Federal Register / Vol. 62, No. 4 / Tuesday, January 7, 1997 / Notices 965

Cooperative Workshop, Inc., Sedalia,

Missouri

G. John Heyer,

General Counsel.

[FR Doc. 97–201 Filed 1–6–97; 8:45 am]

BILLING CODE 6353–01–P

DEPARTMENT OF COMMERCE

International Trade Administration

[A–580–812]

Dynamic Random Access Memory

Semiconductors of One Megabit or

Above From the Republic of Korea;

Final Results of Antidumping Duty

Administrative Review

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

ACTION: Notice of final results of

antidumping duty administrative

review.

SUMMARY: On July 9, 1996, the

Department of Commerce (the

Department) published the preliminary

results of administrative review of the

antidumping duty order on dynamic

random access memory semiconductors

(DRAMs) of one megabit or above from

the Republic of Korea (61 FR 36029).

The review covers two manufacturers/

exporters of the subject merchandise to

the United States for the period May 1,

1994 through April 30, 1995. These

manufacturers/exporters are LG

Semicon Co., Ltd. (LGS, formerly

Goldstar Electron Co., Ltd.) and

Hyundai Electronics Industries, Inc.

(HEI/Hyundai).

As a result of our analysis of the

comments received, the antidumping

margins have changed from those

presented in our preliminary results.

EFFECTIVE DATE: January 7, 1997.

FOR FURTHER INFORMATION CONTACT:

Thomas F. Futtner, AD/CVD

Enforcement Office 4, Import

Administration, International Trade

Administration, U.S. Department of

Commerce, 14th Street and Constitution

Avenue, N.W., Washington, D.C. 20230,

telephone: (202) 482–3814.

SUPPLEMENTARY INFORMATION:

Background

On May 10, 1995, the Department

published a notice of ‘‘Opportunity to

Request an Administrative Review’’ of

this antidumping duty order for the

period of May 1, 1994, through April 30,

1995 (60 FR 24831). We received timely

requests for review from three

manufacturers/exporters of subject

merchandise to the United States:

Hyundai Electronics Industries, Co.

(Hyundai), LG Semicon Co., Ltd. (LGS,

formerly Goldstar Electron Co., Ltd.),

and Samsung Electronics Co.

(Samsung). The petitioner, Micron

Technologies Inc., requested an

administrative review of these same

three Korean manufacturers of DRAMs.

On June 15, 1995, the Department

initiated a review of the above Korean

manufacturers (60 FR 31447). The

period of review (POR) for all

respondents was May 1, 1994, through

April 30, 1995.

On June 26, 1995, in accordance with

section 773(b)(2)(A)(ii) of the Tariff Act

of 1930, we also initiated an

investigation to determine if Hyundai

and LGS made sales of the subject

merchandise below the cost of

production (COP) during the POR based

upon the fact that we disregarded sales

found to have been made below the COP

in the original less-than-fair-value

(LTFV) investigation.

Samsung, formerly a respondent in

this administrative review, was

excluded from the antidumping duty

order on DRAMs from Korea on

February 8, 1996. See Final Court

Decision and Partial Amended Final

Determination: Dynamic Random

Access Memory Semiconductors of One

Megabit and Above From the Republic

of Korea, 61 FR 4765 (February 8, 1996).

Accordingly, we terminated this review

with respect to Samsung.

On July 9, 1996, the Department

published the preliminary results (61 FR

36029) of administrative review of the

antidumping duty order on DRAMs of

one megabit or above from the Republic

of Korea. We received timely comments

from the petitioner and both

respondents.

Scope of the Review

Imports covered by the review are

shipments of DRAMs of one megabit

and above from the Republic of Korea

(Korea). For purposes of this review,

DRAMs are all one megabit and above,

whether assembled or unassembled.

Assembled DRAMs include all package

types. Unassembled DRAMs include

processed wafers, uncut die and cut die.

Processed wafers produced in Korea,

but packaged, or assembled into

memory modules in a third country, are

included in the scope; wafers produced

in a third country and assembled or

packaged in Korea are not included in

the scope of this review.

