[Federal Register Volume 62, Number 4 (Tuesday, January 7, 1997)]
[Notices]
[Pages 973-977]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-297]


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DEPARTMENT OF COMMERCE
[A-588-839]


Suspension of Antidumping Duty Investigation: Sodium Azide From 
Japan

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

SUMMARY: The Department of Commerce (the Department) has suspended the 
antidumping duty investigation involving sodium azide from Japan. The 
basis for this action is an agreement between the Department and 
producers/exporters accounting for substantially all imports of sodium 
azide from Japan wherein each signatory producer/exporter has agreed 
either to revise its prices to eliminate completely sales of this 
merchandise to the United States at less than fair value or to cease 
exports of this merchandise to the United States.

EFFECTIVE DATE: January 7, 1997.

FOR FURTHER INFORMATION CONTACT: William H. Crow II or Michelle A. 
Frederick, Office of AD/CVD Enforcement II, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th & 
Constitution Avenue N.W., Washington, D.C. 20230; telephone (202) 482-
0116 or (202) 482-4162, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On February 5, 1996, the Department initiated an antidumping 
investigation under section 732 of the Tariff Act of 1930, (the Act), 
as amended, to determine whether imports of sodium azide from Japan are 
being or are likely to be sold in the United States at less than fair 
value (61 FR 4959 (February 9, 1996)). On March 8, 1996, the United 
States International Trade Commission (ITC) notified the Department of 
its affirmative preliminary injury determination (see ITC Investigation 
No. 731-TA-740). On August 9, 1996, the Department preliminarily 
determined that sodium azide is being, or is likely to be, sold in the 
United States at less than fair value (LTFV), as provided in section 
733 of the Tariff Act of 1930, as amended by the Uruguay Round 
Agreements Act (61 FR 42585, (August 16, 1996)).
    The Commerce Department and the Japanese producers of sodium azide 
initialed a proposed agreement suspending this investigation on 
November 13, 1996. On that date, we invited interested parties to 
provide written comments on the agreement. On December 20, 1996, 
American Azide Corporation, the petitioner, filed comments with the 
Department.
    The Department and the signatory producers/exporters of sodium 
azide from Japan signed the final suspension agreement on December 26, 
1996.

Scope of Investigation

    The product covered by this investigation is sodium azide 
(NaN<INF>3) regardless of use, and whether or not combined with silicon 
oxide (SiO<INF>2) or any other inert flow assisting agent. The 
merchandise under investigation is currently classifiable under item 
2850.00.50.00 of the Harmonized Tariff Schedule of the United States 
(HTSUS). Although the HTSUS subheading is provided for convenience and 
customs purposes, our written description of the scope of this 
investigation is dispositive.

Interested Party Comments

    Having analyzed all comments filed by interested parties, we 
conclude that the Agreement meets the requirements of the statute. The 
petitioner raised the following concerns:
    First, the petitioner emphasized that the agreement, in its 
opinion, was in the public interest, and stated its reasons for this 
conclusion. Second, the petitioner requested that the Department revise 
the language in the proposed agreement to identify product types by 
physical characteristics and not by end use, in order to preclude 
possible future circumvention of the agreement. Third, the petitioner 
asked the Department to ensure that the language of the agreement 
reflect the statutory definition of profit for constructed value, 
whereby the Department would base profit ``only on amounts realized in 
connection with sales in the ordinary course of trade.''
    As to the first point, the Department agrees that this agreement is 
in the public interest, as outlined in the December 26, 1996, 
memorandum from David Mueller, Director of the Office of Policy, to 
Robert S. LaRussa, Acting Assistant Secretary for Import Administration 
(``Public Interest Memorandum''). With respect to the second point, the 
Department has modified the product type language in the final 
agreement using physical characteristics to define such types. Third, 
the Department has added citations to the statute in the agreement in 
order to define profit for constructed value.

Suspension of Investigation

    The Department consulted with the parties to the proceeding and has 
considered the comments submitted with respect to the proposed 
suspension agreement. In accordance with section 734(b) of the Act, we 
have determined that the agreement will either eliminate exports of 
this merchandise to the United States or eliminate completely sales of 
this merchandise to the United States at less than fair value, that the 
agreement is in the public interest, and that the agreement can be 
monitored effectively. See December 26, 1996, Public Interest 
Memorandum. We find, therefore, that the criteria for suspension of an 
investigation pursuant to section 734(b) of the Act have been met. The 
terms and conditions of this agreement, signed December 26, 1996, are 
set forth in Annex 1 to this notice.
    Pursuant to section 734(f)(2)(A) of the Act, effective January 7, 
1997, the suspension of liquidation of all entries of sodium azide from 
Japan entered or withdrawn from warehouse, for consumption, as directed 
in our notice of ``Preliminary Determination of Sales at Less Than Fair 
Value and Postponement of the Final Determination: Sodium Azide from 
Japan'' is hereby terminated. Any cash deposits on entries of sodium 
azide from Japan pursuant to that suspension of liquidation shall be 
refunded and any bonds shall be released.

