurred

for non-memory merchandise benefits SRAMs is not supported by the

record.

Samsung argues that the R&D costs relating to SRAMs consist of

efforts to apply state-of-the art technology to reduce the size of

circuits utilized in the subject merchandise. Samsung further states

that only after a new generation of memory products has been developed

are the technologies developed for memory products applied to develop

customer and market specific logic devices. These later devices use

existing, mature, process and manufacturing technologies. The R&D that

Samsung conducts to develop new memory products might benefit the later

developed micro products. Thus, the flow of R&D may be from memory to

micro and application specific products, but not vice-versa. Samsung

asserts that it is primarily a memory products company, with a one-way

flow of R&D from memory to micro products.

[[Page 8939]]

Samsung disagrees with the statement prepared by Dr. Murzy Jhabvala

of the National Aeronautics and Space Administration. Samsung claims

that the statement does not provide enough evidence to refute what the

CIT has already ruled upon. Samsung claims that Dr. Jhabvala's

assertion that R&D in a given area of semiconductors, such as micro

devices, is widely disseminated and read by all micro engineers, says

nothing about whether the results of that research benefit development

or production of memory products. Samsung further contends that his

memorandum does not explain how ``cross fertilization'' takes place and

purportedly benefits the development or production of DRAMs (or SRAMs).

Furthermore, Samsung argues that Dr. Jhabvala's December 18, 1997

memorandum does not support the Department's view that R&D expenses on

ASIC and logic devices could benefit the development or production of

SRAMs. Samsung claims that the issue before the Department is how to

allocate the pool of R&D costs, and whether some or all of the expenses

should be allocated to SRAMs production. Moreover, Samsung asserts, Dr.

Jhabvala's memorandum does not demonstrate how the work performed on

non-memory projects benefit SRAMs.

Samsung concludes that because non-memory R&D does not benefit

SRAMs or any other memory products, those expenses cannot be properly

allocated to the cost of producing SRAMs. Samsung recognizes that there

is limited cross-fertilization of R&D within memory products and its

methodology already accounts for any possible cross fertilization

concerns. Samsung states that there is no need to include totally

unrelated R&D undertaken for micro or logic products in the memory

related production costs.

Samsung refers to a letter from Professor Bruce A. Wooley which

states that, ``[I]n the case of circuit design techniques there is

virtually no cross-fertilization among various classes of memories.''

(See Samsung submission dated September 29, 1997.) Samsung claims that

the articles proffered by the petitioner to support its claim that R&D

conducted in one area benefits other areas mainly relate to process

technology which may benefit a variety of products and to the

incorporation of separate designs on a single chip; they do not address

whether design technology from one type of memory product benefits the

design of another. Samsung argues that both its verified R&D

information and the fact that the company separates product-specific

R&D for accounting purposes demonstrate that the R&D conducted by

Samsung is product-specific design R&D, which does not benefit all

products. Samsung argues that, if the Department determines that cross-

fertilization of design R&D among memory products does occur, it should

still not aggregate product-specific R&D for logic products with

product-specific R&D for memory products.

In response to Samsung's and Hyundai's assertions, the petitioner

states that the Department properly allocated all semiconductor R&D

over all semiconductor production. As argued by the petitioner, there

is already sufficient evidence on the record to support the

Department's determination that there is significant cross-

fertilization among the different areas of semiconductor design and

development. Moreover, petitioner contends that logic R&D benefits

SRAMs R&D expenses. Petitioner also claims that since new R&D expenses

for application-specific integrated circuits (ASICs) do not benefit

current production of any product, it must be allocated over all

current semiconductor production. Finally, petitioner states that the

presence of separate accounts for separate R&D projects does not

contradict cross-fertilization.

DOC Position. We agree with the petitioner and have allocated all

semiconductor R&D expenses over the total semiconductor cost of goods

sold. In the DRAMs Final Determination, the Department recalculated

respondents' reported R&D expense based on the ratio of each company's

total semiconductor expenses to the total semiconductor costs of goods

sales. As we stated in the DRAMs Final Determination:

* * * Semiconductors present unique problems related to R&D.

Because the general underlying technology is the same for all

semiconductor products, the benefits from the results of R&D, even

if intended to advance the design or manufacture of a specific

product, provide an intrinsic benefit to other semiconductor

products. It is impossible to measure the extent to which R&D

benefits one semiconductor product relative to another. Thus,

identification of specific R&D costs with any one product causes

overstating or understating of these costs in relation to the

benefits that product derived from the total R&D expenditures for

semiconductors * * *.

(See Dynamic Random Access Memory Semiconductors of One Megabit

or Above From the Republic of Korea; Final Determination of Sales at

Less Than Fair Value 58 FR 15470 (March 23, 1993.))

Subsequent to the Department's final determination, Micron and the

three respondents, Samsung, LG and Hyundai filed lawsuits with the

Court of International Trade challenging that determination.

Thereafter, in Micron Technologies, Inc. v. United States, 893 F.Supp.

21 (CIT 1995), the Court remanded to the Department the allocation of

R&D expenses. The Court stated that the Department had failed to place

on the record any evidence of cross-fertilization in the semiconductor

industry. Therefore, the Court instructed the Department to recalculate

respondents' cost of production by allocating research and development

(R&D) expenses on a product-specific basis. In the remand results, the

Department did so and the remand was affirmed. CIT No. 93-06-00318,

Slip Op. 95-175 (October 27, 1995).

