42750 Federal Register / Vol. 62, No. 153 / Friday, August 8, 1997 / Notices

(LSIs) from Japan. The review covers

one manufacturer/exporter of LSIs,

Otsuka Electronics Co., Ltd. (Otsuka),

and the period November 1, 1995

through October 31, 1996.

EFFECTIVE DATE: August 8, 1997.

FOR FURTHER INFORMATION CONTACT: G.

Leon McNeill or Maureen Flannery,

Import Administration, International

Trade Administration, U.S. Department

of Commerce, 14th Street and

Constitution Avenue, NW., Washington

DC 20230; telephone (202) 482–4733.

SUPPLEMENTARY INFORMATION:

Background

On November 19, 1990, the

Department published in the Federal

Register (55 FR 48244) the antidumping

duty order on LSIs from Japan. On

November 4, 1996, we published in the

Federal Register (61 FR 56663) a notice

of opportunity to request an

administrative review of the

antidumping duty order on LSIs from

Japan covering the period November 1,

1995 through October 31, 1996.

In accordance with 19 CFR

353.22(a)(1), the petitioner, Wyatt

Technology Corporation, requested that

we conduct an administrative review of

Otsuka. We published a notice of

initiation of this antidumping duty

administrative review on January 17,

1997 (62 FR 2647).

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 citations to the

Department’s regulations are to the

regulations codified at 19 CFR part 353

(April 1, 1997).

Scope of the Review

This review covers imports of LSIs

and parts thereof from Japan. The

Department defines such merchandise

as LSIs and the parts thereof, specified

below, that have classical measurement

capabilities, whether or not also capable

of dynamic measurement. Classical

measurement (also known as static

measurement) capability usually means

the ability to measure absolutely (i.e.,

without reference to molecular

standards) the weight and size of

macromolecules and submicron

particles in solution, as well as certain

molecular interaction parameters, such

as the so-called second viral coefficient.

(An instrument that uses single-angle

instead of multi-angle measurement can

only measure molecular weight and the

second viral coefficient.) Dynamic

measurement (also known as quasielastic measurement) capability refers to

the ability to measure the diffusion

coefficient of molecules or particles in

suspension and deduce therefrom

features of their size and size

distribution. LSIs subject to this review

employ laser light and may use either a

single-angle or multi-angle technique.

The following parts are included in

the scope of this administrative review

when they are manufactured according

to specifications and operational

requirements for use only in an LSI as

defined in the preceding paragraph:

scanning photomultiplier assemblies,

immersion baths (to provide

temperature stability and/or refractive

index matching), sample-containing

structures, electronic signal-processing

boards, molecular characterization

software, preamplifier/discriminator

circuitry, and optical benches. LSIs

subject to this review may be sold

inclusive or exclusive of accessories

such as personal computers, cathode ray

tube displays, software, or printers. LSIs

are currently classifiable under

Harmonized Tariff Schedule (HTS)

subheading 9027.30.40. LSI parts are

currently classifiable under HTS

subheading 9027.90.40. HTS

subheadings are provided for

convenience and U.S. Customs Service

purposes. The written product

description remains dispositive.

Different items with the same name as

subject parts may enter under

subheading 9027.90.40. To avoid the

unintended suspension of liquidation of

non-subject parts, those items entered

under subheading 9027.90.40 and

generally known as scanning

photomultiplier assemblies, immersion

baths, sample-containing structures,

electronic signal-processing boards,

molecular characterization software,

preamplifier/discriminator circuitry,

and optical benches must be

accompanied by an importer’s

declaration to the Customs Service

stating that they are not manufactured

for use in a subject LSI.

Termination of Administrative Review

Otsuka responded that it had no

shipments of the subject merchandise

during the period of review. We

confirmed this information with the

United States Customs Service.

Therefore, in accordance with our

practice, we are terminating this

administrative review. See, e.g.,

Calcium Hypochlorite from Japan:

Termination of Antidumping Duty

Administrative Review, 62 FR 18086

(April 14, 1997). The cash deposit rate

for this firm will continue to be 129.71

percent, the rate established in the most

recently completed administrative

review. See Light Scattering Instruments

and Parts Thereof from Japan: Final

Results of Antidumping Duty

Administrative Review, 60 FR 50551

(September 29, 1995).

This termination of administrative

review and notice are in accordance

with section 751(a)(1) of the Act (19

U.S.C. 1675(a)(1)).

Dated: July 31, 1997.

Roland L. MacDonald,

Acting Deputy Assistant Secretary,

Enforcement Group III.

