[Federal Register Volume 62, Number 9 (Tuesday, January 14, 1997)]
[Notices]
[Pages 1954-1970]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-816]



[[Page 1953]]

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Part II





Department of Commerce





_______________________________________________________________________



International Trade Administration



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Antidumping; Silicon Metal From Brazil;



Notices

Federal Register / Vol. 62, No. 9 / Tuesday, January 14, 1997 / 
Notices

[[Page 1954]]



DEPARTMENT OF COMMERCE

International Trade Administration
[A-351-806]


Silicon Metal From Brazil; Final Results of Antidumping Duty 
Administrative Review and Determination Not to Revoke in Part

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

ACTION: Notice of final results of antidumping duty administrative 
review and determination not to revoke in part.

-----------------------------------------------------------------------

SUMMARY: On September 5, 1996, the Department of Commerce (the 
Department) published the preliminary results of its administrative 
review of the antidumping duty order on silicon metal from Brazil. This 
review covers the period July 1, 1993, through June 30, 1994, and five 
manufacturers/exporters of the subject merchandise to the United 
States. The review indicates the existence of margins for four firms.
    We gave interested parties an opportunity to comment on the 
preliminary results. Based on our analysis of the comments received and 
new information submitted at the Department's request, we have changed 
our results from those presented in our preliminary results, as 
described below in the comments section of this notice.

EFFECTIVE DATE: January 14, 1997.

FOR FURTHER INFORMATION CONTACT: Fred Baker, Alain Letort, or John 
Kugelman, AD/CVD Enforcement Group III, Office 8, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C. 
20230; telephone: (202) 482-2924, -4243, or -0649, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On September 5, 1996, the Department of Commerce published in the 
Federal Register (61 FR 46776) the preliminary results of its 
administrative review of the antidumping duty order on silicon metal 
from Brazil (July 31, 1991, 56 FR 36135). On September 27, October 2, 
and November 13, 1996 the Department requested additional information 
from Minasligas, Eletrosilex, and CCM, respectively. We received 
responses from these firms on October 15, October 16, and November 20, 
1996, respectively. The Department has now completed that 
administrative review in accordance with section 751 of the Tariff Act 
of 1930, as amended (the Tariff Act).

Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the statute and the 
Department's regulations are in reference to the provisions as they 
existed on December 31, 1994.

Scope of the Review

    The merchandise covered by this review is silicon metal from Brazil 
containing at least 96.00 percent but less than 99.99 percent silicon 
by weight. Also covered by this review is silicon metal from Brazil 
containing between 89.00 and 96.00 percent silicon by weight but which 
contains a higher aluminum content than the silicon metal containing at 
least 96.00 percent but less than 99.99 percent silicon by weight. 
Silicon metal is currently provided for under subheadings 2804.69.10 
and 2804.69.50 of the Harmonized Tariff Schedule (HTS) as a chemical 
product, but is commonly referred to as a metal. Semiconductor grade 
silicon (silicon metal containing by weight not less than 99.99 percent 
silicon and provided for in subheading 2804.61.00 of the HTS) is not 
subject to the order. HTS item numbers are provided for convenience and 
for U.S. Customs purposes. The written description remains dispositive 
as to the scope of the product coverage.
    The period of review (POR) is July 1, 1993, through June 30, 1994. 
This review involves five manufacturers/exporters of Brazilian silicon 
metal: Companhia Brasileira Carbureto de Calcio (CBCC), Companhia 
Ferroligas Minas Gerais--Minasligas (Minasligas), Eletrosilex Belo 
Horizonte (Eletrosilex), Rima Eletrometalurgia S.A. (RIMA), and Camargo 
Correa Metais (CCM).

Consumption Tax

    In light of the Federal Circuit's decision in Federal Mogul v. 
United States, CAFC No. 94-1097, the Department has changed its 
treatment of home market consumption taxes. Where merchandise exported 
to the United States is exempt from the consumption tax, the Department 
will add to the U.S. price the absolute amount of such taxes charged on 
the comparison sales in the home market. This is the same methodology 
that the Department adopted following the decision of the Federal 
Circuit in Zenith v. United States, 988 F.2d 1573, 1582 (1993), and 
which was suggested by the court in footnote 4 of its decision. The 
Court of International Trade (CIT) overturned this methodology in 
Federal Mogul v. United States, 834 F.Supp. 1391 (1993), and the 
Department acquiesced in the CIT's decision. The Department then 
followed the CIT's preferred methodology, which was to calculate the 
tax to be added to U.S. price by multiplying the adjusted U.S. price by 
the foreign market tax rate; the Department made adjustments to this 
amount so that the tax adjustment would not alter a ``zero'' pre-tax 
dumping assessment.
    The foreign exporters in the Federal Mogul case, however, appealed 
that decision to the Federal Circuit, which reversed the CIT and held 
that the statute did not preclude Commerce from using the ``Zenith 
footnote 4'' methodology to calculate tax-neutral dumping assessments 
(i.e., assessments that are unaffected by the existence or amount of 
home market consumption taxes). Moreover, the Federal Circuit 
recognized that certain international agreements of the United States, 
in particular the General Agreement on Tariffs and Trade (GATT) and the 
Tokyo Round Antidumping Code, required the calculation of tax-neutral 
dumping assessments. The Federal Circuit remanded the case to the CIT 
with instructions to direct Commerce to determine which tax methodology 
it will employ.
    The Department has determined that the ``Zenith footnote 4'' 
methodology should be used. First, as the Department has explained in 
numerous administrative determinations and court filings over the past 
decade, and as the Federal Circuit has now recognized, Article VI of 
the GATT and Article 2 of the Tokyo Round Antidumping Code required 
that dumping assessments be tax-neutral. This requirement continues 
under the new Agreement on Implementation of Article VI of the General 
Agreement on Tariffs and Trade. Second, the Uruguay Round Agreements 
Act (URAA) explicitly amended the antidumping law to remove consumption 
taxes from the home market price and to eliminate the addition of taxes 
to U.S. price, so that no consumption tax is included in the price in 
either market. The Statement of Administrative Action (p. 157) 
explicitly states that this change was intended to result in tax 
neutrality.
    While the ``Zenith footnote 4'' methodology is slightly different 
from the URAA methodology, in that section 772(d)(1)(C) of the pre-URAA 
law required that the tax be added to United States price rather than 
subtracted from home market price, it does result in tax-neutral duty 
assessments. In sum, the Department has elected to treat consumption 
taxes in a manner consistent with its longstanding policy of tax-
neutrality and with the GATT.

[[Page 1955]]

Verification

    As provided in section 776(b) of the Tariff Act, we verified 
information provided by Minasligas, CBCC, RIMA, and CCM by using 
standard verification procedures, including onsite inspection of the 
manufacturers' facilities, the examination of relevant sales and 
financial records, and selection of original documentation containing 
relevant information. Our verification results are outlined in the 
public versions of the verification reports.

Use of Best Information Available (BIA)

    In our preliminary results of this administrative review, we 
determined that RIMA was a non-shipper. See Silicon Metal from Brazil; 
Preliminary Results of Antidumping Duty Administrative Review, Intent 
to Revoke in Part, and Intent Not to Revoke in Part, 61 FR 46776 
(September 5, 1996) (preliminary results). Since publication of the 
preliminary results, we have determined that RIMA did have shipments 
during the POR. See the Department's response to comment 2 below. 
Therefore, we have included in these final results of review all of 
RIMA's sales during the POR made to an importer who had at least one 
importation during the POR. See the Department's response to comment 1 
below.
    Because RIMA failed to produce information requested at 
verification to substantiate significant portions of its response, in 
accordance with section 776(c) of the Act, we have determined that the 
use of BIA is appropriate. For these final results we applied the 
following two-tier BIA analysis in choosing what to use as BIA:

    1. When a company refuses to cooperate with the Department or 
otherwise significantly impedes these proceedings, it assigns that 
company first-tier BIA, which is the higher of:
    (a) The highest of the rates found for any firm for the same 
class or kind of merchandise in the same country of origin in the 
less-than-fair-value investigation (LTFV) or prior administrative 
review; or
    (b) The highest rate found in the present administrative review 
for any firm for the same class or kind of merchandise from the same 
country of origin.
    2. When a company substantially cooperates with our requests for 
information including, in some cases, verification, but fails to 
provide the information requested in a timely manner or in the form 
required, it assigns to that company second-tier BIA, which is the 
higher of:
    (a) The firm's highest rate (including the ``all others'' rate) 
of the same class or kind of merchandise from a prior administrative 
review or, if the firm has never before been investigated or 
reviewed, the all others rate from the LTFV investigation; or
    (b) The highest calculated rate in this review for the class or 
kind of merchandise for any firm from the same country of origin.

See Allied-Signal Aerospace Co. v. United States, 28 F.3d 1188, 1189, 
1190 n.2 (CAFC 1994).
    RIMA cooperated by responding to the Department's questionnaires. 
However, we determined at verification that this company could not 
substantiate significant portions of its responses. Therefore, we have 
determined to apply second-tier BIA to RIMA's third-review sales. (See 
Use of BIA memorandum to Joseph Spetrini, Deputy Assistant Secretary, 
Enforcement Group Three.) The second-tier BIA rate we have assigned to 
RIMA is 91.06 percent. This rate represents the highest rate ever 
applicable to RIMA for the subject merchandise.

Analysis of Comments Received

    We gave interested parties an opportunity to comment on the 
preliminary results. We received case and rebuttal briefs from 
Minasligas, Eletrosilex, CCM, CBCC, and a group of five domestic 
producers of silicon metal (collectively, the petitioners). Those five 
domestic producers are American Alloys, Inc., Elkem Metals Co., Globe 
Metallurgical, Inc., SMI Group, and SKW Metals and Alloys, Inc. We 
received a request for a hearing from CBCC, Minasligas, Eletrosilex, 
CCM, and the petitioners. We held a public hearing on November 25, 
1996.

Comment 1

    Petitioners argue that the Department erred in determining which 
U.S. sales to review by using the methodology employed in the final 
results of the second administrative review of this order. In the 
second review final results, we explained our methodology as follows:

    1. Where a respondent sold merchandise, and the importer of that 
merchandise had at least one entry during the POR, we reviewed all 
sales to that importer during the POR.
    2. Where a respondent sold subject merchandise to an importer 
who had no entries during the POR, we did not review the sales of 
subject merchandise to that importer in this administrative review. 
Instead, we will review those sales in our administrative review of 
the next period in which there is an entry by that importer.

We also said in the notice that after completion of the review, we 
would instruct Customs to assess dumping duties against importer-
specific entries during the period. See Silicon Metal from Brazil, 
Final Results of Antidumping Duty Administrative Review, 61 FR 46763, 
46765 (September 5, 1996) (Silicon Metal from Brazil; Second Review 
Final Results).
    Petitioners argue that the methodology described above and used in 
the preliminary results of this review is inconsistent with the Tariff 
Act, because section 751(a)(2) of the Tariff Act requires that margins 
be based on sales associated with entries during the POR. Petitioners 
also cite to Torrington Co. v. United States, 818 F. Supp. 1563, 1573 
(CIT 1993) (Torrington) to demonstrate that the Court of International 
Trade (CIT) has held that the word ``entry'' as used in the statute 
refers to the ``formal entry of merchandise into the U.S. Customs 
territory.'' They argue that this date of formal entry is the date on 
which the entry summary is filed in proper form. Furthermore, 
petitioners argue that the Department itself has stated that the use of 
the term ``entry'' in the antidumping law refers unambiguously to the 
release of merchandise into the customs territory of the United States. 
See Antifriction Bearings (Other than Tapered Roller Bearings) and 
Parts Thereof from the Federal Republic of Germany; Final Results of 
Antidumping Duty Administrative Review, 56 FR 31692, 31704 (July 11, 
1991). Petitioners also argue that the legislative history of section 
751 demonstrates that margin calculations in administrative reviews are 
to be based on sales of merchandise that entered during the POR.
    In addition to the above arguments based on their interpretation of 
the statute and case law, petitioners argue that the questionnaire 
issued by the Department to the respondents in this review shows that, 
prior to the 1992-93 administrative review of this order, the 
Department's established practice was to base reviews on sales of 
merchandise that entered U.S. Customs territory during the POR, and 
that it was the Department's expressed intention to conduct this review 
in the same way. Furthermore, petitioners argue that the failure to 
calculate dumping margins based on sales associated with entries during 
the POR would result in improper assessment of duties, because the 
duties assessed on entries during the POR would have no relation to the 
margin of dumping on those sales. Thus, by assessing duties on entries 
at rates unrelated to the margin of dumping on the associated sales, 
petitioners argue, the Department would violate 19 U.S.C. 1673(2)(B), 
which requires that ``there shall be imposed upon such merchandise an 
antidumping duty * * * in an amount equal to the amount by which the 
foreign market value exceeds the United States price for the 
merchandise.''