[[Page 974]]

    Notwithstanding the suspension agreement, the Department will 
continue the investigation if it receives a request in accordance with 
section 734(g) of the Act within 20 days after the date of publication 
of this notice.
    This notice is published pursuant to section 734(f)(1)(A) of the 
Act.

    Dated: December 30, 1996.
Robert S. LaRussa,
Acting Assistant Secretary for Import Administration.

Annex 1: Suspension Agreement: Sodium Azide From Japan

    Under section 734(b) of the Tariff Act of 1930, as amended (19 
U.S.C. 1673c) (``the Act''), and 19 CFR 353.18, the U.S. Department of 
Commerce (``the Department'') and the signatory producers/exporters of 
sodium azide from Japan enter into this suspension agreement (``the 
Agreement''). On the basis of the Agreement, the Department shall 
suspend its antidumping investigation initiated on February 9, 1996 (61 
FR 4959) of sodium azide from Japan, subject to the terms and 
provisions set forth below.

A. Product Coverage

    (1) The merchandise subject to the Agreement is sodium azide 
(NaN<INF>3), regardless of use, and whether or not combined with 
silicon oxide (SiO<INF>2) or any other inert flow assisting agent, that 
has Japan as its origin.
    (2) Sodium azide is presently classifiable under subheading 
2850.00.50.00 of the Harmonized Tariff Schedule of the United States 
(``HTSUS'').
    (3) Sodium azide is presently classifiable under subheading 
2850.00.50.00 of the Harmonized Tariff Schedule of the United States 
(``HTSUS''). The products covered are sodium azide regardless of form, 
dose, or purity. Sodium azide includes, but is not limited to: (1a) 
ground sodium azide with flow assisting agents (hereinafter referred to 
as ground airbag sodium azide); (1b) unground sodium azide with flow 
assisting agents (hereinafter referred to as unground airbag sodium 
azide); and (2) sodium azide without flowing agents, hereinafter 
referred to as sodium azide for pharmaceutical use.

B. U.S. Import Coverage

    (1) The signatory producers/exporters collectively are the 
producers and exporters in Japan that, during the antidumping 
investigation of the merchandise subject to the Agreement, accounted 
for substantially all (not less than 85 percent) of the subject 
merchandise imported into the United States, as provided in the 
Department's regulations. The Department may at any time during the 
period of the Agreement require additional producers/exporters in Japan 
to sign the Agreement in order to ensure that not less than 
substantially all imports into the United States are covered by the 
Agreement.
    (2) In reviewing the operation of the Agreement for the purpose of 
determining whether the Agreement has been violated or is no longer in 
the public interest, the Department will consider imports into the 
United States from all sources of the merchandise described in section 
A of the Agreement. For this purpose, the Department will consider 
factors including, but not limited to, the following: Volume of trade, 
pattern of trade, and the reseller's export price.

C. Basis of the Agreement

    (1) This Agreement is entered into pursuant to 19 U.S.C. 1673c(b). 
On or after the effective date of the Agreement, each signatory 
producer/exporter individually agrees either to make any necessary 
price revisions to eliminate completely any amount by which the normal 
value (``NV'') exceeds the U.S. price of its merchandise subject to the 
Agreement or to cease exports of its merchandise subject to the 
Agreement. The Department will determine the NV in accordance with 
section 773(e) of the Act and U.S. price in accordance with section 772 
of the Act.
    (2) For sales occurring on or after the effective date of the 
Agreement through May 31, 1997, each signatory producer/exporter agrees 
not to sell merchandise subject to the Agreement to unaffiliated 
purchasers to the United States at prices that are less than the 
merchandise's normal value as determined by the Department based on the 
cost information for the period of investigation, April 1, 1995-March 
31, 1996, already submitted to the Department.
    (3) Starting June 1, 1997 and each semi-annual period thereafter 
beginning on June 1 and December 1, each signatory producer/exporter 
agrees not to sell merchandise subject to the Agreement to any 
unaffiliated purchaser to the United States at prices that are less 
than the merchandise's NV for that time period or to cease exports of 
its merchandise subject to this Agreement.