[FR Doc. 97–21010 Filed 8–7–97; 8:45 am]

BILLING CODE 3510–DS–P

DEPARTMENT OF COMMERCE

International Trade Administration

[A–588–823]

Professional Electric Cutting Tools

From Japan; Preliminary Results of

Antidumping Duty Administrative

Review

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

ACTION: Notice of preliminary results of

antidumping duty administrative

review.

SUMMARY: In response to a request by

Black & Decker Inc., the petitioners in

this case, the Department of Commerce

(the Department) is conducting an

administrative review of the

antidumping duty order on professional

electric cutting tools (PECTs) from

Japan. The period of review (‘‘POR’’)

covers shipments of the subject

merchandise to the United States during

the period July 1, 1995 through June 30,

1996.

We have preliminarily determined

that respondents sold subject

merchandise at less than normal value

(NV) during the POR. If these

preliminary results are adopted in our

final results of this administrative

review, we will instruct U.S. Customs to

assess antidumping duties equal to the

difference between the constructed

export price (‘‘CEP’’) and the NV.

We invite interested parties to

comment on these preliminary results.

Parties who submit argument in this

proceeding should also submit with the

argument (1) a statement of the issue,

and (2) a brief summary of the

argument.

EFFECTIVE DATE: August 8, 1997.

FOR FURTHER INFORMATION CONTACT:

Stephen Jacques, AD/CVD Enforcement
Federal Register / Vol. 62, No. 153 / Friday, August 8, 1997 / Notices 42751

Group III, Office 9, Import

Administration, International Trade

Administration, U.S. Department of

Commerce, 14th Street and Constitution

Avenue, N.W., Washington, DC 20230;

telephone: (202) 482–3434.

SUPPLEMENTARY INFORMATION:

The Applicable Statute

Unless otherwise indicated, all

citations to the Tariff Act of 1930, as

amended (the Act) are references to the

provisions effective January 1, 1995, the

effective date of the amendments made

by the Uruguay Rounds Agreements Act

(URAA). In addition, unless otherwise

indicated, all references to the

Department’s regulations as codified at

19 CFR part 353, as they existed on

April 1, 1996.

Background

On July 12, 1993, the Department

published in the Federal Register the

antidumping duty order on PECTs from

Japan (58 FR 37461). On July 8, 1996,

the Department published in the

Federal Register a notice of opportunity

to request an administrative review of

this antidumping duty order (61 FR

35713). On July 31, petitioners

requested that we conduct an

administrative review in accordance

with 19 CFR 353.22(a)(1). We published

the notice of initiation of this

antidumping duty administrative review

on August 15, 1996 (61 FR 42416).

The Department is conducting this

review in accordance with section 751

of the Act.

Scope of the Review

Imports covered by this review are

shipments of PECTs from Japan. PECTs

may be assembled or unassembled, and

corded or cordless.

The term ‘‘electric’’ encompasses

electromechanical devices, including

tools with electronic variable speed

features. The term ‘‘assembled’’

includes unfinished or incomplete

articles, which have the essential

characteristics of the finished or

complete tool. The term ‘‘unassembled’’

means components which, when taken

as a whole, can be converted into the

finished or unfinished or incomplete

tool through simple assembly operations

(e.g., kits).

PECTs have blades or other cutting

devices used for cutting wood, metal,

and other materials. PECTs include

chop saws, circular saws, jig saws,

reciprocating saws, miter saws, portable

bank saws, cut-off machines, shears,

nibblers, planers, routers, joiners,

jointers, metal cutting saws, and similar

cutting tools.

The products subject to this order

include all hand-held PECTs and certain

bench-top, hand-operated PECTs. Handoperated tools are designed so that only

the functional or moving part is held

and moved by hand while in use, the

whole being designed to rest on a table

top, bench, or other surface. Bench-top

tools are small stationary tools that can

be mounted or placed on a table or

bench. They are generally

distinguishable from other stationary

tools by size and ease of movement.

The scope of the PECT order includes

only the following bench-top, handoperated tools: cut-off saws; PVC saws;

chop saws; cut-off machines, currently

classifiable under subheading 8461 of

the Harmonized Tariff Schedule of the

United States (HTSUS); all types of

miter saws, including slide compound

miter saws and compound miter saws,

currently classifiable under subheading

8465 of the HTSUS; and portable band

saws with detachable bases, also

currently classifiable under subheading

8465 of the HTSUS.

This order does not include:

professional sanding/grinding tools;

professional electric drilling/fastening

tools; lawn and garden tools; heat guns;

paint and wallpaper strippers; and

chain saws, currently classifiable under

subheading 8508 of the HTSUS.

Parts or components of PECTs when

they are imported as kits, or as

accessories imported together with

covered tools, are included within the

scope of this order.