[[Page 1956]]

    Eletrosilex argues that section 751 of the Tariff Act does not 
provide the specificity that petitioners assert, and must be read in 
light of the other provisions of the statute. In a rule-making 
proceeding several years ago, Eletrosilex alleges that the Department 
did just that. There the Department said:

    Notwithstanding the reference to review and assessment of 
``entries'' pursuant to section 751, Congress also provided that the 
Department should analyze ``sales'' transactions pursuant to 
sections 772 and 773 of the statute in the course of conducting its 
administrative review. The statute provides for the review of both 
``entries'' and ``sales'' without recognizing that the two terms are 
not synonymous or providing a mechanism for linking them.

See Advance Notice of Proposed Rulemaking, 56 FR 63696 (December 5, 
1991). Eletrosilex argues that in that proceeding the Department 
concluded that Congress could not have intended that it base all 
reviews on entries of merchandise rather than sales, and that such a 
conclusion ``would hinder the achievement of other statutory goals 
governing review and assessments.'' Id., at 63697.
    Furthermore, Eletrosilex argues that, contrary to the petitioners' 
statements, the Department has consistently adhered to this policy. 
Petitioners' citations in support of their argument, Eletrosilex 
argues, are dicta, and have no controlling precedent. More importantly, 
Eletrosilex argues, the Department has recently repudiated exactly the 
same argument made by the very same petitioners. As support for this 
statement, Eletrosilex cites the final results of the first and second 
administrative reviews of this proceeding. See Silicon Metal from 
Brazil; Final Results of Antidumping Duty Administrative Review, 59 FR 
42806, 42813 (August 19, 1994) (Silicon Metal From Brazil; First Review 
Final Results) and Silicon Metal from Brazil; Second Review Final 
Results.

Department's Position

    We disagree with petitioners. We most recently addressed this issue 
in the final results of the second review of this order. There we 
stated:

    We do not agree with petitioners that section 751(a)(2) requires 
that we review only sales that entered U.S. customs territory during 
the POR. Section 751(a)(2) mandates that the dumping duties 
determined be assessed on entries during the POR. It does not limit 
administrative reviews to sales associated with entries during the 
POR. Furthermore, to review only sales associated with entries 
during the POR would require that we tie sales to entries. In many 
cases we are unable to do this. Moreover, the methodology the 
Department should use to calculate antidumping duty assessment rates 
is not explicitly addressed in the statute, but rather has been left 
to the Department's expertise based on the facts of each review. ``* 
* * the statute merely requires that PUDD (i.e., potentially 
uncollected dumping duties) * * * serve as the basis for both 
assessed duties and cash deposits of estimated duties.'' See The 
Torrington Company v. United States, 44 F.3d 1572, 1578 (CAFC 1995).

See Silicon Metal from Brazil; Second Review Final Results at 46765. 
Our analysis of this issue and interpretation of the statute remain 
unchanged from those announced in the final results of the second 
review. Furthermore, by applying a consistent methodology in each 
segment of the proceeding we ensure that we review all sales made 
during the entire proceeding. Changing the methodology could result in 
our failure to review some sales. Hence, in these final results of 
review we have employed the methodology we announced in the final 
results of the second review, and which petitioners cite above.

Comment 2

    Petitioners argue that the Department should assign a margin to 
RIMA based on BIA. In the preliminary results of review the Department 
determined that RIMA had no shipments during the POR, and therefore 
assigned RIMA its calculated rate from the final results of the 
previous review. Petitioners argue that the Department was in error in 
its determination that RIMA had no shipments during the POR, and that 
because at verification RIMA was unable to substantiate significant 
portions of its response, the Department should assign RIMA a margin 
based on BIA.

Department's Position

    On October 21, 1996 the importer of the merchandise in question 
submitted information regarding its imports. We have carefully reviewed 
the importer's Customs documentation, and have determined that the 
Department was in error in its preliminary determination that the sales 
did not involve an entry during the third administrative review period. 
Furthermore, RIMA was unable at verification to substantiate 
significant portions of its response in regard to this entry (see the 
preliminary review results for the fourth review (Preliminary Results 
of Antidumping Administrative Review; Intent Not to Revoke in Part, 61 
FR 46779, September 5, 1996), the October 25, 1995 verification report, 
and the September 13, 1996 ``Use of Facts Available'' memorandum from 
Fred Baker to Richard Weible). Therefore, we have determined to use BIA 
for these sales. We have assigned to this sale, as BIA, 91.06 percent 
(see Use of Best Information Available (BIA) above). This rate 
represents the highest rate ever applicable to RIMA for the subject 
merchandise.

Comment 3

    Petitioners argue that the Department erred in its preliminary 
results of review by announcing an intent to revoke the order with 
respect to Minasligas. They argue that Minasligas does not qualify for 
revocation for two reasons. First, Minasligas has sold at less than 
fair value (LTFV) in this and every prior segment of this proceeding, 
and therefore has not met the regulatory requirement of having not sold 
at less than fair value for at least three years. See 19 CFR 
Sec. 353.25(a)(2)(i). The three years in question are the first (91-
92), second (92-93), and third (93-94) reviews. For the first and 
second reviews, the Department calculated a margin of zero percent in 
its final results of review. For the third review the Department 
calculated a margin of zero percent for its preliminary results. 
Petitioners argue, with respect to the first review (which is in 
litigation before the CIT), that after the Department corrects the 
errors for which it has already conceded error, Minasligas will have a 
margin. They argue, with respect to the second review, that after the 
Department corrects the ministerial errors they allege it made in its 
final results, Minasligas will again have a margin. They argue, with 
respect to the third review, that after the Department corrects the 
calculation and methodological errors which they allege it made, 
Minasligas will again have a margin.
    Second, petitioners argue that the Department cannot correctly 
determine that Minasligas is not likely to resume selling at less than 
fair value in the future, and without this determination the Department 
cannot revoke the order. (See 19 CFR 353.25(a)(2)(ii).) Petitioners 
base this argument on the following factors:
    (1) Minasligas had a margin greater than de minimis in the 
preliminary results of the fourth administrative review of this order. 
See Silicon Metal from Brazil, Preliminary Results of Review and Intent 
Not to Revoke in Part, 61 FR 46779, 46781 (September 5, 1996).
    (2) Minasligas has submitted no evidence that it is unlikely to 
sell at less than fair value in the future.
    (3) The Department has not verified any information that Minasligas 
is unlikely to dump in the future. Citing 19 U.S.C. Sec. 1677e(b)(2)(B) 
and 19 CFR

[[Page 1957]]

353.25(c)(2)(ii), petitioners argue that the statute and regulations 
require that the basis for the ``likelihood'' determination be 
verified, and that because the Department did not verify any such 
basis, Minasligas does not qualify for revocation.
    Furthermore, petitioners argue that analysis based on the criteria 
used by the Department in its review of the antidumping duty order on 
brass sheet and strip from Germany show that Minasligas is likely to 
resume dumping. (See Brass Sheet and Strip from Germany, Final Results 
of Administrative Review, 61 FR 49727, 49730 (September 23, 1996) 
(German Brass).) These criteria include a dramatic decline in shipments 
after publication of the antidumping duty order and the low level of 
shipments by the respondent. Both of these factors, petitioners allege, 
are present here with respect to Minasligas.
    Minasligas argues, first, that in two consecutive administrative 
reviews prior to the issuance of the preliminary results of the third 
review, the Department found Minasligas not to have sold at less than 
fair value, and that, therefore, if, in the final results of this 
review the Department finds no sales at less than fair value, it will 
have met the requirement of 19 CFR 353.25(a)(2)(i). Secondly, 
Minasligas argues that 19 CFR 353.25(a)(2)(ii) requires a finding that 
dumping is not likely to occur in the future, but, contrary to 
petitioner's suggestion, does not require Minasligas to provide, or the 
record to contain, evidence that Minasligas is unlikely to resume 
dumping in the future. Furthermore, Minasligas argues that there is 
evidence on the record that Minasligas will not dump in the future. 
That evidence consists of Minasligas' written agreement to 
reinstatement of the antidumping duty order if it is found to be 
selling at less than fair value in the future.

Department's Position

    To qualify for revocation in part under 19 CFR 353.25(a)(2)(i), a 
respondent must have sold the subject merchandise at not less than 
foreign market value for at least three consecutive years. Our analysis 
in these final results of review indicates that Minasligas had no 
margin for this period. Therefore, because Minasligas has met the 
requirement under 353.25(a)(2)(i), we determine that Minasligas has met 
the regulatory requirement of having sold the subject merchandise at 
not less than foreign market value for at least three consecutive 
years.
    However, in order to revoke an order in part the Department must 
also be satisfied that the firm is not likely to resume dumping in the 
future. The Department has determined that Minasligas has a dumping 
margin of greater than de minimis in the fourth administrative review 
(being issued concurrently). Accordingly, the issue of likelihood of 
dumping in the future is moot because Minasligas has in fact resumed 
dumping. Therefore, we are not revoking the order in part for 
Minasligas.

Comment 4

    Petitioners argue that the Department erred in its calculation of 
the COP/CV for Minasligas, Eletrosilex, and CCM by using the monthly 
amounts of depreciation that they reported. Petitioners argue with 
respect to Minasligas and Eletrosilex that their calculation of 
depreciation does not reflect the useful life of the assets, but rather 
reflects an accelerated life. Petitioners argue that the Department's 
practice is to reject accelerated depreciation of assets where such 
accelerated depreciation fails to allocate the cost of the asset on a 
consistent basis over the life of the asset, which, petitioners allege, 
is the case here. Furthermore, with respect to Eletrosilex, petitioners 
argue that evidence on the record indicates that Eletrosilex did not 
report depreciation in accordance with Brazilian GAAP. With respect to 
Minasligas and CCM, petitioners argue that their depreciation 
calculation does not restate the value of the assets to account for 
hyperinflation. Petitioners argue that when an economy is 
hyperinflationary, basing depreciation on historical asset values 
results in severe understatement of actual costs; for this reason the 
Department's practice is to use depreciation that is based on revalued 
assets in hyperinflationary economy cases. Finally, petitioners argue 
that CCM's submitted calculation is inadequate because it does not 
include depreciation of idle equipment. It is the Department's 
practice, petitioners argue, to include depreciation for idle equipment 
when calculating COP and CV. Moreover, petitioners allege that there is 
contradictory information on the record as to whether CCM had expenses 
for idle equipment. Petitioners argue that because CCM failed to 
provide the information that would allow the Department to calculate 
monthly depreciation based on revalued assets and to include 
depreciation for idle assets, and because CCM misled the Department 
about whether it had depreciated its idle equipment, the Department 
should determine depreciation for CCM based on BIA. In the alternative, 
the Department should obtain from CCM the information necessary to 
determine monthly depreciation in accordance with Department practice.
    Minasligas argues that petitioners' argument is fallacious. 
Minasligas points to documentation it submitted on October 15, 1996, 
showing that (1) Minasligas did not depreciate its assets over the 
shortened period that petitioners suggest; (2) the depreciation 
reported in its COP/CV tables for purposes of this proceeding is fully 
supported by Minasligas' accounting records; (3) the value of the 
assets subject to depreciation is restated in current currency to 
account for hyperinflation through the use of special indices known as 
the BTN/UFIR indices. Furthermore, Minasligas argues that the 
Department fully verified this information. Moreover, Minasligas argues 
that the petitioner's argument is based on a misunderstanding of some 
of the columns in the verification exhibit upon which they base their 
argument. Finally, Minasligas argues that to recalculate depreciation, 
using the longer useful lives of Minasligas' assets that petitioners 
suggest, would be unfair because the Department has already completed 
two administrative reviews in which it calculated Minasligas' 
depreciation using the shorter useful lives that are the basis for the 
depreciation calculation that Minasligas records in its books and 
reported to the Department. Therefore, Minasligas argues that, if the 
Department does decide to recalculate its depreciation using longer 
useful lives for the firm's assets, it should adopt a methodology that 
takes into account the depreciation expenses that Minasligas reported 
in the previous administrative reviews.
    Eletrosilex argues that the petitioners have presented no basis for 
rejecting Eletrosilex's longstanding use of aggressive accelerated 
depreciation. It argues that after having taken depreciation of 10 
percent per year through 1991 on its furnaces, as permitted under 
Brazilian generally accepted accounting principles (GAAP), Eletrosilex 
necessarily had to interrupt depreciation on an item that had a 20-year 
useful life. It states it resumed a 5 percent depreciation on its 
furnaces in January 1995. Furthermore, it argues that it has provided 
the Department with a clear statement of its depreciation schedule and 
its application to all depreciable assets. Thus, Eletrosilex concludes 
that it has demonstrated to the Department a sound and legitimate basis 
for the

[[Page 1958]]

depreciation schedules used in the POR, and the Department should use 
those schedules again in the final results of this review.
    CCM argues that petitioners' argument with respect to restatement 
of asset values is invalid because CCM does not base its depreciation 
on historical costs. CCM's financial statement, CCM argues, makes clear 
that the value of CCM's property, plant, and equipment is recorded at 
the cost of acquisition plus monetary adjustment. CCM states that this 
is a common accounting mechanism used by Brazilian companies to restate 
the historical costs of their assets at their current cost during 
hyperinflation. With regard to its statement (cited by petitioners) 
that CCM did not revalue its assets, CCM argues that the statement 
meant only that there was no special asset re-valuation during the POR; 
CCM did follow the accepted accounting practice of restating the 
historical cost through the application of monetary correction. Thus, 
CCM argues, there is no basis for petitioners' statements that CCM's 
reported depreciation is grossly understated because it is based on 
historical costs.
    With respect to petitioners' argument that CCM did not report 
depreciation of idle equipment, CCM admits that it did not include idle 
equipment in its submitted costs, but argues that doing otherwise would 
have distorted the Department's hyperinflationary cost calculations. 
The fundamental premise of the Department's replacement cost 
methodology, CCM argues, is that costs actually incurred by the 
respondent in the production of subject merchandise must be restated on 
a replacement basis in order to eliminate the distortive effects of 
hyperinflation on costs incurred at various times in the POR. In order 
to calculate an accurate monthly replacement cost, CCM argues, the 
Department must apply this approach only to the value of inputs 
actually consumed in the production process. Because of this, it would 
be incorrect to include the replacement cost of an idled asset, because 
by definition the asset was not used or consumed in the specific month. 
Thus, CCM argues that the Department's replacement cost rules work only 
if applied to those costs actually (and not hypothetically) incurred in 
production, as petitioners advocate. Therefore, CCM argues, the 
Department should not include depreciation on idled equipment in CCM's 
COP/CV.

