Antidumping: quality steel plate products from India,
[Federal Register: July 29, 1999 (Volume 64, Number 145)]
[Notices]
[Page 41202-41206]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr29jy99-127]
DEPARTMENT OF COMMERCE
International Trade Administration
[A-533-817]
Preliminary Determination of Sales at Less Than Fair Value: Certain Cut-To-Length Carbon-Quality Steel Plate Products From India
AGENCY: Import Administration, International Trade Administration, Department of Commerce.
EFFECTIVE DATE: July 29, 1999.
[[Page 41203]]
FOR FURTHER INFORMATION CONTACT: James Terpstra, Timothy Finn, or Lyman Armstrong, Office 4, Group II, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482- 3965, (202) 482-0065, and (202) 482-3601, respectively.
The 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 (``the Act'') by the Uruguay Round Agreements Act (``URAA''). In addition, unless otherwise indicated, all references are made to the Department's regulations at 19 CFR Part 351 (1998).
Preliminary Determination
We preliminarily determine that certain cut-to-length carbon- quality steel plate products (``CTL plate'') from India are being, or are likely to be, sold in the United States at less than fair value (``LTFV''), as provided in section 733 of the Act. The estimated margins of sales at LTFV are shown in the ``Suspension of Liquidation'' section of this notice.
Case History
Since the initiation of this investigation (Notice of Initiation of Antidumping Investigations: Certain Cut-To-Length Carbon-Quality Steel Plate from Czech Republic, France, India, Indonesia, Italy, Japan, Republic of Korea, and Former Yugoslav Republic of Macedonia), 64 FR 12959 ( March 16, 1999) (``Initiation Notice''), the following events have occurred:
In their petition, the petitioners ‹SUP›1‹/SUP› identified the Steel Authority of India (``SAIL'') as the sole exporter of CTL plate from India. Based on the petition and information provided by the U.S. embassy in New Delhi indicating that SAIL was the sole exporter of subject merchandise from January 1, 1998 through December 31, 1998, the period of investigation (``POI''), we issued an antidumping questionnaire to SAIL on March 17, 1999.‹SUP›2‹/SUP›
\1\ The petitioners are Bethlehem Steel Corporation, Gulf States Steel, Inc., IPSCO Steel Inc., Tuscaloosa Steel Corporation, the United Steelworkers of America, and the U.S. Steel Group (a unit of USX Corporation).
\2\ Section A of the questionnaire requested general information concerning the company's corporate structure and business practices, the merchandise under investigation that it sells, and the sales of that merchandise in all markets. Sections B and C of the questionnaire requested home market sales listings and U.S. sales listings. Section D of the questionnaire requested information regarding the cost of production of the foreign like product and the constructed value of the merchandise under investigation. Section E of the questionnaire requested information regarding the cost of further manufacture or assembly performed in the United States.
In April 1999, the United States International Trade Commission (``ITC'') issued an affirmative preliminary injury determination in this case (see ITC Investigation No. 731-TA-815-822).
Between April 12, and May 11, 1999, SAIL submitted responses to all applicable sections of the questionnaire. On May 20, 1999, SAIL submitted certain clarifications which supplemented its Section A response.
On May 24, 1999, petitioners submitted comments regarding SAIL's questionnaire responses, and on May 27, 1999, we issued a supplemental questionnaire covering Sections A-D of SAIL's response.
On June 1, 1999, petitioners submitted additional comments on SAIL's April 12, 1999 and May 10, 1999 questionnaire responses.
On June 3 and 8, 1999, SAIL submitted certain clarifications supplementing SAIL's May 10, 1999 response.
On June 11, 1999, we issued a further supplemental questionnaire covering Sections A-C of SAIL's questionnaire response.
On June 16, 1999, SAIL submitted a revised electronic database. See also Facts Available section below.
On June 18, 1999, we issued a further supplemental questionnaire concerning SAIL's Section D response, which SAIL had supplemented on June 8, 1999. Also on June 18, 1999, SAIL submitted certain data supplementing its previous submissions.
