Federal Register / Vol. 63, No. 80 / Monday, April 27, 1998 / Notices 20575

products from the Netherlands by

Hoogovens Staal B.V. (Hoogovens).

Analysis of Comments Received

Hoogovens argues that the

Department inadvertently used the

wrong denominator to arrive at the per

ton factor in reclassifying Hoogovens’

warranty expenses as direct, rather than

indirect expenses. The Department

divided the total warranty expenses

incurred during the period of March

1994–July 1996 (‘‘window period’’) by

the total sales entered into the United

States during the period of review of

August 1995–July 1996, instead of the

total shipments during the window

period. According to Hoogovens, this

resulted in a considerable overstatement

of U.S. warranty expenses. For the home

market warranty expenses, the

Department used as the denominator the

home market sales during the window

period rather than the shipments,

resulting in a slight overstatement of per

ton expenses. Finally, after deducting

warranty expenses from the reported

home market indirect selling expenses

(ISE), the Department allocated the

remaining ISE on the basis of the

quantity sold. Hoogovens alleges that

the Department’s practice is to require

that ISE be reported as a percentage of

sales value rather than on the basis of

quantity.

Petitioners argue that the Department

allocated the expenses exactly as

described in its analysis memorandum.

Moreover, petitioners point out, the

Department found in its final results

that Hoogovens had improperly failed to

report its warranty expenses as direct

selling expenses based on the tonnages

sold. While petitioners argued in their

case brief that the Department should

deny any adjustment for the reported

expense in the home market, in

petitioners’ view the Department’s

decision to allocate these expenses

based on the tonnages in Hoogovens’

reported data is consistent with the

Department’s stated intention and

cannot be said to be a ministerial error.

Finally, petitioners argue that

Hoogovens’ questioning of the

Department’s allocation of ISE raises a

policy issue, not a ministerial error.

We agree in part with Hoogovens. For

these amended final results we have

corrected the denominators to

correspond to the same period as the

numerators. We disagree with the

petitioners’ claim that these were not

ministerial errors. We did not intend to

calculate a ratio in which the

denominator and numerator were based

on data covering different periods.

Accordingly, we find this error to be

ministerial within the meaning of 19

CFR 353.28(d).

In regard to the allocation of ISE, we

agree with petitioners that this raises a

methodological issue, not a ministerial

error. We believe that the Department’s

allocation based on quantity rather than

value is reasonable, and have adjusted

the denominator to correspond to the

quantities shipped in the home market

during the extended window period.

Amended Final Results of Review

As a result of our correction of

ministerial errors, we have determined

the margin to be:

Manufacturer/

exporter Period of review

Margin

(percent)

Hoogovens

Staal B.V. .. 8/1/95–7/31/96 4.32

Further, as a result of these

corrections, we find that there are

dumping margins on 84.3 percent of

Hoogovens’ U.S. sales by quantity. In

the absence of any information on the

record that the unaffiliated purchasers

in the United States will pay the

ultimately assessed duties, the

Department finds that respondent has

absorbed antidumping duties on 84.3

percent of its U.S. sales.

The Department shall determine, and

the Customs Service shall assess,

antidumping duties on all appropriate

entries. For assessment purposes, the

duty assessment rate will be a specific

amount per metric ton. The Department

will issue appraisement instructions

directly to the Customs Service.

Furthermore, the following deposit

requirements will be effective upon

publication of this notice of final results

of review for all shipments of coldrolled carbon steel flat products from

the Netherlands entered, or withdrawn

from warehouse, for consumption on or

after the publication date, as provided

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

The cash deposit rate for the reviewed

company will be the rate for that firm

as stated above; (2) if the exporter is not

a firm covered in this review, or the

original less than fair value (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 (3) if neither the

exporter nor the manufacturer is a firm

covered in this review, the cash deposit

rate will be 19.32 percent. This is the

‘‘all others’’ rate from the amended final

determination in the LTFV

investigation. See Amended Final

Determination Pursuant to CIT Decision:

Certain Cold-Rolled Carbon Steel Flat

Products from the Netherlands, 61 FR

47871. These deposit requirements,

when imposed, shall remain in effect

until publication of the final results of

the next administrative review.

