[Federal Register: July 17, 2003 (Volume 68, Number 137)]
[Notices]
[Page 42386-42389]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17jy03-42]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-351-837]
Notice of Preliminary Determination of Sales at Less Than Fair
Value: Prestressed Concrete Steel Wire Strand from Brazil
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of Preliminary Determination of Sales at Less Than Fair
Value.
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EFFECTIVE DATE: July 17, 2003.
FOR FURTHER INFORMATION CONTACT: David Layton at (202) 482-0371, or
Monica Gallardo at (202) 482-3147; AD/CVD Enforcement Office V, Group
II, Import Administration, International Trade Administration, U.S.
Department of Commerce, 14th Street and Constitution Avenue, NW,
Washington, DC 20230.
SUPPLEMENTARY INFORMATION:
Preliminary Determination
We preliminarily determine that prestressed concrete steel wire
strand (PC strand) from Brazil is being sold, or is likely to be sold,
in the United States at less than fair value (LTFV), as provided in
section 733 of the Tariff Act of 1930, as amended (the Act). The
preliminary margin assigned to Belgo Bekaert Arames, S.A. (BBA) is
based on adverse facts available (AFA). The estimated margin of sales
at LTFV is shown in the Suspension of Liquidation section of this
notice.
Interested parties are invited to comment on this preliminary
determination. We will make our final determination not later than 75
days after the date of this preliminary determination.
Case History
This investigation was initiated on February 20, 2003.\1\ See
Notice of Initiation of Antidumping Duty Investigations: Prestressed
Concrete Steel Wire Strand From Brazil, India, the Republic of Korea,
Mexico, and Thailand, 68 FR 9050 (February 27, 2003) (Initiation
Notice). Since the initiation of the investigation, the following
events have occurred:
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\1\ The petitioners in this investigation are American Spring
Wire Corp., Insteel Wire Products Company, and Sumiden Wire Products
Corp.
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The Department of Commerce (the Department) set aside a period for
all interested parties to raise issues regarding product coverage. See
Initiation Notice, 68 FR at 9050. No comments were received from
interested parties in this investigation.
The Department issued a letter on March 7, 2003, to interested
parties in all of the concurrent PC strand antidumping investigations,
providing an opportunity to comment on the Department's proposed model
match characteristics and its hierarchy of characteristics. The
petitioners submitted comments on March 18 and March 20, 2003. The
Department also received comments on model matching from respondents in
the concurrent investigation involving Mexico on March 18, 2003. These
comments were taken into consideration by the Department in developing
the model matching characteristics and hierarchy for all of the PC
strand antidumping investigations.
On March 17, 2003, the United States International Trade Commission
(ITC) preliminarily determined that there is a reasonable indication
that imports of the products subject to this investigation are
materially injuring an industry in the United States producing the
domestic like product. See Prestressed Concrete Steel Wire Strand From
Brazil, India, Korea, Mexico, and Thailand, 68 FR 13952 (March 21,
2003).
On April 4, 2003, the Department issued its antidumping
questionnaire to the Brazilian respondent, BBA, specifying, that the
response to section A would be due on April 25, 2003, and that the
responses to sections B, C, and D would be due May 12, 2003\2\. On
April 28, 2003, BBA confirmed that it would not participate in the
investigation. See Memorandum from David Layton, International Trade
Compliance Analyst, to the File, Re: Telephone Conversation with
Counsel for Brazilian Producer Belgo Bekaert Arames S.A. Concerning
Participation, dated April 28, 2003. BBA provided no further
elaboration, nor did it suggest alternatives to meet the Department's
requirements pursuant to 782(c) of the Act. Id.
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\2\ Section A of the questionnaire requests general information
concerning a company's corporate structure and business practices,
the merchandise under investigation that it sells, and the manner in
which it sells that merchandise in all of its markets. Section B
requests a complete listing of all home market sales or, if the home
market is not viable, of sales in the most appropriate third-country
market (this section is not applicable to respondents in non-market
economy cases). Section C requests a complete listing of U.S. sales.
Section D requests information on the cost of production of the
foreign like product and the constructed value of the merchandise
under investigation. Section E requests information on further
manufacturing.
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Selection of Respondents
Section 777A(c)(1) of the Act directs the Department to calculate
individual dumping margins for each known exporter and producer of the
subject merchandise. Where it is not practicable to examine all known
producers/exporters of subject merchandise, section 777A(c)(2) of the
Act permits the Department to investigate either: (1) a sample of
exporters, producers, or types of products that is statistically valid,
based on the information available at the time of selection; or (2)
exporters and producers accounting for the largest volume of the
subject merchandise that can reasonably be examined.