On June 29, 1999, SAIL made three submissions. The first two submissions were due on June 28 and responded to the Department's letter of June 18, 1999 to SAIL. The third submission responded to the Department's May 27, 1999 supplemental questionnaire, which was due June 18, 1999. On July 2, 1999, we returned all three of these submissions to SAIL as untimely. See also the Facts Available section below.
On July 6, 1999, petitioners submitted comments regarding deficiencies in SAIL's questionnaire responses.
Finally, on July 12, 1999, we issued a letter to SAIL providing it with a final opportunity to submit a reliable electronic database and information on product-specific costs. On July 16, 1999, SAIL provided this information. See also Facts Available section below.
Facts Available
We have determined that the use of facts available is appropriate for SAIL for purposes of this preliminary determination. Although SAIL fileda questionnaire response, it contained numerous errors. Moreover, because of the problems with the electronic databases that SAIL submitted, its questionnaire response cannot be used to calculate a reliable margin at this time. Section 776(a)(2)(B) of the Act provides that the administering authority shall use facts otherwise available when an interested party ``fails to provide such information by the deadlines for the submission of the information or in the form and manner requested.'' Therefore, the use of facts available is warranted in this case.
Section 776(b) of the Act provides that adverse inferences may be used in selecting from the facts available if a party has failed to cooperate by not acting to the best of its ability to comply with a request for information. As explained in more detail below, SAIL was provided with numerous opportunities and (effective) extensions of time to fully respond to the Department's original and supplemental questionnaires. However, even with several opportunities to remedy problems, SAIL failed to provide, inter alia, a reliable electronic database. Therefore, the Department preliminarily finds that SAIL did not act to the best of its ability to provide the information requested. As a consequence, we have used an adverse inference in selecting the facts available to determine SAIL's margin.
As we discuss below, there are three inter-related problems with SAIL's questionnaire response: (1) technical errors in its electronic databases; (2) lateness and incompleteness of certain narrative portions of its questionnaire response; and (3) the lack of product- specific costs. However, our decision to use facts available for the preliminary determination is based primarily on our inability to use the electronic databases that SAIL submitted.
The problems with the electronic databases began with SAIL's first electronic submission which was formatted incorrectly and was substantially incomplete. As much of the underlying problems with these data involve proprietary information, there is a detailed discussion of these problems in a Memorandum to the File regarding Problems with SAIL's Questionnaire Response, dated July 19, 1999 (``SAIL memo''). From the time these electronic databases were submitted on May 11, 1999, until the submission of its revised electronic tapes on July 16, 1999, the Department repeatedly requested that SAIL revise and correct various sections of these databases. However, SAIL never
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resolved all of the ongoing technical problems to a point where the databases could be used reliably in our preliminary determination. SAIL argued that it is a large, decentralized steel producer with 3 plants, 6 regional sales offices, and 42 local service centers which is not fully automated, making the preparation of consolidated electronic databases extremely difficult. On July 12, 1999, we gave SAIL one final opportunity to supply reliable electronic databases to the Department.
Furthermore, certain portions of SAIL's original questionnaire response were substantially incomplete. Throughout its original response, SAIL either failed to provide information, or stated that certain information would be submitted at a later date, effectively granting itself an extension of time for the submission of factual information. After several such submissions, we returned SAIL's information as untimely. See our letter of July 2, 1999. Although we have issued several supplemental questionnaires and SAIL responded to them, we have been unable to evaluate adequately the firm's selling practices because of problems with the electronic databases discussed above. On July 16, 1999 SAIL submitted one final electronic database. We intend to issue a final supplemental questionnaire to SAIL after reviewing this electronic data.