This notice serves as a final reminder

to importers of their responsibility

under section 353.26 of the

Department’s regulations to file a

certificate regarding the reimbursement

of antidumping duties prior to

liquidation of the relevant entries

during this review period. Failure to

comply with this requirement could

result in the Secretary’s presumption

that reimbursement of antidumping

duties occurred and the subsequent

assessment of double antidumping

duties.

This notice also serves as a reminder

to parties subject to administrative

protective order (APO) of their

responsibility concerning the

disposition of proprietary information

disclosed under APO in accordance

with section 353.34(d) of the

Department’s regulations. Timely

notification of 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.

These amended final results of

administrative review and notice are in

accordance with section 751(a)(1) of the

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

CFR 353.28(c).

Dated: April 17, 1998.

Joseph A. Spetrini,

Acting Assistant Secretary for Import

Administration.

[FR Doc. 98–11000 Filed 4–24–98; 8:45 am]

BILLING CODE 3510–DS–P

DEPARTMENT OF COMMERCE

International Trade Administration

[A–351–827, A–580–833, A–201–821]

Initiation of Antidumping

Investigations: Emulsion StyreneButadiene Rubber from Brazil, the

Republic of Korea, and Mexico

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce

EFFECTIVE DATE: April 27, 1998.

FOR FURTHER INFORMATION CONTACT:

David Genovese, at (202) 482–0498,

Import Administration, International

Trade Administration, U.S. Department

of Commerce, 14th Street and

Constitution Avenue, NW, Washington,

DC 20230.
20576 Federal Register / Vol. 63, No. 80 / Monday, April 27, 1998 / Notices

1See Algoma Steel Corp., Ltd. v. United States,

688 F. Supp. 639, 642–44 (CIT 1988); High

Information Content Flat Panel Displays and

Display Glass Therefor from Japan: Final

Determination; Rescission of Investigation and

Partial Dismissal of Petition, 56 FR 32376, 32380–

81 (July 16, 1991).

Initiation of Investigations

The Applicable Statute and Regulations

Unless otherwise indicated, all

citations to the statute are references to

the provisions effective January 1, 1995,

the effective date of the amendments

made to the Tariff Act of 1930 (the Act)

by the Uruguay Round Agreements Act

(URAA). In addition, unless otherwise

indicated, all citations to the

Department’s regulations are to the

regulations published in the Federal

Register on May 19, 1997 (62 FR 27296).

The Petition

On April 1, 1998, the Department of

Commerce (the Department) received a

petition filed in proper form by

Ameripol Synpol Corporation and DSM

Copolymer. On April 3, 1998, the

Department received an amendment to

the petition. On April 13, 1998, the

Department received supplemental

information to the petition that it had

requested from the petitioners.

In accordance with section 732(b) of

the Act, the petitioners allege that

imports of emulsion styrene-butadiene

rubber (ESBR) from Brazil, the Republic

of Korea (Korea), and Mexico are being,

or are likely to be, sold in the United

States at less than fair value within the

meaning of section 731 of the Act, and

that such imports are materially injuring

an industry in the United States.

The Department finds that the

petitioners filed the petition on behalf of

the domestic industry because they are

interested parties as defined in section

771(9)(C) and (D) of the Act and they

have demonstrated sufficient industry

support (see discussion below).

Scope of Investigations

For purposes of these investigations,

the product covered is ESBR. ESBR is a

synthetic polymer made via free radical

cold emulsion copolymerization of

styrene and butadiene monomers in

reactors. The reaction process involves

combining styrene and butadiene

monomers in water, with an initiator

system, an emulsifier system, and

molecular weight modifiers. ESBR

consists of cold non-pigmented rubbers

and cold oil extended non-pigmented

rubbers that contain at least one percent

of organic acids from the emulsion

polymerization process.

ESBR is produced and sold, both

inside the United States and

internationally, in accordance with a

generally accepted set of product

specifications issued by the

International Institute of Synthetic

Rubber Producers (IISRP). The universe

of products subject to these

investigations are grades of ESBR

included in the IISRP 1500 series and

IISRP 1700 series of synthetic rubbers.