‘‘Corded’’ and ‘‘cordless’’ PECTs are

included within the scope of this order.

‘‘Corded’’ PECTs, which are driven by

electric current passed through a power

cord, are, for purposes of this order,

defined as power tools which have at

least five of the following seven

characteristics:

1. The predominate use of ball,

needle, or roller bearings (i.e., a majority

or greater number of the bearings in the

tool are ball, needle, or roller bearings);

2. Helical, spiral bevel, or worm

gearing;

3. Rubber (or some equivalent

material which meets UL’s

specifications S or SJ) jacketed power

supply cord with a length of 8 feet or

more;

4. Power supply cord with a separate

cord protector;

5. Externally accessible motor

brushes;

6. The predominate use of heat treated

transmission parts (i.e., a majority or

greater number of the transmission parts

in the tool are heat treated); and

7. The presence of more than one coil

per slot armature. If only six of the

above seven characteristics are

applicable to a particular ‘‘corded’’ tool,

then that tool must have at least four of

the six characteristics to be considered

a ‘‘corded’’ PECT.

‘‘Cordless’’ PECTs, for the purposes of

this order, consist of those cordless

electric power tools having a voltage

greater than 7.2 volts and a battery

recharge time of one hour or less.

PECTs are currently classifiable under

the following subheadings of the

HTSUS: 8508.20.00.20, 8508.20.00.70,

8508.20.00.90, 8461.50.00.20,

8465.91.00.35, 85.80.00.55,

8508.80.00.65 and 8508.80.00.90.

Although the HTSUS subheading is

provided for convenience and customs

purposes, the written description of the

merchandise under review is

dispositive.

This review covers one company,

Makita Corporation (‘‘Makita’’), and the

period July 1, 1995 through June 30,

1996.

Level of Trade

To the extent practicable, we

determine NV for sales at the same level

of trade (LOT) as the U.S. sales (either

EP or CEP). When there are no sales at

the same level of trade, we compare U.S.

sales to home market (or, if appropriate,

third-country) sales at a different level

of trade. The NV level of trade is that

of the starting-price sales in the home

market. When NV is based on

constructed value, the LOT is that of the

sales from which we derive SG&A and

profit.

For both EP and CEP, the relevant

transaction for the level-of-trade

analysis is the sale (or constructed sale)

from the exporter to the importer. While

the starting price for CEP is that of a

subsequent resale to an unaffiliated

buyer, the construction of the CEP

results in a price that would have been

charged if the importer had not been

affiliated. We calculate the CEP by

removing from the first resale to an

independent U.S. customer the

expenses under section 772(d) of the

Act and the profit associated with those

expenses. These expenses represent

activities undertaken by the affiliated

importer. Because the expenses

deducted under section 772(d) represent

selling activities in the United States,

the deduction of these expenses

normally yields a different level of trade

for the CEP than for the later resale

(which we use for the starting price).

Movement charges, duties, and taxes

deducted under 772(c) do not represent

activities of the affiliated importer and

we do not remove them to obtain the

CEP level of trade.

To determine whether home market

sales are at a different level of trade than
42752 Federal Register / Vol. 62, No. 153 / Friday, August 8, 1997 / Notices

U.S. sales, we examine whether home

market sales are at different stages in the

marketing process than the U.S. sales.

The marketing process in both markets

begins with goods being sold by the

producer and extends to the sale to the

final user, regardless of whether the

final user is an individual consumer or

an industrial user. The chain of

distribution between the producer and

the final user may have many or few

links, and each respondent’s sales occur

somewhere along this chain. In the

United States, the respondent’s sales are

generally to an importer, whether

independent or affiliated. We review

and compare the distribution systems in

the home market and U.S. export

markets, including selling functions,

class of customer, and the extent and

level of selling expenses for each

claimed level of trade. Customer

categories such as distributor, original

equipment manufacturer (OEM), or

wholesaler are commonly used by

respondents to describe levels of trade,

but, without substantiation, they are

insufficient to establish that a claimed

level of trade is valid. An analysis of the

chain of distribution and of the selling

functions substantiates or invalidates

the claimed levels of trade. If the

claimed levels are different, the selling

functions performed in selling to each

level should also be different.

Conversely, if levels of trade are

nominally the same, the selling

functions should also be the same.

Different levels of trade necessarily

involve differences in selling functions,

but differences in selling functions,

even substantial ones, are not alone

sufficient to establish a difference in the

levels of trade. Differences in levels of

trade are characterized by purchasers at

different stages in the chain of

distribution and sellers performing

qualitatively or quantitatively different

functions in selling to them.