Department's Position

    We agree with petitioners in part. With respect to Minasligas, we 
disagree with petitioners' argument that Minasligas' depreciation 
calculation is unacceptable because it is based on accelerated 
depreciation. The CIT has upheld the Department's calculation of 
depreciation based on a respondent's financial records where their 
financial records are consistent with foreign GAAP principles and where 
those records do not distort actual costs. See Laclede Steel Co. v. 
United States, 18 CIT 965, 975 (1994). Here, Minasligas has 
historically used accelerated depreciation, and these methods are 
consistent with Brazilian GAAP. Moreover, we note that we have in the 
past used accelerated depreciation where the respondent has 
historically used it in its financial statements. See Foam Extruded PVC 
and Polystyrene Framing Stock from the United Kingdom; Final 
Determination of Sales at Less Than Fair Value; 61 51411, 51418 
(October 2, 1996). Furthermore, we agree with Minasligas that to 
recalculate depreciation using a longer useful life for Minasligas' 
assets after having used a shorter life in two prior reviews would 
allocate costs to this review that have already been accounted for in 
prior reviews, and would therefore be inequitable. Finally, we agree 
with Minasligas that its use of the BTN/UFIR indices accurately 
restates the value of its assets. Therefore, in these final results of 
review, as in the preliminary results of review, we have used 
Minasligas' reported depreciation in calculating COP.
    With respect to Eletrosilex, we agree with petitioners that 
evidence on the record indicates that Eletrosilex did not report 
depreciation in accordance with Brazilian GAAP. See note 5(b)(iv) of 
Eletrosilex's 1994 financial statement in Eletrosilex's February 26, 
1996 submission. Therefore, for these final results of review, we have 
used the auditor's estimate of Eletrosilex's depreciation for the COP 
calculation because it is the most accurate reflection of Eletrosilex's 
depreciation that is on the record and because it is in accordance with 
Brazilian GAAP.
    With respect to CCM, we agree with CCM that evidence on the record 
indicates that it makes a monetary adjustment in recording the value of 
its property, plant, and equipment. Therefore, no additional 
restatement is necessary.
    Concerning idle assets, we agree with the petitioners that the 
Department includes in fully absorbed factory overhead the depreciation 
of equipment not in use or temporarily idle, notwithstanding home 
market accounting standards which may allow companies to refrain from 
doing so. See, for example:Silicon Metal From Argentina (58 FR 65336, 
65338, December 14, 1993); Antifriction Bearings (Other than Tapered 
Roller Bearings) and Parts Thereof From France, Germany, Italy, Japan, 
Romania, Singapore, Sweden, Thailand, and the United Kingdom (58 FR 
39729, 39756, July 26, 1993); Tapered Roller Bearings and Parts 
Thereof, Finished and Unfinished, From Japan and Tapered Roller 
Bearings, Four Inches or Less in Outside Diameter, and Components 
Thereof, From Japan (58 FR 64720, 64727-28, July 26, 1993); Tapered 
Roller Bearings and Parts Thereof, Finished and Unfinished, From Japan 
and Tapered Roller Bearings, Four Inches or Less in Outside Diameter, 
and Components Thereof, From Japan (57 FR 4960, 4973, February 11, 
1992); Shop Towels from Bangladesh (57 FR 3996, 3999, February 3, 
1992); Mechanical Transfer Presses from Japan (55 FR 335, January 4, 
1990); Titanium Sponge from Japan (49 FR 38687, 38689, October 1, 
1984). See also NTN Bearing Corp. of America, et al., plaintiffs, v. 
United States, Slip Op. 93-129 (August 4, 1993) (upholding the 
Department's inclusion of depreciation expenses for idle equipment).
    We disagree with CCM's argument that a hyperinflationary 
environment necessitates disregarding the Department's long-standing 
policy. Depreciation is a cost that is incurred without regard to 
whether the assets being depreciated are used in production during a 
particular period. Thus, depreciation of idle assets must be included 
in COP in order for COP to reflect the full costs incurred during the 
POR regardless of whether an economy experienced hyperinflation during 
the POR.
    Similarly, we disagree with CCM's related argument that 
depreciation expense for idled assets involves only hypothetical 
expenses; depreciation expenses reflect not only wear and tear from 
usage but also aging and obsolescence, which affect idle assets as much 
as, and sometimes more than, active assets.
    Therefore, in these final results of review we have added the 
depreciation for idle assets to CCM's reported depreciation.

Comment 5

    Petitioners argue that the Department should disregard Minasligas' 
inventory holding gain/loss calculation because Minasligas failed to 
``layer'' or value its inventory properly. They argue the Department 
should require Minasligas to provide the information necessary to

[[Page 1959]]

perform a proper inventory holding gain/loss calculation in accordance 
with Department practice.
    Minasligas argues that the petitioner's point is moot because the 
Department used Minasligas' home market selling prices for foreign 
market value (FMV), not CV. It also argues that the Department verified 
the accuracy of Minasligas' calculations, and found no discrepancies.

Department's Position

    While we verified that the amounts Minasligas used in its 
calculation were derived from accounting records, Minasligas did not 
substantiate its method of layering its inventory. As petitioners note 
in their brief, Minasligas' calculations show only one layer of prior 
inventory for inputs and finished product even though inventory stemmed 
from more than one previous month. By failing to include in its 
calculations the goods placed in inventory during prior months, 
Minasligas failed to value the inventory properly based on the 
inflation-adjusted costs in the prior months. See Minasligas' March 17, 
1995 submission, exhibit 11. Thus, consistent with our practice when a 
respondent fails to report inventory properly, we have denied 
Minasligas an adjustment for inventory holding gains/losses in these 
final results of review.

Comment 6

    Petitioners argue that the Department erred by not including 
Minasligas' and Eletrosilex's claimed duty drawback in CV. This 
drawback consists of taxes and import duties that the government of 
Brazil suspended on Minasligas' and Eletrosilex's purchases of imported 
electrodes used in the production of silicon metal destined for export. 
Petitioners argue that because the Department added the duty drawback 
to U.S. price, and because the taxes represented by the drawback were 
not elsewhere represented in CV, the Department should add the drawback 
to CV in order to make an ``apples-to-apples'' comparison of U.S. price 
to CV. In addition, they argue, with respect to Eletrosilex, that the 
Department must include the duty paid on purchases of electrodes in COP 
for purposes of the sales-below-cost analysis.
    Minasligas argues that in the preliminary results of review the 
Department correctly added duty drawback to U.S. price for comparison 
with a sales-based FMV. However, if the Department uses CV in the final 
results, and includes indirect taxes in CV, it must still add duty 
drawback to U.S. price to make an ``apples-to-apples'' comparison.
    Eletrosilex argues that the methodology the Department announced in 
its second review final results with respect to taxes does not achieve 
the stated aim of tax neutrality. Therefore, it urges the Department to 
adopt the approach mandated by the Uruguay Round Agreements Act, and 
eliminate consumption taxes from all calculations. It states that this 
is the only way truly to achieve tax neutrality. Furthermore, it argues 
that this approach has the additional virtue of simplifying these 
proceedings.

Department's Position

    We agree with petitioners. The Brazilian duty drawback law 
applicable to Minasligas and Eletrosilex suspends the payment of ICMS 
and IPI taxes and import duties that would ordinarily be due upon 
importation of electrodes if they are consumed in producing silicon 
metal for export. Therefore, because the ICMS and IPI taxes and import 
duties are suspended, we cannot conclude that they are already included 
in the COM or reported tax payments that Minasligas and Eletrosilex 
have reported. Thus, in order to make a valid comparison between USP 
and CV, we need to add to CV the full amount of the claimed duty 
drawback that we added to USP in accordance with section 772(d)(1)(B) 
of the Tariff Act. We have done so in these final results of review. 
This methodology is identical with the methodology announced in the 
final results of the prior review of this case. See Silicon Metal from 
Brazil; Second Review Final Results, at 46770.
    Because the import duties are not suspended for electrodes consumed 
in the home market, we agree with petitioners that Eletrosilex's import 
duties on carbon electrodes should be added to COP for purposes of the 
cost test. In these final results of review we have calculated the 
import duties by multiplying the cost of carbon electrodes that we 
allocated to the domestic market by the import duty rate of ten 
percent.

Comment 7

    Petitioners argue that the Department erred in its computation of 
Minasligas' monthly COP by not including the cost of tubes and rods 
that Minasligas consumed during each month. The Department included 
these costs only in the months in which Minasligas made purchases of 
tubes and rods, and not in the months in which Minasligas consumed 
them. Petitioners argue that in the final results the Department should 
determine the proper costs for tubes and rods based on the number of 
units of each input used in the production of silicon metal in each 
month and the monthly replacement cost for each input.
    Minasligas states that it reported its costs for tubes and rods in 
the month of purchase because this is how they are reported in 
Minasligas' accounting records. It also states that if the Department 
wishes to recalculate these costs for each month of consumption, it is 
willing to cooperate fully with the Department in providing all 
necessary information.

Department's Position

    Because Brazil's economy was hyperinflationary during the POR, in 
these final results of review, we have calculated each respondent's COM 
using an ``annual average'' methodology. See the Final Results Analysis 
Memorandum. In this methodology we first calculated an annual weighted-
average COM indexed to end-of-year values, and then restated the annual 
average COM to compute a monthly COM. We used the wholesale price index 
to restate the annual COM to the specific month of production. Thus, 
because we calculated monthly costs based on annualized figures, 
petitioners' point regarding Minasligas' tubes and rods is moot.

Comment 8

    Petitioners argue that the Department made numerous errors with 
respect to Brazilian taxes in performing the cost test. With respect to 
Minasligas, petitioners allege that the Department erred by comparing 
COP to home market prices that included a disproportionately high 
amount of ICMS tax. By so doing, petitioners allege, the Department 
failed to follow its practice of either including the same absolute 
amount of value-added taxes (VAT) in both home market price and COP, or 
of excluding VAT from both COP and home market price. Thus, petitioners 
argue, the Department did not make a fair and equal comparison in the 
preliminary results of review. They argue that in the final results of 
review the Department should exclude ICMS taxes from both the home 
market prices and the COPs used in the sales-below-cost analysis.
    With respect to Eletrosilex, petitioners argue that the Department 
erred by failing to deduct the ICMS, PIS, and COFINS taxes from 
Eletrosilex's home market prices before performing the cost test. 
Petitioners argue that the failure to deduct the ICMS tax was in error 
because information on the record shows that Eletrosilex's reported 
cost of

[[Page 1960]]

manufacture (COM) did not include the ICMS tax. With respect to PIS and 
COFINS taxes, petitioners argue that the Department correctly included 
in COP the PIS and COFINS taxes that Eletrosilex paid on its purchases 
of inputs (and which Eletrosilex included in its reported price of 
materials), but erred in how it treated the PIS and COFINS taxes 
Eletrosilex collected on sales of silicon metal. In the preliminary 
results, the Department, petitioners allege, added to COP a variable 
Eletrosilex reported that represents its home market direct selling 
expenses, consisting of inland freight and PIS and COFINS taxes collect 
on sales. Petitioners argue that rather than adding this selling 
expense variable to COP to account for collections of PIS and COFINS 
taxes on home market sales, the Department should instead subtract from 
the net home market prices the sales-specific amount of PIS and COFINS 
taxes in its computation of NPRICOP (the price which we compare to COP 
in the cost test).
    With respect to CCM, petitioners argue that the Department erred in 
the cost test by comparing home market prices that included ICMS taxes 
with COPs that included a disproportionately larger amount of ICMS 
taxes. They argue that it is established Department practice when 
performing the cost test to either include the same absolute amount of 
VAT in both home market price and COP or to exclude VAT from both.
    Minasligas argues that the Department should not include the same 
amount of VAT in the sales price and COP because different amounts of 
taxes were collected and paid on the sales price and production costs, 
respectively.
    Eletrosilex argues that the Department should eliminate consumption 
taxes from all calculations. This approach, it argues, is the only way 
to achieve true tax neutrality.
    CCM argues that the Department correctly accounted for its VAT in 
the preliminary results of review. In support of its argument, it cites 
Silicomanganese from Venezuela, 57 FR 55436 (November 7, 1994) 
(Silicomanganese from Venezuela), in which the Department agreed with a 
respondent's argument that ``if the Department includes the value-added 
taxes paid on inputs in the cost of production, it must also include 
the VAT received from its customers in the price for purposes of the 
sales below cost test.''