Regarding the lack of product-specific costs, SAIL claims that its cost accounting records do not track costs on the product-specific basis required by the questionnaire. Instead, SAIL records cost on a more aggregated level. However, in its questionnaire response, SAIL reported different costs for different products using certain cost allocations. SAIL claimed that the allocation method it used was the only one available given the limitations of its accounting system. However, it is not clear whether SAIL's reported costs are reliable for margin calculation purposes, or that they are based on the most reasonable method available from its accounting records. Because a decision on this issue necessarily requires a detailed analysis of SAIL's accounting system, we have determined that it is necessary to examine this issue exhaustively at verification. See also the SAIL memo for a more detailed discussion.
For the preliminary determination, we assigned SAIL the average of the margins in the petition, which is 58.50 percent. Although we find that SAIL did not fully cooperate to the best of its ability, SAIL tried to provide the Department with the data requested in the antidumping questionnaire. Recognizing SAIL's attempts to respond to the Department's information requests, and in light of its claimed difficulties, we do not believe that it is appropriate to assign the highest margin alleged in the petition at this time. See e.g., Krupp Stahl AG v. U.S., 822 F. Supp. 789, 793 (Court of International Trade 1993), which referenced a Court of Appeals' opinion sanctioning the Department's practice of taking into account the level of respondent's cooperation, and Notice of Final Determination of Sales at Less Than Fair Value: Steel Wire Rod from Germany, 63 FR 8953, 8955 (February 23, 1998).)
Section 776(c) of the Act provides that where the Department selects from among the facts otherwise available and relies on ``secondary information,'' such as the petition, the Department shall, to the extent practicable, corroborate that information from independent sources reasonably at the Department's disposal. The Statement of Administrative Action accompanying the URAA, H.R. Doc. No. 103-316, (1994) (hereinafter, the ``SAA'') states that ``corroborate'' means to determine that the information used has probative value. See SAA at 870.
In accordance with section 776(c) of the Act, we sought to corroborate the data contained in the petition. We reviewed the adequacy and accuracy of the information in the petition during our pre-initiation analysis of the petition, to the extent appropriate information was available for this purpose (e.g., import statistics and foreign market research reports). See Initiation Notice.
For purposes of the preliminary determination, we attempted to corroborate the information in the petition. The petition margins were based on both price-to-price and price-to-constructed value comparisons. Petitioners calculated export price was based on U.S. price offerings, with deductions taken for international movement charges. We compared this with information from U.S. Customs and found them consistent. Petitioners based normal value on prices for comparable products sold in the home market obtained from market research. Petitioners calculated constructed value based on their own production experience adjusted for known differences. We compared the petition information with reliable information obtained during the investigation, primarily SAIL's financial statements and other published materials from the questionnaire response and found them consistent. Given the problems with the data submitted by SAIL, as discussed above, this was the only information in the questionnaire response that was reliable for these purposes, the actual reported prices and costs being difficult to adequately evaluate at this time. Consequently, we find that information in the petition continues to be of probative value. See Corroboration Memo, July 19, 1999.
Scope of Investigation
The products covered by the scope of this investigation are certain hot-rolled carbon-quality steel: (1) Universal mill plates (i.e., flat- rolled products rolled on four faces or in a closed box pass, of a width exceeding 150 mm but not exceeding 1250 mm, and of a nominal or actual thickness of not less than 4 mm, which are cut-to-length (not in coils) and without patterns in relief), of iron or non-alloy-quality steel; and (2) flat-rolled products, hot-rolled, of a nominal or actual thickness of 4.75 mm or more and of a width which exceeds 150 mm and measures at least twice the thickness, and which are cut-to-length (not in coils). Steel products to be included in this scope are of rectangular, square, circular or other shape and of rectangular or non- rectangular cross-section where such non-rectangular cross-section is achieved subsequent to the rolling process (i.e., products which have been ``worked after rolling'')--for example, products which have been beveled or rounded at the edges. Steel products