The scope of this review includes

memory modules. A memory module is

a collection of DRAMs, the sole function

of which is memory. Modules include

single in-line processing modules (SIPs),

single in-line memory modules

(SIMMs), or other collections of DRAMs,

whether unmounted or mounted on a

circuit board. Modules that contain

other parts that are needed to support

the function of memory are covered.

Only those modules which contain

additional items which alter the

function of the module to something

other than memory, such as video

graphics adapter (VGA) boards and

cards, are not included in the scope.

The scope of this review also includes

video random access memory

semiconductors (VRAMs), as well as

any future packaging and assembling of

DRAMs.

The scope of this review also includes

removable memory modules placed on

motherboards, with or without a central

processing unit (CPU), unless the

importer of motherboards certifies with

the Customs Service that neither it, nor

a party related to it or under contract to

it, will remove the modules from the

motherboards after importation. The

scope of this review does not include

DRAMs or memory modules that are

reimported for repair or replacement.

The DRAMs subject to this review are

classifiable under subheadings

8542.11.0001, 8542.11.0024,

8542.11.0026, and 8542.11.0034 of the

Harmonized Tariff Schedule of the

United States (HTSUS). Also included

in the scope are those removable Korean

DRAMs contained on or within

products classifiable under subheadings

8471.91.0000 and 8473.30.4000 of the

HTSUS. Although the HTSUS

subheadings are provided for

convenience and customs purposes, the

written description of the scope of this

review remains dispositive.

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

(URAA). In addition, unless otherwise

indicated, all citations to the

Department’s regulations are to the

current regulations, as amended by the

interim regulations published in the

Federal Register on May 11, 1995 (60

FR 25130).

United States Price

We calculated U.S. price according to

the methodology described in our

preliminary results.

Normal Value

We calculated normal value (NV)

according to the methodology described

in our preliminary results.
966 Federal Register / Vol. 62, No. 4 / Tuesday, January 7, 1997 / Notices

Analysis of Comments Received

We invited interested parties to

comment on the preliminary results of

this administrative review. We received

timely comments from the petitioner

and both respondents.

General Comments

Comment 1

The petitioner argues (1) that the

Department should not have allowed a

level of trade adjustment for both

respondents, and (2) that the

Department inappropriately applied a

constructed export price (CEP) offset to

respondents’ CEP sales for this level of

trade adjustment. The petitioner

maintains that the Department erred in

determining that one level of trade

existed in the home market (direct sales

by the parent corporation to the

domestic customer) and a different level

of trade existed in the U.S. market,

where the Department used the level of

trade of the sale to the affiliated

importer rather than the resale to the

unaffiliated customer (i.e., a

‘‘constructed’’ level of trade). According

to the petitioner, the Act and the SAA

do not permit the Department to use a

‘‘constructed’’ level of trade for CEP

sales when identifying the level of trade.

The petitioner argues that section

773(a)(7)(A) of the Act, which provides

for a level of trade adjustment, does not

make any distinction between export

price (EP) sales and CEP sales, and that

the distinction between EP and CEP

sales in subsections 772(a) and 772(b) of

the Act does not warrant any different

treatment when identifying levels of

trade.

The petitioner argues that, in view of

the sections of the Act mentioned above,

the Department’s interpretation of the

SAA as permitting a constructed level of

trade means that the home market level

of trade will always be a more advanced

stage of distribution than the level of

trade of the CEP and that the data

available will never provide an adequate

basis to determine a level of trade

adjustment, and thus that the CEP offset

will always be used. The SAA,

according to the petitioner, intended the

application of the CEP offset to be an

exception, rather than the rule. The

Department’s acceptance of a

constructed level of trade, the petitioner

argues, contradicts the SAA’s intent and

the intent of the statute in section

773(a)(7)(A).

The petitioner argues further that,

even if the Department adheres to the

distinction between EP and CEP sales in

determining the starting price for

determining the level of trade, neither

respondent has adequately

demonstrated that it is entitled to a level

of trade adjustment. The petitioner

argues that the simple enumeration of

selling functions in both the home

market and in the U.S. market is not

sufficient to demonstrate the

significance of the differing selling

functions in both markets.