In the 1992-1994 DRAMs review, LG Semicon (LG) argued that the

Department should not have included R&D expenses of non-DRAM products

in the DRAM R&D. See Dynamic Random Access Memory Semiconductor of One

Megabit or Above From the Republic of Korea; Final Results of Review 61

FR 20217 (May 6, 1996) (``1992-1994 DRAMs review''). According to LG,

the Department identified and verified product-specific expenses in its

accounting system. Therefore, LG argued that the Department's decision

to include non-DRAM R&D was inconsistent with the Micron decision. In

the 1992-1994 DRAMs Review final results, the Department stated:

* * * At verification, we confirmed that each R&D project is

accounted for separately in each of the respondent's respective

books and records. Separate accounting, however, does not

necessarily mean that cross-fertilization of scientific ideas does

not occur. Moreover, the CIT specifically stated in Micron

Technology that the Department did not ``direct the court to any

record evidence of R&D cross-fertilization in the semiconductor

industry.'' Micron Technology, 893 F. Supp., at 27. In this review,

the Department has provided such information. See Memorandum from

Karen Park to Holly Kuga regarding Cross-Fertilization of R&D for

DRAMs, August 14, 1995 (cross-fertilization memo). The cross-

fertilization memo includes pages from verification exhibits, a

memorandum from a non-partisan expert from the semiconductor

industry, as well as information from certain articles widely read

by experts in the DRAM R&D field demonstrating the existence of

cross-fertilization of R&D in the DRAM industry * * *

Dynamic Random Access Memory Semiconductor of One Megabit or

Above From the Republic of Korea; Final Results of Review 61 FR

20218 (May 6, 1996).

Due to the forward-looking nature of the R&D activities, the

Department, in this investigation, cannot identify every instance where

SRAM R&D may influence logic products or where logic R&D may influence

SRAM products, but

[[Page 8940]]

the Department's own semiconductor expert has identified areas where

R&D from one type of semiconductor product has influenced another

semiconductor product in the past. Dr. Murzy Jhabvala, a semiconductor

device engineer at NASA with twenty-four years experience, was asked by

the Department to state his views regarding cross-fertilization of R&D

efforts in the semiconductor industry. In a July 14, 1995 Memorandum to

Holly Kuga, `` Cross Fertilization of Research and Development Efforts

in the Semiconductor Industry,'' Dr. Jhabvala stated that ``it is

reasonable and realistic to contend that R&D from one area (e.g.,

bipolar) applies and benefits R&D efforts in another area (e.g., MOS

memory).'' Dr. Jhabvala also stated that:

SRAMs represent along with DRAMs the culmination of

semiconductor research and development. Both families of devices

have benefitted from the advances in photo lithographic techniques

to print the fine geometries (the state-of-the-art steppers)

required for the high density of transistors * * *. Clearly, three

distinct areas of semiconductor technology are converging to benefit

the SRAM device performance. There are other instances where

previous technology and the efforts expended to develop that

technology occurs in the SRAM technology. Some examples of these are

the use of thin film transistors (TFTs) in SRAMs, advanced metal

interconnect systems, anisotropic etching and filling techniques for

trenching and planarization (CMP) and implant technology for

retrograde wells.

( See ``September 8, 1997 Jhabvala Memo.'')

Furthermore, Dr. Jhabvala also participated in the verification of

Samsung's R&D expenses. After interviewing several of Samsung's R&D

engineers, Dr. Jhabvala concluded that ``the most accurate and most

consistent method to reflect the appropriate R&D expense for any

semiconductor device is to obtain a ratio by dividing all semiconductor

R&D by the cost to fabricate all semiconductor sold in a given

period.'' (December 19, 1997, Memorandum from Murzy Jhabvala to the

File, ``Examination of Research and Development Expenses and Samsung

Electronic Corporation '').

We reviewed the views of Samsung's expert on this subject and found

them to be of less probative value than the cases cited above, as

Jhabvala's articles refute Dr. Wooley's assertion that there is no

cross-fertilization among circuit design techniques. In fact, Dr.

Wooley agrees that there can be cross-fertilization in the development

of process technologies among various classes of memories. This

assertion also refutes the claims that there is no cross-fertilization

in the development of process technologies.

The respondents argue we should follow their normal accounting

records which categorize R&D expenses by project and product. While we

do not disagree that each R&D project is accounted for separately in

each of the respondents' respective books and records, we do not find

this argument persuasive since accounting records do not address the

critical issue of whether R&D in one area benefits another area.

Therefore, we do not believe that the R&D expenses associated with

these records reasonably reflect the appropriate cost of producing the

subject merchandise.

Finally, contrary to the respondents' assertion, the methodology we

are applying does calculate product-specific costs. It is the

Department's practice where costs benefit more than one product to

allocate those costs to all the products which they benefit. This

practice is consistent with section 773(f)(1)(A) of the Act because we

have determined that the product-specific R&D accounts do not

reasonably reflect the costs associated with the production and sale of

SRAMs. Therefore, as semiconductor R&D benefits all semiconductor

products, we allocated semiconductor R&D to all semiconductor products.

Comment 4: Foreign exchange loss. The petitioner argues that

current period foreign exchange losses on long-term debt should be

included in cost of production since the Department's practice and U.S.

and international accounting standards all require that current period

foreign exchange losses on long-term debt be included in cost of

production and the Department's past practice has been to disregard

Korea's local accounting standard that called for deferring current

period foreign exchange losses on long-term debt.

Samsung contends that its methodology is consistent with Korean

GAAP and with the Department's past practice of amortizing foreign

exchange losses relating to debt over the life of the loan. Samsung

further maintains that its methodology does not exclude the foreign

exchange losses but rather amortizes them over the life of the loans

and does not distort the dumping calculation. Samsung argues that

foreign exchange losses should not be treated like interest because

they are not functionally equivalent to interest.

Hyundai maintains that its treatment of unrealized foreign exchange

losses is in accordance with Korean GAAP and reasonably reflects the

cost of production. Hyundai argues that Korean GAAP provides for the

recognition of such gains or losses when they are actually incurred and

unrealized long-term foreign currency translation losses do not

represent an actual cost to them. Hyundai further contends that the

Department should reject Micron's contention that the losses be treated

as interest expenses and be allocated over fixed assets because such

foreign exchange losses on long-term debt are not current interest

expenses, but rather reflect fluctuations in exchange rates associated

with year end valuation of foreign currency liabilities.