When we compare U.S. sales to home

market sales at a different level of trade,

we make a level-of-trade adjustment if

the difference in levels of trade affects

price comparability. We determine any

effect on price comparability by

examining sales at different levels of

trade in a single market, the home

market. Any price effect must be

manifested in a pattern of consistent

price differences between home market

sales used for comparison and sales at

the equivalent level of trade of the

export transaction. To quantify the price

differences, we calculate the difference

in the average of the net prices of the

same models sold at different levels of

trade. We use the average difference in

net prices to adjust NV when NV is

based on a level of trade different from

that of the export sale. If there is a

pattern of no consistent price

differences, the difference in levels of

trade does not have a price effect, and

no adjustment is necessary.

The statute also provides for an

adjustment to NV when NV is based on

a level of trade different from that of the

CEP if the NV level is more remote from

the factory than the CEP and if we are

unable to determine whether the

difference in levels of trade between

CEP and NV affects the comparability of

their prices. This latter situation can

occur where there is no home market

level of trade equivalent to the U.S.

sales level or where there is an

equivalent home market level but the

data are insufficient to support a

conclusion on price effect. This

adjustment, the CEP offset, is identified

in section 773(a)(7)(B) and is the lower

of the following:

• The indirect selling expenses on the

home market sale, or

• The indirect selling expenses

deducted from the starting price in

calculating CEP.

The CEP offset is not automatic each

time we use CEP. The CEP offset is

made only when the level of trade of the

home market sale is more advanced

than the level of trade of the U.S. (CEP)

sale and there is not an appropriate

basis for determining whether there is

an effect on price comparability.

In this review, Makita reported two

levels of trade in the home market: (1)

Sales made at the wholesale/distributor

price level; and (2) sales made to the

retail level. Makita also reported twelve

channels of distribution for the two

levels of trade in the home market.

Makita based the channels of

distribution on which entity (i.e.,

wholesaler, subwholesaler or retailers)

in the distribution chain Makita had

billed or shipped the merchandise to.

Although Makita described twelve

channels of distribution, upon review

we found that channels 1 through 7

were sales to the wholesale LOT, and

channels 8 through 12 were at the retail

LOT.

We found that the two home market

levels of trade differed significantly

with respect to selling activities. The

level of selling activities with respect to

the retail sales was much greater than

with respect to the wholesaler sales.

Based on these differences, which have

been reported as business proprietary,

we found that Makita’s selling activities

with respect to the levels of trade for

wholesalers and retailers in the home

market are sufficiently dissimilar to

conclude that two separate levels of

trade exist in the home market (i.e.,

wholesale and retail) (See Analysis

Memo from Stephen Jacques to the File,

July 31, 1997).

Makita reported only CEP sales in the

U.S. market. The CEP sales were based

on sales made by Makita to its whollyowned U.S. subsidiary, Makita U.S.A.

We determined that these sales

constitute a single level of trade in the

United States. Because Makita’s sales to

the United States were all CEP sales

made by an affiliated company, we

considered only the parent company’s

selling activities reflected in the price

after the deduction of expenses and

profit, pursuant to section 772(d) of the

Act.

Based on an analysis of the record

evidence, we disagree with Makita’s

assertion that there is no home market

level equivalent to the CEP level of

trade. To determine whether sales in the

comparison market were at a different

level of trade than CEP sales, we

examined whether the CEP comparison

sales were at different stages in the

marketing process. We made this

determination on the basis of a review

of the distribution system in the two

markets, including selling functions,

class of customer, and the extent and

the level of selling expenses for each

type of sale. Overall, Makita listed

fourteen separate selling activities

which it performed in making sales in

both markets in its business proprietary

chart in Exhibit B–20 of the November

27, 1996 questionnaire response. The

majority (ten) of these selling activities

were either different in character or

intensity between the CEP level of trade

and the retail and wholesaler levels of

trade in the home market. However, in

comparing the CEP level of trade against

both home markets levels of trade we

found that the CEP level of trade had

several (six) selling functions that were

either identical to the home market

wholesaler level of trade or differed

only in intensity, not in character. In

contrast, between the CEP level of trade

and the retailer level of trade in the

home market, we found only one selling

activity that was identical to a CEP

selling activity, while most of the

remaining selling functions were

completely different from selling

activities Makita performed for its CEP

sales.

Based upon this evidence, we have

concluded that the differences between

the channels of distribution for the CEP

and the home market wholesale level of

trade sales are not sufficient to

constitute different levels of trade.

Therefore, to the extent possible, we

have used sales at the wholesale level of

trade for comparison purposes in our
Federal Register / Vol. 62, No. 153 / Friday, August 8, 1997 / Notices 42753

analysis without making a level-of-trade

adjustment.

