61084 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Notices

DEPARTMENT OF COMMERCE

International Trade Administration

[A–791–802]

Notice of Final Results of Antidumping

Duty Administrative Review: Furfuryl

Alcohol From the Republic of South

Africa

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

SUMMARY: On July 8, 1997, the

Department of Commerce published the

preliminary results of its administrative

review of the antidumping duty order

on furfuryl alcohol from the Republic of

South Africa. The review covers

shipments of this merchandise to the

United States during the period

December 16, 1994, through May 31,

1996, the period of review.

Based on our analysis of the

comments received, and the correction

of certain ministerial errors, we have

changed the preliminary results. The

final results are listed below in the

section ‘‘Final Results of Review.’’

EFFECTIVE DATE: November 14, 1997.

FOR FURTHER INFORMATION CONTACT:

Michelle Frederick or Kris Campbell,

Office of AD/CVD Enforcement II,

Import Administration, International

Trade Administration, U.S. Department

of Commerce, 14th Street and

Constitution Avenue, N.W.,

Washington, D.C. 20230; telephone:

(202) 482–0186 and (202) 482–3813,

respectively.

SUPPLEMENTARY INFORMATION:

Applicable Statute and Regulations

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 to the Act by the Uruguay Round

Agreement Act (‘‘URAA’’). In addition,

unless otherwise indicated, all citations

to the Department of Commerce’s (‘‘the

Department’s’’) regulations are to the

provisions codified at 19 CFR part 353,

as of April 1, 1996. Where we cite to the

Department’s new regulations (19 CFR

part 351, 62 FR 27926 (May 19, 1997)

(‘‘New Regulations’’) as an indication of

current Department practice, we have so

stated.

Background

This review covers one manufacturer/

exporter to the United States of the

subject merchandise, Illovo Sugar

Limited (‘‘ISL’’). On July 8, 1997, the

Department published in the Federal

Register the Preliminary Results of

Administrative Review of the

Antidumping Duty Order on Furfuryl

Alcohol from the Republic of South

Africa, 62 FR 36488 (‘‘the preliminary

results’’). We received case and rebuttal

briefs from QO Chemicals, Inc (‘‘the

petitioner’’) and ISL on August 7, 1997,

and August 26, 1997, respectively. A

public hearing was held on August 28,

1997.

The Department has now completed

this administrative review in

accordance with section 751 of the Act.

Scope of the Review

The merchandise covered by this

order is furfuryl alcohol (C4H3OCH2OH).

Furfuryl alcohol is a primary alcohol,

and is colorless or pale yellow in

appearance. It is used in the

manufacture of resins and as a wetting

agent and solvent for coating resins,

nitrocellulose, cellulose acetate, and

other soluble dyes. The product subject

to this order is classifiable under

subheading 2932.13.00 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

proceeding is dispositive.

Constructed Export Price (‘‘CEP’’)

For sales to the United States, we

calculated CEP based on the same

methodology used in the preliminary

results, with the following exceptions:

1. We excluded certain sales made of

furfuryl alcohol which entered the

United States prior to the suspension of

liquidation. See Comment 6.

2. We based the calculation of the CEP

profit rate on information contained in

ISL’s audited financial statements

regarding profits made on ‘‘byproducts’’ rather than on the total profit

figure in the company’s financial

statements. See Comment 8.

3. We have treated the quality testing

expense that ISL incurs upon furfuryl

alcohol’s arrival in the United States as

a movement expense and not as an

indirect selling expense. See Comment

9.

4. We limited the deduction of

indirect expenses incurred in the home

market on behalf of U.S. sales to the

expenses of ISL personnel incurred for

travel to the United States. See

Comment 10.

5. Tank car rental credits gained for

transporting furfuryl alcohol in the

United States are no longer added to

CEP because the reported tank car rental

expense is net of such credits. See

Comment 11.

6. Certain U.S. inventory carrying

costs have been converted from Rand to

U.S. dollars. See Comment 12.

Normal Value (‘‘NV’’)

We used the same methodology to

calculate NV as that described in the

preliminary results.

Analysis of Comments Received

In accordance with 19 CFR 353.38, we

gave interested parties an opportunity to

comment on the preliminary results. We

received a case brief from the petitioner

and a rebuttal brief from ISL (e.g.,

‘‘Petitioner Case Brief’’, ‘‘ISL Rebuttal

Brief’’).

Comment 1: Fictitious Home Market:

The petitioner argues that the

Department erred in the preliminary

results by not determining that a

fictitious market exists in South Africa

rendering HM sales of furfuryl alcohol

inappropriate as a basis for NV. The

petitioner contends that the Department

unlawfully restricted the applicability of

the fictitious market provision (section

773(a)(2) of the Act) to situations where

there is evidence of different

movements in prices at which different

forms of the foreign like product are

sold or offered for sale.

Specifically, the petitioner argues that

the Department’s restriction of this

provision to situations involving price

movements of different forms of the

foreign like product is incorrect for the

following reasons. First, the legislative

history of the 1988 amendment to the

fictitious market provision (which

provides that the Department may

consider ‘‘different movements in prices

at which different forms of the foreign

like product are sold or offered for sale’’

as evidence of a fictitious market)

clearly indicates that this evidence is

simply an illustrative example of a

fictitious market and does not prevent

the Department from finding a fictitious

market based on other evidence. In this

regard, the petitioner cites the Senate

Report accompanying this amendment:

‘‘The purpose of this provision is to

highlight one particular example of a

fictitious market.’’ S.Rep. No. 71, 100th

Congress., 1st Sess. at 126 (1987)

(Senate Report) (emphasis petitioner’s).

Second, the petitioner contends that the

Department’s interpretation conflicts

with PQ Corp v. United States, 652 F.

Supp. 724, 729 (CIT 1987) (‘‘PQ Corp.’’),

which, although it predated the 1988

amendment, continues to offer the

proper reading of the general purpose of

the fictitious market provision as

concerned with preventing ‘‘parties

from manipulating dumping margins by

* * * offering merchandise at a price

that does not reflect its actual market
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Notices 61085

price.’’ Third, the petitioner claims that

the Department’s reasoning renders the

provision a nullity in all cases where

there is only one form of the foreign like

product, as in this review. The

petitioner concludes that the

Department’s overly restrictive reading

of the fictitious market provision has

allowed ISL to manipulate the results of

this review by establishing a fictitious

market through severe home market

price reductions even though the world

price for furfuryl alcohol increased

during the period of review (‘‘POR’’).