Department's Position

    We agree with petitioners that in performing the cost test our 
policy is to either include the same absolute amount of VAT in both 
home market price and COP, or to exclude VAT from both COP and home 
market price. In Silicomanganese from Venezuela, though we agreed with 
the statement that CCM cites, we also said, ``The amount of VAT 
included in the home market COP should be the same as the amount that 
is included in the home market sales prices.'' See Silicomanganese from 
Venezuela at 55441. In performing the cost test for these final results 
of review, we have calculated both COP and the price we compare to COP 
exclusive of the ICMS tax. This is the methodology recently used in 
Ferrosilicon from Brazil; Final Results of Antidumping Duty 
Administrative Review, 61 FR 59407, 59410 (November 22, 1996) 
(Ferrosilicon from Brazil; First Review Final Results). However, unlike 
Ferrosilicon from Brazil; First Review Final Results, we have not 
deducted IPI tax from COP because IPI tax is not assessed on sales of 
silicon metal as it is for ferrosilicon.
    With respect to PIS and COFINS, we have not deducted these taxes 
from the home market price to which we compare COP because they are 
gross revenue taxes, and not taxes imposed directly on the merchandise 
or components thereof on a transaction-by-transaction basis. See the 
Department's Position in response to comment 28 (below). For 
Eletrosilex we have eliminated the addition to COP of the selling 
expense variable it reported in its COP response, and have instead 
added to COP the sales-specific amount of direct selling expenses, 
which does not include PIS and COFINS taxes. We have also calculated 
COP for all respondents so that it represents the full purchase price 
of all inputs, and is not exclusive of a hypothetical amount of PIS and 
COFINS taxes.

Comment 9

    Petitioners argue that the Department erred in its treatment of 
inland freight in the COP test for CCM, Minasligas, and Eletrosilex. 
With respect to CCM, petitioners argue that the Department erred by 
comparing COPs that did not include freight costs to home market 
selling prices that did include freight costs. They argue that to make 
a fair comparison in the final results the Department should exclude 
freight expenses from the home market prices used in the sales-below-
cost analysis.
    CCM states that it included freight costs in the direct selling 
expense field of its COP/CV database. Therefore, CCM argues, the COPs 
that the Department used in the cost test did in fact include freight 
costs.
    With respect to Minasligas, petitioners argue that the Department 
erred by comparing COPs inclusive of freight charges to home market 
prices inclusive of disproportionately high freight charges. This 
difference in freight occurred, petitioners argue, because Minasligas 
calculated the per-unit freight cost for home market sales by dividing 
the freight charges incurred on each home market sale by the quantity 
of each sale, while it calculated the per-unit freight included in COP 
by dividing the monthly sum of those same freight charges by the 
monthly volume of its silicon metal production. This methodology, 
petitioners allege, resulted in Minasligas including a lower per-unit 
amount of freight in COP than in the home market prices. By using this 
methodology, petitioners argue, the Department failed to compare home 
market prices to COP on an ``apples-to-apples'' basis. Petitioners also 
allege this methodology violates Import Administration Policy Bulletin 
No. 94.6, which states that the Department determines both COP and the 
home market prices on an ex-factory basis (i.e., net of movement 
charges, which, by definition, include freight expenses). They argue, 
therefore, that in the final results of review the Department should 
exclude freight expenses from both the COP and the home market prices.
    Minasligas argues that the petitioners' proposed method is 
distortive, and in fact is contrary to Import Administration Policy 
Bulletin 94.6. According to this bulletin, Minasligas argues, COP is 
calculated net of selling expenses. Because its reported selling 
expenses included inland freight, Minasligas argues that if the 
Department removes freight from home market price, it should also 
remove selling expenses from COP.
    With respect to Eletrosilex, petitioners argue that the Department 
erred by not deducting inland freight from Eletrosilex's home market 
prices before performing the cost test. In the preliminary results, 
rather than subtracting inland freight from Eletrosilex's home market 
prices before performing the cost test, the Department added to the 
cost build-up a variable that Eletrosilex reported that included inland 
freight (as well as PIS and COFINS taxes). Petitioners argue that this 
approach was an error because not all of Eletrosilex's home market 
sales included freight expenses. Thus, petitioners argue, the 
Department improperly compared the home market sales prices that 
include freight to a COP that includes an amount of freight that is 
artificially lowered by Eletrosilex's improper division of the total 
freight

[[Page 1961]]

incurred on a portion of home market sales by the volume of all home 
market sales. At the same time, petitioners argue, the Department 
improperly compared a COP that includes freight to home market sales 
prices for which Eletrosilex reported no freight.

Department Position

    Petitioners and Minasligas are correct that Import Administration 
Policy Bulletin 94.6 states that the cost test will be performed on an 
ex-factory basis, and thus net of freight expenses. Therefore, in these 
final results of review we have deducted inland freight from the price 
which we compare to COP in the cost test. In order to ensure we make a 
proper comparison for those respondents (i.e., Minasligas and CCM) who 
included freight in their reported direct selling expenses for COP, we 
have not used the direct selling expenses the respondents reported in 
their cost questionnaire response. Instead, in these final results of 
review, we have added to COP the sales-specific direct selling expenses 
included in each home market sales price.

Comment 10

    Petitioners argue that the Department erred by calculating 
Minasligas', CCM's, and CBCC's home market imputed credit expenses 
based on prices that include VAT. The Department's established 
practice, petitioners argue, is to exclude VAT collected on home market 
sales from the prices used in calculating imputed credit expenses. 
Thus, petitioners argue, in the final results of review the Department 
should exclude ICMS taxes from the prices used to calculate home market 
imputed credit.
    Minasligas argues, based on the tax policies of the government of 
Brazil, that ICMS taxes should be included in the imputed credit 
calculation. It argues that imputed credit expenses represent the 
opportunity cost of financing accounts receivable, and that this 
opportunity cost does not apply solely to a portion of the sale, but to 
the entire revenue that is generated by the sale. During the period 
that payment from the customers is outstanding, not only must 
Minasligas finance its production operations, it must also pay any ICMS 
amounts it owes to the Brazilian government. To the extent that it pays 
such taxes before it receives them from its customers, they become part 
of the cost of financing receivables. Therefore, Minasligas argues, 
ICMS taxes should be included in the imputed credit calculation.
    CCM argues that petitioners are incorrect in saying that it is the 
Department's policy not to include ICMS tax in the computation of 
imputed credit. It argues that the Department has previously calculated 
CCM's home market imputed credit expenses based on ICMS tax-inclusive 
home market prices. In support of this statement, it cites the final 
determination of the LTFV investigation of this case, in which the 
Department said:

    The ICMS incident to a home market sale is outstanding until 
that time that the customer pays for its merchandise. Until the 
customer pays, CCM cannot use the ICMS collected on that sale to 
offset ICMS it has paid on purchases of materials used in the 
production of the subject merchandise. Accordingly, there is an 
inherent cost in maintaining an outstanding amount of ICMS due to 
CCM's receivables. Therefore, we have included the ICMS in the home 
market price when calculating imputed credit expenses.

See Silicon Metal from Brazil; Final Determination of Sales at Less 
Than Fair Value, 56 FR 26977, 26982 (June 12, 1991). Furthermore, CCM 
points out that no party appealed this issue to the CIT, reflecting all 
parties' agreement concerning the legitimacy of this approach.

Department's Position

    We agree with petitioners. While CCM is correct that we have 
calculated imputed credit inclusive of ICMS tax in earlier segments of 
this proceeding, our more recent practice is to calculate imputed 
credit exclusive of ICMS tax. We addressed this issue in 
Silicomanganese from Venezuela. There we said:

    The Department's practice is to calculate credit expenses 
exclusive of VAT. (See the discussion of our VAT methodology in the 
preliminary determination (59 FR 31204, 31205, June 17, 1994.) 
Theoretically, there is an opportunity cost associated with any 
post-service payment. Accordingly, to calculate the VAT adjustment 
argued by Hevensa would require the Department to calculate the 
opportunity costs involved with freight charges, rebates, and 
selling expenses for each reported sale. It would be an impossible 
task for the Department to attempt to determine the opportunity cost 
of every such charge and expense.

See Silicomanganese from Venezuela, 59 FR 55436, 55438 (November 7, 
1994). Similarly, in this case to calculate the ICMS adjustment argued 
by CCM would require the Department to calculate the opportunity costs 
involved with freight charges, selling expenses, and packing for each 
reported sale. It would be an impossible task for the Department to 
determine the opportunity cost of every such charge and expense. In 
these final results of review we have followed our more recent 
practice. See also Ferrosilicon from Brazil; First Review Final Results 
at 59410.

Comment 11

    Petitioners argue that the Department made two currency conversion 
errors in its margin calculation for CBCC and Minasligas. With respect 
to CBCC, petitioners argue that the Department used the wrong exchange 
rate for converting CBCC's brokerage, warehousing, and foreign inland 
freight from Brazilian currency into U.S. dollars. This error occurred, 
petitioners allege, because the Department incorrectly believed that 
these expenses were denominated in cruzeiros, rather than in cruzeiros 
reais.
    CBCC argues that there is no evidence on the record that any of the 
charges it reported are in a currency other than cruzeiros.
    With respect to Minasligas, petitioners argue that the Department 
erred by converting the cruzeiro value of Minasligas' U.S. sales into 
dollars, rather than using the actual value of the U.S. sales in the 
currency in which they were originally denominated. They argue that the 
needless recalculation of U.S. price had the effect of increasing the 
U.S. price.
    Minasligas argues that it reported its U.S. sales in cruzeiros (as 
recorded in its books), and that the Department correctly converted it 
into dollars using the average exchange rate of the month of shipment. 
This methodology, Minasligas argues, is in accordance with the 
Department's practice of comparing the U.S. price to the CV or FMV in 
the month of shipment.

Department's Position

    We agree with petitioners. With respect to CBCC, we note that in 
exhibit 6 of CBCC's March 17, 1994 supplemental questionnaire response 
(SQR) CBCC demonstrated the currency conversion. That demonstration 
indicates that the expenses were in fact denominated in cruzeiros 
reais, and not cruzeiros. We have corrected this error in these final 
results of review. With respect to Minasligas, our practice is to use 
the actual U.S. price in the currency in which it was originally 
denominated. We also seek to avoid any unnecessary currency 
conversions. Therefore, in these final results of review we have used 
the actual sales prices in the currency in which they were originally 
denominated.

