[Federal Register Volume 63, Number 76 (Tuesday, April 21, 1998)]
[Notices]
[Pages 19712-19714]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-10415]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-533-810]


Stainless Steel Bar from India: Final Results of New Shipper 
Antidumping Duty Administrative Review

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

ACTION: Notice of final results of new shipper antidumping duty 
administrative review.

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SUMMARY: On January 23, 1998, the Department of Commerce published the 
preliminary results of the new shipper administrative review of the 
antidumping duty order on stainless steel bar from India. We gave 
interested parties an opportunity to comment on the preliminary 
results. Based on our analysis of the comments received, we have made 
certain changes for the final results.
    This review covers two producers/exporters of stainless steel bar 
to the United States during the period February 1, 1996, through 
January 31, 1997. The review indicates no dumping margins during the 
review period.

EFFECTIVE DATE: April 21, 1998.

FOR FURTHER INFORMATION CONTACT: Zak Smith or James Breeden, Import 
Administration, AD/CVD Enforcement Group I, Office 1, U.S. Department 
of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 
20230; telephone (202) 482-1279 or 482-1174, respectively.

Applicable Statute and Regulations

    The Department of Commerce (``the Department'') is conducting this 
administrative review in accordance with section 751 of the Tariff Act 
of 1930, as amended (``the Act''). Unless otherwise indicated, all 
citations to the statute are references to the provisions effective 
January 1, 1995, the effective date of the amendments made to the Act 
by the Uruguay Round Agreements Act. In addition, unless otherwise 
indicated, all citations to the Department's regulations are to those 
codified at 19 CFR Part 353 (April 1997).

SUPPLEMENTARY INFORMATION:

Background

    On January 23, 1998, the Department of Commerce published the 
preliminary results of the new shipper administrative review of the 
antidumping duty order on stainless steel bar from India (63 FR 3536) 
(``preliminary results''). The manufacturers/exporters in this review 
are Panchmahal Steel Limited (``Panchmahal'') and Ferro Alloys 
Corporation Limited (``Facor''). We received comments from Panchmahal 
and rebuttal comments from the petitioners <SUP>1</SUP> (see, 
Interested Party Comments, below).
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    \1\ Al Tech Specialty Steel Corp., Carpenter Technology Corp., 
Crucible Specialty Metals Division, Crucible Materials Corp., 
Electralloy Corp., Republic Engineered Steels, Slater Steels Corp., 
Talley Metals Technology, Inc. and the United Steelworkers of 
America (AFL-CIO/CLC).
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Scope of the Review

    Imports covered by this review are shipments of stainless steel 
bar. The term ``stainless steel bar'' means articles of stainless steel 
in straight lengths that have been either hot-rolled, forged, turned, 
cold-drawn, cold-rolled or otherwise cold-finished, or ground, having a 
uniform solid cross section along their whole length in the shape of 
circles, segments of circles, ovals, rectangles (including squares), 
triangles, hexagons, octagons, or other convex polygons. Stainless 
steel bar includes cold-finished stainless steel bars that are turned 
or ground in straight lengths, whether produced from hot-rolled bar or 
from straightened and cut rod or wire, and reinforcing bars that have 
indentations, ribs, grooves, or other deformations produced during the 
rolling process.
    Except as specified above, the term does not include stainless 
steel semi-finished products, cut length flat-rolled products (i.e., 
cut length rolled products which if less than 4.75 mm in thickness have 
a width measuring at least 10 times the thickness or if 4.75 mm or more 
in thickness have a width which exceeds 150 mm and measures at least 
twice the thickness), wire (i.e., cold-formed products in coils, of any 
uniform solid

[[Page 19713]]

cross section along their whole length, which do not conform to the 
definition of flat-rolled products), and angles, shapes and sections.
    The stainless steel bar subject to these orders is currently 
classifiable under subheadings 7222.10.0005, 7222.10.0050, 
7222.20.0005, 7222.20.0045, 7222.20.0075, and 7222.30.0000 of the 
Harmonized Tariff Schedule of the United States (``HTSUS''). Although 
the HTSUS subheadings are provided for convenience and customs 
purposes, our written description of the scope of this order is 
dispositive.