ISL responds that the petitioner’s

reading of the fictitious market

provision is overly broad and contends

that the Department should sustain its

position in the preliminary results that

a fictitious market does not exist in the

home market. Citing Tubeless Steel Disc

Wheels from Brazil, 56 FR 14083 (April

5, 1991) (Disc Wheels), Porcelain-onSteel Cooking Ware from Mexico, 58 FR

32095 (June 8, 1993) (Porcelain

Cookware), and the Department’s June

30, 1997, Memorandum, ISL contends

that: (a) The Department has always

required evidence of price movements

of different forms of the foreign like

product before pursuing a fictitious

market allegation; (b) furfuryl alcohol is

a single, unitary product and there is no

possibility that the prices of different

forms of the foreign like product could

be manipulated to distort the dumping

margin; and (c) contrary to the

petitioner’s interpretation of PQ Corp.,

this case stands for the proposition that

there is no reason to invoke the

fictitious market provision absent

evidence that a sale is anything less

than a bona fide transaction; in this

case, the viability and reality of the

transactions is not in dispute. ISL adds

that the petitioner’s concern with

reduced home market prices is more

appropriate to a below-cost allegation,

which the petitioner chose not to file,

and concludes that a respondent is

within its discretion to eliminate price

discrimination by either raising U.S.

price, lowering home market price, or

doing a combination of the two, citing

Final Results of Redetermination to

Court Remand, The Timken Company v.

United States, CIT Case No. 94–01–

00008 (December 17, 1996)) (Timken

Remand).

DOC Position: We agree with ISL that

the record evidence regarding its South

African sales does not warrant a finding

that ISL has established a fictitious

home market. Our general practice in

determining whether a fictitious market

exists is to require evidence that the

decrease in the price of home market

sales of the foreign like product was

accompanied by an increase in the price

of sales of ‘‘different forms of the foreign

like product.’’ See Disc Wheels, 56 FR

at 14085 (‘‘[B]efore pursuing a [fictitious

market] allegation, the Department must

have sufficient evidence to believe that

there have been different movements in

the prices at which different forms of

the subject merchandise have been sold

in the home market’’) and Porcelain

Cookware, 58 FR at 32096 (‘‘In order for

price differences to serve as a basis for

initiating a fictitious sales inquiry . . .

the Department must have sufficient

evidence to believe or suspect that there

have been different movements in the

prices at which different forms of the

subject merchandise have been sold in

the home market and that such

movements appear to reduce the

amount by which foreign market value

(FMV) exceeds the U.S. price of the

merchandise’’). As we explained in the

June 30, 1997, Memorandum, the facts

that the petitioner presents in support of

its claim, centering around a single

supplier selling at low prices in the

home market, do not justify an

expansion of our practice.

Although our position regarding the

petitioner’s claim was stated clearly in

that memorandum, we make the

following additional points regarding

the petitioner’s comments as contained

in its case brief. First, given the

language in the Senate Report to the

1988 amendment to the fictitious market

provision that price movements within

a foreign like product are ‘‘one example

of a fictitious market,’’ it is possible that

we may determine in the future that a

fact pattern other than price movements

within a foreign like product constitutes

a fictitious market. However, the fact

pattern before us, involving a single

respondent that lowered its home

market prices during the POR, is

insufficient to make such a

determination and, in fact, would

conflict with a basic tenet of the

dumping law were we to do so. As

noted in the Timken Remand, a

respondent may reduce or eliminate

dumping either by raising its U.S. prices

or by lowering its home market prices

of merchandise subject to the order. A

finding that ISL has created a fictitious

market based solely on ISL’s lowering of

its home market furfuryl alcohol prices

would contradict this basic proposition.

Second, regarding the petitioner’s

argument that CIT’s decision in PQ

Corp. requires a different result, we

agree with the petitioner that the court

indicated that a fictitious market could

exist when the price of merchandise

‘‘does not reflect its actual price.’’

However, we disagree that the

information on the record indicates that

ISL’s home market sales fail to meet this

standard. Rather, ISL’s home market

sales were bona fide transactions

involving a significant number of

customers made during the course of the

POR. These customers ordered,

received, and paid for the merchandise

in the normal course of business based

on prices contained in ISL’s price lists.

Further, the total quantity of ISL’s home

market sales was far in excess of the

viability threshold and in our view

those South African sales must be

considered one of the company’s

primary markets.

Finally, based on the above facts

concerning ISL’s home market sales, we

disagree with the petitioner’s assertion

that the Department is rendering the

fictitious market provision a nullity

where, as here, there was no other form

of the foreign like product to which a

price comparison can be made. Rather,

given the facts surrounding ISL’s home

market sales, we have determined that

the harm that this provision seeks to

prevent (artificial pricing leading to the

elimination of a finding of dumping) is

not present in this case. As a result,

there is no reason in this proceeding to

go beyond our normal practice of

determining the existence of a fictitious

market based on a comparison of prices

of different forms of the foreign like

product.

Comment 2: Home Market Customer

Affiliation: The petitioner argues that

ISL is affiliated with its home market

customers due to its self-described

status as the only established producer

and seller of furfuryl alcohol in South

Africa. Citing the SAA’s discussion (at

838) of possible affiliation in the

absence of an equity relationship (in

elaborating on section 771(33)(G) of the

Act), the petitioner states that affiliation

can result from the ability of one

company ‘‘to exercise restraint or

direction’’ over another company

through a ‘‘close supplier relationships

in which the supplier or buyer becomes

reliant upon the other.’’

In addition, the petitioner commented

on the following specific aspects of the

Department’s June 30, 1997,

Memorandum, which provided an

analysis of this issue for the preliminary

results. In this memorandum, the

Department noted that: (a) ISL’s home

market customers appear to be free to

purchase furfuryl alcohol from any

source willing to offer it; (b) a 10

percent tariff rate appeared to be the

only barrier to trade facing furfuryl

alcohol; and (c) that it appears that

furfuryl alcohol based resins compete

with phenolic resins.

The petitioner counters these points

by arguing that: (a) as stated in the Final

Results of Antidumping Duty
61086 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Notices

Administrative Review: Certain Welded

Stainless Steel Pipe from Taiwan, 62 FR

37543, 37550 (July 14, 1997), the

Department focuses on actual supplier

relationships, not putative statements

regarding freedom to purchase from

other suppliers; (b) the 10 percent tariff

is significant given the absence of

furfuryl alcohol imports to South Africa

during the POR; (c) there is evidence of

barriers to trade such as insignificant

purchasing power, immense

transportation distances from foreign

suppliers, insufficient storage for foreign

bulk shipments, and the possibility of

ISL’s customers’ damaging their

relationship with ISL, the sole domestic

supplier; and (d) there are in fact no

substitutes for furfuryl alcohol in its

primary uses.

These facts, the petitioner concludes,

demonstrate affiliation between ISL and

its home market customers, warranting

the rejection of ISL’s home market sales

unless they are determined to have been

made at arm’s length.

ISL responds that the Department was

correct in determining, in its June 30,

1997, Memorandum at 8, that the

petitioner’s allegation that ISL is

affiliated with its home market

customers is ‘‘an overly broad

interpretation of the affiliation via

control provision in section 771(33)(G).’’

According to ISL, the fact that it is the

sole domestic producer of furfuryl

alcohol in South Africa is not sufficient

to support a finding of affiliation with

its home market customers. Specifically,

ISL argues that: (a) None of the home

market customers is related to ISL by

ownership; (b) sales are freely

negotiated with home market customers

using the company’s price lists; (c) there

are no long-term sales or agency

agreements with home market

customers; (d) all home market

customers are free to purchase from

abroad; (e) there are no import barriers

on furfuryl alcohol—the tariff rate on

this product entering South Africa

before December 1996 was 10 percent

and zero thereafter; and (f) the

International Trade Commission’s (ITC)

report notes that while there are no

precise substitutes for furfuryl alcohol

itself, phenolic resins compete in the

foundry industry with furfuryl alcohol’s

primary downstream products, furan

resins. Accordingly, ISL contends, there

are no indicia of control.