LGS and Hyundai argue that the

Department correctly applied the CEP

offset to adjust for differences in the

levels of trade in the two markets which

were not able to be quantified. Both

respondents assert that the Department’s

use of a ‘‘constructed’’ level of trade

when analyzing CEP sales is in

accordance with past interpretation of

the SAA and of the Act. LGS maintains

that the Department has consistently

followed this approach and has

explicitly stated in the antidumping

questionnaire that constructed level of

trade will be used.

LGS and Hyundai also reject the

petitioner’s argument that respondents

have not adequately documented

differences in selling functions in the

home and in the U.S. markets.

Respondents point out that the

petitioner only referenced the brief

discussion of the selling function

differences contained in the notice of

preliminary results and ignores the

detailed analysis presented in its

questionnaire response and in the

Department’s preliminary analysis

memorandum. LGS and Hyundai argue

that, because respondents’ home market

sales were at levels of trade more

advanced than its U.S. sales and it was

not possible to quantify the price

differential caused by these differences,

the Department should continue to

allow a CEP offset to NV or to

constructed value (CV) to adjust for the

differences of trade in the two markets.

DOC Position

We agree with respondents. We have

consistently determined that the statute

and the SAA both support analyzing the

level of trade of CEP sales at the

constructed level, after expenses

associated with economic activities in

the United States (section 772(d) of the

Act) have been deducted. We believe

that it is neither reasonable nor logical

to base level of trade on the starting

price for both EP and CEP sales. We

stated in Antidumping Duties;

Countervailing Duties; Notice of

Proposed Rulemaking and Request for

Public Comments, 61 FR 7308, 7347

(February 27, 1996), the following:

With respect to the identification of levels

of trade, some commentators argued that,

consistent with past practice, the Department

should base level of trade on the starting

price for both export price (‘‘EP’’) and CEP

sales...The Department believes that this

position is not supported by the SAA...If the

starting price is used for all U.S. sales, the

Department’s ability to make meaningful

comparisons at the same level of trade (or

appropriate adjustments for differences in

levels of trade) would be severely

undermined in cases involving CEP sales. As

noted by other commentators, using the

starting price to determine the level of trade

of both types of U.S. sales would result in a

finding of different levels of trade for an EP

sale and a CEP sale adjusted to a price that

reflected the same selling functions.

Accordingly, the regulations specify that the

level of trade analyzed for EP sales is that of

the starting price, and for CEP sales it is the

constructed level of trade of the price after

the deduction of U.S. selling expenses and

profit.

We have consistently stated that, in

those cases where a level of trade

comparison is warranted and possible,

then for CEP sales the level of trade will

be evaluated based on the price after

adjustments are made under section

772(d) of the Act (see Large Newspaper

Printing Presses and Components

Thereof, Whether Assembled or

Unassembled, From Japan; Notice of

Final Determination of Sales at Less

Than Fair Value, 61 FR 38139, 38143

(July 23, 1996). In every case decided

under the revised antidumping statute,

we have consistently adhered to this

interpretation of the SAA and of the

Act. See, e.g., Aramid Fiber Formed of

Poly para-Phenylene Terephthalamide

from the Netherlands; Preliminary

Results of Antidumping Duty

Administrative Review, 61 FR 15766,

15768 (April 9, 1996); Certain Stainless

Steel Wire Rods from France;

Preliminary Result of Antidumping

Duty Administrative Review, FR 8915,

8916 (March 6, 1996); Antifriction

Bearings (Other Than Tapered Roller

Bearings) and parts Thereof from

France, et. al., Preliminary Results of

Antidumping Duty Administrative

Review, 61 FR 25713, 35718–23 (July 8,

1996). In accordance with this clear

precedent, our instructions in the

questionnaire response issued to

respondents in this administrative

review stated that constructed level of

trade should be used.

We disagree that respondents have

not adequately documented the

differences in selling functions in the

home and in the U.S. markets. As noted

by respondents, the petitioner based this

argument solely upon the content of the

preliminary results of review and

ignored the detailed data on the record

of this proceeding in respondents’

questionnaire responses and in our

preliminary analysis memorandum

concerning the differences in selling

functions. These data contained detailed
Federal Register / Vol. 62, No. 4 / Tuesday, January 7, 1997 / Notices 967

information and descriptions of the

differences in selling functions in the

two markets (for example, the

differences in shipments per month

from respondents to U.S. and home

market customers is described in detail).