that meet the noted physical characteristics that are painted, varnished or coated with plastic or other non-metallic substances are included within this scope. Also, specifically included in this scope are high strength, low alloy (HSLA) steels. HSLA steels are recognized as steels with micro- alloying levels of elements such as chromium, copper, niobium, titanium, vanadium, and molybdenum. Steel products to be included in this scope, regardless of Harmonized Tariff Schedule of the United States (HTSUS) definitions, are products in which: (1) Iron predominates, by weight, over each of the other contained elements, (2) the carbon content is two percent or less, by weight, and (3) none of the elements listed below is equal to or exceeds the quantity, by weight, respectively indicated: 1.80 percent of manganese, or 1.50 percent of silicon, or 1.00 percent of copper, or 0.50 percent of aluminum, or 1.25 percent of chromium, or 0.30 percent of cobalt, or 0.40 percent of lead, or 1.25 percent of nickel, or 0.30 percent of tungsten, or 0.10 percent of molybdenum, or 0.10 percent of niobium, or 0.41 percent of titanium, or 0.15 percent of vanadium, or 0.15 percent zirconium. All products that
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meet the written physical description, and in which the chemistry quantities do not equal or exceed any one of the levels listed above, are within the scope of these investigations unless otherwise specifically excluded. The following products are specifically excluded from these investigations: (1) Products clad, plated, or coated with metal, whether or not painted, varnished or coated with plastic or other non-metallic substances; (2) SAE grades (formerly AISI grades) of series 2300 and above; (3) products made to ASTM A710 and A736 or their proprietary equivalents; (4) abrasion-resistant steels (i.e., USS AR 400, USS AR 500); (5) products made to ASTM A202, A225, A514 grade S, A517 grade S, or their proprietary equivalents; (6) ball bearing steels; (7) tool steels; and (8) silicon manganese steel or silicon electric steel.
The merchandise subject to these investigations is classified in the HTSUS under subheadings: 7208.40.3030, 7208.40.3060, 7208.51.0030, 7208.51.0045, 7208.51.0060, 7208.52.0000, 7208.53.0000, 7208.90.0000, 7210.70.3000, 7210.90.9000, 7211.13.0000, 7211.14.0030, 7211.14.0045, 7211.90.0000, 7212.40.1000, 7212.40.5000, 7212.50.0000, 7225.40.3050, 7225.40.7000, 7225.50.6000, 7225.99.0090, 7226.91.5000, 7226.91.7000, 7226.91.8000, 7226.99.0000.
Although the HTSUS subheadings are provided for convenience and Customs purposes, the written description of the merchandise under investigation is dispositive.
Scope Comments
As stated in our notice of initiation, we set aside a period for parties to raise issues regarding product coverage. In particular, we sought comments on the specific levels of alloying elements set out in the description below, the clarity of grades and specifications excluded from the scope, and the physical and chemical description of the product coverage.
On March 29, 1999, Usinor, a respondent in the French antidumping and countervailing duty investigations and Dongkuk Steel Mill Co., Ltd. and Pohang Iron and Steel Co., Ltd., respondents in the Korean antidumping and countervailing duty investigations (collectively the Korean respondents), filedcomments regarding the scope of the investigations on CTL plate and the Department's model matching criteria. On April 14, 1999, the petitioners filedcomments regarding Usinor's and the Korean respondents' comments regarding model matching. In addition, on May 17, 1999, ILVA S.p.A. (ILVA), a respondent in the Italian antidumping and countervailing duty investigations, requested guidance on whether certain products are within the scope of these investigations.
Usinor requested that the Department modify the scope to exclude: (1) plate that is cut to non-rectangular shapes or that has a total final weight of less than 200 kilograms; and (2) steel that is 4'' or thicker and which is certified for use in high-pressure, nuclear or other technical applications; and (3) floor plate (i.e., plate with ``patterns in relief'') made from hot-rolled coil. Further, Usinor requested that the Department provide clarification of scope coverage with respect to what it argues are over-inclusive HTSUS subheadings included in the scope language.
The Department has not modified the scope of these investigations because the current language reflects the product coverage requested by the petitioners, and Usinor's products meet the product description. With respect to Usinor's clarification request, we do not agree that the scope language requires further elucidation with respect to product coverage under the HTSUS. As indicated in the scope section of every Department antidumping and countervailing duty proceeding, the HTSUS subheadings are provided for convenience and Customs purposes only; the written description of the merchandise under investigation or review is dispositive.