DOC Position. We agree with the petitioner, in part, and have

included the amortized portion of foreign exchange losses on long-term

debt in the cost of production as part of interest expense. The

translation gains and losses at issue are related to the cost of

acquiring and maintaining debt. These costs are related to production

and are properly included in the calculation of financing expense as a

part of COP. In previous cases, we have found that translation losses

represent an increase in the actual amount of cash needed by

respondents to retire their foreign currency denominated loan balances.

(See Notice of Final Determination of Sales at Less than Fair Value:

Fresh Cut Roses from Ecuador, 24 FR 7019, 7039, (Feb. 6, 1995).)

Furthermore, the Department has amortized these expenses over the

remaining life of the companies' loans in the past. (See Notice of

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

Concrete Reinforcing Bars From Turkey, 62 FR 9737, 9743, (March 4,

1997).) We have verified deferred foreign exchange translation gains

and losses for both respondents. See Samsung Cost Verification Report

and Hyundai Cost Verification Report. To reasonably reflect the cost of

producing and selling the subject merchandise, it is necessary that the

respondents' cost reflect the additional financial burden represented

by the additional cash need to retire foreign currency denominated

loans. Therefore, for the final determination, the Department amortized

deferred foreign exchange translation gains and losses over the average

remaining life of the loans on a straight-line basis and included the

amortized portion in net interest expense.

Comment 5: CEP Offset. The petitioner contends that the Department

should make no CEP offset adjustment for any respondent for purposes of

the final determination. The petitioner asserts that the Department's

practice of determining the number and comparability of levels of trade

after making all adjustments to CEP, but before adjusting NV, makes CEP

offsets virtually automatic. According to the petitioner, under both

the plain terms of

[[Page 8941]]

the statute and the intent of Congress, such adjustments should be the

exception, not the rule. The petitioner notes that it raised the same

argument in another case and that the issue is now before the courts.

(See Dynamic Random Access Memory Semiconductors of One Megabit or

Above From the Republic of Korea; Final Results of Antidumping Duty

Administrative Review 62 FR 965 (Jan. 7, 1997) (``DRAMs 1994-1995

review'') .

Hyundai disagrees, noting that the statute requires that a level of

trade analysis be performed only after adjustment is made for U.S.

selling expenses. Hyundai further states that the Department has

rejected similar arguments made in the second and third review of

DRAMS. As support for this proposition, Hyundai cites to the second

review, where the Department stated that the level of trade will be

evaluated based on the price after adjustments are made under section

772(d) of the Tariff Act. Hyundai maintains there is nothing new in the

law or the facts of this investigation to suggest that the Department

should reexamine its practice of beginning its level of trade analysis

after adjusting for U.S. expenses

Samsung also disagrees with the petitioners' argument that the

Department should not grant the CEP offset. Samsung cites to the second

and third reviews of DRAMs in which the Department rejected identical

arguments by the petitioner and stated ``while the petitioner is

correct in noting that the starting price for calculating the

Constructed Export Price (CEP) is that of the subsequent resale by the

affiliated importer to an unaffiliated buyer, the Act, as amended by

the URAA, and the SAA clearly specifies that the relevant sale for our

level of trade (LOT) analysis is the CEP transaction between the

exporter and the importer.'' (See Dynamic Random Access Memory from

Korea, 62 FR 39809, 39821 (July 24, 1997) (``DRAMs 1995-1995 review'').

Samsung states that the statute, the SAA, the Department's regulations

and the Department's practice in every case decided under the new law

all mandate that in making the LOT determination, the Department should

compare normal value to CEP.

Samsung also claims that the new regulations issued by the

Department formally codify this policy. 19 CFR 351.412 (c) (ii) states

that for purposes of the LOT analysis, the Department will ``[i]n the

case of constructed export price, the export price as adjusted under

section 772(d) of the Act.'' (See Antidumping Duties; Countervailing

Duties; Final Rule, 62 FR 27296, 27414 (May 19, 1997). Samsung contends

that the SAA instructs the Department ``to establish normal value based

on home market sales at the same LOT as the CEP or the starting price

for the export price''. Samsung asserts that the petitioner has failed

to offer any evidence that the Department's level of trade analysis is

incorrect and should disregard the petitioner's argument.

Samsung further claims that for CEP sales, use of the starting

price, which is the sale to the first unaffiliated customer in the

United States, is inappropriate because the starting price of CEP sales

includes expenses associated with economic activity in the United

States. .

DOC Position. The statute and SAA both support analyzing the level

of trade of CEP sales at the constructed export level price, i.e. after

expenses associated with economic activities in the United States have

been deducted pursuant to section 772(d) of the Act. As we stated in

the second DRAMs review, the Department has:

* * * Consistently stated that, in those cases where a level of

trade comparison is warranted and possible, then for CEP sales the

level of trade will be evaluated based on the price after

adjustments are made under section 772(d) of the Act (see Large

Newspaper Printing Presses and Components Thereof, Whether Assembled

or Unassembled, From Japan; Notice of Final Determination of Sales

at Less Than Fair Value, 61 FR 38139, 38143 (July 23, 1996). In

every case decided under the revised antidumping statute, we have

consistently adhered to this interpretation of the SAA and of the

Act. See, e.g., Aramid Fiber Formed of Poly Para-Phenylene

Terephthalamide from the Netherlands; Preliminary Results of

Antidumping Duty Administrative Review, 61 FR 15766, 15768 (April 9,

1996); Certain Stainless Steel Wire Rods from France; Preliminary

Result of Antidumping Duty Administrative Review, FR 8915, 8916

(March 9, 1996); Antifriction Bearings (Other Than Tapered Roller

Bearings) and parts Thereof from France, et al., Preliminary Results

of Antidumping Duty Administrative Review, 61 FR 25713, 35718-23

(July 8, 1996)'.

Dynamic Random Access Memory Semiconductors of One Megabit or

Above From the Republic of Korea; Final Results of Antidumping Duty

Administrative Review 62 FR 965, January 7, 1997).)