D. Monitoring

    Each signatory producer/exporter will supply to the Department all 
information that the Department deems necessary to ensure that the 
producer/exporter is in full compliance with the terms of the 
Agreement.
1. U.S. Sales Reporting
    (1) The Department will require each signatory producer/exporter to 
report on a quarterly basis whether or not it has had sales or 
shipments to the United States and, if so, to report each sale, 
shipment and all related adjustments of the merchandise subject to the 
Agreement, sold either directly or indirectly to unaffiliated 
purchasers in the United States. Such reports shall be made not later 
than 30 days following the close of the reporting period using the 
specified format and method of data compilation and U.S. price 
calculation as set forth in Appendix A.
    (2) The first report of U.S. sales data for sales occurring on or 
after the effective date of the Agreement through March 31, 1997 shall 
be submitted to the Department in the prescribed format and using the 
prescribed method of data compilation, not later than April 30, 1997.
    (3) If the Department receives information that a possible 
violation of the Agreement may have occurred, the Department may 
request sales data more frequently.
2. Cost Reporting
    (1) Each signatory producer/exporter must request NVs for all 
subject merchandise that will be sold either directly or indirectly to 
unaffiliated purchasers for the United States. To calculate NV, the 
Department will require each signatory producer/exporter to report, 
using the specified format and method of data compilation, cost 
information for sodium azide for the immediately preceding six month 
time period. Such report will be due not later than 30 days following 
the close of the reporting period. For those products for which a 
signatory producer/exporter is requesting NVs, the Department will 
require the signatory producer/exporter to report its cost of 
manufacturing; selling, general and administrative (``SG&A'') expenses; 
and profit data for the immediately preceding six-month period in the 
prescribed format to enable use of the data to calculate NV as 
indicated in Appendix B. When reporting costs, the signatory producer/
exporter also must report anticipated increases in production costs and 
may report anticipated decreases in production costs, resulting from 
factors such as anticipated changes in production yield, changes in 
production process, changes in production quantities or changes in 
production facilities.
    (2) The first report of cost information on or after implementation 
of this Agreement shall be submitted to the

[[Page 975]]

Department in the prescribed format and using the prescribed method of 
data compilation, not later than April 30, 1997. This cost data will 
cover the period April 1, 1996 through March 31, 1997.
    (3) The Department shall use the cost data in accordance with 
Appendix B to calculate a NV. The NV shall be effective the first day 
of the month after issuance, but no sooner than 5 days after issuance, 
and shall remain in effect for the next six-month period.
    (4) If the Department receives information that a possible 
violation of the Agreement may have occurred, the Department may 
request additional cost data more frequently.
    (5) If the Department determines that the NV it determined for a 
previous period was erroneous because the reported data for that period 
were inaccurate or incomplete, or for any other reason, the Department 
may adjust NV in a subsequent period or periods, unless the Department 
determines that section E of the Agreement applies.
3. Other Provisions
    (1) Upon proper application for an APO covering the suspension 
agreement, the representative(s) of the U.S. industry producing the 
subject merchandise may obtain business proprietary information 
submitted to the Department for each reporting period, as well as the 
results of the Department's analysis under section 773 of the Act.
    (2) All submissions to the Department by any signatory to this 
Agreement shall also be served promptly on the designated 
representatives of the U.S. industry subject to the terms and 
conditions of any applicable administrative protective order (``APO''). 
The Department will provide the representatives of the U.S. industry an 
opportunity to comment on such submissions.
    (3) When the Department identifies, as a result of its own price 
monitoring or as a result of comments provided by representative(s) of 
the U.S. industry, that one or more sales to the United States may have 
been made at prices that are inconsistent with the requirements of this 
Agreement, the Department will notify the party concerned. The 
Department will consult with that party for a period of up to 30 days 
to review the matter. During the consultation period, the Department 
will notify representative(s) of the U.S. industry and will provide an 
opportunity for comments by all parties, and the Department will 
examine any information that it develops or that is submitted.
    (4) Each signatory producer/exporter agrees to verification of all 
sales and costs information, as the Department deems necessary. A 
signatory producer/exporter who has not undergone verification in the 
investigation stage of this proceeding shall undergo verification prior 
to being given a NV under this Agreement.
    (5) Signatory producers/exporters agree not to circumvent the 
Agreement. Upon request of the Department, signatory producers/
exporters will submit a written statement to the Department certifying 
that the sales reported hereunder were not, or are not, part of or 
related to on-site processing arrangements, discounts, free goods, or 
financing packages, swaps, other exchanges, or any other arrangements, 
where such arrangements are designed to circumvent the basis of the 
Agreement.
    Where there is reason to believe that an arrangement circumvents 
the basis of this Agreement, the Department will request signatory 
producers/exporters to provide within 14 days all particulars regarding 
any such arrangement, including, but not limited to, sales information 
pertaining to covered and noncovered merchandise that is manufactured 
or sold by signatory producers/exporters. The Department will accept 
written comments, not to exceed 15 pages, from all parties no later 
than 7 days after the date of receipt of such producer/exporter 
information.
    If the Department, after reviewing all submissions, determines that 
such arrangement circumvents the basis of the Agreement, it may, as it 
deems appropriate, utilize one of two options: (a) the amount of the 
effective price discount resulting from such arrangement shall be 
reflected in the NV in accordance with section D.2(5) of this Agreement 
or (b) the Department shall determine that the Agreement has been 
violated and take action according to the provisions under section E.
    (6) The Department may reject any information submitted after the 
deadlines set forth in this Agreement or any information which it is 
unable to verify to its satisfaction. If information is not submitted 
in a complete and timely fashion or is not fully verifiable, the 
Department may calculate normal value and/or U.S. price based on facts 
available, as it determines appropriate, unless the Department 
determines that section E applies.

