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[Federal Register Volume 65, Number 102 (Thursday, May 25, 2000)]
[Notices]
[Pages 33803-33805]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-13097]

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-851-802]

Preliminary Determination of Critical Circumstances: Certain 
Small Diameter Carbon and Alloy Seamless Standard, Line and Pressure 
Pipe From the Czech Republic

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

EFFECTIVE DATE: May 25, 2000.

FOR FURTHER INFORMATION CONTACT: John Brinkmann or Dennis McClure, AD/
CVD Enforcement, Office 6, Group II, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Ave, NW, Washington, DC 20230; telephone: (202) 
482-4126 or 482-0984, respectively.

The Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the statute are 
references to the provisions effective January 1, 1995, the effective 
date of the amendments made to the Tariff Act of 1930 (the Act) by the 
Uruguay Round Agreements Act. In addition, unless otherwise indicated, 
all citations to the Department's regulations are references to the 
provisions codified at 19 CFR part 351 (April 1999).

Background

    On February 4, 2000, the Department published the preliminary 
affirmative determination in the antidumping duty investigation on 
certain small diameter carbon and alloy seamless standard, line and 
pressure pipe (seamless pipe) from the Czech Republic, 65 FR 5599. On 
April 18, 2000, the petitioners alleged that there is a reasonable 
basis to believe or suspect that critical circumstances exist with 
respect to imports of seamless pipe from the Czech Republic.

Critical Circumstances

    Section 733(e)(1) of the Act provides that the Department will 
preliminarily determine that critical circumstances exist if there is a 
reasonable basis to believe or suspect that: (A)(i) There is a history 
of dumping and material injury by reason of dumped imports in the 
United States or elsewhere of the subject merchandise, or (ii) the 
person by whom, or for whose account, the merchandise was imported knew 
or should have known that the exporter was selling the subject 
merchandise at less than its fair value and that there was likely to be 
material injury by reason of such sales, and (B) there have been 
massive imports of the subject merchandise over a relatively short 
period. Section 351.206(h)(1) of the Department's regulations provides 
that, in determining whether imports of the subject merchandise have 
been ``massive,'' the Department normally will examine: (i) The volume 
and value of the imports; (ii) seasonal trends; and (iii) the share of 
domestic consumption accounted for by the imports. In addition, section 
351.206(h)(2) of the Department's regulations provides that an increase 
in imports of 15 percent during the ``relatively short period'' of time 
may be considered ``massive.''
    Section 351.206(i) of the Department's regulations defines 
``relatively short period'' as normally being the period beginning on 
the date the proceeding begins (i.e., the date the petition is filed) 
and ending at least three months later. The regulations also provide, 
however, that if the Department finds that importers, or exporters or 
producers, had reason to believe, at some time prior to the beginning 
of the proceeding, that a proceeding was likely, the Department may 
consider a period of not less than three months from that earlier time.

History of Dumping and Importer Knowledge

    Because we are aware of the European Union's (EU's) November 17, 
1997, finding that the Czech Republic had sold similar products (e.g., 
seamless pipes, of iron or non-alloy steel) at less than fair value and 
had caused injury to the domestic industry, we find that a reasonable 
basis exists to believe or suspect that there is a history of dumping 
and material injury by reason of dumped imports in the United States or 
elsewhere of the subject merchandise, pursuant to section 
733(e)(1)(A)(i) of the Act. Although the products investigated by the 
EU are not all identical to those covered by the scope of this 
investigation, we do not require the scope of our proceedings to match 
exactly the scope of the foreign proceeding. See Notice of Final 
Determination of Sales at Less Than Fair Value: Disposable Pocket 
Lighters From the People's Republic of China, 60 FR 22359, 22368 (May 
5, 1995). In addition, the Department may look to the second criterion 
for determining importer knowledge of dumping.
    In determining whether there is a reasonable basis to believe or 
suspect that an importer knew or should have known that the exporter 
was selling the seamless pipe at less than fair value, pursuant to 
section 733(e)(1)(A)(ii) of the Act, the Department's normal practice 
is to consider margins of 25 percent or more for export price (EP) 
sales sufficient to impute knowledge of dumping. See Certain Cut-to-
Length Carbon Steel Plate From the People's Republic of China, 62 FR 
31972, 31978 (June 11, 1997). In the instant case, the respondent, Nova 
Hut, received a margin of 32.26 percent in the amended preliminary 
determination, 65 FR 12971. Therefore, we have imputed knowledge of 
dumping to importers of subject merchandise from Nova Hut.
    In determining whether there is a reasonable basis to believe or 
suspect that an importer knew or should have known that there was 
likely to be material injury by reason of dumped imports, under section 
733(e)(1)(A)(ii) of the Act, the Department normally will look to the 
preliminary injury determination of the International Trade Commission 
(ITC). If the ITC finds a reasonable indication of present material 
injury to the relevant U.S. industry, the Department will determine 
that a reasonable basis exists to impute importer knowledge that there 
was likely to be material injury by reason of dumped imports. In this 
case, the ITC has found that a reasonable indication of present 
material injury due to dumping exists for all imports of seamless pipe 
from the Czech Republic. See Certain Seamless Carbon and Alloy Steel 
Standard, Line and Pressure Pipe from the Czech Republic, Japan, 
Mexico, Romania and South Africa, 64 FR 46953 (August 27, 1999). As a 
result, the Department has determined that there is a reasonable basis 
to believe or suspect that importers knew or should have known that 
there was likely to be material injury by reason of dumped imports of 
subject merchandise from the Czech Republic.