The 1500 grades are light in color and

are often described as ‘‘Clear’’ or ‘‘White

Rubber.’’ The 1700 grades are oilextended and thus darker in color, and

are often called ‘‘Brown Rubber.’’ ESBR

is used primarily in the production of

tires. It is also used in a variety of other

products, including conveyor belts, shoe

soles, some kinds of hoses, roller

coverings, and flooring.

Products manufactured by blending

ESBR with other polymers, high styrene

resin master batch, carbon black master

batch (i.e., IISRP 1600 series and 1800

series) and latex (an intermediate

product) are not included within the

scope of these investigations.

The products under investigation are

currently classifiable under subheading

4002.19.0010 of the Harmonized Tariff

Schedule of the United States (HTSUS).

Although the HTSUS subheading is

provided for convenience and customs

purposes, the written description of the

scope of these investigations is

dispositive.

During our review of the petition, we

discussed the scope with the petitioners

to ensure that the scope in the petition

accurately reflects the product for which

they are seeking relief. As we discussed

in the preamble to the new regulations

(62 FR 27323), we are setting aside a

period for parties to raise issues

regarding product coverage. The

Department encourages all parties to

submit such comments by May 18,

1998. Comments should be addressed to

Import Administration’s Central

Records Unit at Room 1874, U.S.

Department of Commerce, Pennsylvania

Avenue and 14th Street, NW,

Washington, D.C., 20230. This period of

scope consultation is intended to

provide the Department with ample

opportunity to consider all comments

and consult with parties prior to the

issuance of the preliminary

determinations.

Determination of Industry Support for

the Petition

Section 732(b)(1) of the Act requires

that a petition be filed on behalf of the

domestic industry. Section 732(c)(4)(A)

of the Act provides that a petition meets

this requirement if the domestic

producers or workers who support the

petition account for: (1) at least 25

percent of the total production of the

domestic like product; and (2) more

than 50 percent of the production of the

domestic like product produced by that

portion of the industry expressing

support for, or opposition to, the

petition.

Section 771(4)(A) of the Act defines

the ‘‘industry’’ as the producers of a

domestic like product. Thus, to

determine whether the petition has the

requisite industry support, the statute

directs the Department to look to

producers and workers who account for

production of the domestic like product.

The International Trade Commission

(ITC), which is responsible for

determining whether the domestic

industry has been injured, must also

determine what constitutes a domestic

like product in order to define the

industry. While both the Department

and the ITC must apply the same

statutory provision regarding the

domestic like product (section 771(10)

of the Act), they do so for different

purposes and pursuant to separate and

distinct authority. In addition, the

Department’s determination is subject to

limitations of time and information.

Although this may result in different

definitions of the domestic like product,

such differences do not render the

decision of either agency contrary to the

law.1 Section 771(10) of the Act defines

domestic like product as ‘‘a product

which is like, or in the absence of like,

most similar in characteristics and uses

with, the article subject to an

investigation under this title.’’ Thus, the

reference point from which the

domestic like product analysis begins is

‘‘the article subject to an investigation,’’

i.e., the class or kind of merchandise to

be investigated, which normally will be

the scope as defined in the petition.

The domestic like product referred to

in the petition is the single domestic

like product defined in the ‘‘Scope of

Investigation’’ section, above. The

Department has no basis on the record

to find the petition’s definition of the

domestic like product to be inaccurate.

The Department has, therefore, adopted

the domestic like product definition set

forth in the petition. In addition, the

petitioners established that they

represent more than 50 percent of

domestic production of the like product.

This level of industry support is above

the statutory requirement. Accordingly,

the Department determines that the

petition is filed on behalf of the

domestic industry within the meaning

of section 732(b)(1) of the Act.

Export Price and Normal Value

The following are descriptions of the

allegations of sales at less than fair value
Federal Register / Vol. 63, No. 80 / Monday, April 27, 1998 / Notices 20577

upon which our decisions to initiate

these investigations are based. Should

the need arise to use any of this

information in our preliminary or final

determinations for purposes of facts

available under section 776 of the Act,

we may re-examine the information and

revise the margin calculations, if

appropriate.