Comment 2

The petitioner maintains that the

Department’s preliminary calculations

contained the following clerical errors

with respect to both respondents: (1) the

preliminary calculations double

counted interest expenses by including

both reported interest expense and

imputed home market credit and

inventory carrying expenses in its

calculation of total cost of production

for purposes of calculating profit for

home market, CEP, and furtherprocessed U.S. sales; (2) the preliminary

calculations failed to add U.S. packing

expenses to the foreign unit price in

dollars for comparisons of U.S. sales to

CV; and, (3) the Department erred in

computing profit for CV based upon all

home market sales, including those with

negative profits, maintaining that

section 773(e)(2)(A) of the Act, as

amended by the URAA, has changed the

calculation of profit to consider only

profitable sales and to exclude sales

below the cost of production.

DOC Position:

We agree with the petitioner that our

preliminary calculations inadvertently

double counted interest expense in the

computation of the total cost of

production for purposes of calculating

profit for home market, CEP, and

further-processed U.S. sales. We also

agree that U.S. packing expenses should

have been added to the foreign unit

price in dollars. We have revised our

calculations accordingly.

While we agree that our inclusion of

all home market sales for purposes of

calculating profit for CV was an error,

we do not agree that it was a clerical

error. Section 773(e)(2)(A) of the Act

specifies the addition of ‘‘the actual

amounts incurred and realized by the

specific exporter or producer * * * for

selling, general, and administrative

expenses, and for profits, in connection

with the production and sales of a

foreign like product in the ordinary

course of trade * * *’’ Although the

petitioner argues that sales below cost

are outside of the ordinary course of

trade, section 773(b) of the Act is clear

that sales below cost may be disregarded

as being outside the ordinary course of

trade only if made within an extended

period of time in substantial quantities

and at prices which do not permit the

recovery of costs within a reasonable

period of time. Section 771(15) of the

Act provides that sales which failed the

cost of production test provided for

under section 773(b) of the Act are

outside the ordinary course of trade.

However, section 771(15) of the Act

does not provide that sales made below

the cost of production per se are outside

the ordinary course of trade. Thus, sales

below cost are not in and of themselves

outside the ordinary course of trade,

only those sales which fail our cost of

production test and are thus

disregarded. Accordingly for both

respondents, as a result of this analysis,

we have revised our calculations to base

profit on CV for both respondents upon

those home market sales which do not

fail our cost of production test.

Company-Specific Comments

LGS

Comment 3

The petitioner argues that the

Department erred in its preliminary

results in calculating research and

development expenses for LGS by

allocating only a portion of LGS’

semiconductor research and

development expenses over a portion of

LGS’ cost of sales. The petitioner

maintains that, in accordance with the

precedent set in the first administrative

review, the Department should allocate

all of LGS’ semiconductor research and

development expenses over all of LGS’

1994 semiconductor cost of sales. The

petitioner also maintains that the

Department erred in allocating LGS’

purchased research and development

over the applicable contract periods.

According to the petitioner, any

purchased research and development

should be included with all

semiconductor research and

development expenses allocated over

LGS’ 1994 cost of sales.

LGS agrees with the petitioner that

purchased research and development

should be included in those research

and development expenses allocated

over cost of sales for 1994. LGS

contends that since the Department

rejected LGS’ allocation of purchased

research and development over contract

periods in the previous administrative

review, it should allocated research and

development purchased in 1994 over

1994 cost of sales.

LGS disagrees with the petitioner that

all semiconductor research and

development expenses should be

allocated over all cost of sales. LGS

maintains that non-DRAM research and

development does not benefit LGS’

DRAM production and that the

Department should calculate a productspecific research and development rate

for LGS.