Comment 12

    Petitioners argue the Department erred in the margin calculation 
for Minasligas and CCM by using the wrong shipment date. With respect 
to

[[Page 1962]]

Minasligas this alleged error occurred where the Department performed 
the currency conversion for the movement expenses on U.S. sales by 
using the exchange rate on the date of shipment from the port in 
Brazil, rather than the exchange rate on the date of shipment from 
Minasligas' plant. Doing so, petitioners allege, was a violation of the 
Department's practice in which the date of shipment is the date the 
merchandise was shipped from the producer's factory. Therefore, 
petitioners argue, the Department should use the exchange rate of the 
date of sale in converting U.S. movement expenses, just as it used the 
date of sale (rather than the reported date of shipment) in the 
calculation of imputed credit.
    Minasligas argues that because the record does not contain the date 
on which Minasligas paid the movement expenses, the Department was 
correct in using the exchange rate of the date of shipment from the 
port because it was the closest date on record to the date in which the 
expenses were actually incurred.
    With respect to CCM, petitioners argue that the Department used the 
wrong shipment date in its calculation of U.S. imputed credit. The 
shipment date that CCM reported and that the Department used in its 
computation, petitioners allege, was the shipment date from the port in 
Brazil, rather than the shipment date from CCM's plant. Petitioners 
argue that the Department should use the date of sale as the date of 
shipment as it did in calculating Minasligas' imputed credit. 
Furthermore, petitioners argue that for the same reason the Department 
should base CV on the month of the U.S. sale, rather than on CCM's 
reported month of shipment.
    With respect to petitioners' argument that the Department should 
have calculated imputed credit using the date of the U.S. sale, CCM 
argues, first, that the Department should use the credit calculation it 
submitted in its questionnaire response as the actual credit expense. 
This calculation, CCM states, reflects the actual interest charged on 
the export credit line obtained for that shipment, and therefore is the 
most accurate, transaction-specific measure of CCM's interest expense 
in connection with its U.S. sale. Second, CCM argues that if the 
Department decides to use an imputed figure, it need not resort to the 
date of sale as the date of shipment because the date of shipment from 
CCM's factory is on the record as verification exhibit 11.
    With regard to petitioners' argument that the Department should use 
the CV in the month of sale to establish fair value, CCM argues that it 
is the Department's practice in hyperinflationary economy cases to use 
the bill-of-lading date as the shipment date, and thus the date upon 
which CV should be based. In support of this assertion it cites 
Tubeless Steel Disc Wheels from Brazil; Amended Final Determination of 
Sales at Less than Fair Value and Amended Antidumping Duty Order, 53 FR 
34566 (September 7, 1988) (Tubeless Steel Disc Wheels from Brazil). 
There the Department stated that it corrected a clerical error whereby 
``invoice dates were used rather than bill-of-lading dates to represent 
the date of shipment for the calculation of antidumping duty margins.'' 
CCM also argues that if the Department decides to use the invoice date, 
rather than the bill-of-lading date, as the date of shipment, it need 
not resort to using the date of sale (as petitioners urge) because, as 
previously mentioned, the invoice date is on the record in verification 
exhibit 11.

Department's Position

    With respect to the petitioners' argument regarding Minasligas, we 
agree with Minasligas. Where the record does not contain the actual 
dates of payment for its export sale movement expenses and where the 
Department did not specifically solicit this information, it is 
reasonable to use the date of shipment from the port in the imputed 
credit calculation because it is the closest date on record to the date 
on which the expenses were actually incurred. With respect to the 
petitioners' argument regarding CCM, we agree with CCM that when using 
CV in hyperinflationary economy cases it is the Department's practice 
to perform the margin calculation using the CV of the month of shipment 
from the port, rather than (as petitioners argue) the CV of the month 
of shipment from the plant. See Tubeless Steel Disc Wheels from Brazil 
at 34567.
    We disagree with CCM that we should use its reported ``actual 
expense'' for U.S. credit. The Department requires that the credit 
expenses reflect the opportunity cost of the entire period between 
shipment from the plant and payment by the customer. That is not the 
case for CCM's reported ``actual expense.'' The actual expense covers 
only a portion of the imputed credit expense period. Therefore, in 
these final results of review we have calculated imputed credit using 
the shipment date from CCM's plant, as given in verification exhibit 
11.

Comment 13

    Petitioners argue that the Department erred in its computation of 
Minasligas' COP/CV by using the 1993 G&A expenses that Minasligas 
reported. They argue that Minasligas' 1993 audited financial statements 
show that Minasligas' G&A expenses are greater than what it reported to 
the Department. Therefore, petitioners argue, the Department should 
require Minasligas to report monthly G&A expenses for 1993 whose sum 
reconciles to the total 1993 G&A expenses shown on its financial 
statement.
    Minasligas argues that petitioners' argument fails to consider that 
Minasligas deducted from its G&A some expenses associated with forest 
maintenance, depletion, and exhaustion that it included in its cost of 
charcoal as part of direct material expenses. To have not made this 
deduction, Minasligas argues, would have resulted in these costs being 
double-counted.

Department's Position

    We agree with petitioners that the G&A figures Minasligas reported 
in its October 15, 1996 submission do not reconcile to its 1993 
financial statement. Though Minasligas claims that the difference is 
due to its exclusion from G&A of some costs that had been included in 
its cost of charcoal as part of direct material costs, we note that 
neither Minasligas' G&A chart of accounts nor its cost of charcoal list 
includes the categories of forest maintenance, depletion, or 
exhaustion. See verification exhibits 23 and 33. Thus, since there is 
no evidence on the record to substantiate Minasligas' explanation or 
the G&A figures in its October 15, 1996 submission, for these final 
results of review we have relied upon the G&A expenses reported in 
Minasligas' 1993 financial statement.
    Furthermore, in these final results of review, unlike the 
preliminary results of review, we have calculated Minasligas' G&A by 
multiplying a ratio (consisting of indexed monthly historical G&A 
divided by indexed monthly historical cost of goods sold) by monthly 
replacement cost COM. As explained below in response to comment 22, 
this is our current method of calculating G&A in a hyperinflationary 
economy. To perform this calculation, we increased the reported G&A 
costs for each month in 1993 by the percentage difference between the 
reported annual G&A costs and the financial statement G&A costs.

Comment 14

    Petitioners argue that the Department erred in its calculation of 
interest

[[Page 1963]]

expense for Eletrosilex, CCM, and CBCC by offsetting interest expenses 
with interest income. Petitioners argue with respect to all three of 
these respondents that the interest income for which the Department 
allowed an offset is not interest income derived from short-term 
investments of working capital (i.e., from business operations). 
Petitioners argue that allowing an offset for this income was a 
violation of the Department's requirements for granting an interest 
income offset. Those requirements are, petitioners state, that the 
respondent demonstrate (1) that the interest income stemmed from short-
term investments and (2) that short-term interest income was derived 
from business operations. Petitioners argue with respect to CBCC that 
some of the interest income for which the Department allowed an offset 
does not meet these two criteria. Therefore, petitioners argue, in the 
final results the Department should allow an offset only for those 
interest income items which CBCC has demonstrated to be from short-term 
investments.
    With respect to Eletrosilex, petitioners focus on one transaction 
recorded on Eletrosilex's 1994 financial statement for which, they 
allege, there is no evidence that it was revenue from a short-term 
investment. They also allege it does not consist of interest income 
from investments, and therefore does not qualify to be an offset to 
Eletrosilex's financial expenses. Furthermore, petitioners argue, 
Eletrosilex did not even make a claim for an offset to its financial 
expenses, and for this reason alone the Department should not have made 
one.
    With respect to CCM, petitioners also argue that CCM did not submit 
the financial statement of its direct parent, or a consolidated 
financial statement for the CCM group of related companies. By not 
submitting such statements, petitioners argue, CCM thwarted application 
of the Department's established practice of determining interest 
expenses on a consolidated basis. Furthermore, petitioners argue that 
because CCM did not cooperate with the Department by answering the 
Department's questions regarding its interest income, the Department 
should base interest expense for CCM on BIA, or, in the alternative, it 
should obtain the information necessary to calculate interest expenses 
for CCM properly in accordance with Department practice.
    CBCC argues that the Department verified the financial income and 
expenses of CBCC and its parents Solvay do Brasil and Solvay & Cie at 
verification, and the Department's report did not indicate that the 
financial gains were not derived from short-term investments, nor that 
they were not related to the companies' business operations. 
Furthermore, because the Department verified CBCC's financial gains, 
CBCC argues that it is no longer CBCC's burden to prove that the 
financial gains are short-term or related to its business operations; 
it is, rather, the petitioners' burden to prove that the Department's 
methodology was incorrect. Because petitioners are unable to do this, 
CBCC argues, the Department should reject their argument.
    Eletrosilex argues, with regard to petitioners' second argument, 
that its submitted financial statement (at page 79) shows that the 
entire transaction occurred between July 28, 1994 and December 27, 
1994, and therefore qualifies as short-term under any analysis. 
Eletrosilex also argues that the financial statement shows that the 
transaction was a credit cession operation made with several financial 
institutions. A credit cession operation, Eletrosilex argues, is by its 
nature a transaction that provides interest income on the investment.
    CCM argues, with regard to petitioners' first argument, that in a 
February 21, 1995, submission (in which it submitted its balance sheet) 
it demonstrated that all of its interest income was derived from short-
term investments. With regard to petitioners' second argument, CCM 
argues that in the same February 21, 1995, submission, it submitted 
financial statements for each of CCM's corporate layers. It argues that 
these financial statements demonstrate that each of its corporate 
layers had a net interest expense of zero, and that for each corporate 
layer the interest expenses were offset by interest revenue from short-
term investments. As for the company that petitioners call CCM's 
``direct parent,'' CCM states that this company is a related entity 
which does not have audited financial statements, and therefore CCM did 
not submit one. CCM also says that this entity's net income was 
captured in the financial statement of another related entity, and that 
CCM submitted this financial statement.

Department's Position

    We agree with petitioners in part. With respect to CBCC, we agree 
with petitioners that CBCC's reported interest income includes two line 
items which do not constitute interest income. We are unable to 
identify these line items in this notice because CBCC has requested 
that the identity of these line items be treated as business 
proprietary information subject to release only under administrative 
protective order (APO). The fact that the verification report does not 
discuss these items does not imply the Department's agreement with 
CBCC's characterization of these two line items as interest income. 
CBCC unduly attempts to shift the burden of proof to the petitioners, 
disregarding the fact that it is up to a respondent to substantiate and 
document any adjustment or claim to the Department. As the Department 
stated in Gray Portland Cement and Clinker from Japan; Final Results of 
Antidumping Duty Administrative Review (60 FR 43761, 43767, August 23, 
1995), ``[w]hen a respondent makes a claim for an adjustment, it is the 
respondent's responsibility to provide a detailed explanation of the 
adjustment as well as supporting documentation.'' Therefore, because 
CBCC did not substantiate through an explanation or supporting 
documentation that the claimed offsets were from short-term 
investments, we have reduced CBCC's interest income by the total amount 
of those two line items. See Final Results Analysis Memorandum for our 
calculations.
    With respect to Eletrosilex, we agree with petitioners that 
Eletrosilex is not entitled to an adjustment. The transaction in 
question consisted of an investment in Brazilian bonds denominated in 
reais and financed by borrowing on dollar-denominated export notes. 
Eletrosilex later sold the real-denominated bonds after they had 
accrued pro rata interest for Eletrosilex. Such a transaction would 
result in interest income and capital gains; only the former would 
qualify as an offset to interest expenses. However, we have no 
information on the record to enable us to break out the interest income 
from the capital gains. Furthermore, we are unable to evaluate any of 
Eletrosilex's other claimed short-term interest income because, in 
response to a request that it itemize its offsets, Eletrosilex stated 
that it is not claiming any offsets. See Eletrosilex's March 17, 1995, 
SQR, at 32. Therefore, in these final results of review, we have denied 
Eletrosilex an offset to its interest expenses.
    We agree with CCM that the evidence on the record supports its 
contentions that (1) all of CCM's interest income was derived from 
short-term investments (see CCM's audited balance sheet); (2) CCM's 
interest income outweighed interest expenses (see CCM's audited profit/
loss statement); and (3) each of CCM's parent companies also 
experienced short-term interest income in excess of short-term interest 
expenses (see the financial statements for each corporate layer of the 
group of which CCM is a member). The fact that CCM did not submit 
consolidated financial

[[Page 1964]]

statements--which do not exist--cannot be held against CCM since the 
individual company statements demonstrate that short-term income 
exceeded short-term interest. For all of these reasons, we have 
continued to exclude interest expenses from CCM's COP.

Comment 15

    Petitioners argue that the Department erred in its computation of 
Eletrosilex's COP by allocating Eletrosilex's production costs equally 
between silicon metal and products which petitioners allege are by-
products of silicon metal production. They argue that in the final 
results of review the Department, as it did in the preliminary results 
of the fourth administrative review of this order, should allocate 
silicon metal production costs only to commercial-grade silicon metal, 
and should offset COM with estimated revenue from by-product sales.
    Eletrosilex argues that if the Department allocates all production 
costs only to commercial-grade silicon metal, then it should make an 
offset to the COP for the revenue generated from the sale of by-
products, and should apply the offset to the volume of by-products 
produced, rather than the volume of by-products sold. Furthermore, 
Eletrosilex argues that the Department should consider as by-products 
only ladle sculls, off-grades, and fines, but not slag or silicon metal 
of ingot bottom. Eletrosilex states that it does not consider slag or 
silicon metal of ingot bottom production items, and does not include 
them in its production volume records.