Brazil

The petitioners identified Petroflex

Industria e Comercio S.A. (Petroflex) as

the sole exporter and producer of ESBR

from Brazil. The petitioners based

export price on U.S. prices in call

reports generated by the petitioners’

sales personnel in the normal course of

business and obtained from various

customers over the last 12 months for

ESBR grades 1502 and 1712, the grades

the petitioners claim are those used

most extensively by the tire industry.

The petitioners converted U.S. prices

quoted in dollars per pound to dollars

per metric ton by multiplying the per

pound amounts by 2204.60 pounds per

metric ton. The petitioners calculated

net U.S. prices by subtracting an

estimate of the international freight and

insurance expenses incurred to

transport the subject merchandise from

the factory to a port in the United States

or to the U.S. customer, depending on

the terms of sale specified in the call

reports. Where the terms of sale were

not specified in the call report, the

petitioners assumed that the terms of

sale were FOB Brazil and no freight

expense was deducted from the U.S.

price. The petitioners estimated the cost

of international freight and insurance

based upon the difference in the CIF

values and the U.S. Customs values

reported in the official U.S. import

statistics for 1997.

With respect to normal value (NV),

the petitioners obtained from a local

business contact in Brazil prices for

contemporaneous sales of ESBR grades

1502 and 1712 from Petroflex to a

Brazilian consumer. Because home

market prices were quoted in U.S.

dollars, prices were converted from U.S.

dollars to reals for purposes of making

adjustments based on the daily

exchange rate corresponding to the date

of the price quotes. Daily exchange rates

for 1997 were obtained from the

database of exchange rates maintained

by Import Administration on the

internet. Daily exchange rates for 1998

were obtained from The Money

Exchange (internet address

www.oanda.com). When comparing

normal value to U.S. price, the

petitioners used the daily exchange rate

corresponding to the effective date of

each U.S. sale to convert the normal

values to U.S. dollars. The petitioners

calculated net home market prices by

subtracting an amount for the estimated

expense incurred by Petroflex to deliver

the merchandise to the Brazilian

consumer. This estimate was provided

by the local business contact noted

above.

The petitioners made a circumstance

of sale adjustment for imputed credit

expenses by subtracting home market

credit expenses and by adding U.S.

credit expenses to the net home market

prices calculated in the petition. The

petitioners calculated home market

imputed credit expenses based on

payment terms of net 35 days, as

reported by the local business contact,

and the annual average Brazilian bank

rate published by the International

Financial Statistics of 26.4 percent. The

petitioners calculated U.S. credit

expenses based on payment terms of net

30 days and the annual average lending

rate in the United States published in

the International Financial Statistics of

8.44 percent. The petitioners did not

adjust the reported prices for differences

in packing costs because the petitioners

assumed that packing costs were the

same for home market and for U.S.

sales.

Comparison of NV and net U.S. prices

for sales of ESBR from Brazil results in

estimated dumping margins that range

from 17.77 percent to 71.08 percent.

Korea

The petitioners identified two

exporters and producers of ESBR: Korea

Kumho Petrochemical Company

(Kumho) and Hyundai Petrochemical

Co., Ltd. (Hyundai). The petitioners

based export price on U.S. prices in call

reports generated by the petitioners’

sales personnel in the normal course of

business and obtained from various

customers over the last 12 months for

ESBR grades 1502 and 1712. The

petitioners converted U.S. prices quoted

in dollars per pound to dollars per

metric ton by mulitplying the per pound

amounts by 2204.60 pounds per metric

ton. The petitioners calculated net U.S.

prices by subtracting an estimate of the

international freight and insurance

expenses incurred to transport the

subject merchandise from the factory to

a port in the United States or to the U.S.

customer, depending on the terms of

sales specified in the call reports. Where

the terms of sale were not specified in

the call reports, the petitioners assumed

that the terms of sale were FOB Korea

and no freight expense was deducted

from the U.S. price. The petitioners

estimated the cost of international

freight and insurance based upon the

difference in the CIF values and the U.S.