During the period of investigation (POI), only BBA was identified
as a producer /exporter of subject merchandise from Brazil. In an April
1, 2003, conversation with counsel to BBA, it was confirmed that BBA is
the sole producer of PC strand in Brazil and that BBA is a subsidiary
of the Companhia Siderurgica Belgo-Mineira (Belgo-Mineira) which holds
majority shares in BBA. See Memorandum from David Layton, International
Trade Compliance Analyst, to the File dated April 1, 2003. Therefore,
we selected BBA as the sole respondent in the investigation of PC
strand from Brazil. See Memorandum from Daniel O'Brien, Import
Compliance Specialist, to Gary Taverman, Director, Office 5, RE:
[[Page 42387]]
Selection of Respondents, dated April 4, 2003.
Period of Investigation
The period of investigation (POI) is January 1, 2002, through
December 31, 2002. This period corresponds to the four most recent
fiscal quarters prior to the month of filing of the petition (i.e.,
January, 2003) involving imports from a market economy, and is in
accordance with our regulations. See 19 CFR 351.204(b)(1).
Scope of Investigation
For purposes of this investigation, PC strand is steel strand
produced from wire of non-stainless, non-galvanized steel, which is
suitable for use in prestressed concrete (both pretensioned and post-
tensioned) applications. The product definition encompasses covered and
uncovered strand and all types, grades, and diameters of PC strand.
The merchandise under investigation is currently classifiable under
subheadings 7312.10.3010 and 7312.10.3012 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 merchandise under investigation is dispositive.
Facts Available
For the reasons discussed below, we determine that the use of AFA
is appropriate for the preliminary determination with respect to BBA.
A. Use of Facts Available
Section 776(a)(2) of the Act provides that, if an interested party
withholds information requested by the Department, fails to provide
such information by the deadline or in the form or manner requested,
significantly impedes a proceeding, or provides information which
cannot be verified, the Department shall use, subject to sections
782(d) and (e) of the Act, facts otherwise available in reaching the
applicable determination. Section 782(d) of the Act provides that if
the Department determines that a response to a request for information
does not comply with the Department's request, the Department shall
promptly inform the responding party and provide an opportunity to
remedy the deficient submission. Section 782(e) of the Act further
states that the Department shall not decline to consider submitted
information if all of the following requirements are met: (1) the
information is submitted by the established deadline; (2) the
information can be verified; (3) the information is not so incomplete
that it cannot serve as a reliable basis for reaching the applicable
determination; (4) the interested party has demonstrated that it acted
to the best of its ability; and (5) the information can be used without
undue difficulties.
As discussed above, BBA failed to respond to the Department's
request for information, thus the curative provisions of sections
782(d) and (e) of the Act are not applicable. Specifically, the
information that BBA failed to report is critical for calculating
preliminary dumping margins, therefore, the Department must resort to
facts otherwise available to ensure that BBA does not obtain a more
favorable result than it would by responding to the Department's
request for information. The failure of BBA to respond significantly
impedes this process because the Department cannot accurately determine
a margin for this party. Thus, in reaching our preliminary
determination, pursuant to sections 776(a)(2)(A), (B), and (C) of the
Act, we have based BBA's margin rate on facts available.
B. Application of Adverse Inferences for Facts Available
In applying facts otherwise available, section 776(b) of the Act
provides that the Department may use an inference adverse to the
interests of a party that has failed to cooperate by not acting to the
best of its ability to comply with the Department's requests for
information. See, e.g., Notice of Final Determination of Sales at Less
Than Fair Value and Final Negative Critical Circumstances: Carbon and
Certain Alloy Steel Wire Rod from Brazil, 67 FR 55792, 55794-96 (August
30, 2002). Adverse inferences are appropriate ``to ensure that the
party does not obtain a more favorable result by failing to cooperate
than if it had cooperated fully.'' See Statement of Administrative
Action accompanying the Uruguay Round Agreements Act, H.R. Rep. No.
103-316, at 870 (1994) (SAA). Furthermore, ``{a{time} ffirmative
evidence of bad faith on the part of a respondent is not required
before the Department may make an adverse inference.'' See Antidumping
Countervailing Duties: Final Rule, 62 FR 27296, 27340 (May 19, 1997).
In this case, BBA has failed to cooperate to the best of its ability by
failing to respond to the Department's antidumping questionnaire. In
addition, the company did not make an effort to provide an explanation
for its failure to respond, or proposed an alternate form of submitting
the required data. These omissions constitute a failure on the part of
this company to cooperate ``to the best of its ability to comply with a
request for information'' by the Department within the meaning of
section 776 of the Act. Therefore, the Department has preliminarily
determined that in selecting from among the facts otherwise available,
an adverse inference is warranted. See, e.g., Notice of Final
Determination of Sales at Less than Fair Value: Circular Seamless
Stainless Steel Hollow Products from Japan, 65 FR 42985, 42986 (July
12, 2000) (the Department applied total AFA where respondent failed to
respond to the antidumping questionnaires).