Finally, ISL notes that the Department

has recently considered this issue in a

number of cases and did not find

affiliation between domestic producers

of the foreign like product and home

market customers because the requisite

control did not exist, citing inter alia,

Final Determination of Sales at Less

than Fair Value: Open-End Spun Rayon

Singles Yarn from Austria, 62 FR 43701

(August 15, 1997). ISL states that in

each case involving this issue, the

petitioner argued that affiliation existed

because of a close supplier relationship

between the producer and its customer

or supplier, and the Department

declined to find the parties affiliated

because the requisite control

relationship did not exist.

DOC Position: We disagree with the

petitioner’s contention that ISL is

affiliated with all of its home market

customers. The basis for petitioner’s

claim, the fact that ISL is the only

manufacturer of furfuryl alcohol in

South Africa, is insufficient for a finding

of affiliation. Further, the petitioner

failed to provide any evidence that ISL

controls its home market customers. As

we stated in the June 30, 1997,

Memorandum at 8, ‘‘ISL’s dominant

position in the home market is not

sufficient, in and of itself, to find

affiliation between ISL and its

customers.’’ We also noted in that

memorandum that the other primary

evidence that the petitioner provided to

support its affiliation claim, ISL’s POR

pricing in the home market, ‘‘does not

suggest that the company is in a

position to exercise restraint or control

over its customers, since customers will

generally seek the lowest price possible

from their suppliers.’’ Id.

We also do not accept the petitioner’s

allegation that ISL controls its home

market customers due to significant

barriers to trade, an absence of imports

during the POR of the subject

merchandise, and no substitutes for

furfuryl alcohol in its primary uses.

First, the factors proposed by the

petitioner would be more relevant to an

assertion that ISL is controlling its

customers through high pricing, not low

pricing. Second, while we agree with

the petitioner that there was an absence

of imports during the POR, the

petitioner’s other arguments are

speculative (e.g., whether a 10 percent

tariff is a ‘‘significant’’ barrier to trade).

Further, if we were to consider the

absence of imports as determinative of

affiliation, we would in effect find

affiliation in any sole supplier situation.

In sum, these factors, whether true or

not, do not indicate that ISL controls its

customers.

Comment 3: Particular Market

Situation in the Home Market: The

petitioner disagrees with the

Department preliminary determination

(as detailed in its June 30, 1997,

Memorandum) that a ‘‘particular market

situation’’ did not exist in South Africa.

Citing this Memorandum, the petitioner

first notes that this finding was based in

part on the inapplicability of any of the

three illustrative examples of particular

market situations in the SAA and the

absence of any model matching

complications. Moreover, the petitioner

states that the Department based its

finding on the position that the facts of

the case be analyzed more appropriately

under the below-cost and fictitious

market provisions of the Act.

The petitioner disagrees with this

finding based on its contention that a

particular market situation does exist in

South Africa due to the absence of

competitive pricing. It maintains that

the SAA makes clear that competitive

pricing is an important consideration in

assessing the existence of a particular

market situation, citing the ‘‘government

control over pricing’’ example of a

possible particular market situation

listed in the SAA (at 822) (i.e., ‘‘where

there is government control over pricing

to such an extent that home market

prices cannot be considered to be

competitively set’’). Acknowledging that

the instant proceeding does not involve

government control, the petitioner

argues that the key element of this

example of a particular market situation

is whether prices are competitively set,

not whether there is government control

of prices. In support of its argument, the

petitioner cites Certain Cold-Rolled and

Corrosion-Resistant Carbon Steel Flat

Products from Korea, 62 FR 18404

(April 15, 1997), where the Department

considered whether pricing practices in

an oligopolistic market constituted a

particular market situation but

ultimately found competitive pricing,

and no particular market situation, in

that case. Contrary to the Korean

oligopoly in question, the petitioner

asserts that ISL is a monopolist and as

such, allowed for no price competition

of any type in this case.

Regarding the Department’s position

that the facts of the case are more

appropriately analyzed under the

fictitious market provision, the

petitioner argues that both the fictitious

market and particular market situation

provisions are applicable because both

are intended to preserve the integrity of

the Department’s analysis by

eliminating inappropriate sales from

consideration. The petitioner affirms its

claim that, given a correct

understanding of the facts of this case

and of the particular market situation

provision, the Department should

disregard ISL’s home market sales and

require ISL to submit third country sales

data.

ISL responds that the Department

should sustain its position in the

preliminary results that a particular

market situation does not exist in the
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Notices 61087

home market. In its rebuttal brief (at 8)

ISL interprets Certain Cold-Rolled and

Corrosion-Resistant Steel Flat Product

from Korea to mean that ‘‘[t]he fact that

there are very few, or even one,

producer in a market is not evidence,

per se, that prices are not competitively

set.’’ ISL reiterates its claim, first made

in Comment 3, above, that there are no

import barriers to furfuryl alcohol

entering South Africa and, therefore,

foreign producers are free to compete,

just as non-furfuryl alcohol products

compete in the foundry industry with

furfuryl alcohol’s primary downstream

products.

ISL further argues that none of the

circumstances of particular market

situations outlined in the SAA are

present in this case. Thus, ISL

concludes, the petitioner is actually

arguing for the creation of a new form

of particular market situation based on

the sole criterion that a foreign producer

has lowered it home market prices.

Accordingly, ISL, urges the Department

to reject the petitioner’s expansive

reading of the Act.

DOC Position: Although we agree

with the petitioner that the list of

examples in the SAA regarding what

may constitute a particular market

situation is not exhaustive, we disagree

that such a finding is warranted under

the facts of this case. First, we do not

agree with the petitioner that the facts

of this case are analogous to the

‘‘government control over pricing’’

example in the SAA. In this regard, we

agree with ISL’s interpretation of ColdRolled Steel. In that case, although we

considered whether oligopolistic pricing

practices might constitute a particular

market situation, we ultimately

determined that prices were

competitively set. In fact, we explicitly

found that even though different pricing

patterns may occur in an oligopolistic

market, such patterns are not evidence,

per se, sufficient to establish that prices

are not competitively set. We conceded

that there was substantial Korean

government involvement in the

industry, but did not find ‘‘convincing

evidence’’ of control (Cold-Rolled Steel,

62 FR at 18412). The Department found

that there was price competition based

on discounts, credit adjustments, and

freight equalization. Similarly, the fact

pattern in the instant proceeding,

involving a large volume of low-priced

sales of furfuryl alcohol sold to a

significant number of home market

customers from price lists, does not

indicate an absence of competitive

pricing.