In addition, we note that in a previous

review of this order, the Department

found, based on verified information,

that the wholesale level of trade in

Japan is equivalent to the CEP level in

the United States. See Professional

Electric Cutting Tools from Japan;

Preliminary Results of Antidumping

Duty Administrative Review, 61 FR

46624, 46626 (September 4, 1996).

When we are unable to find sales of

the foreign like product in the home

market at the same level of trade as the

U.S. sale, we examine whether a level

of trade adjustment is appropriate. We

make this adjustment when it is

demonstrated that a difference in level

of trade has an effect on price

comparability. This is the case when it

is established that, with respect to sales

used to calculate NV, there is a pattern

of consistent price differences between

sales made at the two different levels of

trade. To make this determination, we

compared the weighted average of

Makita’s NV prices of sales made in the

ordinary course of trade at the two

levels of trade for models sold at both

levels as indicated in Makita’s

Appendix B–21 of the November 27,

1996 questionnaire response. Because

the weighted-average prices were higher

at one of the levels of trade for a

preponderance of the models, we

considered this to demonstrate a pattern

of consistent price differences. We

based our finding on whether the

weighted-average prices were higher for

a preponderance of sales on the

quantities of each model sold. See

Antifriction Bearings (Other Than

Tapered Roller Bearings) and Parts

Thereof from France, et al.: Preliminary

Results of Antidumping Duty

Administrative Reviews, 61 FR 35713

(July 8, 1996). On the basis of this

analysis, we found that there was a

pattern of consistent price differences

between the two levels of trade in the

home market. Thus, we made an

adjustment to NV for the differences in

levels of trade when we made our

comparison to sales at the retail level.

Makita has requested a CEP offset in

this review. Section 773(a)(7)(B) of the

Act establishes that a CEP ‘‘offset’’ may

be made when two conditions exist: (1)

NV is established at a level of trade

which constitutes a more advanced

stage of distribution than the level of

trade of the CEP; and (2) the data

available do not provide an appropriate

basis for a level-of-trade adjustment.

As we stated in the final results of the

recently completed administrative

review of this product, ‘‘the amended

statute permits the deduction of indirect

selling expenses from NV as a CEP offset

only when a level-of-trade adjustment is

warranted, but the data available do not

provide an appropriate basis to

determine a level of trade adjustment.’’

See § 773(a)(7)(B). In addition, the SAA

clearly states that the CEP offset is to be

used in lieu of a level of trade

adjustment. See SAA at 829. In the

preliminary results of this review, we

made a level of trade adjustment to NV

in accordance with § 773(a)(7)(B).

Therefore, we have not made a CEP

offset.

Product Comparisons

In accordance with section 777A(d)(2)

of the Act, we calculated transactionspecific CEPs for comparison to

monthly weighted-average NVs. We

compared CEP sales to sales in the home

market and to constructed value (CV).

Constructed Export Price

For Makita, we based our margin

calculation on CEP as defined in section

772(b) of the Act because the subject

merchandise was first sold in the United

States after importation into the United

States by Makita U.S.A., a seller

affiliated with Makita. We calculated

CEP based on packed, delivered prices

to the first unrelated purchaser in the

United States.

We deducted Japanese and U.S.

inland freight, ocean freight, insurance,

brokerage and handling pursuant to

section 772(c)(2) of the Act. We also

deducted an amount from the price for

the following expenses in accordance

with section 772(d)(1) of the Act, which

related to economic activities in the

United States: commissions, direct

selling expenses, including credit

expenses, and indirect selling expenses,

including inventory carrying costs. We

also made deductions for discounts and

rebates. Finally, we made an adjustment

for profit allocated to these expenses in

accordance with section 772(d)(3) of the

Act.

Normal Value

We compared the aggregate volume of

Makita’s home-market sales of the

foreign like product and U.S. sales of

the subject merchandise to determine

whether the volume of the foreign like

product Makita sold in Japan was

sufficient, pursuant to section

773(a)(1)(C) of the Act, to form a basis

for NV. Because Makita’s volume of

home-market sales of foreign like

product was greater than five percent of

its U.S. sales of subject merchandise, in

accordance with section 773(a)(1)(B)(i)

of the Act, we based NV on the prices

at which the foreign like products were

first sold for consumption in Japan.

In calculating NV, we disregarded

sales of the foreign like product to

affiliated customers in the home market

where we determined that such sales

were not made at arm’s length. To test

whether these sales were made at arm’s

length, we compared the starting prices

of sales of the foreign like product to

affiliated and unaffiliated customers net

of all movement charges, direct selling

expenses, discounts and packing. Where

the price to the affiliated party was on

average 99.5 percent or more of the

price to the unaffiliated party, we

determined that the sale made to the

affiliated party was at arm’s-length.