Department's Position

    We agree with petitioners that Eletrosilex's production costs 
should be allocated to only commercial-grade silicon metal, and that an 
offset should be made to Eletrosilex's costs for the revenue it 
collects from its sale of by-products. By using this approach we 
succeed in calculating the actual costs of the merchandise subject to 
review, without distorting that calculation by allocating some costs to 
merchandise not subject to review. We have done so in these final 
results of review.
    We do not agree with Eletrosilex that the by-product offset should 
be calculated based on the volume of by-products produced. Our policy 
is to allow an offset only for actual revenue. To offset costs with 
revenue not earned would result in an inaccurate calculation of actual 
costs, and thus an inaccurate calculation of COP/CV. In these final 
results of review we have offset production costs with all revenue that 
Eletrosilex reported from its sale of by-products. Based on 
Eletrosilex's statement that it does not record slag or silicon metal 
of ingot bottom as production items in its books, in these final 
results of review we have counted as by-products only ladle sculls, 
off-grades, and fines.

Comment 16

    Petitioners argue that the Department erred in its calculation of 
the indirect selling expenses used in Eletrosilex's COP. For the 
preliminary results of review, the Department divided Eletrosilex's 
indirect selling expenses by its volume of production. This methodology 
was incorrect, petitioners argue, for two reasons. First, the selling 
expense total used in the calculation does not include the selling 
expenses of Eletrosilex's related affiliates. Second, it is not the 
Department's practice, petitioners state, to calculate selling expenses 
based on production volume. Therefore, petitioners argue, in the final 
results the Department should calculate per-unit indirect selling 
expenses for COP and CV by dividing Eletrosilex's reported indirect 
selling expenses by its reported volume of home market and U.S. sales.
    Eletrosilex argues that it makes no sense to calculate per-unit 
indirect selling expenses solely on U.S. and home market sales 
quantities. It argues that its indirect selling expenses (consisting 
primarily of salaries and related employee costs) apply to all facets 
of Eletrosilex's sales functions without regard to the particular 
market. Citing statements in its questionnaire response, Eletrosilex 
argues that sales in both the United States and in Brazil are made 
solely by Eletrosilex personnel, with no assistance from affiliated 
companies. The Eletrosilex employees involved in all aspects of these 
sales, Eletrosilex argues, have functions that are relevant to all 
sales in all markets, and the fact that some affiliated companies may 
assist in some way with respect to some of the sales in the much larger 
markets of Europe, Asia, and the Middle East is not relevant to the 
determination of per-unit indirect selling expenses in the U.S. and 
home markets.

Department's Position

    We agree with petitioners that indirect selling expenses should be 
calculated based on sales volumes, and not production volumes because, 
by their nature, indirect selling expenses are attributable to sales, 
not production, of merchandise. We do not agree with petitioners that 
the computation needs to include the indirect selling expenses of all 
of Eletrosilex's affiliates because COP includes only the indirect 
selling expenses included in each home market sale. Because the related 
affiliates did not contribute toward Eletrosilex's home market sales, 
there is no reason to include their indirect selling expenses in COP. 
In these final results of review, we have calculated Eletrosilex's 
monthly indirect selling expenses by dividing its monthly indirect 
selling expenses allocated to the home market by its monthly home 
market sales volumes.

Comment 17

    Petitioners argue that the Department erred in its computation of 
Eletrosilex's COP by using the fixed factory overhead costs that 
Eletrosilex reported on its tape file. Petitioners argue that doing so 
was improper because evidence on the record suggests that the fixed 
overhead costs in Eletrosilex's tape file were not replacement cost 
figures. Specifically, petitioners point out that the fixed factory 
overhead costs on Eletrosilex's tape file are inconsistent with the 
replacement cost fixed overhead costs in exhibit 14 of Eletrosilex's 
March 22, 1995 SQR and with the historical cost fixed overhead costs in 
exhibit 23 of Eletrosilex's March 22, 1995 SQR. Furthermore, they argue 
that a worksheet that Eletrosilex submitted (exhibit 17 of its March 
22, 1995 SQR) in response to the Department's request does not 
reconcile to either exhibit 14 or 23 of the SQR, though it does 
reconcile to the figures on its tape file. Petitioners argue that 
though exhibit 17 does reconcile to the tape file, it is not truly 
responsive to the Department's question because the Department had 
asked Eletrosilex to support the fixed factory overhead costs in its 
worksheet. In light of these discrepancies, and in the absence of any 
explanation from Eletrosilex for them, petitioners argue that the 
Department should use Eletrosilex's reported ``historical'' fixed 
factory overhead cost figures as Eletrosilex reported them in exhibit 
23 of its SQR. These figures are the most disadvantageous to 
Eletrosilex.
    Eletrosilex argues that the figures reported in exhibit 23 of its 
SQR, which petitioners cite as evidence that the numbers in the tape 
file are not replacement cost figures, were only preliminary figures on 
a table which was inadvertently submitted with the SQR. Therefore, they 
are not the correct historical fixed factory overhead figures. It 
further argues that data contained in exhibit 17 of its SQR provide the 
correct historical cost figures for fixed overhead, and that these 
numbers are identical to those in the tape file.

[[Page 1965]]

Department's Position

    In its rebuttal brief Eletrosilex explained the discrepancy 
regarding its reported historical costs, and has indicated that the 
fixed factory overhead figures it reported on its tape file were 
historical cost figures. However, in hyperinflationary economies the 
Department uses replacement cost figures, and not historical cost 
figures. Therefore we agree with petitioners that the Department should 
not have used the figures on Eletrosilex's tape file. For this same 
reason we cannot use the figures Eletrosilex reported in exhibits 17 or 
23 of its SQR. In these final results of review we have used the 
figures that Eletrosilex reported in exhibit 14 of its SQR because 
these are replacement cost figures.

Comment 18

    Petitioners argue that the Department must include in CV all of the 
taxes that Eletrosilex and CBCC paid on purchases of inputs. They base 
this argument on the fact that the statute requires that CV include 
taxes paid on inputs unless the taxes are ``remitted or refunded upon 
the exportation of the article in the production of which such 
materials are used.'' See 19 U.S.C. Sec. 1677b(e)(1)(A). Petitioners 
argue, with respect to Eletrosilex, that because Eletrosilex did not 
even claim that home market taxes paid on material inputs were remitted 
or refunded upon exportation of the merchandise, all of Eletrosilex's 
taxes must be included in CV.
    Eletrosilex argues that the Department should eliminate consumption 
taxes from all calculations. This approach, it argues, is the only way 
to achieve true tax neutrality.
    CBCC argues the Department erred in its calculation of CV (for 
those sales for which it used CV, as opposed to BIA, in the preliminary 
results) by including VAT in the cost build-up. CBCC argues, first, 
that including VAT in CV violates the tax-neutrality principle that the 
Department regularly applies in the calculation of margins. If the 
Department seeks to apply the tax-neutrality policy in its calculation 
of CV that it applies in its calculation of margins, CBCC argues, VAT 
should not be included in CV because it has the effect of creating 
dumping even where none exists. Secondly, CBCC argues that evidence on 
the record demonstrates that CBCC was able to offset its VAT liability 
with taxes collected on domestic sales. Thus, CBCC argues, with respect 
to CBCC in this review, the ICMS tax does not remain a cost of the 
material input, and should not be included in CV.
    Petitioners argue that Eletrosilex's and CBCC's arguments ignore 
the fact that the statute applicable to this review (19 U.S.C. 
Sec. 1677b(e)(1)(A)(1994)) and the statute as amended by the URAA (19 
U.S.C. Sec. 1677b(e)(1)) require that CV includes taxes on purchases of 
inputs unless those taxes are remitted or refunded upon exportation. 
Section 773(e)(1)(A) of the Tariff Act states that the constructed 
value of imported merchandise shall be the sum of:

the cost of materials (exclusive of any internal tax applicable in 
the country of exportation directly to such materials or their 
disposition, but remitted or refunded upon the exportation of the 
article in the production of which such materials are used) * * *

    Furthermore, petitioners argue that CBCC's claim that it was able 
to offset its VAT liability with taxes collected on domestic sales is 
contradicted by other information on the record. Moreover, petitioners 
point out that the Department directly addressed this issue in the 
final results of the second administrative review of this order, and 
agreed that section 773(e)(1)(A) of the Tariff Act required that VAT be 
included in CV. Silicon Metal from Brazil; Second Review Final Results, 
at 46769. The Department took this same position, petitioners state, in 
Ferrosilicon from Brazil, Final Redetermination of Remand at 9-10, 
AIMCOR v. United States, Ct. No. 94-03-00182 (January 16, 1996). 
Therefore, petitioners conclude, CBCC's claim that ICMS and IPI taxes 
paid on inputs used to produce exported silicon metal are not a ``cost 
of materials'' has no basis and has already been rejected by the 
Department.

Department's Position

    We agree with petitioners. In the final results of the second 
review of this order, the Department stated:

because section 773(e)(1)(A) of the Tariff Act does not account for 
offsets of taxes paid due to home market sales, we did not account 
for the reimbursement to the respondents of ICMS and IPI taxes due 
to home market sales of silicon metal. The experience with regard to 
home market sales is irrelevant to the tax burden borne by the 
silicon metal exported to the U.S.

See Silicon Metal from Brazil; Second Review Final Results, at 46769. 
Our interpretation of the statute and our analysis of the issue have 
not changed since publication of the second review final results. Thus, 
in keeping with our prior determination on this issue, we have included 
in CV all taxes paid on purchases of material inputs except where an 
ICMS tax was assessed on the respondent's U.S. sales. For our treatment 
of the ICMS tax in such a situation, see comment 19 below.

Comment 19

    Petitioners argue that the Department must add to Eletrosilex's CV 
the ICMS tax that Eletrosilex collects from its exports of silicon 
metal, and that is included in the reported U.S. selling price. They 
argue that to do otherwise would result in a dumping margin distorted 
by the use of an artificially high selling price as the basis for U.S. 
price (USP). Petitioners argue that, in the alternative, the Department 
should reduce USP by the amount of the ICMS taxes included in the 
reported USP. This approach, they argue, is pursuant to section 
772(d)(2)(A) of the Tariff Act, which requires that USP be reduced by 
``any additional costs, charges, and expenses, and United States import 
duties, incident to bringing the merchandise from the place of shipment 
in the country of exportation to the place of delivery in the United 
States.''
    Eletrosilex argues that the Department should eliminate consumption 
taxes from all calculations. This approach, it argues, is the only way 
to achieve true tax neutrality. Furthermore, Eletrosilex argues that 
the Department erred in subtracting the ICMS tax from USP. It argues 
that this subtraction was a violation of a policy the Department stated 
in the final results of the second administrative review of this order. 
There the Department stated:

    We disagree with petitioners that the ICMS tax is an export tax 
or other charge imposed on the exportation of the merchandise to the 
United States as defined in section 772(d)(2) of the Act. The ICMS 
tax is imposed upon all sales of this product, regardless of the 
market to which it is destined. Since the tax is not levied solely 
upon exported merchandise, it does not constitute an export tax and 
cannot be subtracted from the USP of the merchandise under section 
772(d)(2).

    Petitioners argue that Eletrosilex is in error in stating that the 
Department subtracted the ICMS tax from USP. It states that while the 
Department said in its analysis memorandum that it made such a 
subtraction, in fact it did not do so in its margin calculations. 
Moreover, petitioners state, the argument Eletrosilex has advanced is 
irrelevant because it applies only to margin calculations based on 
price-to-price comparisons. After the Department makes the necessary 
corrections in its calculations for Eletrosilex that the petitioners 
have identified, Eletrosilex, petitioners allege, will have its margin 
calculated on the basis of CV.
    CCM argues that the Department erred by leaving imbedded in the USP 
the ICMS tax that its U.S. customers pay,

[[Page 1966]]

and comparing that USP to a home market price that includes the ICMS 
tax that its home market customers pay. This was an error, CCM argues, 
because the ICMS tax rates in the U.S. and home markets are 
significantly different. Thus, CCM argues, in its methodology the 
Department did not achieve tax neutrality.

Department's Position

    We agree with Eletrosilex that because the ICMS tax assessed on its 
U.S. sale is not an export tax, it should not be deducted from the U.S. 
prices. See Silicon Metal from Brazil; Second Review Final Results at 
46770. However, where the ICMS tax is included in the U.S. price, a 
proper comparison requires that CV not include both the ICMS tax paid 
on the purchases of material inputs and the ICMS tax assessed on the 
U.S. sale. Thus, for the calculation of CV in this situation, we 
ensured that the amount of the ICMS tax included in CV was the higher 
of either the ICMS tax on purchases of material inputs or the ICMS tax 
included in the U.S. price.
    We agree with CCM that in the preliminary results of review our 
methodology failed to achieve tax neutrality. In these final results of 
review, where we based the margin calculation on a price-to-price 
comparison (as opposed to a price-to-CV comparison) we have added to 
the U.S. price the difference between the ICMS tax assessed on the U.S. 
sale and the ICMS tax assessed on FMV.

Comment 20

    Petitioners argue that the Department erred in the calculation of 
Eletrosilex's U.S. selling prices by calculating the unit prices on the 
net weight of contained silicon, rather than the gross weight of the 
silicon metal. They argue that in a CV-based margin calculation the 
Department should use the gross weight of the silicon metal to 
calculate the per-unit USP because CV is reported on a gross-weight 
basis.