Interested Party Comments

    In accordance with 19 CFR 353.38, we invited interested parties to 
comment on our preliminary results. We received written comments from 
Panchmahal and rebuttal comments from the petitioners.

Comment 1: Model Matches

    Panchmahal disagrees with the Department's preliminary decision to 
compare its U.S. sales of 304L grade bar to its home market sales of 
316 grade bar. Rather, Panchmahal argues that the Department should 
compare the U.S. sales of 304L grade bar to its home market sales of 
304 grade bar.
    The petitioners rebut that hot-rolled 304 grade bar and cold-
finished 304L grade bar are not comparable because of differences in 
these grades' production costs. Furthermore, the petitioners assert 
that the differences in variable costs between 304 grade bar and 304L 
grade bar reported by Panchmahal are too low and thus must be flawed, 
given the different production processes of the two grades. 
Accordingly, the Department should use constructed value (``CV'') as 
the basis for normal value.

Department's Position

    We agree with Panchmahal. Based on its chemical composition, we 
have determined that grade 304L bar is more appropriately matched to 
grade 304 bar than grade 316 bar. Specifically, grade 304L bar and 304 
bar are more comparable based on their chrome and nickel content. 
Moreover, grade 316 bar contains molybdenum, while grades 304L and 304 
bar do not.
    In regard to petitioners' argument to use CV as a basis of normal 
value, it is the Department's normal practice to use contemporaneous 
home market sales of the foreign like product, before resorting to CV, 
as a basis for normal value unless those sales fail the difference in 
merchandise test. Because the home market bar sales are sales of 
foreign like product that do not fail the difference in merchandise 
test and that match to U.S. sales, use of constructed value would be 
inappropriate. Based on our general knowledge of the production 
processes involved, the reported differences in variable costs are not 
unreasonable.

Comment 2: Duty Drawback

    Panchmahal asserts that the Department, in Certain Welded Carbon 
Standard Steel Pipes and Tubes from India (62 FR 47632 (September 10, 
1997)) (``Pipes and Tubes''), has found that the Indian Passbook Scheme 
is a proper duty drawback program. Thus, in this case, the Department 
should allow an upward adjustment to U.S. price in the amount of the 
duty drawback received on exports of the subject merchandise. The 
respondent also states that it fully answered the Department's 
supplemental questions regarding the duty drawback benefit under this 
scheme; therefore, the Department's rejection of the adjustment in the 
preliminary results is groundless. In particular, Panchmahal argues 
that the Indian Passbook Scheme meets the criteria used by the 
Department when analyzing duty drawback programs because the duty 
drawback is based on duties paid with respect to imported inputs 
actually used in the production of the subject merchandise.
    The petitioners maintain that the Panchmahal's use of the Indian 
Passbook Scheme fails the Department's two-part test for drawback 
claims because the respondent did not provide documentation 
establishing: (1) A direct link between the duties imposed and those 
rebated, and (2) that the company imported a sufficient amount of raw 
materials to account for the drawback received. The petitioners assert 
that the evidence on the record supports the Department's decision to 
reject Panchmahal's claimed duty drawback adjustment. Specifically, 
petitioners argue that Panchmahal's claim for a duty drawback 
adjustment is based merely on the existence of the Indian Passbook 
Scheme. They state that the existence of a drawback program does not 
guarantee acceptance of the adjustment by the Department; rather, the 
company's specific utilization of the scheme must be examined. 
According to the petitioners, the lack of a direct link between duties 
paid on imported inputs and duties rebated on exported finished 
products under the program, and the failure by Panchmahal to provide 
any details on its imports should compel the Department to reject the 
company's request for an upward adjustment to U.S. price.

Department's Position

    When evaluating a duty drawback program, the Department considers 
whether the import duty and duty drawback are directly linked to, and 
dependent upon, one another and whether the company claiming the 
adjustment can show that there were sufficient imports of the imported 
raw materials to account for the drawback received on the exported 
product (see, Pipes and Tubes, at 47634).
    Panchmahal has not provided adequate documentation establishing a 
sufficient link between import duties paid and duty drawbacks generally 
received under the program. Moreover, there is no indication that 
Panchmahal imported inputs in sufficient quantities to account for 
rebates received under the program. Accordingly, as in the preliminary 
results, no adjustment to the U.S. price for duty drawback has been 
made.