As we stated in the June 30, 1997,

Memorandum, the facts as presented by

the petitioner, focusing on a single

supplier that has lowered its home

market prices, are more appropriately

analyzed in the context of the belowcost and fictitious market provisions of

the statute. In this regard, the petitioner

did not make a below-cost allegation in

this segment of the proceeding and, as

discussed above, our analysis of the

petitioner’s claim in the context of a

fictitious market allegation indicates

that the facts presented by petitioner do

not warrant such a finding.

Comment 4: Whether the

Antidumping Duty Reimbursement

Regulation Applies to ISL: ISL argues

that the Department’s doubling of the

assessment rate in the preliminary

results, which was based on the

Department’s finding that ISL

reimbursed its affiliated U.S. importer

Harborchem, is impermissible because:

(1) The reimbursement regulation

should not apply to affiliated importers;

(2) the reimbursement provision’s focus

on raising U.S. prices is improper, since

the Act itself is not concerned with the

absolute level of the price at which

subject merchandise is sold in the

United States; and (3) even if the

reimbursement provision is valid and

can legally be applied to affiliated

parties, there was no reimbursement of

actual duties assessed in this case.

The petitioner disagrees with ISL,

stating that: (1) The Department can

apply the reimbursement regulation to

affiliated parties; and (2) there is clear

evidence in this case that ISL

reimbursed its U.S. affiliate for AD

duties during the POR, citing the

Department’s proprietary preliminary

analysis memorandum (Analysis

Memorandum to the File, June 30, 1997,

at 2).

DOC Position: Since the assessment

rate for this review is zero, there are no

duties to be assessed. Hence, this issue

is moot.

Comment 5: Affiliation of ISL and

Harborchem: The petitioner argues that

ISL and its U.S. importer, Harborchem,

are not affiliated parties and,

accordingly, the Department should

base U.S. price on export price rather

than CEP in the final results. The

petitioner maintains that the

Department’s finding in the original

investigation that these parties are

affiliated, on which the Department

subsequently relied in stating that the

facts had not changed in this review,

was incorrect. The petitioner contends

that the record demonstrates that

Harborchem is not ISL’s agent under the

law of agency or the four-part test

originally relied on by the Department.

The petitioner states that since the

Act does not define the term ‘‘agent,’’

the term must give its common law

meaning, i.e., ‘‘that an agent is to act on

behalf of and for the benefit of the

principal.’’ Petitioner Brief at 16. Citing,

inter alia, Waterhout v. Associated Dry

Goods, Inc., 835 F.2d 718 (8th Cir.

1987), the petitioner adds that a second

tenet of the law of agency is that a

determination as to the existence of an

agency relationship is to be based on the

factual circumstances at hand and not

on a party’s characterization of itself as

an agent.

The petitioner submits that, in this

case, there is no record evidence

indicating an agency relationship

between ISL and Harborchem, since ISL

merely characterizes Harborchem as its

an agent; instead, the evidence shows

two distinct commercial transactions:

one in which Harborchem purchases

furfuryl alcohol from ISL and another in

which Harborchem resells the

merchandise to a third party.

Specifically, the petitioner states that:

(a) ISL negotiates price and quantity

with Harborchem;

(b) ISL sells to Harborchem;

(c) ISL invoices and receives payment

Harborchem; and

(d) Harborchem then separately

stores, markets, ships, and receives

payment for the merchandise.

Thus, the petitioner asserts,

Harborchem acts on its own behalf, and

ISL and Harborchem each seek to

maximize profits. Moreover, the

petitioner asserts that mere coordination

of certain activities for their mutual

benefit is not critical in determining an

agency relationship.

ISL responds that it is in fact affiliated

with Harborchem. First, ISL argues that

the question of relationship was

examined thoroughly in the

investigation and at on-site verifications

of both ISL and Harborchem. Second,

ISL agrees with the Department’s

preliminary finding that the facts

considered by the Department in its

original determination are the same as

those in the current review, namely:

(a) ISL participated directly with

Harborchem in the marketing of furfuryl

alcohol to ultimate U.S. customers;

(b) ISL participated directly in pricing

and sales negotiations with ultimate

U.S. customers;

(c) ISL interacted directly, as well as

through Harborchem, with ultimate U.S.

customers on product testing and

quality control;

(d) ISL and Harborchem

communicated on a daily basis on

matters related to marketing and sales to

the ultimate customers;

(e) ISL exerted a substantial degree of

control over Harborchem marketing and

pricing of furfuryl alcohol to the

ultimate U.S. customers; and
61088 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Notices

(f) the two parties viewed their

relationship as one of principal and

agent.

As support for its contention that

these facts apply to the POR as well as

the period of investigation (POI), ISL

cites to evidence on the record of this

review regarding the correspondence

between Harborchem and ISL on the

setting of U.S. prices, the approval by

ISL of any significant sales and

marketing efforts, and the granting of

permission by ISL on other business

decisions.

Regarding the petitioner’s arguments

concerning the nature of an ‘‘agency’’

relationship, ISL submits that although

the URAA replaced the definition of

‘‘related party’’ with the definition of

‘‘affiliation’’ based on a ‘‘control’’

concept, Congress did not intend to

narrow the criteria it uses for

determining affiliation, and the

Department has in fact continued to use

the same criteria for assessing ‘‘control’’

as was used under the pre-URAA law

related party ‘‘agency’’ provision. In this

respect, ISL cites the post-URAA cases

Melamine from Indonesia and Rayon

Singles Yarn from Austria, where the

Department examined:

(a) Whether one party controlled

pricing of the subject merchandise;

(b) Whether a long-term sales

agreement existed;

(c) Whether there were any

restrictions on purchasing from or

selling to other sources; and

(d) Whether there were other indicia

of affiliation, such as a joint venture

arrangement.

ISL asserts that the facts surrounding

its relationship with Harborchem meet

this standard.

Finally, ISL cites the preamble to the

New Regulations as proving that,

because section 771(33) of the statute

refers to a person being in a position to

exercise restraint or direction, the

Department is required to examine the

ability to control, not the actual exercise

of control (62 FR 27298). ISL concludes

that, based on the facts as stated above,

the record shows that ISL is in a

position to exercises restraint over

Harborchem.

DOC Position: We disagree with the

petitioner. As both parties note, in the

less-than-fair-value (LTFV)

investigation, we examined this issue in

depth at verification (see Final

Determination of Sales at Less Than

Fair Value: Furfuryl Alcohol From

South Africa, 60 FR 22550 (May 8, 1995)

(Final Determination of Sales at LTFV)).

Our examination was based on the

criteria for determining an agency

relationship as established in Final

Determination of Sales at Not Less Than

Fair Value: Certain Forged Steel

Crankshafts from Japan, 52 FR 36984,

36985 (October 2, 1987). Contrary to the

petitioner’s assertions, the information

on the record in this review again

indicates that a finding of affiliation

between ISL and Harborchem is

appropriate.

As noted in our preliminary results,

the facts that led to our finding in the

LTFV investigation have not changed.

The petitioner provides no evidence

that the facts have changed. ISL, on the

other hand, submitted evidence (at

Exhibit A–4 of its September 19, 1996

response) in response to our

questionnaire that indicates that the

agency relationship between ISL and

Harborchem still exists. For example,

this evidence indicates that ISL and

Harborchem routinely coordinate

marketing and sales activity, including

pricing, for sales to U.S. customers.