C. Selection and Corroboration of Information Used as Facts Available
Where the Department applies AFA because a respondent failed to
cooperate by not acting to the best of its ability to comply with a
request for information, section 776(b) of the Act authorizes the
Department to rely on information derived from the petition, a final
determination, a previous administrative review, or other information
placed on the record. See also 19 CFR 351.308(c); SAA at 829-831. In
this case, because we are unable to calculate margins for the
respondent in this investigation, we assign to BBA the highest margin
from the proceeding, which is the highest margin alleged for Brazil in
the petition. See Initiation Notice, 68 FR at 9052.
When using facts otherwise available, section 776(c) of the Act
provides that, when the Department relies on secondary information
(such as the petition) in using facts otherwise available, it must, to
the extent practicable, corroborate that information from independent
sources that are reasonably at its disposal. The SAA clarifies that
``corroborate'' means that the Department will satisfy itself that the
secondary information to be used has probative value. See SAA at 870.
The Department's regulations state that independent sources used to
corroborate such evidence may include, for example, published price
lists, official import statistics and customs data, and information
obtained from interested parties during the particular investigation.
See 19 CFR 351.308(d); see also SAA at 870.
To assess the reliability of the petition margin for the purposes
of this investigation, to the extent appropriate information was
available, we reviewed the adequacy and accuracy of the information in
the petition for both this preliminary determination and during our
pre-initiation analysis. See Office of AD/CVD Enforcement Initiation
Checklist, at 15 (February 20, 2003)
[[Page 42388]]
(Initiation Checklist). Also, as discussed below, we examined evidence
supporting the calculations in the petition to determine the probative
value of the margins in the petition for use as AFA for purposes of
this preliminary determination. In accordance with section 776(c) of
the Act, to the extent practicable, we examined the key elements of the
constructed export price (CEP) and normal value (NV) calculations on
which the margin in the petition was based. See Memorandum from David
Layton and Monica Gallardo, International Trade Compliance Analysts, to
Gary Taverman, Director, Office 5, Re: Corroboration of Data Contained
in the Petition for Assigning Facts Available Rates, dated July 10,
2003 (Corroboration Memo).
1. Corroboration of Constructed Export Price
The petitioners based CEP on prices for sales of low-relaxation PC
strand from a Brazilian producer, through its U.S. affiliate, to an
unaffiliated U.S. purchaser. The petitioners calculated a single
average gross unit price and deducted from it estimated costs for
international freight and insurance charges, U.S. inland freight
charges, harbor maintenance and merchandise processing fees, imputed
credit expenses, and trading company commission to arrive at an average
net U.S. price. Information regarding U.S. prices including warehousing
expenses, indirect selling expenses, inventory carrying expenses, and
CEP profit was not reasonably available to the petitioners. Therefore,
the petitioners did not deduct these items from the average gross unit
price. Instead, as a conservative estimate of these expenses, the
petitioners subtracted an amount for the ``prevailing commission rate
for PC strand sold in the United States via unaffiliated agents to
foreign producers' unaffiliated U.S. customers.'' See Volume II-Brazil
AD of the petition at 2-3. We compared the U.S. market price quotes
with official U.S. import statistics and U.S. customs data, and found
the prices used by the petitioners to be reliable. For further
discussion, see Corroboration Memo at 2.
2. Corroboration of Normal Value
With respect to the NV, the petitioners provided a home market
price for low-relaxation PC strand that was obtained from foreign
market research. See Memorandum to the File, Re: Telephone Conversation
with Market Researcher Regarding the Petitions for Imposition of
Antidumping: Prestressed Concrete Steel Wire Strand from Brazil
(February 12, 2003). The petitioners adjusted the gross unit price for
home market credit expenses and inland freight.
The Department was provided with no useful information by the
respondent or other interested parties and is aware of no other
independent source of information that would enable it to further
corroborate the margin calculations in the petition. Specifically, we
attempted to locate both home market prices through publicly available
sources and U.S. producer costs upon which the CV was based, but we
were unable to do so. See Corroboration Memo at 3.
The implementing regulation for section 776 of the Act, at 19 CFR
351.308(d) states, ``{t{time} he fact that corroboration may not be
practicable in a given circumstance will not prevent the Secretary from
applying an adverse inference as appropriate and using the secondary
information in question.'' Additionally, we note that the SAA at 870
specifically states that, where ``corroboration may not be practicable
in a given circumstance,'' the Department need not ``prove that the
facts available are the best alternative.''