The Korean respondents requested confirmation whether the maximum alloy percentages listed in the scope language are definitive with respect to covered HSLA steels.
At this time, no party has presented any evidence to suggest that these maximum alloy percentages are inappropriate. Therefore, we have not adjusted the scope language. As in all proceedings, questions as to whether or not a specific product is covered by the scope and, hence, must be reported, should be timely raised with Department officials.
ILVA requested guidance on whether certain merchandise produced from billets is within the scope of the current CTL plate investigations. According to ILVA, the billets are converted into wide flats and bar products (a type of long product). ILVA notes that one of the long products, when rolled, has a thickness range that falls within the scope of these investigations. However, according to ILVA, the greatest possible width of these long products would only slightly overlap the narrowest category of width covered by the scope of the investigations. Finally, ILVA states that these products have different production processes and properties than merchandise covered by the scope of the investigations and therefore are not covered by the scope of the investigations.
As ILVA itself acknowledges, the particular products in question appear to fall within the parameters of the scope and, therefore, we are preliminarily treating them as covered merchandise.
Period of Investigation
The period of investigation is January 1, 1998 through December 31, 1998.
Verification
As provided in section 782(i) of the Act, we will verify all information determined to be acceptable for use in making our final determination.
Suspension of Liquidation
In accordance with section 733(d) of the Act, we are directing the Customs Service to suspend liquidation of all imports of subject merchandise that are entered, or withdrawn from warehouse, for consumption on or after the date of publication of this notice in the Federal Register.
We will instruct the Customs Service to require a cash deposit or the posting of a bond equal to the weighted-average margin, as indicated in the chart below. We will adjust the deposit requirements to account for any export subsidies found in the companion countervailing duty investigation. These suspension of liquidation instructions will remain in effect until further notice. The weighted- average dumping margins are as follows:
Weighted- Exporter/manufacturer
average margin percentage
SAIL....................................................
58.50 All Others \3\..........................................
58.50
\3\ The Act normally prohibits inclusion in the ``All Others'' rate of any margins determined entirely on the basis of facts available, pursuant to section 776. Where the estimated weighted-average margin (s) is based entirely on facts available, we must use any reasonable method to establish the estimated ``All Others'' rate for exporters and producers nor individually investigated. See section 733(d)(1)(ii); 735(c)(5)(B). In this case, we have determined that the only reasonable method is to use the 58.50 percent simple average of the margins alleged in the petition which was also the source of our facts available margin for SAIL.
ITC Notification
In accordance with section 733(f) of the Act, we have notified the ITC of our determination. If our final
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determination is affirmative, the ITC will determine before the later of 120 days after the date of this preliminary determination or 45 days after our final determination whether these imports are materially injuring, or threaten material injury to, the U.S. industry.
Public Comment
Case briefs or other written comments in at least ten copies must be submitted to the Assistant Secretary for Import Administration no later than August 25, 1999, and rebuttal briefs no later than September 1, 1998. A list of authorities used and an executive summary of issues should accompany any briefs submitted to the Department. Such summary should be limited to five pages total, including footnotes. 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. Tentatively, the hearing will be held on September 8, 1999, time and room to be determined, at the U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230. Parties should confirm by telephone the time, date, and place of the hearing 48 hours before the scheduled time.
Interested parties who wish to request a hearing, or to participate 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 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. Oral presentations will be limited to issues raised in the briefs. If this investigation proceeds normally, we will make our final determination by no later than 75 days after the date of this preliminary determination.
This determination is issued and published pursuant to sections 733(d) and 777(i)(1) of the Act.
Dated: July 19, 1999. Robert S. LaRussa, Assistant Secretary for Import Administration.
[FR Doc. 99-19301Filed7-28-99; 8:45 am]
BILLING CODE 3510-DS-P