Rather than provide evidence that the

facts have changed during this review

period, the petitioners are suggesting

that these facts are not sufficient for a

finding of affiliation. We agree with the

petitioner that although the Act does not

define agency, the existence of an

agency relationship is based on the

factual circumstances. The four-pronged

test relied upon in the LTFV

investigation explores the factual

circumstances of the relationship

between ISL and Harborchem. At

verification, based on correspondence

files, we determined that ISL: (1)

participates directly with Harborchem

in marketing furfuryl alcohol to U.S.

customers; (2) participates directly in

pricing and sales negotiations with U.S.

customers; (3) interacts directly, as well

as through Harborchem, with U.S.

customers on product testing and

quality control matters; and (4) interacts

with U.S. customers directly (Final

Determination of Sales at LTFV, 60 FR

at 22552–53). In the current review, ISL

provided additional documentary

evidence of this relationship consistent

with our finding in the LTFV

investigation. Proprietary

correspondence documents were

submitted by ISL in its September 1996

response (Exhibit A–4a and b) that

demonstrated that: ISL and Harborchem

have an exclusive distributor agreement;

frequently discuss pricing to U.S.

customers; and participate in joint

marketing efforts. Documents submitted

also show that ISL maintains direct

contact with U.S. end-user customers

and exerts control over U.S. marketing

efforts. In addition, documentation

concerning the arrangement and sharing

of profits between the two parties were

included in Exhibit A–22 of the April

10, 1997, response and documentation

showing Harborchem seeking and

obtaining ISL’s approval of a purchase

of furfuryl alcohol from alternative

source, were submitted in Exhibit A–23

of the same response. Therefore, we

continue to find that, based on our fourprong test, ISL and Harborchem

maintain an agency relationship and are

affiliated within the meaning of section

771(33) of the Act. Consequently, we

have used CEP for sales to the United

States.

Comment 6: Exclusion of Certain U.S.

Sales: ISL requests that the Department

exclude from its analysis U.S. sales of

subject merchandise that entered prior

to suspension of liquidation, which ISL

identified using a first-in, first-out

(‘‘FIFO’’) inventory accounting

methodology. ISL further asserts that

certain of these sales merit exclusion

regardless of the validity of its FIFO

analysis, based on the fact that they

were shipped prior to the first postsuspension entry of merchandise.

In the preliminary results, the

Department rejected ISL’s request, citing

Final Results of Antidumping Duty

Administrative Review: Industrial Belts

and Components and Parts Thereof,

Whether Cured or Uncured from Italy,

57 FR 8295 (March 9, 1992) (‘‘Industrial

Belts’’), wherein the Department had

similarly rejected an exclusion request

based on a FIFO inventory analysis. ISL

states that the preliminary results did

not sufficiently explain the

Department’s reasons for denying the

request. ISL contemplates two possible

reasons for this rejection: (a) that the

Department finds a FIFO matching

methodology to be inherently

unacceptable; or (b) that the Department

requires a further explanation regarding

ISL’s FIFO analysis.

In arguing against the first reason, ISL

states that Harborchem’s normal

inventory accounting records use the

FIFO methodology employed in its

exclusion request. ISL also notes that

Harborchem uses FIFO to match specific

entries and sales as part of its internal

cost control and reporting systems to

ensure proper accounting treatment. ISL

contends that since furfuryl alcohol is a

fungible liquid, this is the only

methodology available for matching presuspension entries to specific POR sales.

ISL notes that the Department verified

Harborchem’s inventory accounting

records during the less than fair value

investigation. Citing Industrial Quimica

del Nalon v. United States, 15 CIT 240,

243–44 (1991), ISL contends that the

Department’s rejection of the only

methodology available to link entries to

sales would constitute an abuse of the

Department’s discretion and, in the
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Notices 61089

words of the ruling, ‘‘fly in the face of

established business practice.’’

Regarding the second possible reason,

ISL provides in its brief a further

explanation of the methodology

employed in the company’s responses to

ensure that the analysis is clear to the

Department. In so doing, ISL points to

worksheets, inventory records, and

entry and sales data that provide

sufficient information to allow the

Department to tie the sales in question

to pre-suspension entries.

Finally, ISL asserts that even if the

Department chooses to reject again ISL’s

FIFO methodology, the company is still

entitled to the exclusion of certain sales

from the antidumping analysis. ISL

notes that the record shows that the first

shipment of furfuryl alcohol to enter the

United States during the POR, i.e., after

suspension, entered the United States

after sales by Harborchem to U.S.

customers had already been made and

delivered during the POR. ISL states

that it is therefore physically impossible

for those sales to have been made using

furfuryl alcohol entered during the POR.

The petitioner responds that the

Department should continue to reject

ISL’s exclusion request. It argues that

ISL did not sufficiently link POR sales

to specific pre-suspension entries

because the company’s receipt and

inventory records are inconsistent and

unreliable, as demonstrated by certain

discrepancies on the record.

Specifically, the petitioner notes that

ISL, in its April 10, 1997, supplemental

response, conceded that it made two

mistakes in reporting its inventory in its

initial response. The petitioner asserts

that this unreliability, together with

‘‘the Department’s justifiable reluctance

to use hypothetical constructions to link

U.S. sales to specific pre-suspension

entries,’’ necessitates the Department’s

continued rejection of the request.

DOC Position: We agree with ISL, in

part. As discussed below, all but one of

the POR sales that ISL requested be

excluded are not appropriately part of

our analysis because they involve

merchandise that entered the United

States prior to the suspension of

liquidation. See Certain Stainless Steel

Wire Rod from France, 61 FR 47874,

47875 (September 11, 1996).

Accordingly, we have not included

these sales in our calculation of ISL’s

antidumping duty rate for this POR.

However, we have included one such

sale in our analysis because it cannot be

tied to pre-suspension merchandise.

We note that the petitioner is correct

in pointing out the Department’s

reluctance to use hypothetical

constructions to link U.S. sales to

specific pre-suspension entries. This

was demonstrated in Industrial Belts,

wherein the Department rejected an

exclusion request based on a FIFO

inventory analysis. However, we

excluded a majority of the sales at issue

based not on a FIFO analysis but on the

fact that these sales were shipped before

the first post-suspension entry of subject

merchandise. See Memorandum from

Michelle Frederick and Scott Oudkirk to

Richard W. Moreland (November 5,

1997) (‘‘November 5, 1997,

Memorandum’’). We have excluded

these sales from our analysis because it

would not be possible for those sales to

have been shipped using merchandise

that entered during the POR.