Consistent with this practice, we performed our level of trade

analysis of CEP sales only after adjusting for selling expenses

incurred in the United States. Based on our analysis, we determined

that each respondent sold SRAMs during the POI at a level of trade in

the home market which was different, and more advanced, than the level

of trade of the CEP sales of SRAMs in the United States. In addition,

we did not have the data necessary to consider whether a level of trade

adjustment was appropriate.

Because Samsung and Hyundai provided sufficient data to justify CEP

offset adjustments, we have continued to grant these adjustments.

Comment 6: Scope of the Investigation. The petitioner argues that

the Department should clarify that the scope of the order on SRAMs from

Korea includes the SRAM content of motherboards for personal computers.

The petitioner contends that if SRAMs incorporated on motherboards are

not included in the scope of the order, the respondents will shift a

significant volume of SRAMs into the production of motherboards in

Korea that are destined for the United States, thereby avoiding paying

duties on the SRAMs.

In addition, argues the petitioner, while motherboards viewed as a

whole may be considered to fall within a class or kind of merchandise

separate from SRAMs, the placement of SRAMs on a motherboard does not

diminish their separate identity or function, and should not insulate

them from antidumping duties. The petitioner contends that its position

is supported by: (1) The Department's practice regarding combined or

aggregated products; (2) analogous principles of Customs Service

classification; and (3) the Department's inherent authority to craft an

antidumping order that forestalls potential circumvention of an order.

The petitioner also argues that the Customs Service can administer,

without undue difficulty, an antidumping duty order that covers SRAMs

carried on non-subject merchandise.

At the public hearing held by the Department, the petitioner

asserted that there are fundamental differences between the scope

language in the DRAMs Final Determination and the scope language in

this investigation that distinguish the two cases. The petitioner first

argues distinguishes this investigation from the DRAMs Final

Determination, because in this case there ``is no limitation to the

function of memory.'' See January 16, 1998, Hearing on SRAMs from

Korea, Transcript dated January 22, 1998, at page 225. The petitioner

further argues that, in the DRAM case the function of the product was

memory, which is not the case in this investigation. See January 16,

1998, Hearing on SRAMs from Korea, Transcript dated January 22, 1998,

at page 225.

IDT and Cypress agree with the petitioner, arguing that SRAMs on a

motherboard are no less SRAMs than

[[Page 8942]]

those imported separately and that the Department's failure to cover

such imports would provide an incentive to foreign SRAM producers to

shift their sales to motherboard producers in Taiwan and elsewhere.

Hyundai, Motorola, Compaq, and Digital opposed the petitioner's

position. Compaq, and Digital argue that the petitioner's circumvention

concerns are unfounded. They note that the Department determined in the

DRAMs Final Determination that DRAMs physically integrated with the

other components of a motherboard in a manner that made them part of an

inseparable amalgam (i.e., a motherboard) posed no circumvention risk

and that the same holds true in this case.

In addition, Compaq and Digital argue that, contrary to the

petitioner's assertion, SRAMs affixed to a motherboard do not retain

their separate functional identities. In this case, SRAMs are

integrated onto motherboards by soldering, are interconnected with

other motherboard elements by intricate electronic circuitry, and

become part of a complex electronic processing unit representing an

inseparable amalgam (i.e., a motherboard) constituting a different

class or kind of merchandise that is outside the scope of the

investigation.

Hyundai disputes petitioner's contention that the memory function

of SRAMs is not altered by the placement of chips on a motherboard.

According to Hyundai, the same statement could be made of any product

installed in a finished product. For example, Hyundai argues that the

Department has not determined that the scope of the antifriction

bearings antidumping duty orders should be extended to include the ball

bearing content of imported automobiles. Finally, Compaq and Digital

argue that the petitioner's proposal is unworkable from an

administrative standpoint, since it would require motherboard

manufacturers to track all SRAMs placed in every motherboard throughout

the world. Compaq and Digital note that they cannot determine the value

of Korea SRAMs incorporated in a particular motherboard. In addition,

Compaq, and Digital argue that the petitioner's proposal would be

unadministrable by the Customs Service because the SRAM content of a

motherboard cannot be determined by physical inspection and because the

petitioner has provided no realistic proposition as to how the Customs

Service might carry out the petitioner's proposal on an entry-by-entry

basis, given the enormous volume of trade in motherboards.

With regard to the petitioner's assertion that the scope of the

language in DRAMs Final Determination is fundamentally different from

the scope language in this investigation, Compaq and Digital argue that

the language is quite similar and that there is no ``doubt that

literally the language in this Notice of Investigation and in the

preliminary referred to certain modules, and those are memory modules,

not any kind of board on which other elements are stuffed.'' See

January 16, 1998, Hearing on SRAMs from Korea, Transcript dated January

22, 1998, at page 203.

DOC Position. We disagree with the petitioner. The petitioner's

argument that the scope of the investigation as defined in the

preliminary determination should be interpreted to encompass the SRAM

content of motherboards is unpersuasive for three basic reasons. First,

the SRAM content of motherboards (when affixed to the motherboard) was

not expressly or implicitly referenced in the scope language used, to

date, in this investigation. Second, just as we found in the DRAMs

Final Determination, the petitioner's claims about potential

circumvention of the order are groundless. Third, it is not appropriate

for an antidumping duty order to cover the input content of a

downstream product. As the Department found in DRAMS Final

Determination, a case in which a nearly identical proposal was rejected

by the Department, when a DRAM is physically integrated with a

motherboard, it becomes a component part of the motherboard (an

inseparable amalgam). As there has been no request to include

motherboards within the scope of this investigation, the SRAM content

of motherboards (when physically integrated with the motherboard)

cannot be covered.