Where no affiliated customer ratio could

be constructed because identical

merchandise was not sold to

unaffiliated customers, we were unable

to determine that these sales were made

at arm’s length and, therefore, excluded

them from our analysis. See Final

Determination of Sales at Less Than

Fair Value: Certain Cold-Rolled Carbon

Steel Flat Products from Argentina, (58

FR 37062, 37077 (July 9, 1993)). Where

the exclusion of such sales eliminated

all sales of the most appropriate

comparison product based on our

model-matching hierarchy, we made

comparisons to the next most similar

model.

We based home-market prices on the

packed, delivered prices to affiliated or

unaffiliated purchasers in the home

market. Where applicable, we made

adjustments for differences in packing

and for movement expenses in

accordance with section 773(a)(6) (A)

and (B) of the Act. We also made

adjustments for discounts and rebates,

and differences in cost attributable to

the differences in physical

characteristics of the merchandise

pursuant to section 773(a)(6)(C)(iii) of

the Act and 19 CFR 353.56. If

appropriate, we made circumstance of

sale adjustments by deducting homemarket direct selling expenses and

adding U.S. direct selling expenses,

except those deducted from the starting

price in calculating CEP pursuant to

section 772(d) of the Act.

We based NV on the price at which

the foreign like product was first sold

for consumption in Japan, in the usual

commercial quantities, in the ordinary

course of trade and in accordance with

section 773(a)(1)(B)(i) of the Act. To

extent practicable, we based NV on sales

at the same level of trade as the CEP

sales. If NV was calculated at a different

level of trade, we made an adjustment,

in accordance with section 773(a)(7) of

the Act. This adjustment is discussed

further in the Level of Trade section

above.
42754 Federal Register / Vol. 62, No. 153 / Friday, August 8, 1997 / Notices

Cost of Production Analysis

On December 13, 1996, Black &

Decker (U.S.), the petitioner in the LTFV

investigation, alleged that respondent

Makita made home market sales of

professional electric cutting tools at

prices below the cost of production

(‘‘COP’’) during this POR and provided

information in support those

allegations.

After petitioner’s December 1996

allegation, the Department published

the final results of the second

administrative review on Professional

Electric Cutting Tools from Japan (62 FR

386, January 3, 1997). In that most

recently completed review of Makita,

the Department disregarded sales by

Makita at prices below cost, pursuant to

section 773(b)(1). Because the

Department disregarded sales below the

COP in the last completed review, we

have reasonable grounds to believe or

suspect that sales of the foreign like

product under consideration for the

determination of NV in this review may

have been made at prices below the COP

as provided by section 773(b)(2)(A)(ii) of

the Act. Therefore, we did not consider

petitioner’s allegation, but pursuant to

section 773(b)(1) of the Act, we initiated

an investigation to determine whether

Makita made home market sales during

the POR at prices below its COP.

A. Calculation of COP

We calculated the COP based on the

sum of the costs of materials and

fabrication employed in producing the

foreign like product, plus amounts for

home market selling, general and

administrative (SG&A) expenses and

packing costs in accordance with

section 773(b)(3) of the Act. We relied

on the home market sales and COP

information provided by Makita in their

questionnaire responses.

B. Test of Home Market Prices

After calculating COP, we tested

whether home market sales of the

subject merchandise were made at

prices below COP within an extended

period of time in substantial quantities

and whether such prices permitted

recovery of all costs within a reasonable

period of time. We compared modelspecific COPs to the reported home

market prices less any applicable

movement charges, discounts, rebates

and direct selling expenses.

C. Results of COP Test

Pursuant to section 773(b)(2)(C)(i) of

the Act, where less than 20 percent of

a respondent’s sales of a given product

are at prices less than COP, we do not

disregard any below-cost sales of that

product because we determine that the

below-cost sales are not made in

substantial quantities within an

extended period of time. Where 20

percent or more of a respondent’s sales

of a given product during the POR are

at prices less than the COP, we

disregard the below-cost sales because

we find such sales to be made in

substantial quantities within an

extended period and were at prices

which would not permit the recovery of

all costs within a reasonable period of

time (see section 773(b)(2)(D) of the

Act). Based on this test, for these

preliminary results, we disregarded

certain of Makita’s below-cost sales.

Where we disregarded all

contemporaneous sales of the

comparison product based on this test,

we calculated NV based on CV, in

accordance with section 773(a)(4) of the

Act.