Department's Position

    We disagree with petitioners. We find no evidence on the record to 
support petitioners' contention that the weights Eletrosilex reported 
for its U.S. sales reflect only the weight of the silicon, rather than 
the weight of the silicon metal. Furthermore, there is no record 
evidence to support petitioners' assertion that CV was calculated on a 
gross-weight basis. Therefore, there is no basis to change the per-unit 
calculations from those in the preliminary results of review.

Comment 21

    Petitioners argue that the Department erred in its treatment of 
packing costs in the cost test for Eletrosilex and CCM. They argue, 
with respect to Eletrosilex, that the Department erred by including in 
the calculation of Eletrosilex's COP the packing expense amounts as 
Eletrosilex reported them on its COP computer file. Petitioners argue 
that Eletrosilex's computation of packing on its computer file is not 
appropriate for the cost test because not all of Eletrosilex's home 
market sales incurred packing costs. They argue that the Department 
should compare net home market sales prices to a COP that includes the 
reported amount of packing for each sale.
    With respect to CCM, petitioners argue that the Department erred in 
its cost test by comparing monthly COPs that include per-unit packing 
costs to home market prices that include much larger per-unit packing 
costs. They argue that by so doing the Department failed to make an 
``apples-to-apples'' comparison. For the final results, they argue, the 
Department should include the same absolute per-unit packing costs in 
the home market prices and COPs used in the sales-below-cost analysis.
    CCM argues that the Department correctly calculated packing costs 
for the COP analysis. It argues that differences in per-unit packing 
costs are to be expected because in hyperinflationary economy cases the 
Department compares home market prices to costs incurred during the 
month of payment of the comparison home market sale. Furthermore, it 
cites Import Administration Policy Bulletin 94.6 (at 1) which states 
that in the sales-below-cost test, the Department uses ``COM, actual 
interest cost, and home market packing * * * based on information in 
the section D COP/CV questionnaire response.'' Thus, CCM concludes, the 
Department's policy in a COP analysis is to use the packing costs from 
the cost section of the questionnaire response.

Department's Position

    We agree with petitioners in part. We agree that where home market 
sales were sold in bulk (i.e., not packed), COP should not include 
packing because Import Administration Policy Bulletin 94.6 states (at 
1), ``Both the net COP and the net home-market prices should be on the 
same basis, e.g., packed, ex-factory, net of selling expenses; 
otherwise, the comparison would be distorted.'' We have done this for 
Eletrosilex and all other respondents in this review.
    We disagree with CCM that we should use the packing costs reported 
in the section D response. Our present policy is to use the packing 
costs identified on the home market sales tape, which are transaction-
specific. Since the section D packing computation is based on monthly 
averages, using it would reflect less accurate costs than using 
transaction-specific packing costs.
    Finally, we disagree with petitioners that CCM reported much higher 
packing costs on its home market sales listing than it reported on its 
COP worksheet. Comparison of exhibits A (home market sales listing) and 
B (COP worksheet) of CCM's March 17, 1995 submission reveals that the 
packing costs are identical.

Comment 22

    Petitioners argue the Department erred by using CCM's reported 
general and administrative (G&A) expenses in its calculation of CCM's 
COP, because CCM calculated an annual G&A ratio that it applied to its 
monthly historical COM. Petitioners allege that this methodology is not 
the Department's practice in hyperinflationary economy cases. They 
argue that the Department should determine monthly G&A expenses for CCM 
by multiplying the reported ratio by the monthly replacement COM which 
CCM reported.
    CCM argues the methodology that CCM submitted and that the 
Department used in the preliminary results is the one that the 
Department used for CCM in response to the CIT's remand instruction to 
the Department in the LTFV investigation to ensure that ``its 
allocation of GS&A expenses does not lead to a systematic overstatement 
of those expenses due to the restatement of monthly costs as 
replacement costs.'' See Camargo Correa Metais, S.A. v. United States, 
Ct. No. 91-09-00641, Slip Op. 93-163 (August 12, 1993) at 15. As a 
result of these instructions, CCM states, the Department developed and 
used this method in the preliminary remand results and final remand 
results which are now awaiting the CIT's approval. See Preliminary 
Results on Remand at 4-5 (Nov. 17, 1993) and Final Results of 
Redetermination Pursuant to Court Remand at 6-7 (Dec. 13, 1993). CCM 
argues the Department is under obligation to comply with the CIT's 
remand order until and if it is determined by the Federal Circuit in 
the LTFV appeal that the CIT's remand instructions, and the 
Department's resulting methodology for calculating CCM'S G&A, were 
incorrect. Furthermore, CCM argues that the methodology the petitioners 
say we should use is one that was developed

[[Page 1967]]

for other respondents, and not the one the Department developed for 
CCM.

Department's Position

    We agree with petitioners. Contrary to CCM's argument, the 
Department is not obligated to employ the calculation methodology it 
used in its remand determination in the LTFV investigation. Since 
issuing the remand determination the Department has refined its 
methodology, and now employs a formula in which it multiplies a ratio 
(consisting of indexed monthly historical G&A divided by indexed 
monthly historical cost of goods sold) by monthly replacement cost COM. 
As explained in the final results of the second administrative review 
of this order, the purpose of indexing is to obtain values at a uniform 
price level because the simple addition of monthly nominal values 
during a period of high inflation would yield a meaningless result. See 
Silicon Metal from Brazil; Second Review Final Results at 46773. This 
is the formula we used in these final results of review.

Comment 23

    Petitioners argue that the Department should include in CV the ICMS 
tax that CCM paid on its purchases of electricity. They allege that CCM 
did not report this tax in the electricity costs or ICMS tax it 
previously reported.
    CCM argues that it already reported the ICMS tax it paid on 
electricity, and that these amounts are included in its computer 
database under the field for taxes.

Department's Position

    We agree with CCM. Evidence on the record indicates that CCM did 
report the ICMS tax it pays on electricity. See July 3, 1996 submission 
by CCM, p. 8. We have included this tax in CV.

Comment 24

    Petitioners argue that the Department should not include in CV the 
amounts that CCM reported on its CV worksheet under the name 
``inventory holding.'' They argue that if these amounts are inventory 
carrying costs, then they should be excluded from CV because it is the 
Department's established practice to exclude inventory carrying costs 
from CV when the margin calculations are based on purchase price (PP) 
sales. Furthermore, they argue that if the amounts that CCM reported in 
its CV worksheet under the name ``inventory holding'' are actually 
inventory holding gains/losses (i.e., the difference between 
replacement costs and the inflation-adjusted cost of inventory), they 
should be excluded from the calculation because CCM did not calculate 
them correctly. They base this argument on the fact that CCM's 
calculation allegedly includes only gains or losses on finished product 
inventory (and not inventoried inputs) and were calculated without 
proper layering of the inventory.
    CCM argues that it reported inventory carrying costs as requested 
by the Department in its questionnaire, and that petitioners' argument 
is irrelevant because in the preliminary results of review the 
Department based the margin calculation on a price-to-price comparison, 
and not CV. It also notes that it is appropriate to include inventory 
carrying costs in the sales-below-cost test where such costs are 
compared to the home market sales which were made out of inventory. CCM 
also argues (presumably with respect to inventory holding gains and 
losses), that it followed the inventory layering method that the 
Department used in the LTFV investigation and noted in the 
questionnaire, and that these costs should be included in the monthly 
COM for CV purposes, should the Department rely on CV for FMV in the 
final results of review.

Department's Position

    Consistent with our practice we did not include inventory carrying 
costs in our calculation of CV. Also consistent with Department 
practice, for purposes of the cost test we did not adjust prices for 
inventory carrying costs because we do not include any imputed costs in 
the calculation of COP. See Silicon Metal from Brazil; Second Review 
Final Results, at 46775.
    Concerning the adjustment CCM reported on its CV worksheet under 
the name ``inventory holding,'' we have not made this adjustment 
because CCM failed to substantiate its entitlement to this adjustment. 
The record of this review contains no narrative description of or 
request for the adjustment, nor any worksheet demonstrating its 
calculations. In light of these deficiencies we have denied this 
adjustment.

Comment 25

    Petitioners argue that the Department erred in its calculation of 
CBCC's interest expense ratio for 1992 by treating as interest income a 
value that was actually interest expense.
    CBCC argues that petitioners' point is moot because the Department 
did not use the 1992 ratio in the margin calculation.

Department's Position

    We agree with CBCC that this point is moot because we did not use 
the 1992 ratio in the margin calculation.

Comment 26

    Petitioners argue that the Department used an incorrect methodology 
in calculating profit for CBCC. The Department calculated profit by 
subtracting a COP that includes interest expenses (which by definition 
include the cost of financing receivables) from home market prices from 
which the Department subtracted home market imputed credit expenses. By 
comparing a COP that includes the cost of financing receivables to home 
market prices from which the (imputed) cost of financing receivables 
had been subtracted, the Department, petitioners allege, made an 
improper comparison. Thus they argue that the Department should remove 
the subtraction of home market imputed credit from the calculation of 
the price to which the Department compares COP in the cost test.

Department's Position

    We agree with petitioners. For purposes of calculating profit, we 
have continued to include interest expenses in the calculation of COP, 
but did not deduct imputed credit expenses from home market prices.

Comment 27

    Petitioners argue that the Department erred in its margin 
calculation for CBCC by failing to deduct from U.S. price an 
unspecified charge that CBCC reported as ``other expenses.'' 
Petitioners argue that these ``other expenses'' should be deducted from 
U.S. price in accordance with section 772(d)(2)(A) of the Tariff Act.
    CBCC argues that if the Department decides to deduct the ``other 
expenses'' (which, it states, are movement expenses) from U.S. price, 
it should note that CBCC mislabeled the currency as U.S. dollars. In 
fact, CBCC states, it reported them in cruzeiros, and they must be 
converted into U.S. dollars for the margin calculation.

Department's Position

    We agree that we failed to deduct ``other expenses'' in the 
calculation of U.S. price used in the preliminary results. We have 
converted them into dollars because the amount of these expenses 
relative to other reported expenses indicates that they were incurred 
in cruzeiros. See CBCC's March 17, 1994 submission, exhibit 3.

[[Page 1968]]

Comment 28

    Minasligas comments that the Department correctly applied its tax-
neutral policy in the preliminary results of this review. Minasligas 
summarizes that application as follows:
    (1) Home market prices included PIS and COFINS taxes;
    (2) In calculating U.S. price, the Department subtracted the ICMS 
tax that Minasligas' customers pay on their purchases of silicon metal;
    (3) The Department then added to the U.S. price the equivalent 
amount of ICMS, IPI, PIS, and COFINS taxes due on Minasligas' home 
market sales.
    This methodology, Minasligas states, is consistent with the 
Department's guiding principle of tax neutrality, and should be 
affirmed in the final results of this review.
    Eletrosilex argues that the Department erred in failing to add to 
USP the PIS, COFINS, and consumption taxes charged on its home market 
comparison sales. It argues, with respect to the PIS and COFINS taxes, 
that this failure was a violation of the Department's policy of 
calculating tax-neutral dumping assessments. It argues, with respect to 
the consumption taxes, that this failure was a violation of the change 
in the treatment of consumption taxes that the Department announced in 
the final results of the second review of this case. There the 
Department stated:

    Where merchandise exported to the United States is exempt from 
the consumption tax, the Department will add to the U.S. price the 
absolute amount of such taxes charged on the comparison sales in the 
home market.

Eletrosilex argues that the Department's failure to add to USP the 
absolute amount of consumption taxes charged on its home market sales 
was a violation of the Department's announced policy because there is 
evidence on the record that the relevant consumption tax, the ICMS tax, 
is exempt from payment upon exportation.
    CCM also argues that the Department erred by not adding to USP the 
PIS and COFINS taxes that its home market customers pay on their 
purchases of silicon metal. It argues that these taxes are imposed only 
on home market sales, and not on export sales. Thus, by failing to add 
them to USP, CCM argues, the Department failed to achieve tax 
neutrality. Moreover, CCM argues, in numerous antidumping 
investigations and reviews involving imports from Brazil, the 
Department has made an adjustment to USP for the PIS and COFINS taxes.
    Petitioners argue that the Department was correct in not adding the 
equivalent amount of PIS and COFINS taxes to USP. They base this 
argument on 772(d)(1)(C) of the Tariff Act which states that USP may be 
adjusted only for taxes imposed directly upon the ``merchandise or 
components thereof.'' They argue that the Department has concluded that 
taxes on gross revenue exclusive of export revenue were not taxes 
imposed directly upon the merchandise or components thereof, and thus 
did not qualify for an adjustment to USP. See Silicon Metal from 
Argentina, 56 FR 37891, 37893 (August 9, 1991) (Silicon Metal from 
Argentina). Petitioners argue that Brazil's PIS and COFINS taxes are 
taxes on gross revenue exclusive of export revenue, and that therefore 
the Department should not add them to USP.