We excluded a second group of sales

based on a FIFO analysis that involves

a single POR entry made prior to these

sales. For these sales, the data contained

in ISL’s response indicates that the

company’s storage of inventory involved

the co-mingling of only one POR entry

of furfuryl alcohol with a pre-existing

inventory of pre-suspension furfuryl

alcohol. As detailed in the November 5,

1997, Memorandum, ISL’s inventory,

sales, and entry data contained in its

responses establishes that it had

sufficient pre-suspension inventory,

prior to the one POR entry of subject

merchandise at issue, to cover all but

one of the second group of sales for

which ISL requested the exclusion. To

the extent that we attribute the

merchandise involved in such sales to

this pre-suspension inventory, rather

than to the single POR entry that

occurred prior to these sales, this

analysis is based on a FIFO

methodology. However, given that the

fact pattern involves only a single POR

entry occurring prior to these sales,

along with the fact that this is a unitary

liquid product, it is appropriate under

these circumstances to determine that

these sales involved pre-suspension

merchandise. We note that, in the

unique circumstances of this case, the

respondent was able to provide

supporting documentation regarding

entry and sales data not only for the

claimed exclusions, but also for the

remainder of the South African-sourced

POR sales.

Finally, we have not excluded one

sale (the final chronological sale in the

second group) because the inventory of

pre-suspension furfuryl alcohol was

insufficient to cover this sale.

Regarding the petitioner’s contention

that ISL’s inventory records are

inconsistent and unreliable, we found

that an examination of the evidence on

the record demonstrates that any

inconsistencies are relatively minor and

that the mistakes reported by ISL were

corrected in supplemental responses

(see the memorandum referenced

above). Therefore, the record as a whole

allowed us to sufficiently link entries to

sales and to exclude sales when

appropriate.

Finally, we note that the petitioner

claimed at the public hearing, with

respect to ISL’s counsel’s discussion of

this issue, that certain information

presented by ISL was not included in its

hearing briefs. We have determined that

ISL’s counsel did not reveal new

information during the hearing and that

it was responding to a question raised

by the Department regarding this issue.

The information that ISL’s counsel

referenced was already on the record in

the form of entry dates, sale dates,

inventory records and location of

inventory.

Comment 7: Level of Trade and CEP

Offset: ISL asserts that the Department’s

preliminary determination that the level

of trade (LOT) at which ISL sold furfuryl

alcohol in the home market level is not

more advanced than the LOT of the CEP

sales is incorrect because it ignores

significant selling functions performed

in the home market. In particular, ISL

states that there is a ‘‘significant

difference in the level of selling

function provided at each LOT.’’

ISL argues that the Department

ignored the level or degree of selling

activities that ISL performed with

respect to home market versus U.S.

sales, as well as the corresponding

greater amounts of time and energy

spent performing these activities in

conducting home market sales. Further,

ISL stated that, whereas ISL itself

undertook all of these activities in

conducting home market sales, it merely

supported Harborchem, which was

principally responsible for marketing

and selling activities in the United

States. For this reason, ISL claims that

the degree of the selling functions it

provides to home market customers is

greater than that of those provided for

Harborchem such that the home market

LOT is more advanced than the LOT of

the CEP. In support of this claim, ISL

compared the number of customers, the

number of shipments, and the

individual shipment sizes in the home

market to shipments to Harborchem,

noting that ‘‘[t]he average size of a

shipment to Harborchem was over 30

times as large as a shipment in the home

market.’’ Therefore, ISL claims it is

entitled to a CEP offset.

The petitioner responds that the

Department did not ignore specific

selling functions in the home market

but, rather, determined that the selling

functions performed by ISL for sales in

the home market did not differ

substantially from those performed by
61090 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Notices

ISL for sales to Harborchem. The

petitioner adds that ISL exaggerates the

differences between the number of

customers and shipments in the home

market compared with those to

Harborchem. Finally, the petitioner

notes that ISL’s contention in its case

brief that the company plays a

supporting, non-principal role for U.S.

sales is at variance with earlier

statements made in support of ISL’s

claim of affiliation with Harborchem,

i.e., that ISL plays a joint role with

Harborchem in the U.S. market.

DOC Position: We disagree with ISL.

We have continued to find that a CEP

offset is inappropriate because the

record evidence indicates that ISL’s

home market sales are not made at a

more advanced LOT than that of the

CEP.

Section 773(a)(7) of the Act provides

that one requirement for granting a CEP

offset is that the home market sale must

be made at a more advanced stage of

distribution than the LOT of the CEP. In

order to determine whether home

market sales were at the same, or a

different, LOT than U.S. sales, we

examined whether home market sales

had been made at a different stage in the

marketing process. Section 351.412(c)(2)

of the new regulations defines an LOT

as a marketing stage ‘‘or the equivalent’’

and provides that different LOTs

depend on one level (or stage) being

more remote, characterized by an

additional layer of selling activities,

amounting in the aggregate to a

substantially different selling function.

Substantial differences in the amount of

selling expenses associated with two

groups of sales also may indicate that

the two groups are at different LOTs.

Accordingly, as a threshold matter in

examining whether home market sales

were made at a more advanced LOT

than the LOT of the CEP, we considered

the selling activities performed for the

home market LOT and compared them

to the selling activities performed for

the LOT of the CEP. Specifically, we

examined the selling activities

performed by ISL for setting up,

shipping, and delivering furfuryl

alcohol destined for the U.S. market up

to the point of tank storage at the U.S.

port of entry (selling activities reflected

in the price after the deduction of

expenses and profit under section

772(d) of the Act). Next, we compared

the selling activities performed by ISL

for home market sales.

In the preliminary results, we

determined that there was one LOT in

the home market and, furthermore, that

the LOT for home market sales was

comparable to the LOT of the CEP. In

other words, we determined that the

home market LOT did not constitute a

more advanced stage of distribution

than the LOT of the CEP and, therefore,

no adjustment to price (i.e., LOT

adjustment or CEP offset) was necessary.

We explained, in detail, in the

preliminary results our rationale for

making this determination. 62 FR

36488, 36490 (July 8, 1997). ISL’s

arguments in its case brief do not

establish that our analysis in the

preliminary results was incorrect.

We disagree with ISL’s argument that

we ignored the level or degree of selling

functions performed in the home

market. While it is our preference to

examine selling functions on both a

qualitative and a quantitative basis, our

examination is not contingent on the

number of customers nor on the number

of sales for which the activity is

performed.

Thus, having determined that the LOT

for home market sales is comparable to

the LOT of the CEP, we are precluded

in this case from granting a CEP offset.

Comment 8: Basis for the Calculation

of CEP Profit: The petitioner argues that

the Department’s calculation of CEP

profit understates the amount of profit

that should be deducted from CEP. In

the preliminary results, the Department

relied upon revenue and cost of sales

data from ISL’s 1995 and first-half 1996

financial statements to calculate a profit

ratio. The figures in those financial

statements are representative of all ISL

products. The petitioner cites the SAA

(at 824–825, regarding section

772(f)(2)(C) of the Act) for the

proposition that, where the Department

has not requested cost data, CEP profit

information shall be based on ‘‘the

narrowest category of merchandise sold

in the United States and the exporting

country which includes the subject

merchandise or * * * the narrowest

category of merchandise sold in all

countries which includes the subject

merchandise.’’ The petitioner contends

that there is information on the record,

in the form of an internal report, that

would allow the Department to base the

calculation of a CEP profit ratio on a

more narrow category of merchandise,

e.g. excluding sugar, than that contained

in ISL’s financial statements.