Constructed Value

In accordance with section 773(a)(4)

of the Act, we used CV as the basis for

NV when there were no usable sales of

the foreign like product in Japan. We

calculated CV in accordance with

section 773(e) of the Act. We included

the cost of materials and fabrication,

SG&A expenses, and profit. In

accordance with section 773(e)(2)(A) of

the Act, we based SG&A expenses and

profit on the actual amounts incurred

and realized by Makita in connection

with the production and sale of the

foreign like product in the ordinary

course of trade for consumption in

Japan. We used the weighted-average

home market selling expenses.

Where appropriate, we made

adjustments to CV in accordance with

section 773(a)(6)(C)(iii) of the Act for

differences in the circumstances of sale

(COS). We made COS adjustments by

deducting home direct selling expenses

and adding U.S. direct selling expenses,

except those deducted from the starting

price in calculating CEP pursuant to

section 772(d) of the Act. Where

appropriate we made level of trade

adjustments pursuant to 773(a)(7)(A).

Duty Absorption

On December 13, 1996, the petitioner

requested that the Department examine

whether antidumping duties had been

absorbed during the POR. Section

751(a)(4) of the Act provides that the

Department, if requested, shall

determine, during an administrative

review initiated two years or four years

after publication of the order, whether

antidumping duties have been absorbed

by a foreign producer or exporter subject

to the order if the subject merchandise

is sold in the U.S. through an affiliated

importer. As noted above, this

proceeding is governed by the

provisions of the Act as they existed on

January 1, 1995, which includes section

751(a)(4). However, the regulations

applicable to this proceeding do not

address duty absorption. Therefore,

section 351.701 of the new regulations

(19 CFR part 351) serves as a statement

of the Department’s interpretation of the

requirements of the Act regarding duty

absorption.

Under section 751(c)(6)(C), orders that

were in effect on January 1, 1995,

constitute transition orders. Under

section 751(c)(6)(D), the Department is

to treat transition orders, such as the

1993 order at issue, as being issued on

January 1, 1995. Section 351.213(j)(2) of

the Department’s new antidumping duty

regulations provides that the

Department will make a duty absorption

determination, if requested by a

domestic interested party, for any

administrative review initiated in 1996

or 1998. See Antidumping Duties;

Countervailing Duties; Final Rule, 62 FR

2295, 27394 (May 19, 1997). The

preamble to the antidumping

regulations explains that reviews

initiated in 1996 will be considered

initiated in the second year and reviews

initiated in 1998 will be considered

initiated in the fourth year. See 62 FR

27318.

This approach ensures that interested

parties will have the opportunity for a

duty absorption inquiry prior to a sunset

review of the order under section 751(c)

in cases where the second and fourth

years following issuance of an order

have already passed. Because the order

on professional electric cutting tools

from Japan had been in effect since

1993, this is a transition order.

Therefore, the Department will first

consider a request for an absorption

determination during a review initiated

in 1996. This being a review initiated in

1996, we are making a duty-absorption

determination as part of this segment of

the proceeding.

The statute provides for a

determination on duty absorption if the

subject merchandise is sold in the

United States through an affiliated

importer. In this case, Makita U.S.A. is

the importer of record. Makita U.S.A. is

wholly-owned by Makita Corporation of

Japan. Therefore, the importer and

exporter are ‘‘affiliated’’ within the

meaning of section 751(a)(4).

Furthermore, we have preliminary

determined that there is a dumping

margin for Makita on 16.3 percent of its

U.S. sales during the POR. In addition,

we cannot conclude from the record that

the unaffiliated purchaser in the United

States will pay the ultimately assessed

duty. Therefore, based on these
Federal Register / Vol. 62, No. 153 / Friday, August 8, 1997 / Notices 42755

circumstances, we preliminarily find

that antidumping duties have been

absorbed by Makita on 16.3 percent of

its U.S. sales.

Preliminary Results of Review

As a result of our review, we

preliminarily determine that the

following weighted-average dumping

margin exists for the period June 30,

1995, through July 1, 1996:

Manufacturer/exporter

Margin

(percent)

Makita Corporation ......................... 0.50

Parties to the proceeding may request

disclosure within five days of the date

of publication of this notice. Any

interested party may request a hearing

within 10 days of publication. Any

hearing, if requested, will be held 44

days after the date of publication or the

first business day thereafter. Case briefs

and/or other written comments from

interested parties may be submitted not

later than 30 days after the date of

publication. Rebuttal briefs and

rebuttals to written comments, limited

to issues raised in those comments, may

be filed not later than 37 days after the

date of publication of this notice. The

Department will publish the final

results of this administrative review,

including its analysis of issues raised in

any written comments or at a hearing,

not later than 120 days after the date of

publication of this notice.