DOC Position

We agree with the petitioner that, in

calculating a research and development

rate for LGS, all semiconductor research

and development expenses should be

allocated over all of LGS’ semiconductor

cost of sales reported in its audited 1994

financial statements. This method of

allocation is consistent with our

practice in the last administrative

review, where we determined that

sufficient evidence of cross-fertilization

exists in the semiconductor industry to

rule out the use of only product or

DRAM-related research and

development expenses. See Dynamic

Random Access Memory

Semiconductors from the Republic of

Korea; Final Results of Antidumping

Duty Administrative Review, 61 FR

20216, 20218 (May 6, 1996).

We agree with both the petitioner and

LGS that research and development

purchased in 1994 should be included

in those research and development

expenses allocated over LGS’ 1994 cost

of sales.

Comment 4

LGS argues that the Department erred

in the preliminary calculations by

deducting indirect selling expenses and

inventory carrying costs incurred in

Korea from U.S. price. LGS maintains

that under the revised antidumping law,

such expenses which do not result from

or bear relationship to selling activities

in the United States should not be

deducted from U.S. price. LGS argues

that the SAA only permits the

deduction from U.S. price of selling

expenses which result from, and bear a

direct relationship to, selling activities

in the United States.

The petitioner argues that the

Department was correct in deducting

these Korean expenses from U.S. price

for LGS. The petitioner maintains that

section 772(d) of the Act clearly requires

the Department to reduce CEP by all

expenses generally incurred by or for

the account of the producer. According

to the petitioner, the SAA is a

clarification of prior law and was not

intended to change current law.

DOC Position

We agree with the respondent.

Section 772(d)(1) provides for the

deduction of all expenses generally

incurred by or for the account of the

producer or exporter, or the affiliated

reseller in the United States. However,

the deductions under section 772(d) of

the Act do not involve all direct and

indirect selling expenses. The

deductions under section 772(d) of the

Act remove only expenses associated
968 Federal Register / Vol. 62, No. 4 / Tuesday, January 7, 1997 / Notices

with economic activities in the United

States. Thus, the CEP is not a price

necessarily exclusive of all selling

expenses. Therefore, we have not

deducted indirect selling expenses and

inventory carrying costs incurred in

Korea from U.S. price because these

expenses do not result from or bear

relationship to selling activities in the

United States.

Comment 5

LGS and the noted the following

clerical errors in the Department’s

computer program: (1) a programming

error caused several home market sale

dates to be mistakenly changed; (2) the

Department’s preliminary results failed

to deduct home market packing

expenses in its calculations of net home

market price; (3) the preliminary

calculations mistakenly double counted

U.S. repacking expense; (4) the

preliminary calculations mistakenly

included duty drawback and movement

expenses in the calculation of CEP

profit; and, (5) the preliminary results

mistakenly excluded non-profitable

sales when computing profit for CEP.

DOC Position

We agree with LGS on each of these

points and have revised our calculations

accordingly.

Hyundai

Comment 6

The petitioner maintains that

Hyundai misclassified its advertising

expenses in the home market as direct

selling expenses. Insofar as Hyundai did

not submit samples of these

advertisements, the petitioner maintains

that Hyundai did not meet the burden

of demonstrating that these home

market advertising expenses were direct

in nature. The petitioner urges the

Department to reclassify all of

Hyundai’s home market advertising

expenses as indirect expenses.

Hyundai argues that its home market

advertising classification is correct.

Hyundai notes that its home market

advertising classification methodology

remains unchanged from the previous

administrative review where the

Department accepted Hyundai’s

classification of home market

advertising expenses. Hyundai

maintains that there is no justification

for reclassifying its home market

advertising expenses.

DOC Position

We agree with Hyundai. Hyundai

fully complied with our instructions in

the antidumping questionnaire issued

for this administrative review with

respect to information requested for

home market advertising expenses.

Because Hyundai’s methodology

remained unchanged from the previous

administrative review, we chose not to

require Hyundai to submit further

documentation on its home market

advertising expenses during the POR.

Therefore, we have accepted Hyundai’s

classification of its home market

advertising expenses as direct selling

expenses.