E. Violations of the Agreement

    If the Department determines that the Agreement is being or has 
been violated or no longer meets the requirements of section 734 (b) or 
(d) of the Act, the Department shall take action it determines 
appropriate under section 734(i) of the Act and the regulations.

F. Other Provisions

    In entering into the Agreement, the signatory producers/exporters 
do not admit that any sales of the merchandise subject to this 
Agreement have been made at less-than-fair-value or that the 
methodology used in the Department's preliminary determination to 
calculate antidumping margins is appropriate.

G. Termination

    (1) Any signatory producer/exporter may withdraw its participation 
in the Agreement at any time upon notice to the Department, after which 
the Department may terminate the Agreement. Such withdrawal shall be 
effective 60 days after such notice is given to the Department. Upon 
termination, the Department shall follow the procedures outlined in 
section 734(i)(1) of the Act.
    (2) Absent affirmative determinations under the five-year review 
provisions of sections 751 and 752 of the Act, the Department expects 
to terminate this Agreement and the underlying investigation no later 
than five years from the effective date of the Agreement.

H. Definitions

    For purposes of the Agreement, the following definitions apply:
    (1) U.S. Price: The amount determined by the Department under 
section 772 of the Act.
    (2) Normal Value: The amount determined by the Department under 
section 773(e) of the Act.
    (3) Producer/Exporter: This term means (1) the foreign manufacturer 
or producer or (2) the foreign producer or reseller which also exports, 
as defined in section 771(28) of the Act.
    (4) Date of Sale: This term means the date on which the material 
terms are set. For purposes of this definition, requirements contracts 
are deemed to establish a fixed quantity. Any change in price or change 
in terms or conditions that impacts price will be deemed to have 
established a new date of sale.
    (5) Affiliated Purchasers: This term shall be interpreted 
consistent with section 771(33) of the Act.
    (6) The effective date of the Agreement is the date on which it is 
published in the Federal Register.

[[Page 976]]

    For Japanese Producers/Exporters.

Masuda Chemicals Industries Co., Ltd.

----------------------------------------------------------------------
Kenneth G. Weigel, Esq.,
Kirkland & Ellis

Date-------------------------------------------------------------------

Toyo Kasei Kogyo Co., Ltd.

----------------------------------------------------------------------
Name: Matsuhei Kametaka,
Title: Director, General Manager.

Nippon Carbide Industries Company, Inc.

Date-------------------------------------------------------------------

----------------------------------------------------------------------
Name: N. Kaneke
Title:
Dates------------------------------------------------------------------

    For U.S. Department of Commerce.

----------------------------------------------------------------------
Robert S. LaRussa,
Assistant Secretary for Import Administration.