ISL argues that the financial

statements on which the Department

relied in its calculation of profit are

audited and, given the Department’s

normal reliance on audited or published

data, are the proper basis for the

calculation of a CEP profit ratio. ISL

notes that the information that the

petitioner advocates is found in an

unverified internal report used to report

gross sales and profit figures. As such,

it does not take account of reversals,

reconciliations, and adjustments made

only at year-end. Therefore, the

Department should continue to use the

information contained in the audited

financial statements in its calculation of

a CEP profit ratio for the final results.

DOC Position: We agree with the

petitioner in part. Section

772(f)(2)(C)(iii) of the Act provides that,

absent more specific data related to

expenses incurred in selling subject

merchandise in the United States or

home market, the expenses used in the

profit calculation should be based on

‘‘the narrowest category of merchandise

sold in all countries which includes the

subject merchandise.’’ In this review,

there is information on the record that

would allow the Department to base the

calculation of a CEP profit ratio on a

more narrow category of merchandise

than that covered by ISL’s overall profit

amount for all products sold by the

company. However, contrary to

petitioner’s assertions, the audited

financial statements contain profit data

on a product basis (i.e. by-products) that

is sufficiently narrow to fulfill the

statutory requirements regarding CEP

profit.

Instead of relying on the internal

report, we were able to derive a more

appropriate CEP profit ratio from the

audited financial statements, thus

meeting our obligation to rely on

information for the ‘‘narrowest category

of merchandise.’’ We were able to

discern from the audited financial

statements the relative amount of profit

due to the sale of sugar, ISL’s primary

merchandise, and the profit due to the

sales of by-products, which includes the

subject merchandise sold. Thus, we

revised the CEP profit ratio for the final

results based on information from

audited financial statements. (See

Analysis Memorandum to File,

November 5, 1997.)

We note that, given the statutory

preference for profit based on a narrow

category of merchandise, the use of

internal financial reports may be

appropriate where we do not otherwise

have sufficiently tailored profit data.

The preamble of the proposed

regulations at 61 FR 7308, 7332

(February 27, 1996), reflects this, stating

‘‘[p]aragraph (d)(2) [of section 351.402]

specifies that the Department will not be

limited to audited financial statements,

but may use any appropriate financial

report, including internal reports, the

accuracy of which can be verified, if

verification is conducted. This

provision reflects the suggestion of

commentators that the Department make

clear its discretion to use financial

reports prepared in the normal course of

business that are as specific as possible
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Notices 61091

to the merchandise under investigation

or review.’’

Comment 9: Inclusion of Quality

Testing Expenses in the Calculation of

CEP Profit: The petitioner notes that the

Department determined that the

expense ISL incurs for the quality

testing of furfuryl alcohol upon its

arrival in the United States is an

indirect selling expense. The

Department therefore made a

circumstance of sale adjustment to CEP

for the preliminary results, but the

petitioner contends that this quality

testing expense should also be included

as part of total selling expenses for the

calculation of CEP profit.

ISL argues that this expense is a

movement expense undertaken solely

for U.S. sales insurance purposes

because of the possibility of

contamination during shipment and

because the U.S. Customs periodically

requires purity reports. Therefore, ISL

argues that this expense is not an

indirect selling expense and, as a

movement expense, should not be

included as part of selling expenses

when calculating CEP profit.

DOC Position: We agree with ISL that

the quality testing expense that the

company incurs upon furfuryl alcohol’s

arrival in the United States is a

movement expense undertaken solely

for U.S. sales as a result of shipment

from South Africa. We note ISL’s

description at page 84 of its September

19, 1996, response, that, ‘‘Furfuryl

alcohol is tested on arrival to detect any

impurities that may have entered the

product while in transit * * * [t]he

testing is performed * * * at the time

the product is unloaded from the

maritime vessel.’’ We also note that

there is no similar testing done for

shipments in the home market; all semibulk sales of furfuryl alcohol in the

home market are made f.o.b., so there is

no chance of contamination that will

result in a loss to the company and

though drum sales are sometimes made

on a c.i.f. basis, it is not subject to

contamination because it is packed.

Because contamination only results

from transporting furfuryl alcohol via a

shipping vessel, which carries many

other different products, not just

furfuryl alcohol, we have determined

that the quality testing expense is

associated with the type of

transportation, and, thus, is a movement

expense. Accordingly, we have changed

the margin calculation to treat this

expense as a movement expense, which

is not included in total U.S. expenses in

the calculation of CEP profit.

Comment 10: Treatment of ISL U.S.

Travel Expenses in the Margin

Calculation: The petitioner claims that

the expenses ISL personnel incurred for

travel to the United States to market

furfuryl alcohol are indirect selling

expenses incurred in the United States.

As such, they should be deducted from

U.S. price when calculating CEP and

should be included in the total U.S.

selling expenses used to derive profit

attributable to those expenses.

ISL contends that the expenses in

question are already included in the

South African component of U.S.

indirect selling expenses, given that

most of the expenses associated with

U.S. travel of ISL personnel, such as

airfare and salaries, were incurred and

paid for in the home market. Therefore,

it would be incorrect for the Department

to deduct these expenses once again.

DOC Position: We agree with ISL that

the expenses ISL personnel incurred for

travel to the United States to market

furfuryl alcohol are included in the

South African component of U.S.

indirect selling expenses (DINDIRSU).

As such, for the preliminary results,

they had already been deducted from

U.S. price when calculating CEP.

We do not deduct indirect selling

expenses incurred in the home market

on behalf of U.S. sales, except when

such expenses are associated with

economic activity in the United States.

The expenses of ISL personnel incurred

for travel to the United States are

associated with economic activity in the

United States. Therefore, for these final

results, we segregated the expenses of

ISL personnel incurred for travel to the

United States from all other indirect

expenses incurred in the home market

on behalf of U.S. sales, and deducted

only those travel expenses from CEP.

See Final Results and Partial Rescission

of Antidumping Duty Administrative

Review; Certain Fresh Cut Flowers from

Colombia, 62 FR 53287, 53293 (October

14, 1997) (‘‘selling expenses incurred in

the home market that are not associated

with U.S. economic activity should

neither be deducted from CEP nor

included in the basis for calculating CEP

profit’’).

Comment 11: Addition of Tank Car

Rental Credits to CEP: The petitioner

claims that the U.S. tank car rental

expense is reported net of credits.

Therefore, tank car rental credits should

not be added to CEP.

ISL concedes the petitioner’s claim.

DOC Position: We agree that the U.S.

tank car rental expense reported is net

of credits for tank car utilization.

Therefore, we have deducted these

expenses from CEP.

Comment 12: Conversion of Certain

Inventory Carrying Cost Expenses: ISL

contends that the Department failed to

convert the U.S. inventory carrying cost

expense, which is expressed in rand, to

U.S. dollars.

The petitioner did not comment on

this issue.

DOC Position: We agree with ISL.

This expense was expressed in rand

because the inventory value used in the

calculation of this inventory carrying

cost was the total cost of manufacture in

rand. Accordingly, we have converted

this to U.S. dollars.