As to the first point, we disagree with the petitioner's assertion

that the differences between the scope language in DRAMs From Korea and

the language in this case are so fundamental that the differences can

be interpreted to mean that SRAMs soldered onto motherboards are

included within the scope of this investigation. The SRAM scope

language relied upon by the petitioner includes within the scope of

this investigation ``other collection[s] of SRAMs;'' as the petitioner

notes in its argument, this refers specifically to modules whether

mounted or unmounted on a circuit board. There is similar scope

language in DRAMs From Korea. In that case, we interpreted the language

as not extending to modules which contain additional items which alter

the function of the module to something other than memory. Such an

interpretation, applied to this case, indicates clearly that the SRAM

content of motherboards is not within the scope of this investigation.

We found in DRAMs From Korea that memory boards whose sole function

was memory were included within the definition of memory modules;

however, we further concluded that other boards, such as video graphic

adapter boards and cards were not included because they contained

additional items which altered the function of the modules to something

other than memory. Consequently, at the time of the final

determination, we added language to the DRAMs From Korea scope in order

that these other, enhanced, boards be specifically excluded. Since the

issue of such enhanced boards was not raised in this case, we did not

find it necessary to include an express exclusion for such products.

Thus, the absence of such language should not be interpreted to permit

the inclusion of products which do not fall under the rubric of ``other

collections of SRAMs.''

As to the second point, the petitioner argued in DRAMS Final

Determination that unremovable DRAMs on motherboards should be included

in the scope of the order to counter the potential for circumvention of

the order. We stated in that determination that we considered it

``infeasible that a party would import motherboards with the intention

of removing the integrated DRAM content and, therefore, consider it

unreasonable to expect that any order arising from this investigation

could be evaded in such a fashion.'' (See DRAMS Final Determination,

Case Number A-580-812, ``Memorandum to Joseph Spetrini from Richard

Moreland'', dated March 15, 1993, at page 13). We find it equally

infeasible that an importer would import SRAMs soldered onto a

motherboard for the sole purpose of removing those SRAMs for individual

resale thereby circumventing the antidumping duty order.

As to the third point, our statute does not provide a basis for

assessing duties on the input content of a downstream product. See

Senate Rep. 100-71, 100th Congress, 1st Sess. 98 (1987) (in which the

report notes both the general rule and the ``major input'' exception,

which applies only in an investigation or review of a downstream

product). Thus, where an SRAM loses its separate identity by being

incorporated into a downstream product, and where the investigation

covers SRAMs but does not cover the downstream product, there can be no

basis for assessing

[[Page 8943]]

duties against the SRAMs incorporated in the downstream product.

For a more detailed discussion regarding this issue, see the

Memorandum to Louis Apple from the Team, dated February 13, 1998.

Comment 7: Calculation of CV Profit. Petitioner maintains that the

Department erroneously included in its calculation of CV profit sales

that failed both prongs of the cost test. Samsung disagrees and argues

that the Department, for the purposes of calculating CV profit, should

not have disregarded sales below costs which have not otherwise been

excluded from the calculation of normal value. Furthermore, petitioner

argues that the Department should revise its computer program to ensure

that only sales that are above quarterly costs at the time of sale are

included in the calculation. According to petitioner, sales that fail

the cost test, but pass the ``cost recovery test'' under section

773(b)(2)(D), are deemed to have zero profit even if they are not

excluded from normal value. As a result, an erroneous CV profit rate

was calculated by the Department. Therefore, the Department should

correct the programming language.

Samsung asserts that the Department inadvertently included sales of

models that were found to be one hundred percent below costs in the

calculation of CV profit. It argues that the Department's longstanding

practice is to exclude from the pool of sales used to calculate CV

profit only those sales which have been disregarded in the cost test.

DOC Position. We agree with Samsung. It is the Department's

practice to exclude any home market sales that failed the cost test

from the pool of sales used to calculate CV profit. According to the

SAA, the Department ``will base amounts for SGA and profit only on

amounts incurred and realized in connection with sales in the ordinary

course of trade . . . Commerce may ignore sales it disregards as a

basis for normal value, such as those sales disregarded because they

are made at below-cost prices.'' See SAA at 839. The Department has

revised its preliminary calculations to include in the CV profit only

those sales which have not been disregarded as the basis for normal

value.

Company Specific Issues

A. Petitioner

Comment 1: Untimely Clerical Error Allegation. Petitioner alleges

that the Department accepted an untimely clerical error submission from

Samsung. Samsung's clerical error allegation was that the Department

inadvertently set inventory carrying costs to zero.

DOC Position. We agree with the petitioner. Samsung's submission

was dated after the deadline to submit any allegations for clerical

errors pursuant to the preliminary determination. However, the

Department had already determined that inventory carrying cost had been

set to zero prior to the Samsung submission. Therefore, for this final

determination, we have revised the computer program, accordingly.

Comment 2: Cost Test Methodology. Petitioner claims that the

Department inappropriately compared U.S. models to the next most

similar model in the home market when all of the home market sales of

the identical or most similar product made during a given quarter

failed the cost test. Petitioner claims that if all of the sales made

during a given quarter fail the cost test, the Department should make

comparisons to CV, rather than going to the next most similar model,

even if more than 80 percent of the sales of that home market model

were made above cost during the POI.

DOC Position. Section 773(b)(1) instructs the Department to

disregard sales below cost when they ``(A) have been made within an

extended period of time in substantial quantities; and (B) were not at

prices which permit recovery of all costs within a reasonable period of

time.'' To measure cost recovery of each below-cost sale, the

Department compares each below-cost price to the annual cost of

production of that model, and disregards those sales whose price is

lower than the annual cost of production. The Department defines the

extended period of time and the cost recovery period as the POI. To

measure whether sales have been made in substantial quantities over an

extended period of time, the Department determines the quantity of

sales that were made below cost during the POI. If 80 percent or more

of the sales during the POI were made above cost, then the Department

uses all sales, above and below cost, to determine normal value. If

less than 80 percent of the sales during the POI were above cost, then

the Department uses only the above-cost sales to determine normal

value.