Dates------------------------------------------------------------------

Appendix A: Reporting U.S. Sales

I. U.S. Sales Records

    A. Each signatory shall report all of their U.S. shipments of 
sodium azide products sold in the United States during the reporting 
period by type including, but not limited to, the following types: (1) 
Pharmaceutical sodium azide, (2) ground airbag sodium azide, and (3) 
unground airbag sodium azide.
    B. Below is a model record layout for reporting U.S. sales. 
Additional fields should be added to the model record, as necessary, to 
provide complete information on each shipment. Each shipment will be 
reported as a record in a electronic file. Each record will contain 
complete information identifying the sale and all adjustments related 
to the sale.

------------------------------------------------------------------------
  Field No.            Field Description                Field Name      
------------------------------------------------------------------------
1.0..........  Complete Product Code............  PRODCODU              
2.0..........  Matching Control Number..........  CONNUMU               
3.0..........  Type of Transaction..............  TTYPEU                
3.1..........  Particle Size....................  PARTICLU              
3.2..........  Silicon Dioxide..................  SIO2U                 
4.0..........  Sale Type........................  SALEU                 
5.0..........  Customer Code....................  CUSCODU               
6.0..........  Customer Category................  CUSCATU               
7.0..........  Date of Sale.....................  SALEDTU               
8.0..........  Shipment Number..................  INVOICU               
10.0.........  Date of Shipment.................  SHIPDTU               
11.0.........  Date of Receipt of Payment.......  PAYDTU                
12.0.........  Quantity of Shipment.............  QTYU                  
12.1.........  Quantity Unit of Measure.........  QTUMU                 
13.0.........  Gross Unit Price.................  GRSUPRU               
14.0.........  Discounts........................  EARLPYU               
15.0.........  Rebates..........................  REBATEU               
16.0.........  Inland Freight--Plant from         DINLFRGU              
                Grinder.                                                
16.1.........  Inland Freight--Plant/Warehouse    DINLFTPU              
                to Port of Exit.                                        
17.0.........  Destination......................  DESTU                 
18.0.........  Credit Expense...................  CREDITU               
19.0.........  Duty Drawback....................  DTYDRWU               
20.0.........  Packing Cost.....................  PACKU                 
21.0.........  Net U.S. Sales Price.............  NETUPRU               
------------------------------------------------------------------------

II. Net U.S. Sales Price

    A. Net U.S. Sales Price, reported in field 21.0 above, will be 
calculated either as Export Price (``EP'') , the price at which the 
subject merchandise is sold to the first unaffiliated buyer when the 
sale occurs prior to the importation, or as constructed export price 
(``CEP''), the price at which the sale occurs subsequent to 
importation. Net U.S. Sales Price shall be calculated using the 
following values weight averaged by product (``CONNUMU'') as follows:

Gross Unit Price
LESS:
    Price adjustments (14.0, 15.0)
    Movement Expenses

PLUS:
    Duty Drawback

    B. A Net Weighted Average U.S. Sales Price shall be calculated for 
the reporting period for each product type for use in determining 
compliance with the Agreement.

Appendix B: Cost Reporting

I. General

    The cost information reported to the Department for purposes of the 
Agreement must be:

--Comprehensive in nature, based on the company's accounting system, 
and able to be tied to the company's audited financial statements;
--Representative of the company's costs incurred to produce the 
specific models subject to this Agreement;
--Calculated on a semi-annual, weighted-average basis of the plants or 
cost centers manufacturing the product;
--Based on fully-absorbed costs of production, including any downtime;
--Valued in accordance with generally accepted accounting principles;
--Reflective of appropriately allocated common costs so that the costs 
necessary for the manufacturing of the product are not absorbed by 
other products; and
--Reflective of the actual cost of producing the product.
A. Cost of Manufacturing (``COM'')
    (1) Cost of manufacturing is reported by major cost categories. 
Weighted-average costs are used for a product that is produced at more 
than one facility based on the cost at each facility.
    (2) Direct materials--costs of those materials which are input into 
the production process and physically become part of the final product.
    (3) Direct labor--labor costs identified with a specific product. 
These costs are not allocated among products except when two or more 
products are produced at the same cost center. Direct labor costs 
should include salary,