Final Results of Review

As a result of our review, we

determine that the following margin

exists for the period of December 16,

1994, through May 31, 1996:

Manufacturer/exporter Margin

(percent)

Illovo Sugar Ltd ......................... 0.00

The results of this review shall be the

basis for the assessment of antidumping

duties on entries of merchandise

covered by the review and for future

deposits of estimated duties for the

manufacturer/exporter subject to this

review. The Department will issue

appraisement instructions 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

this administrative review, as provided

by section 751(a)(2)(C) of the Act: (1)

The cash deposit rate for ISL is zero; (2)

if the exporter is not a firm covered in

this review or the original 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

(3) if neither the exporter nor the

manufacturer is a firm covered in this or

any previous review or the original

investigation, the cash deposit rate will

be the ‘‘all others’’ rate of 11.55 percent

established in the less than fair value

investigation (60 FR 28840, June 21,

1995). These deposit requirements will

remain in effect until publication of the

final results of the next administrative

review.

This notice also serves as a 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
61092 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Notices

subsequent assessment of double

antidumping duties.

This notice is the only 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)(1). Timely

written notification of the return or

destruction of APO materials, or

conversion to judicial protective order is

hereby requested. Failure to comply is

a violation of the APO.

This administrative review and notice

are in accordance with section 751(a) of

the Act and 19 CFR 353.22, and this

notice is published in accordance with

section 777(i) of the Act.

Dated: November 5, 1997.

Robert S. LaRussa,

Assistant Secretary for Import

Administration.

[FR Doc. 97–29958 Filed 11–13–97; 8:45 am]

BILLING CODE 3510–25–P

DEPARTMENT OF COMMERCE

International Trade Administration

Applications for Duty-Free Entry of

Scientific Instruments

Pursuant to Section 6(c) of the

Educational, Scientific and Cultural

Materials Importation Act of 1966 (Pub.

L. 89–651; 80 Stat. 897; 15 CFR part

301), we invite comments on the

question of whether instruments of

equivalent scientific value, for the

purposes for which the instruments

shown below are intended to be used,

are being manufactured in the United

States.

Comments must comply with 15 CFR

301.5(a)(3) and (4) of the regulations and

be filed within 20 days with the

Statutory Import Programs Staff, U.S.

Department of Commerce, Washington,

D.C. 20230. Applications may be

examined between 8:30 A.M. and 5:00

P.M. in Room 4211, U.S. Department of

Commerce, 14th Street and Constitution

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

Docket Number: 97–089. Applicant:

Worcester Polytechnic Institute, 100

Institute Road, Worcester, MA 01609.

Instrument: Fire Modeling Research

Apparatus. Manufacturer: Fire Testing

Technology Ltd., United Kingdom.

Intended Use: The instrument will be

used to determine certain fire properties

from a particular substance, object or

material—sometimes testing each type

of material present in a composite then

calculating experimental values if the

materials were burned together. In

addition, the instrument will be used for

educational purposes in the course

FPE580F. Special Problems: Fire

Science Laboratory providing overall

instruction and hands-on experience

with fire science related experimental

measurement techniques. Application

accepted by Commissioner of Customs:

October 23, 1997.

Docket Number: 97–090. Applicant:

University of Minnesota, Department of

Psychology, N218 Elliott Hall, 75 East

River Road, Minneapolis, MN 55455.

Instrument: Visual Stimulus Generator,

Model VSG2/3S. Manufacturer:

Cambridge Research Systems Ltd.,

United Kingdom. Intended Use: The

instrument will be used to investigate

the sensory limitations on letter

recognition which involves measuring

the spatio temporal properties of letter

recognition across the human visual

field. The experiments will tell the size

of the visual span (the number of letters

that can be recognized in a single

fixation) for different print sizes,

contrasts and fixation duration. This

data will test models that relate letter

recognition to reading. Application

accepted by Commissioner of Customs:

October 23, 1997.

Frank W. Creel,

Director, Statutory Import Programs Staff.

[FR Doc. 97–29957 Filed 11–13–97; 8:45 am]

BILLING CODE 3510–DS–P

DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric

Administration

[I.D. 093097E]

Small Takes of Marine Mammals

Incidental to Specified Activities;

Space Launch Vehicles at Vandenberg

Air Force Base, CA

AGENCY: National Marine Fisheries

Service (NMFS), National Oceanic and

Atmospheric Administration (NOAA),

Commerce.

ACTION: Notice of receipt of applications

and proposed authorizations for small

take exemptions; request for comments.

SUMMARY: NMFS has received a request

from the U.S. Air Force for continuation

of incidental harassment authorizations

to take small numbers of marine

mammals incidental to launches of

Delta II, Titan II, Titan IV, and Taurus

launch vehicles at Vandenberg Air

Force Base, CA (Vandenberg). Under the

Marine Mammal Protection Act

(MMPA), NMFS is requesting comments

on its proposal to continue to authorize

these takings (limited to harassment),

for a period not to exceed 1 year.

DATES: Comments and information must

be received no later than December 15,

1997.

ADDRESSES: Comments on this

application should be addressed to

Michael Payne, Chief, Marine Mammal

Division, Office of Protected Resources,

NMFS, 1315 East-West Highway, Silver

Spring, MD 20910. A copy of this

application, previous documentation

and Federal Register notices on this

action may be obtained by writing to

this address or by telephoning the

contact listed below.

FOR FURTHER INFORMATION CONTACT:

Kenneth Hollingshead, Office of

Protected Resources at 301–713–2055,

or Irma Lagomarsino, Southwest

Regional Office at 562–980–4016.

SUPPLEMENTARY INFORMATION:

Background

Section 101(a)(5)(A) of the MMPA (16

U.S.C. 1361 et seq.) directs the Secretary

of Commerce to allow, upon request, the

incidental, but not intentional, taking of

marine mammals by U.S. citizens who

engage in a specified activity (other than

commercial fishing) within a specified

geographical region if certain findings

are made and regulations are issued.

Permission may be granted if NMFS

finds that the taking will have a

negligible impact on the species or

stock(s); will not have an unmitigable

adverse impact on the availability of the

species or stock(s) for subsistence uses;

and the permissible methods of taking

and requirements pertaining to the

monitoring and reporting of such taking

are set forth. NMFS has defined

‘‘negligible impact’’ in 50 CFR 216.103

as ‘‘ * * *an impact resulting from the

specified activity that cannot be

reasonably expected to, and is not

reasonably likely to, adversely affect the

species or stock through effects on

annual rates of recruitment or survival.’’

Subsection 101(a)(5)(D) of the MMPA

established an expedited process by

which U.S. citizens can apply for an

authorization to incidentally take small

numbers of marine mammals by

harassment for a period of up to one

year. The MMPA defines ‘‘harassment’’

as:

...any act of pursuit, torment, or annoyance

which (a) has the potential to injure a marine

mammal or marine mammal stock in the

wild; or (b) has the potential to disturb a

marine mammal or marine mammal stock in

the wild by causing disruption of behavioral

patterns, including, but not limited to,

migration, breathing, nursing, breeding,

feeding, or sheltering.

New subsection 101(a)(5)(D)

establishes a 45-day time limit for

NMFS review of an application