Customs values reported in the official

U.S. import statistics for 1997.

With respect to NV, the petitioners

obtained from local business contacts in

Korea prices for contemporaneous sales

of ESBR grades 1502 and 1712 from

Kumho to Korean consumers. For

Hyundai, the petitioners obtained from

local business contacts in Korea prices

for contemporaneous sales of ESBR

grades 1500/1500H (rather than 1502)

and 1712 from Hyundai to Korean

consumers. However, the petitioners

provided documentation to show that

ESBR grades 1500/1500H and 1502 are

priced the same by Hyundai in Korea.

Due to the volatility in the exchange

rate, the petitioners received a set of

price quotes from one producer for a

period before exchange rate volatility set

in, as well as for a period after the

Korean won plummeted in value. Where

home market prices were quoted in U.S.

dollars, prices were converted from U.S.

dollars to won for purposes of making

adjustments based on the daily

exchange rate corresponding to the

effective date of the price quote. Daily

exchange rates for 1997 were obtained

from the database of exchange rates

maintained by Import Administration

on the internet. Daily exchange rates for

1998 were obtained from The Money

Exchange (internet address

www.oanda.com). When comparing

normal value to U.S. price, the

petitioners used the daily exchange rate

corresponding to the effective date of

each U.S. sale to convert the normal

values to U.S. dollars. The petitioners

calculated net home market prices by

subtracting an amount for the estimated

expense incurred by Hyundai and

Kumho to deliver the merchandise to

the consumer in Korea. This estimate

was provided by the local business

contact noted above.

The petitioners made a circumstance

of sale adjustment for imputed credit

expenses by subtracting home market

credit expenses and by adding U.S.

credit expenses to the net home market

prices calculated in the petition. The

petitioners calculated home market

imputed credit expenses based on the

typical credit terms for ESBR in Korea

as obtained by local business contacts of

90 days, and the average corporate bond

rate in Korea published by the

International Financial Statistics for

August 1997, of 12.1 percent (to reflect

the corporate bond rate before the won

depreciated), and October 1997, of 12.5

percent (to reflect the corporate bond

rate after the won depreciated). See

Exhibit 8 of the petition. The petitioners

calculated U.S. credit expenses based on

payment terms of net 30 days, and the

annual average lending rate in the
20578 Federal Register / Vol. 63, No. 80 / Monday, April 27, 1998 / Notices

United States published in the

International Financial Statistics of 8.44

percent. The petitioners did not adjust

the reported prices for differences in

packing costs because the petitioners

assumed that packing costs were the

same for home market and for U.S.

sales.

Comparison of NV and net U.S. prices

for sales of ESBR from Korea results in

estimated dumping margins that range

from 14.92 percent to 118.88 percent.

Mexico

The petitioners identified Industrias

Negromex, S.A. de C.V. (Negromex) as

the sole exporter and producer of ESBR

from Mexico. The petitioners based

export price on contemporaneous price

quotes to an unaffiliated U.S. consumer

and U.S. prices in call reports generated

by the petitioners’ sales personnel in the

normal course of business over the last

12 months for grades 1502 and 1712.

The petitioners converted U.S. prices

quoted in dollars per pound to dollars

per metric ton by multiplying the per

pound amounts by 2204.60 pounds per

metric ton. The petitioners calculated

net U.S. prices by subtracting an

estimate of the international freight and

insurance expenses incurred to

transport the subject merchandise from

the factory to a port in the United States

or to the U.S. customer, depending on

the terms of sales specified in the call

reports. Where the terms of sale were

not specified in the call report, the

petitioners assumed that the terms of

sale were FOB Mexico and no freight

expense was deducted from the U.S.

price. The petitioners estimated the cost

of international freight and insurance

based upon the difference in the CIF

values and the U.S. Customs values

reported in the official U.S. import

statistics for 1997.

With respect to NV, the petitioners

obtained from a local business contact

in Mexico contemporaneous price

quotes for ESBR grades 1502 and 1712

from Negromex to Mexican consumers

of ESBR. The petitioners converted

home market prices quoted in pesos per

kilogram to U.S. dollars per metric ton

by using a conversion ratio of one

kilogram equals 1/1000 metric tons and

the Mexican pesos/U.S. dollar exchange

rate in effect on the date of the U.S. sale.