[[Page 977]]

bonus, and overtime pay, training expenses, and all fringe benefits.
    (4) Factory overhead--overhead costs including indirect materials, 
indirect labor, depreciation, and other fixed and variable expenses 
attributable to a production line or factory. Because overhead costs 
are typically incurred for an entire production line, an appropriate 
portion of those costs must be allocated to covered products, as well 
as any other products produced on that line. Acceptable cost 
allocations can be based on labor hours or machine hours. Overhead 
costs should also reflect any idle or downtime and be fully absorbed by 
the products.
    (5) Grinding cost is the cost paid for the grinding of the product 
type which includes transportation to and from the processor.
    (6) Grinding loss is the cost incurred as a result of product lost 
in the grinding process.
B. Cost of Production (``COP'')
    (1) Cost of production is equal to the sum of materials, labor, and 
overhead (``COM'') plus SG&A expenses in the home market (``HM'').
    (2) G&A expenses are those expenses incurred for the operation of 
the corporation as a whole and not directly related to the manufacture 
of a particular product. They include corporate general and 
administrative expenses, financing expenses and research and 
development expenses. G&A expenses should be the ratio of the company's 
total G&A expenses relative to total cost of sales for the most 
recently completed fiscal year that corresponds to the reporting 
period.
    (3) Selling expenses are those expenses incurred in selling the 
specific products in the home market calculated by product type 
(``CONNUM'').
C. Constructed Value (``CV'')
    (1) Constructed value is equal to the COP plus profit in accordance 
with section 773 of the Act.
    (2) Profit--HM profit shall be calculated based on HM sales of 
sodium azide, in accordance with 773(e) of the Act.
    (3) Cost of Packing--the cost of materials, labor and overhead and 
all other expenses incidental for preparing the product for shipment to 
the U.S. in accordance with section 773(e).

II. Reporting Cost of Production Data

    A. Each signatory shall report costs for all of the sodium azide 
products sold in the United States during the reporting period 
including, but not limited to, the following types: (1) Pharmaceutical 
sodium azide, (2) ground airbag sodium azide, and (3) unground airbag 
sodium azide.
    B. This information shall be reported for each sodium azide product 
in an electronic file. Additional fields should be added to the record 
described below as necessary. Worksheets should be submitted showing 
the calculation of each of the per unit costs and expenses.

------------------------------------------------------------------------
  Field No.            Field Description                Field Name      
------------------------------------------------------------------------
1.0..........  Matching Control Number..........  CONNUM                
2.0..........  Production Quantity..............  PRODQTY               
3.0..........  Direct Materials Cost............  DIRMAT                
4.0..........  Direct Labor Cost................  DIRLAB                
5.0..........  Variable Overhead Cost...........  VOH                   
6.0..........  Fixed Overhead Cost..............  FOH                   
7.0..........  Grinding Cost....................  GRINDING              
8.0..........  Grinding Loss....................  GYL                   
9.0..........  Total Cost of Manufacturing......  TOTCOM                
10.0.........  General and Administrative         GNA                   
                Expenses.                                               
11.0.........  Interest Expense.................  INTEX                 
12.0.........  Indirect Selling Expense.........  INDSEL                
13.0.........  Profit...........................  PROFIT                
14.0.........  HM Credit Expense................  HMCREDIT              
15.0.........  Direct Selling Expenses..........  DIRSELL               
------------------------------------------------------------------------

III. NV Based on Constructed Value

    (1) For EP NVs, the CV will be adjusted for packing costs and 
differences in direct selling expenses such as commissions, credit, 
warranties, technical services, advertising, and sales promotion, in 
accordance with sections 772 and 773 of the Act.
    (2) For CEP NVs, the NV will be calculated in accordance with the 
relevant statutory and regulatory provisions, including sections 772 
and 773 of the Act.
    (3) Direct selling expenses in either the U.S. or the home market 
are expenses that are incurred as a direct result of a sale.
    (4) Credit expenses are expenses incurred for the extension of 
credit to the HM and U.S. customers.

IV. Calculation of NV Based on Constructed Value

    Normal value for EP transactions will be calculated for 
pharmaceutical sodium azide, unground airbag sodium azide and ground 
airbag sodium azide as follows:
Direct Materials
+Direct Labor Cost
+Overhead Cost
+Grinding Cost (if relevant)
+Grinding Loss (if relevant)
=Cost of Manufacture
+General & Administrative Expenses (including financing)
+Home Market Indirect Selling Expense
+Home Market Direct Selling Expense
=Cost of Production
+Home Market Profit
+U.S. Packing
=Constructed Value
-Home Market Direct Selling Expense
-Home Market Credit Expense
+U.S. Direct Selling Expense
    +U.S. Credit Expense
=Normal Value

[FR Doc. 97-297 Filed 1-6-97; 8:45 am]
BILLING CODE 3510-DS-P