Department's Position

    We disagree with Eletrosilex that there is evidence on the record 
that the ICMS tax is not assessed upon exportation. In fact, there is 
evidence to the contrary. See Eletrosilex's March 22, 1995, submission, 
pp. 21-22. To achieve tax neutrality in these final results of review, 
where we calculated the margin on U.S. and Brazilian price-to-price 
comparisons, we added to Eletrosilex's USP the difference between the 
absolute amounts of ICMS tax assessed on its U.S. sales and its FMV. 
See comment 19 (above).
    We agree with petitioners that information on the record 
demonstrates that the PIS and COFINS taxes are taxes on gross revenue 
exclusive of export revenue. Thus, in accordance with our determination 
in Silicon Metal from Argentina, we determine that these taxes are not 
imposed ``directly upon the merchandise or components thereof.'' 
Therefore, in these final results of review we have not added PIS and 
COFINS taxes to USP.

Comment 29

    Eletrosilex argues that the Department erred in its calculation of 
home market imputed credit by dividing an allegedly annual interest 
rate by 30, rather than by 365.
    Petitioners argue that the interest rate the Department used in its 
calculation was a monthly rate, and that the Department was therefore 
correct in using 30 in the denominator.

Department's Position

    We agree with petitioners that the rate is a monthly rate. This 
rate is the average of the monthly rates that appear in Exhibit VI-3 of 
Minasligas' November 10, 1994, submission. Those rates are the monthly 
rates of the state bank of Minas Gerais.

Comment 30

    CCM argues that in order for its cash deposit rate for future 
entries to reflect the appropriate dumping margin, the Department 
should issue the third review final results prior to, or concurrently 
with, issuance of the fourth review final results. If the Department 
issues the fourth review final results prior to the third review final 
results, CCM argues, CCM will continue to face the 93.2 percent cash 
deposit rate established in the LTFV investigation. In the alternative, 
if the Department does issue the third review final results after the 
fourth review, CCM argues that the Department should make clear in its 
cash deposit instructions that CCM's third review cash deposit rate 
should apply to all future entries because CCM was a non-shipper in the 
fourth review.

Department's Position

    CCM's point is moot because the Department is issuing the results 
of both reviews concurrently.

Comment 31

    CBCC argues that the Department erred in using total BIA for its 
U.S. sales verified at the third review verification. (The Department 
assigned a margin to these sales based on total BIA after it determined 
that CBCC was unable to substantiate significant portions of its 
response with respect to these sales.) CBCC argues that the Department 
was not justified in using BIA for these sales because:
    1. Throughout the proceeding CBCC cooperated fully with the 
Department;
    2. At the verification the verifiers collected the information 
needed to correct the mistakes uncovered at the verification;
    3. Even if the Department did not have the resources to recalculate 
CBCC's data, the Department could have requested CBCC to perform the 
recalculations.
    CBCC also notes that there was ample time to perform any necessary 
recalculations during the 14 months between the verification and 
issuance of the Department's BIA memorandum.
    Furthermore, CBCC argues that, if the Department believes it does 
not have all necessary information totally to correct the mistakes 
found at verification, it should calculate CBCC's dumping margin using 
partial BIA for those discrete areas where it does not have the 
necessary information. CBCC argues that this use of partial BIA would 
be warranted in this case because there were no mistakes uncovered at 
verification regarding U.S. sales; most of

[[Page 1969]]

the mistakes, CBCC argues, were connected with home market sales. CBCC 
argues that as an alternative, the Department should base FMV on CV, 
for which, CBCC alleges, the Department has all necessary information.
    Petitioners argue the Department properly determined the margin for 
the sales at issue based on total BIA. They argue that the number and 
magnitude of the deficiencies in CBCC's reported data, the law, and the 
Department's practice require the Department to assign a margin to the 
sales at issue based on total BIA. With respect to CBCC's argument that 
it could have rectified the problems found at the verification if the 
Department had requested that it do so, petitioners argue that this 
suggestion ignores the responsibility of respondents to provide 
accurate and complete information in antidumping proceedings prior to 
verification. Moreover, petitioners argue, this suggestion is 
tantamount to asking the Department to condone the submission of false 
and incomplete information in response to the Department's 
questionnaire until, at verification, the Department positively 
determines the submitted information to be false. Doing so would allow 
respondents to abuse and manipulate the administrative review process.
    With regard to CBCC's argument that the Department use partial BIA, 
petitioners argue that the deficiencies the Department found at 
verification are so fundamental and numerous that they require the use 
of total BIA. Moreover, with regard to CBCC's argument that the 
Department should use CV as the FMV, petitioners argue that using CV 
would be contrary to the purpose of using BIA. The purpose of using BIA 
is to induce the respondent to provide accurate and complete 
information. To achieve this purpose, petitioners argue, a margin based 
on BIA must be adverse, i.e., it must be higher than the margin that 
would have been calculated had the respondent provided accurate and 
complete information. Here, because of the deficiencies in the 
submitted information, the Department cannot even begin to determine 
whether a price-based margin calculation would result in a higher 
margin than the CV-based margin calculation that CBCC suggests.

Department's Position

    We agree with the petitioners. As we stated in our September 13, 
1996 memorandum on this subject:

    It is the obligation of the respondents to provide an accurate 
and complete response prior to verification so that the Department 
may have opportunity to analyze fully the information and other 
parties are able to review and comment on it. Verification is 
intended to establish the accuracy and completeness of a response 
rather than to supplement and reconstruct the information to fit the 
requirements of the Department.

    Nor is it the Department's practice or policy to reconstruct a 
response with the large number of errors which we found in CBCC's 
response. See Final Determination of Sales at Less Than Fair Value: 
Certain Granite Products from Italy (53 FR 27187, 27190, July 19, 
1988). See also Final Determination of Sales at Less Than Fair Value: 
Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts 
Thereof From the Federal Republic of Germany (54 FR 18992, 19037, May 
3, 1989). Among the problems we encountered were:
    <bullet> CBCC underreported all per-unit COP and CV values by using 
unrefined weights, rather than refined weights;
    <bullet> CBCC underreported its direct materials costs by failing 
to report late fees it had to pay;
    <bullet> CBCC was unable to substantiate some of its parent 
company's interest rates;
    <bullet> CBCC's method of calculating depreciation understated 
depreciation for all months;
    <bullet> CBCC could not substantiate its reported home market sales 
value;
    <bullet> CBCC's reported consignment sales listing reported 
adjustments to sales prices, rather than actual sale prices;
    <bullet> CBCC underreported ICMS taxes for all its consignment 
sales.
    Because of these and other problems more fully discussed in the 
September 13, 1996 memorandum, we deem CBCC's submissions to be 
unusable. Accordingly, in these final results of review we have applied 
total BIA to CBCC's third review sales.

Comment 32

    CBCC argues that the Department erred in its application of its 
two-tier BIA methodology. This methodology, CBCC argues, states 
explicitly that the Department has discretion to use two alternative 
types of BIA when a respondent is deemed to be cooperative. The 
Department can (1) use the firm's highest rate from a prior 
administrative review or, if the firm has never been investigated or 
reviewed, the all others rate from the LTFV investigation; or (2) the 
highest calculated rate in this review.
    CBCC argues that in this case the Department erred because it used 
CBCC's rate from the LTFV investigation. Under the two-tier BIA 
methodology, the Department should have used CBCC's rate from a prior 
review because CBCC has been included in two completed reviews since 
the LTFV investigation.
    Petitioners argue that CBCC's erroneous argument is based on the 
Department's inadvertent misstatement of its second-tier BIA policy in 
the preliminary results of this review. It argues that the Department 
has expressed its two-tier BIA methodology on many occasions, and on 
one of those recent occasions it expressed it as follows:

    When a company substantially cooperates with our request for 
information, but fails to provide all the information requested in a 
timely manner or in the form requested, we use as BIA the higher of 
(1) the highest rate (including the ``all others'' rate) ever 
applicable to the firm for the same class or kind of merchandise 
from the same country from the LTFV investigation or a prior 
administrative review; or (2) the highest calculated rate in the 
review of any firm for the same class or kind of merchandise from 
the same country.

See Silicon Metal from Argentina; Final Results of Antidumping Duty 
Administrative Review and Termination In Part, 60 FR 64416, 64417 
(December 15, 1995) (Silicon Metal from Argentina II). Petitioners 
argue that the Department properly applied this methodology when as BIA 
it assigned to CBCC its rate from the LTFV investigation.

Department's Position

    We agree with the petitioners. As cooperative BIA, we use the 
higher of either (1) the highest rate ever applicable to the firm in 
the investigation or in any previous review, or (2) the highest 
calculated margin for any respondent in the same review. See Silicon 
Metal from Argentina II and Tapered Roller Bearings and Parts Thereof, 
Finished and Unfinished, From the People's Republic of China; Final 
Results of Antidumping Duty Administrative Reviews (61 FR 65527, 
December 13, 1996). Accordingly, for these final results, where 
necessary, we have applied to CBCC 87.79 percent, which is the highest 
rate ever applicable to CBCC. This use of BIA applies to only those 
sales where we determined that the use of BIA is appropriate. See 
September 10, 1996 preliminary results analysis memorandum from Fred 
Baker to the file and September 13, 1996 ``Use of Best Information 
Available'' memorandum from Fred Baker to Richard Weible.

Comment 33

    Parties allege the following clerical errors:
    <bullet> Petitioners argue that the Department erred by failing to 
make a

[[Page 1970]]

circumstance-of-sale adjustment to Minasligas' FMV for bank charges 
related to loans taken out to finance its U.S. sales.
    <bullet> Petitioners argue that the Department erred by using an 
incorrect amount of foreign inland insurance on CCM's U.S. sale.
    <bullet> CCM argues that the Department erred by failing to deduct 
post-sale inland freight expenses from its home market price.

Department's Position

    We agree, and have corrected these errors in these final results of 
review. We have also corrected one additional error we noted in our 
review of the preliminary results. There, for U.S. sales, we used 
Minasligas' dates of sale as the date of shipment from its plant 
because we believed the dates of shipment not to be on the record. 
However, we have determined that the invoice dates are on the record in 
verification exhibit 12. Therefore, in these final results of review we 
have used the invoice dates as the dates of shipment.

Final Results of Review

    As a result of our analysis of the comments received, we determine 
that the following margins exist for the period July 1, 1993, through 
June 30, 1994:

------------------------------------------------------------------------
                                                               Weighted-
                                                                average 
               Producer/manufacturer/exporter                   margin  
                                                               (percent)
------------------------------------------------------------------------
CBCC........................................................       64.39
CCM.........................................................        5.97
Eletrosilex.................................................       39.72
Minasligas..................................................        0   
RIMA........................................................       91.06
------------------------------------------------------------------------

    The Department shall determine, and the Customs Service shall 
assess, antidumping duties on all appropriate entries. Individual 
differences between USP and FMV may vary from the percentages stated 
above. The Department will issue appraisement instructions directly to 
the Customs Service.
    Furthermore, the following deposit requirements will be effective 
upon publication of these final results of review for all shipments of 
silicon metal from Brazil entered, or withdrawn from warehouse, for 
consumption on or after the publication date, as provided by section 
751(a)(1) of the Tariff Act, and will remain in effect until 
publication of the final results of the next administrative review: (1) 
the cash deposit rates for the reviewed companies will be those rates 
listed above; (2) for previously reviewed or investigated companies not 
listed above, the cash deposit rate will continue to be the company-
specific rate published for the most recent period; (3) if the exporter 
is not a firm covered in this review, a prior review, or the original 
LTFV investigation, but the manufacturer is, the cash deposit rate will 
be the rate established for the most recent period for the manufacturer 
of the merchandise; and (4) if neither the exporter nor the 
manufacturer is a firm covered in this or any previous review or in the 
LTFV investigation conducted by the Department, the cash deposit rate 
will be 91.06 percent, the ``all others'' rate established in the LTFV 
investigation.
    This notice 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 subsequent 
assessment of double antidumping duties.
    This notice also serves as a reminder to parties subject to APO of 
their responsibility concerning the disposition of proprietary 
information disclosed under APO in accordance with 19 CFR 353.34(d). 
Timely written notification of the return/destruction of APO materials 
or conversion to judicial protective order is hereby requested. Failure 
to comply with the regulations and the terms of an APO is a 
sanctionable violation.
    This administrative review and notice are in accordance with 
section 751(a)(1) of the Tariff Act (19 U.S.C. Sec. 1675(a)(1)) and 19 
CFR Sec. 353.22.

    Dated: January 3, 1997.
Robert S. LaRussa,
Acting Assistant Secretary for Import Administration.
[FR Doc. 97-816 Filed 1-13-97; 8:45 am]
BILLING CODE 3510-DS-P