Comment 3: Duty Drawback Adjustment to Material Costs

    Panchmahal argues that its material costs should be reduced by the 
amount of reported duty drawback. Panchmahal refers to Stainless Steel 
Bar from India (62 FR 60482 (November 10, 1997)), in support of its 
position.
    Petitioners contend that since the Passbook Scheme does not require 
direct linkage between import duties paid and rebates received on 
exported products, the rebates cannot be linked to the material costs 
incurred. Petitioners further argue that since Panchmahal has failed to 
report the actual amount of import duties paid, the Department is 
unable to ensure that the claimed adjustment to material input costs 
does not exceed the amount of import duties paid.
    Petitioners also assert that Panchmahal mischaracterized the 
Department's determination in Stainless Steel Bar from India (62 FR 
60482 (November 10, 1997)) (``Bar from India''), which states that the 
Department offset the per unit direct materials cost to account for the 
rebates received only on those sales where constructed value was the 
basis for normal value. The petitioners maintain that since normal 
value was not based on constructed value for Panchmahal, no adjustment 
should be made to the reported materials costs.

Department's Position

    Respondent's comment is moot because we did not use constructed 
value as the basis for normal value.

[[Page 19714]]

Final Results of Review

    As a result of this review, we find that the following margins 
exist for the period February 1, 1996, through January 31, 1997:

------------------------------------------------------------------------
                                                                 Margin 
           Manufacturer/exporter                  Period       (percent)
------------------------------------------------------------------------
Panchmahal.................................    2/1/96-1/31/97          0
Facor......................................    2/1/96-1/31/97          0
------------------------------------------------------------------------

    Parties to the proceeding may request disclosure within five days 
of the date of publication of this notice. The results of this review 
shall be the basis for the assessment of antidumping duties on entries 
of merchandise covered by the review and for future deposits of 
estimated duties for the manufacturers/exporters subject to this 
review. We have calculated an importer-specific duty assessment rate 
based on the ratio of the total amount of antidumping duties calculated 
for the examined sales made during the period of review (``POR'') to 
the total value of subject merchandise entered during the POR. The 
Department will issue appraisement instructions directly to the Customs 
Service.
    Furthermore, the following deposit requirements will be effective 
for all shipments of the subject merchandise entered, or withdrawn from 
warehouse, for consumption on or after the publication date of these 
final results of this new shipper administrative review, as provided by 
section 751(a)(1) of the Act: (1) The cash deposit rate for the 
reviewed companies will be the rates established in the final results 
of this new shipper review; (2) for companies not covered in this 
review, but covered in previous reviews or the original less-than-fair-
value investigation, 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 investigation, but the manufacturer is, the cash deposit rate 
will be the most recent rate established 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 the original 
investigation, the cash deposit rate will be the ``all others'' rate of 
12.45 percent established in the final determination of sales at less 
than fair value (59 FR 66915, December 28, 1994).
    These deposit requirements will remain in effect until publication 
of the final results of the next administrative review.
    This notice also serves as a final reminder to importers of their 
responsibility under 19 CFR 353.26 to file a certificate regarding the 
reimbursement of antidumping duties prior to liquidation of the 
relevant entries during this review period. Failure to comply with this 
requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    This notice also serves as a reminder to parties subject to 
administrative protective orders (``APOs'') of their responsibility 
concerning the disposition of proprietary information disclosed under 
APO in accordance with 19 CFR 353.34(d)(1). Timely written notification 
of the return/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 new shipper review and notice are in accordance with sections 
751(a)(1) and 777(i)(1) of the Act (19 U.S.C. 1675(a)(1)), 19 CFR 
353.22.

    Dated: April 13, 1998.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 98-10415 Filed 4-20-98; 8:45 am]
BILLING CODE 3510-DS-P