Massive Imports

    In determining whether there are ``massive imports'' over a 
``relatively short period,'' pursuant to 733(e)(1)(B) of the Act, the 
Department normally compares the import volume of the subject 
merchandise for three months immediately preceding and following the 
filing of the petition. Imports normally will be considered massive

[[Page 33804]]

when imports have increased by 15 percent or more during this 
``relatively short period.''
    We do not have verifiable data from Nova Hut because it withdrew 
from verification. Therefore, the Department must base its ``massive 
imports'' determination as to the company on the facts available, 
pursuant to section 776(a) of the Act.\1\ Accordingly, we first 
examined U.S. Customs data \2\ on imports of seamless pipe from the 
Czech Republic for January through June 1999 (the six months preceding 
the June 30, 1999, filing of the petition) and from July through 
December 1999 (the six months following the filing of the petition).\3\ 
We found that the total volume of imports of small diameter seamless 
pipe from the Czech Republic increased by 45.75 percent in the six-
month period following the filing of the petition (July through 
December 1999), as compared to the total volume of such imports from 
January through June 1999. Second, we considered that Nova Hut, the 
sole respondent in the investigation, was the only company identified 
by both the petitioner and the Government of the Czech Republic as a 
Czech producer of merchandise under investigation. From this we infer 
that Nova Hut is a significant producer of the merchandise under 
investigation. As facts available, then, we also infer that a 
significant portion of the 45.75 percent increase in imports is 
attributable to Nova Hut. We recognize that some of the HTS categories 
analyzed to derive the 45.75 percent increase in imports are basket 
categories that may include non-scope merchandise. However, given that 
Nova Hut's refusal to supply verifiable data prevents the Department 
from doing a company-specific massive imports analysis, we are, 
pursuant to section 776(b) of the Act, making the adverse inference 
that the country-wide import data is representative of Nova Hut's 
import data. Moreover, the Department's practice has been to make an 
adverse inference concerning massive imports with respect to an 
uncooperative respondent even when country-wide data was not available 
or not considered. See, e.g., Notice of Final Determination of Sales at 
Less Than Fair Value: Collated Roofing Nails from Taiwan, 62 FR 51427, 
51437 (October 1, 1997). We, therefore, find that Nova Hut had massive 
imports of the subject merchandise over a relatively short period of 
time, under section 733(e)(1)(B) of the Act and 19 CFR 351.206(h)(2).
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    \1\ Because the respondent withdrew from verification, we 
considered the company non-cooperating and did not request monthly 
shipment data from the company.
    \2\ IM-145 import statistics on HTS numbers included within the 
scope of the investigation.
    \3\ As stated in Final Determination of Sales at Less Than Fair 
Value: Certain Cut-to-Length Carbon-Quality Steel Plate from 
Indonesia (64 FR 73164, December 29, 1999), the Department's 
practice is to use the longest period for which information is 
available from the month that the petition was submitted through the 
date of the preliminary determination.
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    Based on our determination that there is a reasonable basis to 
believe or suspect that there is a history of dumping and material 
injury by reason of dumped imports of the subject merchandise in the 
EU, as well as importer knowledge of dumping, and that there have been 
massive imports of seamless pipe from this producer over a relatively 
short period, we preliminarily determine that critical circumstances 
exist for imports from the Czech Republic of seamless pipe produced by 
Nova Hut.