Therefore, based on our efforts, described above, to corroborate
information contained in the petition, and in accordance with section
776(c) of the Act, we consider the margins in the petition to be
corroborated to the extent practicable for purposes of this preliminary
determination. Accordingly, in selecting AFA with respect to BBA, we
have applied the margin rate of 118.75 percent, which is the highest
estimated dumping margin set forth in the notice of initiation. See
Initiation Notice, 68 FR at 9052.
All Others Rate
Section 735(c)(5)(B) of the Act provides that, where the estimated
weighted-averaged dumping margins established for all exporters and
producers individually investigated are zero or de minimis or are
determined entirely under section 776 of the Act, the Department may
use any reasonable method to establish the estimated all-others rate
for exporters and producers not individually investigated. This
provision contemplates that we weight-average margins other than zero,
de minimis, and facts available margins to establish that ``All
Others'' rate. Where the data do not permit weight-averaging such
rates, the SAA provides that we use other reasonable methods. See SAA
at 873. Because the revised petition, contained only one price-to-price
dumping margin, it is reasonable to use this dumping margin to create
an ``All Others'' rate. Further, since BBA is the only known Brazilian
producer/exporter of subject merchandise, it is reasonable to use a
margin based on a comparison of its sales as the ``All Others'' rate.
Accordingly, we have applied a margin of 118.75 percent as the ``All
Others'' rate.
Suspension of Liquidation
In accordance with section 733(d)(2) of the Act, we are directing
the U.S. Bureau of Customs and Border Protection (BCBP) to suspend
liquidation of all entries of PC strand from Brazil that are entered,
or withdrawn from warehouse, for consumption on or after the date of
publication of this notice in the Federal Register. We are also
instructing the BCBP to require a cash deposit or the posting of a bond
equal to the dumping margin as indicated in the chart below. These
instructions suspending liquidation will remain in effect until further
notice.
The dumping margins are as follows:
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Producer/Exporter Margin (Percentage)
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Belgo Bekaert Arames S.A....................... 118.75
All Others..................................... 118.75
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International Trade Commission Notification
In accordance with section 733(f) of the Act, we have notified the
ITC of the Department's preliminary affirmative determination. If the
final determination in this proceeding is affirmative, the ITC will
determine before the later of 120 days after the date of this
preliminary determination or 45 days after the final determination
whether imports of PC strand from Brazil are materially injuring, or
threaten material injury, to the U.S. industry.
Public Comment
Interested parties are invited to comment on the preliminary
[[Page 42389]]
determination. Interested parties may submit case briefs within 30 days
of the date of publication of this notice. See 19 CFR 351.309(c)(1)(I).
Rebuttal briefs, the content of which is limited to the issues raised
in the case briefs, must be filed within five days after the deadline
for the submission of case briefs. See 19 CFR 351.309(d). A list of
authorities used, a table of contents, and an executive summary of
issues should accompany any briefs submitted to the Department.
Executive summaries should be limited to five pages total, including
footnotes. Further, we request that parties submitting briefs and
rebuttal briefs provide the Department with a copy of the public
version of such briefs on diskette.
In accordance with section 774 of the Act, we will hold a public
hearing, if requested, to afford interested parties an opportunity to
comment on arguments raised in case or rebuttal briefs. If a request
for a hearing is made, we will tentatively hold the hearing two days
after the deadline for submission of rebuttal briefs at the U.S.
Department of Commerce, 14th Street and Constitution Avenue, NW,
Washington, DC 20230, at a time and in a room to be determined. Parties
should confirm by telephone the date, time, and location of the hearing
48 hours before the scheduled date.
Interested parties who wish to request a hearing, or to participate
in a hearing if one is requested, must submit a written request to the
Assistant Secretary for Import Administration, U.S. Department of
Commerce, Room 1870, within 30 days of the date of publication of this
notice. Requests should contain: (1) the party's name, address, and
telephone number; (2) the number of participants; and (3) a list of the
issues to be discussed. At the hearing, oral presentations will be
limited to issues raised in the briefs. See 19 CFR 351.310(c). The
Department will make its final determination no later than 75 days
after the date of publication of this preliminary determination.
This determination is issued and published in accordance with
sections 733(f) and 777(I)(1) of the Act.
Dated: July 10, 2003.
Jeffrey May,
Acting Assistant Secretary for Grant Aldonas, Under Secretary.
[FR Doc. 03-18131 Filed 7-16-03; 8:45 am]