Therefore, in cases where comparisons are made on a POI-basis, the

Department calculates a weighted-average normal value for all models

that had at least one sale above cost during the POI. It resorts to CV

only when there are no sales of identical or similar merchandise or

when all sales of a comparison product fail the cost test.

Comment 3: Depreciation Ratio Adjustment. Petitioner claims that

the Department applied the wrong depreciation ratio adjustment for

components to Samsung's modules.

DOC Position. We agree with petitioner. We inadvertently applied

the wrong depreciation ratio and therefore, have made the adjustment

for the final determination. (See Comment 1.)

Comment 4: Overwritten Data. Petitioner alleges, and Hyundai and

Samsung concur, that the cost test results are applied to the original

sales database in such a way that the cost test data set

inappropriately overwrites the data in the original data set.

DOC Position. We agree with petitioner, Hyundai and Samsung, and

have made the appropriate corrections to our calculations.

Comment 5: Adjustment to Fabrication Costs. Petitioner argues that

the evidence on the record clearly has demonstrated that Samsung

shifted costs from the production of SRAMs to the production of non-

subject merchandise. Therefore, petitioner requests that the Department

make an adjustment to Samsung's fabrication costs. Petitioner claims

the verification team missed the demonstrable under-reporting of costs

of the SRAMs. The team did not do the following: (1) Verify the entire

production of a sample cost center; (2) ask to see the entire

production quantities of subject and non-subject merchandise; (3)

examine all costs; (4) determine if the allocation of costs between

subject and non-subject merchandise was reasonable. Petitioner also

developed a cost model to demonstrate how Samsung's costs were

allocated away from SRAMs to uncovered merchandise. In a parallel

argument, petitioner also alleges that Samsung was unable to provide

contemporaneous ``written'' records of its non letter-of-credit home

market sales. Although it contained price and quantity information,

Samsung's computer-generated sales listing does not constitute a

verifiable document and permits the manipulation of past prices.

Samsung argues that it did not shift costs from SRAMs to non-

subject merchandise. Citing the verification report, Samsung argues

that the Department did the following: (1) Examined and differentiated

between the allocation of costs for SRAMs and non-subject merchandise;

(2) reconciled the allocation of the processing costs between subject

and non-subject merchandise using actual data from the cost system and

the cost submission; (3) tied the reported product costs to the

financial statements; (4) tested the allocations and the standard

machine and labor hours; and (5) summarized

[[Page 8944]]

that all costs were reconciled to the financial statements.

DOC Position. We agree with Samsung and have not made an adjustment

to fabrication costs. Regarding Samsung's costs, the Department

conducted an extensive verification. See Samsung Cost Verification

Report. Moreover, contrary to the petitioner's allegation, the

Department verified the entire cost of several cost centers as well as

production quantities. We determined that the allocation of costs

between subject and non-subject merchandise was reasonable, as based on

Samsung's actual accounting records. We examined these issues during

the overall cost reconciliation and the verification of major cost

components, such as materials, labor, and overhead. Furthermore, the

Department reconciled the total accumulated costs for each cost center

to the total cost of manufacturing for Samsung. Therefore, the

Department fully verified and reconciled all reported costs.

In regard to petitioner's cost model, we note that it was based on

three faulty assumptions: (1) That all models produced on a given line

have the same processing times; (2) that all models produced on the

same line have the same yields; and (3) that the total products

processed on a given line will equal the rated capacity for the

product. The Department examined standard times and yields in detail

and verified that there are differences among products. Also, actual

throughput will vary from rated capacity depending on the operation and

utilization of the resources of the line. For these reasons, we do not

find that petitioner's cost model provides a substantial basis for

disregarding our verification findings

With respect to the sales verification allegation, the Department

examined at length Samsung's computerized record keeping system. The

fact that Samsung did not state the price of the merchandise on the

shipping orders is irrelevant. The Department successfully conducted

extensive sales traces on both pre-selected and surprise sales to

verify prices and received voluminous documentation for each sale, from

shipping orders to bank receipts, which were then tracked into the

sales ledgers and then tied to the audited financial statements. This

process was clearly described in the verification report. As noted in

the verification report, the Department found no discrepancies or

omissions in Samsung's reporting. See Samsung Cost Verification Report.

For these reasons, we are not making changes to Samsung's sales

response except as noted elsewhere in this notice.

B. Samsung

Comment 1: Double-Counting of Duty Drawback. Samsung claims that

the Department double-counted the duty drawback for local letter of

credit sales by adding duty drawback to the sales value in the

determination of revenue in the CEP profit calculation. Samsung argues,

that the Department, however, also reduced direct selling expenses,

which were deducted from Korean revenues, by the amount of duty

drawback. As a result, duty drawback was double-counted.

DOC Position. We disagree with Samsung. We did not inadvertently

double-count duty drawback in the calculation for U.S. and home market

revenue.

Comment 2: Use of Consolidated Financial Statements. Samsung argues

that the Department's use of its unconsolidated financial statements

for determining interest expense is appropriate in this case since the

use of the unconsolidated financial statements is consistent with the

DRAMs Final Determination investigation and the first administrative

review of 1992-1994 DRAMs review. It further contends that calculating

the interest expense based on the consolidated financial statements

would distort the interest expense calculation because it is not

possible for Samsung to break out the short-term interest income which

would be used to offset interest expense on the consolidated basis.

However, Samsung maintains that the requisite data is on the record and

has been verified if the Department decides to use the consolidated

financial statements to calculate the interest expense.

DOC Position. We disagree with Samsung. It is a longstanding

Department policy to use consolidated interest expense because this

practice recognizes the fungible nature of invested capital resources

within a consolidated group of companies. See Kaplan, Kamarck and

Parker Cost Analysis under the Antidumping Law, 21 Geo. Wash. J. Int'l

L & Econ., 357, 387 (1988). The Department previously used the

unconsolidated financial statements for the DRAMs investigation and the

first and second reviews because the consolidated financial statements

were not available at that time. For this final determination, we have

used the used the interest expense as recorded in Samsung's

consolidated financial statement.