Comment 7

The petitioner maintains that the

Department’s preliminary results did

not include Hyundai’s sales of DRAMs

sold by the ISD and Axil divisions of

Hyundai’s U.S. subsidiary Hyundai

Electronics America, Inc. (HEA) in its

dumping margin calculations. These

DRAMs were further processed by ISD

and Axil in the production of personal

computers and computer workstations,

some of which were sold with the

memory modules separately invoiced

(option sales) and some of which were

sold without separately invoiced

memory modules (embedded sales). The

petitioner argues that the Department

should include these sales in its margin

analysis by setting the margin for these

sales equal to the margin found on other

further-processed sales and averaging

the two margins together to derive one

margin for all further-processed sales of

DRAMs.

Hyundai agrees with the petitioner

that these further-processed sales

should be included in the Department’s

margin analysis, but disagrees with the

petitioner on the method of including

them. Hyundai maintains that, since

there are other U.S. sales of

merchandise identical to the ISD/Axil

sales, the Department should apply the

margin found on U.S. sales of identical

merchandise to these ISD/Axil sales.

DOC Position

We agree with the petitioner and with

Hyundai that the further-processed sales

of DRAMs by ISD and Axil should be

included in the dumping analysis of

U.S. sales in the POR because it is the

Department’s longstanding practice to

include all U.S. sales in its dumping

calculations except in instances where

title does not transfer to the U.S.

customer or in the case of statistical

sampling (see Color Television

Receivers from the Republic of Korea,

58 FR 50333 (1993)). We agree with

Hyundai that, because Hyundai had

other U.S. sales identical models of

DRAMs, the margins on these identical

sales should be applied to the ISD/Axil

sales. We revised our final calculations

for Hyundai’s ISD/Axil sales by

applying the margin found on the other

U.S. sales of models identical to those

sold by ISD/Axil to Hyundai’s ISD/Axil

further-processed U.S. sales.

Comment 8

Hyundai asserts that the Department’s

preliminary calculations contained a

clerical error in the computation of

Hyundai’s antidumping margin on sales

of DRAMs in the United States further

processed into memory modules.

Hyundai maintains that the preliminary

calculations incorrectly compared the

U.S. price of these memory modules to

NV, rather than to the foreign unit price

in dollars.

DOC Position

We agree with Hyundai and have

adjusted our final calculations

accordingly.

Final Results of Review

Upon review of the comments

submitted, the Department has

determined that the following margins

exist for the period of May 1, 1994

through April 30, 1995:

Manufacturer/exporter

Percent

margin

May 1, 1994 through April 30, 1995:

LG Semicon Co., Ltd. ................... 0.01

Hyundai Electronic Industries, Inc. 0.10

The Customs Service shall assess

antidumping duties on all appropriate

entries. Individual differences between

USP and NV may vary from the

percentages stated above. The

Department will issue appraisement

instructions concerning each

respondent directly to the U.S. Customs

Service.

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 these final results of

administrative review, as provided for

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

cash deposit rate for the reviewed firms

will be zero 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 in 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) if neither the

exporter nor the manufacturer is a firm

covered in this or any previous review

conducted by the Department, the cash
Federal Register / Vol. 62, No. 4 / Tuesday, January 7, 1997 / Notices 969

deposit rate will be 3.85 percent, the all

others rate established in the LTFV

investigation. Samsung Electronics Co.,

Ltd. (Samsung), formerly a respondent

in this administrative review, was

excluded from the antidumping duty

order on DRAMs from Korea on

February 8, 1996. See Final Court

Decision and Partial Amended Final

Determination: Dynamic Random

Access Memory Semiconductors of One

Megabit and Above From the Republic

of Korea, 61 FR 4765 (February 8, 1996).

These deposit requirements shall

remain in effect until publication of the

final results of the next administrative

review.

This notice serves as the final

reminder to importers of their

responsibility under 19 CFR 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 notice also serves as a reminder

to parties subject to administrative

protective order (APO) of their

responsibility concerning the

disposition of proprietary information

disclosed under APO in accordance

with 19 CFR 353.34(d). Timely written

notification or conversion to judicial

protective order is hereby requested.

Failure to comply with the regulations

and the terms of the APO is a

sanctionable violation.

This administrative review and notice

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

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

and 19 CFR 353.22.

Dated: December 24, 1996.

Jeffrey P. Bialos,

Acting Assistant Secretary for Import

Administration.