Daily exchange rates for 1997 were

obtained from the database of exchange

rates maintained by Import

Administration on the internet. Daily

exchange rates for 1998 were obtained

from The Money Exchange (internet

address www.oanda.com).

The petitioners made a circumstance

of sale adjustment for imputed credit

expenses by subtracting home market

credit expenses and by adding U.S.

credit expenses to the net home market

prices calculated in the petition. The

petitioners calculated home market

imputed credit expenses based on

payment terms of net 60 days, as

reported by the local business contacts,

and the annual average Mexican

Treasury bill rate published by the

International Financial Statistics of

19.80 percent. The petitioners

calculated U.S. credit expenses based on

payment terms of net 30 days and the

annual average lending rate in the

United States published in the

International Financial Statistics of 8.44

percent. The petitioners did not adjust

the reported prices for differences in

packing costs because the petitioners

assumed that packing costs were the

same for home market and for U.S.

sales.

Comparison of NV and net U.S. prices

for sales of ESBR from Mexico results in

estimated dumping margins that range

from 6.06 percent to 25.16 percent.

Fair Value Comparisons

Based on the data provided by the

petitioners, there is reason to believe

that imports of ESBR from Brazil, Korea,

and Mexico are being, or are likely to be,

sold at less than fair value.

Allegations and Evidence of Material

Injury and Causation

The petition alleges that the U.S.

industry producing the domestic like

product is being materially injured, and

is threatened with material injury, by

reason of imports of the subject

merchandise sold at less than NV. The

allegations of injury and causation are

supported by relevant evidence

including business proprietary data

from the petitioning firms and U.S.

Customs import data. The Department

assessed the allegations and supporting

evidence regarding material injury and

causation and determined that these

allegations are sufficiently supported by

accurate and adequate evidence and

meet the statutory requirements for

initiation.

Initiation of Antidumping

Investigations

We have examined the petition on

ESBR and have found that it meets the

requirements of section 732 of the Act.

Therefore, we are initiating

antidumping duty investigations to

determine whether imports of ESBR

from Brazil, Korea, and Mexico are

being, or are likely to be, sold in the

United States at less than fair value.

Unless extended, we will make our

preliminary determinations for the

antidumping duty investigations by

September 8, 1998.

Distribution of Copies of the Petition

In accordance with section

732(b)(3)(A) of the Act, a copy of the

public version of each petition has been

provided to the representatives of the

governments of Brazil, Korea, and

Mexico. We will attempt to provide a

copy of the public version of the

petition to each exporter named in the

petition (as appropriate).

International Trade Commission

Notification

We have notified the ITC of our

initiations, as required by section 732(d)

of the Act.

Preliminary Determinations by the ITC

The ITC will determine by May 18,

1998, whether there is a reasonable

indication that imports of ESBR from

Brazil, Korea, and Mexico are causing

material injury, or threatening to cause

material injury, to a U.S. industry.

Negative ITC determinations will result

in the particular investigations being

terminated; otherwise, the

investigations will proceed according to

statutory and regulatory time limits.

Dated: April 21, 1998.

Robert S. LaRussa,

Assistant Secretary for Import

Administration.

[FR Doc. 98–11148 Filed 4–24–98; 8:45 am]

BILLING CODE 3510–DS–P

DEPARTMENT OF COMMERCE

International Trade Administration

[A–570–838]

Agreement Suspending the

Antidumping Investigation on Honey

From the People’s Republic of China

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

ACTION: Notice of amendment to the

agreement between the United States

Department of Commerce and the

Government of the People’s Republic of

China Suspending the Antidumping

Investigation on Honey from the

People’s Republic of China.

SUMMARY: The Department of Commerce

and the Government of the People’s

Republic of China have signed an

Amendment to the Agreement

Suspending the Antidumping

Investigation on Honey from China.

EFFECTIVE DATE: July 1, 1998.

FOR FURTHER INFORMATION CONTACT:

Abdelali Elouaradia at 202/482–2243, or