Comment 3: Guaranty Fees. Samsung maintains it did not include

guaranty fees in its interest expense because these fees were included

in the G&A calculation. If the fees are an interest expense, Samsung

argues that they should be deducted from G&A to avoid double-counting.

DOC Position. We have not reclassified guaranty fees from G&A

expense to interest expense as it would have no impact on the submitted

costs.

Comment 4: Revised Interest Expense. Samsung claims that the

Department erroneously calculated the revised interest expense as a

percentage of the variable TOTAL, which includes the cost of

manufacturing (COM), G&A and R&D. It maintains that the revised

interest adjustment factor was based on COGS which does not include G&A

or R&D, and, therefore, the revised interest factor should be

calculated as a percentage of COM.

DOC Position. We agree and have revised our calculations in our

computer program

Comment 5: CV Profit Rate Methodology. Samsung claims that the

Department erroneously calculated the overall CV profit rate by first

computing the transaction specific profit rate for each home market

sale, then weight-averaging the transaction specific rates based on

sale quantity to compute the overall CV profit rate. It claims that the

Department's standard practice is to calculate the CV profit rate by

dividing the total home market profit by the total home market cost to

derive a profit ratio. It quotes Certain Stainless Steel Wire Rods from

France, 62 FR 7206, 7209 (February 18, 1997) and Certain Hot-Rolled

Lead and Bismuth Carbon Steel Products from the United Kingdom, 61 FR

56514 (November 1, 1996), as saying that the method used in the

preliminary determination seriously distorts the dumping calculation.

For the final determination, the Department should use its normal

methodology for calculating CV profit.

Petitioner states that it is more appropriate to calculate CV

profit using the methodology in the preliminary determination. Further,

petitioner notes that the two cases cited by Samsung did not make a

judgement as to the general applicability of the CV profit methodology.

Instead, the Department in these two above-cited cases only

acknowledged that it was changing the programming language and not

revising its overall CV profit methodology.

DOC Position. We agree with Samsung. For this final determination,

we have used the normal methodology used to calculate the CV profit

rate for both Samsung and Hyundai. It measures more accurately the

actual profit for sales of the foreign like product made in the

ordinary course of trade. Therefore, for the final determination, the

CV profit ratio was calculated by dividing total

[[Page 8945]]

home market profit by total home market costs, for each respondent, as

both respondents had above-cost sales in the home market.

C. Hyundai

Comment 1: CV Profit on a Quarterly Basis. Hyundai argues that the

Department must calculate CV profit on no longer than a quarterly

basis. For the purposes of the preliminary determination, the

Department recognized that prices during the POI declined significantly

and, therefore, used quarterly data for the comparisons of prices and

sales below cost test. However, the Department did not calculate profit

for CV on a quarterly basis. Hyundai further argues that declining

prices, in turn affect the profit rates earned on sales during the

period of investigation. Since the antidumping comparison is based on

matching comparable products in a comparable period, the Department

should also apply the appropriate quarterly profit rates in the

calculation of CV.

Petitioner contends that the Department properly used the annual

profit figure in the CV calculation. The annual profit rate is the

correct figure since it reflects not only the quarterly cost of

manufacture but also those annual costs, such as general and

administrative and financing expenses, which are non-recurring and must

be calculated on an annual basis to ensure that all costs are captured

in the cost of production.

DOC Position. We agree with the petitioner. The Department applies

the average profit rate for the POI or period of review (POR) even when

the cost calculation period is less than a year. See, e.g., Certain

Fresh Cut Flowers From Colombia; Final Results and Partial Rescission

of Antidumping Duty Administrative Review, 62 FR 53287, 53295 (Oct. 14,

1997) and Silicon Metal from Brazil; Final Results of Antidumping Duty

Administration Review, 61 FR 46763, 46774 (Sept. 5, 1996). The

calculation of profit as an average for the period of investigation or

review is implied by the statute's guidance as to the recovery of cost

test. Section 773(e)(2)(A) of the Act mandates that the Department use

the actual amounts for profit in connection with the production and

sale of the foreign like product in the ordinary course of trade.

Moreover, section 773(b)(2)(D) of the Act directs us to perform the

recovery of cost test on a POI basis. Therefore, in order to be

consistent we must calculate profit on the same basis as the basis used

to determine whether sales were made in the ordinary course of trade.

Comment 2: Reversal of Bad Debt. Hyundai contends that the reversal

of bad debt should be used to offset G&A expense. Hyundai submitted a

revised G&A calculation at verification to reflect this reversal of bad

debt. Hyundai states that the reversal of the allowance for bad debt is

classified under non-operating income in its financial statements.

DOC Position. We agree with Hyundai. The allowance for bad debt is

properly classified as a non-operating general expense. The revised G&A

calculation was properly submitted prior to the beginning of

verification. We have made the appropriate changes for the final

determination.

D. LG Semicon

Comment 1: Facts Available. LG argues that the Department should

not use a facts available rate based on information supplied by the

petitioner that has been determined to be inaccurate in the course of

the Department's investigation. LG contends that because the petition

was based on Samsung's data, and since Samsung received an estimated

margin in the preliminary determination significantly different than

the petition rate, the petition data cannot be used as facts available.

LG maintains that to assign it a rate of 55.36 percent nullifies the

subsequent investigation which led to Samsung having a 1.59 percent

margin. LG cites the case of D & L Supply Co. v United States 113 F.3d

1220 (1997), in which the Federal Circuit ruled that the Department

should use the best information provisions of the Act ``to determine

current margins as accurately as possible.''

Petitioner contends that the Department properly assigned a facts

available rate to LG based on corroborated information from the

petition since LG refused to participate in the investigation. The

Department should not give preferential treatment to LG, a non-

cooperative respondent, by assigning as facts available a margin

calculated for a participating respondent. Petitioner disputes LG's

contention that the petition data was ``seriously flawed.'' Petitioner

argues that the Department compared Samsung's actual prices with the

petitioner's home market and U.S. price quotes, and found them

sufficiently ``close.'' LG had full opportunity to present its own data

and receive its own calculated dumping margin based on that data if it

disagreed with the data presented in the petition. LG chose not to

cooperate.