[FR Doc. 97–295 Filed 1–6–97; 8:45 am]

BILLING CODE 3510–DS–P

A–122–047

Elemental Sulphur From Canada:

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 requests by

respondents, the Department of

Commerce (the Department) is

conducting an administrative review of

the antidumping finding on elemental

sulphur from Canada. The review covers

the period December 1, 1994 through

November 30, 1995.

As a result of the review, we have

preliminarily determined that sales have

been made below normal value (NV). If

these preliminary results are adopted in

our final results of administrative

review, we will instruct U.S. Customs to

assess antidumping duties equal to the

difference between United States price

(USP) and NV.

Interested parties are invited to

comment on these preliminary results.

Parties who submit arguments in this

segment of the proceeding are requested

to submit with each argument (1) a

statement of the issue and (2) a brief

summary of the argument.

EFFECTIVE DATE: January 7, 1997.

FOR FURTHER INFORMATION CONTACT: Rick

Johnson or Jean Kemp, Office of

Antidumping and Countervailing Duty

Enforcement, Import Administration,

International Trade Administration,

U.S. Department of Commerce, 14th

Street and Constitution Avenue, N.W.,

Washington, D.C. 20230; telephone:

(202) 482–3793.

SUPPLEMENTARY INFORMATION:

The Applicable Statute

Unless otherwise indicated, all

citations to the statute refer 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

current regulations, as amended by the

interim regulations published in the

Federal Register on May 11, 1995 (60

FR 25130).

Background

On December 17, 1973, the

Department of the Treasury published

in the Federal Register (38 FR 34655)

the antidumping finding on elemental

sulphur from Canada. On December 4,

1995, the Department published in the

Federal Register a notice of opportunity

to request an administrative review of

this antidumping finding for the period

December 1, 1994 through November

30, 1995 (60 FR 62070).

On January 11, 1996, Mobil Oil

Canada, Ltd. (Mobil) requested an

administrative review of its sales. On

January 22, 1996, Husky Oil Ltd.

(Husky) requested an administrative

review of its sales. The review was

initiated on February 1, 1996 (61 FR

3670–71).

The Department is conducting this

review in accordance with section 751

of the Tariff Act of 1930, as amended

(the Act).

Scope of the Review

Imports covered by these reviews are

shipments of elemental sulphur from

Canada. This merchandise is classifiable

under Harmonized Tariff Schedule

(HTS) subheadings 2503.10.00,

2503.90.00, and 2802.00.00. Although

the HTS subheadings are provided for

convenience and for U.S. Customs

purposes, the written description of the

scope of this finding remains

dispositive.

The period of review (‘‘POR’’) is

December 1, 1994 through November

30, 1995, and covers two companies.

Verification

As provided in section 782(i) of the

Act, we verified information provided

by Mobil, using standard verification

procedures, including on-site inspection

of the manufacturer’s facilities,

examination of relevant sales and

financial records, and selection of

original documentation containing

relevant information. Our verification

results are outlined in the public

versions of the verification reports.

Mobil

Facts Available

On May 31, 1996, petitioners alleged

that Mobil made home market sales of

subject merchandise below cost of

production (‘‘COP’’). On June 28, 1996,

we concluded that petitioners’

allegation provided the Department

with ‘‘reasonable grounds to believe or

suspect’’ that Mobil made below cost

sales in the home market within the

meaning of section 773(2)(A)(i) of the

Act. Therefore, we initiated a COP

investigation of Mobil’s sales, and

directed Mobil to respond to Section D

of the Department’s February 8, 1996

questionnaire.

Mobil has maintained throughout this

review that because sulphur is a ‘‘waste

product’’, it does not track sulphur

production and handling costs. In its

August 5, 1996 cost response, Mobil

estimated its cost of manufacture

(‘‘COM’’) based on an engineering

estimate of sulphur loading costs at one

plant, representing 5% of Mobil’s

sulphur production. However, Mobil

could not prove that this estimate bore

any relation to Mobil’s actual costs as

recorded in Mobil’s cost accounting

system. Moreover, the estimate only

applied to 5% of Mobil’s production of