All Other Exporters

    In regard to the ``all others'' category, it is the Department's 
normal practice to conduct its critical circumstances analysis based on 
the experience of investigated companies. See Notice of Final 
Determination of Sales at Less Than Fair Value: Certain Steel Concrete 
Reinforcing Bars from Turkey (Rebars from Turkey), 62 FR 9737, 9741 
(March 4, 1997). In Rebars from Turkey, the Department determined that 
because it found critical circumstances existed for three out of the 
four companies investigated, critical circumstances also existed for 
companies covered by the ``all others'' rate. However, in Notice of 
Final Determination of Sales at Less Than Fair Value: Stainless Steel 
Sheet and Strip in Coils from Japan (Stainless Steel from Japan), 64 FR 
30574 (June 8, 1999), the Department did not extend its affirmative 
critical circumstances findings to the ``all others'' categories while 
finding affirmative critical circumstances for four of the five 
respondents, because the affirmative determinations were based on 
adverse facts available.
    In the instant case, in our critical circumstances analysis for the 
one investigated company, Nova Hut, we determined that the EU's finding 
that the Czech Republic had sold similar products at less than fair 
value and had caused injury to the domestic industry provides 
reasonable basis to believe or suspect that there is a history of 
dumping and material injury by reason of dumped imports in this case. 
Consistent with our practice, we similarly extend this finding to the 
``all others'' category.
    With respect to massive imports, however, we are unable to rely on 
our import level analysis for Nova Hut because it is based upon adverse 
facts available, and we have no verified data upon which to base a 
massive imports analysis. Instead, consistent with the approach taken 
in Notice of Final Determination of Sales at Less Than Fair Value: Hot-
Rolled Flat-Rolled Carbon-Quality Steel Products from Japan, 64 FR 
24239 (May 6, 1999) and Notice of Final Determinations of Sales at Less 
Than Fair Value: Certain Cold-Rolled Flat-Rolled Carbon-Quality Steel 
Products From Argentina, Japan and Thailand 65 FR 5220, 5227 (February 
4, 2000), we examined U.S. Customs data on overall imports from the 
Czech Republic for the six months preceding and the six months 
following the filing of the petition in order to see if we could 
ascertain whether an increase in shipments of greater than 15 percent 
or more occurred within a relatively short period following the point 
at which importers had reason to believe that a proceeding was likely. 
Information on the record indicates that there was a 45.75 percent 
increase in overall imports from the Czech Republic for the six months 
following the filing of the petition, as compared to the six months 
preceding the filing of the petition. However, these data cover 
numerous HTS categories that may include merchandise other than subject 
merchandise. Although we made an adverse inference based on this data 
with respect to Nova Hut, it is not appropriate to make a similar 
inference with respect to ``all others.'' Because we have no reliable 
data upon which to determine whether there were massive imports of 
seamless pipe from the producers included in the ``all others'' 
category, a necessary criterion for determining affirmative critical 
circumstances has not been met. Therefore, we have preliminarily 
determined that critical circumstances do not exist for imports from 
the Czech Republic of seamless pipe for companies in the ``all others'' 
category.

Suspension of Liquidation

    In accordance with section 733(e)(2) of the Act, the Department 
will direct the Customs Service to suspend liquidation of all entries 
of seamless pipe from the Czech Republic produced by Nova Hut, that are 
entered, or withdrawn from warehouse, for consumption on or after 
November 6, 1999, which is 90 days prior to the date of publication in 
the Federal Register of our preliminary determination of sales at less 
than fair value. The Customs Service shall require a cash deposit or 
posting of a bond equal to the estimated preliminary dumping margin 
reflected

[[Page 33805]]

in the preliminary determination of sales at less than fair value 
published in the Federal Register. This suspension of liquidation will 
remain in effect until further notice. The margin in the preliminary 
determination is as follows:

Nova Hut--32.26 percent.

Final Critical Circumstances Determination

    We will make final critical circumstances determinations when we 
issue our final determination in the less-than-fair-value 
investigation, which is due to be made no later than June 19, 2000.

ITC Notification

    In accordance with section 733(f) of the Act, we have notified the 
ITC of our determination.
    This notice is published pursuant to section 777(i) of the Act.

    Dated: May 17, 2000.
Troy H. Cribb,
Acting Assistant Secretary for Import Administration.
[FR Doc. 00-13097 Filed 5-24-00; 8:45 am]
BILLING CODE 3510-DS-P
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