DOC Position. We agree with petitioner. We have assigned an adverse

facts available rate due to LG's refusal to provide information

pursuant to the investigation. Section 776(a)(2) of the Act provides

that if an interested party: (1) Withholds information that has been

requested by the Department; (2) fails to provide such information in a

timely manner or in the form or manner requested, subject to

subsections 782(c)(1) and (e) of the Act; (3) significantly impedes a

determination under the antidumping statute; or (4) provides such

information but the information cannot be verified, the Department

shall use the facts otherwise available in reaching the applicable

determination. At the time of LG's withdrawal from the investigation,

the Department did not consider LG to be an insignificant supplier to

the U.S. market and did not excuse the company from responding to the

questionnaire. Because LG failed to respond to the Department's

questionnaire, we recommend using the facts otherwise available to

calculate their dumping margins.

When a party fails to cooperate to the best of its ability, the

Department may make an adverse inference when selecting from the facts

otherwise available, and pursuant to Section 776(b) of the Act such an

inference may be based on information in the petition. Section 776(c)

of the Act provides that, when the Department relies on secondary

information (such as the petition) in using the facts otherwise

available, it must, to the extent practicable, corroborate that

information from independent sources that are reasonably at its

disposal. When analyzing the petition, the Department reviewed all of

the data the petitioner relied upon in calculating the estimated

dumping margins, and adjusted those calculations where necessary. These

estimated dumping margins were based on a comparison of CV to U.S.

price, the latter of which was based on price quotations offered by

Samsung. For purposes of corroboration, the Department re-examined the

price information provided in the petition in light of information

developed during the investigation and found that it had probative

value. See September 23, 1997, Memorandum from the Team to Tom Futtner.

In this case, the Department corroborated the sales information

contained in the petition by comparing it to Samsung's actual data. The

Department found that the petition prices reasonably reflected

Samsung's actual reported prices during this investigation. While

Samsung's calculated, weighted-average margin differs from the

weighted-average

[[Page 8946]]

margin based on the petition information, that difference is a result

of the more complete data-set provided by Samsung. Within that data-

set, we have confirmed that some of Samsung's product-specific margins

exceed the 55.36 percentage rate calculated in the petition. Thus,

because the petition rate is not contradicted by the evidence gathered

during the investigation, we continue to find it of probative value in

drawing an adverse inference concerning dumping by LG.

LG's reliance on D&L Supply is misplaced. D&L Supply dealt with a

situation in which the Department attempted to rely on a calculated

margin from a prior review when that calculated margin had been revised

as a result of litigation. The Federal Circuit held that continued use

of the judicially invalidated rate was erroneous. That situation is

significantly different from the present case. In this case, the

petition was based on data from one respondent and the Department has

calculated a different weighted-average dumping margin for that

respondent. A petition rate is normally based on a limited selection of

the products and prices at which subject merchandise has been sold

during the period of the investigation. Only by participation in the

investigation will the Department obtain, for each individual

respondent, more complete data on the products and prices sold by the

respondents throughout the period of investigation. Based on the

complete universe of products and prices for each respondent, the

Department calculates a weighted-average dumping margin for the

respondent. Of course, each respondent's products and prices will be

different and, typically, different from that contained in the

petition. However, it is only by cooperating in the investigation that

the Department obtains the data to determine the extent to which a

respondent's product-mix and price-mix differs from the information

contained in the petition. Finally, LG argues that Samsung's reported

U.S. and home market prices were different from those used in the

petition. It further maintains that had Samsung's reported prices been

used, the result would have lowered the margin. However, the prices

cited in the petition represented a reasonable estimate of Samsung's

prices based on the information available at the time the petition was

filed. Corroboration of the petition does not require the substitution

if actual reported numbers where the Department finds that the

information originally submitted has probative value. Because the

Department has found that the petition prices were probative of the

level of dumping which may have taken place during the period of

investigation, we have continued to rely on it in this final

determination.

Continuation of Suspension of Liquidation

In accordance with section 733(d)(1) and 735(c)(4)(B) of the Act,

we are directing the Customs Service to continue to suspend liquidation

of all entries of SRAMs from Korea that are entered, or withdrawn from

warehouse, for consumption on or after October 1, 1997 (the date of

publication of the preliminary determination in the Federal Register).

The Customs Service shall continue to require a cash deposit or posting

of a bond equal to the estimated amount by which the normal value

exceeds the U.S. price as shown below. These suspension of liquidation

instructions will remain in effect until further notice. The weighted-

average dumping margins are as follows:

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

Margin

Manufacturer/producer/exporter percentage

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

Samsung Electronics Co. Ltd................................ 1.00

Hyundai Electronics Co. Ltd................................ 5.08

LG Semicon Co. Ltd......................................... 55.36

All others rate............................................ 5.08

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

ITC Notification

In accordance with section 735(d) of the Act, we have notified the

International Trade Commission (ITC) of our determination. As our final

determination is affirmative, the ITC will, within 45 days, determine

whether these imports are materially injuring, or threaten material

injury to, the U.S. industry. If the ITC determines that material

injury, or threat of material injury does not exist, the proceeding

will be terminated and all securities posted will be refunded or

canceled. If the ITC determines that such injury does exist, the

Department will issue an antidumping duty order directing Customs

officials to assess antidumping duties on all imports of the subject

merchandise entered for consumption on or after the effective date of

the suspension of liquidation.

This determination is published pursuant to section 735(d) of the

Act.

Dated: February 13, 1998.

Robert S. LaRussa,

Assistant Secretary for Import Administration.

[FR Doc. 98-4537 Filed 2-20-98; 8:45 am]

BILLING CODE 3510-DS-P