The Department shall determine, and

the U.S. Customs Service shall assess,

antidumping duties on all appropriate

entries. We have calculated an importerspecific ad valorem duty assessment

rate based on the ratio of the total

amount of antidumping duties

calculated for the examined sales made

during the POR to the total customs

value of the sales used to calculate those

duties. This rate will be assessed

uniformly on all entries of that

particular importer made during the

POR. (This is equivalent to dividing the

total amount of antidumping duties,

which are calculated by taking the

difference between statutory NV and

statutory EP or CEP, by the total

statutory EP or CEP value of the sales

compared, and adjusting the result by

the average difference between EP or

CEP and customs value for all

merchandise examined during the POR).

Furthermore, the following deposit

requirements will be effective for all

shipments of the subject merchandise

entered, or withdrawn from warehouse,

for consumption on or after the

publication date of the final results of

these administrative reviews, as

provided by section 751(a)(1) of the Act:

(1) The cash deposit rate for Makita will

be the rate established in the final

results of this review (except that no

deposit will be required for Makita if we

find zero or de minimis margins, i.e.,

margins less than 0.5 percent); (2) for

previously reviewed or investigated

companies not listed above, the cash

deposit rate will continue to be the

company-specific rate published for the

most recent period; (3) if the exporter is

not a firm covered in this review, a prior

review, or the original LTFV

investigation, but the manufacturer is,

the cash deposit rate will be the rate

established for the most recent period

for the manufacturer of the

merchandise; and (4) the cash deposit

rate for all other manufacturers or

exporters will continue to be 54.52

percent, the ‘‘All Others’’ rate made

effective by the LTFV investigation.

These deposit requirements, when

imposed, shall remain in effect until

publication of the final results of the

next administrative review.

This notice also serves as a

preliminary reminder to importers of

their responsibility under 19 C.F.R.

353.26 to file a certificate regarding the

reimbursement of antidumping duties

prior to liquidation of the relevant

entries during this review period.

Failure to comply with this requirement

could result in the Secretary’s

presumption that reimbursement of

antidumping duties occurred and the

subsequent assessment of double

antidumping duties.

This administrative review and notice

are in accordance with section 751(a)(1)

of the Act (19 U.S.C. 1675(a)(1)) and 19

C.F.R. 353.22(c)(5).

Dated: July 31, 1997.

Robert S. LaRussa,

Acting Assistant Secretary for Import

Administration.

[FR Doc. 97–20940 Filed 8–7–97; 8:45 am]

BILLING CODE 3510–DS–P

DEPARTMENT OF COMMERCE

International Trade Administration

[A–570–825]

Sebacic Acid From the People’s

Republic of China; Preliminary Results

of Antidumping Duty Administrative

Review

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

ACTION: Notice of preliminary results of

antidumping duty administrative review

of sebacic acid from the People’s

Republic of China.

SUMMARY: The Department of Commerce

(the Department) is conducting an

administrative review of the

antidumping duty order on sebacic acid

from the People’s Republic of China

(PRC) in response to requests from the

petitioner, Union Camp Corporation,

and three respondents: Tianjin

Chemicals Import and Export

Corporation (Tianjin), Guangdong

Chemicals Import and Export

Corporation (Guangdong) and Sinochem

International Chemicals Company, Ltd.

(SICC). This review covers four

exporters of the subject merchandise,

including the three respondent

companies above and Sinochem Jiangsu

Import and Export Corporation

(Jiangsu). The period of review (POR) is

July 1, 1995, through June 30, 1996.

We have preliminarily determined

that sales have been made below normal

value (NV) during this period. If these

preliminary results are adopted in the

final results of this administrative

review, we will instruct the U.S.

Customs Service to assess antidumping

duties equal to the difference between

United States price (USP) and NV.

These assessment rates, if adopted for

the final results of the review, will be

calculated on an importer-specific ad

valorem duty basis. Interested parties

are invited to comment on these

preliminary results.

EFFECTIVE DATE: August 8, 1997.

FOR FURTHER INFORMATION CONTACT: Lyn

Baranowski, Doreen Chen, or Stephen

Jacques, Import Administration,

International Trade Administration,

U.S. Department of Commerce, 14th and

Constitution Avenue, N.W.,

Washington, D.C. 20230; telephone:

(202) 482–3793.

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 Rounds Agreements Act

(URAA). In addition, unless otherwise

indicated, all citations to the

Department’s regulations are in

reference to the regulations, codified at

19 CFR part 353, as they existed on

April 1, 1996.

SUPPLEMENTARY INFORMATION:

Background

The Department published in the

Federal Register an antidumping duty

order on sebacic acid from the PRC on

July 14, 1995 (59 FR 35909). On July 8,