[Federal Register Volume 66, Number 86 (Thursday, May 3, 2001)]
[Notices]
[Pages 22163-22168]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-10849]


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

DEPARTMENT OF COMMERCE

International Trade Administration

[A-560-812]


Notice of Preliminary Determination of Sales at Less Than Fair 
Value: Certain Hot-Rolled Carbon Steel Flat Products From Indonesia

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

EFFECTIVE DATE: May 3, 2001.

FOR FURTHER INFORMATION CONTACT: Mark Manning or Nova Daly at (202) 
482-3936 and (202) 482-0989, respectively; AD/CVD Enforcement, Office 
4, Group II, Import Administration, Room 1870, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230.

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 Department of Commerce (the Department) 
regulations refer to the regulations codified at 19 CFR part 351 
(2000).

Preliminary Determination

    We preliminarily determine that certain hot-rolled carbon steel 
flat products (HRS) from Indonesia are being sold, or are likely to be 
sold, in the United States at less than fair value (LTFV), as provided 
in section 733 of the Act. The estimated margins of sales at LTFV are 
shown in the Suspension of Liquidation section of this notice.

Case History

    This investigation was initiated on December 4, 2000. See Notice of 
Initiation of Antidumping Duty Investigations: Certain Hot-Rolled 
Carbon Steel Flat Products From Argentina, India, Indonesia, 
Kazakhstan, the Netherlands, the People's Republic of China, Romania, 
South Africa, Taiwan, Thailand, and Ukraine, 65 FR 77568 (December 12,

[[Page 22164]]

2000) (Initiation Notice).\1\ Since the initiation of these 
investigations, the following events have occurred.
---------------------------------------------------------------------------

    \1\ The petitioners in these investigations are Bethlehem Steel 
Corporation, Gallatin Steel Company, IPSCO Steel Inc., LTV Steel 
Company, Inc., National Steel Corporation, Nucor Corporation, Steel 
Dynamics, Inc., U.S. Steel Group (a unit of USX Corporation), 
Weirton Steel Corporation, the Independent Steelworkers Union, and 
the United Steelworkers of America (collectively the petitioners). 
Weirton Steel Corporation is not a petitioner in the investigation 
involving hot-rolled steel from the Netherlands.
---------------------------------------------------------------------------

    The Department set aside a period for all interested parties to 
raise issues regarding product coverage. See Initiation Notice at 
77569. We received no comments from any parties in this investigation. 
The Department did, however, receive comments regarding product 
coverage in the investigation of HRS from the Netherlands. In that 
investigation we received comments from Duracell Global Business 
Management Group on December 11, 2000; from Energizer Battery Co., Inc. 
on December 15, 2000; from Bouffard Metal Goods, Inc., and Truelove & 
Maclean, Inc., on December 18, 2000; from Corus Staal BV and Corus 
Steel U.S.A., Inc., (collectively referred to as ``Corus'') and Thomas 
Steel Strip Corporation on December 26, 2000; and from Rayovac 
Corporation on March 12, 2001.
    On December 22, 2000, the Department issued a letter to interested 
parties in all of the concurrent HRS antidumping investigations, 
providing an opportunity to comment on the Department's proposed model 
matching characteristics and hierarchy. Comments were submitted by: 
petitioners (January 5, 2001); Corus, respondent in the Netherlands 
investigation (January 3, 2001); Iscor Limited, respondent in the South 
Africa investigation (January 3, 2001); and Zaporizhstal, respondent in 
the Ukraine investigation (January 3, 2001). Petitioners agreed with 
the Department's proposed characteristics and hierarchy of 
characteristics. Corus suggested adding a product characteristic to 
distinguish prime merchandise from non-prime merchandise. Neither Iscor 
nor Zaporizhstal proposed any changes to either the list of product 
characteristics proposed by the Department or the hierarchy of those 
product characteristics but, rather, provided information relating to 
its own products that was not relevant in the context of determining 
what information to include in the Department's questionnaires. For 
purposes of the questionnaires subsequently issued by the Department to 
the respondents, no changes were made to the product characteristics or 
the hierarchy of those characteristics from those originally proposed 
by the Department in its December 22, 2000 letter. With respect to 
Corus' request, the additional product characteristic suggested by 
Corus, to distinguish prime merchandise from non-prime merchandise, is 
unnecessary. The Department already asks respondents to distinguish 
prime from non-prime merchandise in field number 2.2 ``Prime vs. 
Secondary Merchandise.'' See the Department's Antidumping Duty 
Questionnaire, at B-7 and C-7 (January 4, 2001). These fields are used 
in the model match program to prevent matches of prime merchandise to 
non-prime merchandise.
    On January 4, 2001, the Department issued an antidumping 
questionnaire to Krakatau, the mandatory respondent in Indonesia.\2\ 
See January 3, 2001 respondent selection memo. On January 15, 2001, we 
received a faxed letter from Krakatau requesting an extension of time 
to respond to section A of the Department's questionnaire. On January 
18, 2001, we received Krakatau's official, mailed section A extension 
request. On January 23, 2001, the Department granted Krakatau an 
extension of time to respond to section A of the questionnaire and 
notified Krakatau that submitting documents to the record of this 
proceeding via fax is not an acceptable method of submission and that 
such documents would not be accepted on an official basis. In the 
January 23, 2001 letter to Krakatau, we provided detailed information 
concerning the appropriate manner of submitting information or requests 
to the record, including a discussion of the regulations guiding the 
official submission of information.
---------------------------------------------------------------------------

    \2\ Section A of the questionnaire requests general information 
concerning a company's corporate structure and business practices, 
the merchandise under investigation that it sells, and the manner in 
which it sells that merchandise in all of its markets. Section B 
requests a complete listing of all home market sales, or, if the 
home market is not viable, of sales in the most appropriate third-
country market (this section is not applicable to respondents in 
non-market economy (NME) cases). Section C requests a complete 
listing of U.S. sales. Section D requests information on the cost of 
production (COP) of the foreign like product and the constructed 
value (CV) of the merchandise under investigation. Section E 
requests information on further manufacturing.
---------------------------------------------------------------------------

    On February 5, 2001, we received Krakatau's response to section A 
of the Department's questionnaire. Also on February 5, 2001, the 
Department received a faxed letter from Krakatau requesting an 
extension of time to respond to sections B, C, and D of the 
questionnaire. On February 8, 2001, the Department sent a letter to 
Krakatau granting its request for an extension of the deadline. In the 
letter, we again instructed Krakatau to follow the proper procedures 
for submitting requests to the record.
    On February 23, 2001, the Department received a letter from 
Krakatau requesting a further extension of time to respond to sections 
B, C, and D of the questionnaire. The Department subsequently sent a 
letter, dated February 23, 2001, denying Krakatau's request for a 
further extension due to the limited time available in this 
investigation and the impending preliminary determination. On February 
28, 2001, fifty-five days after issuing the antidumping questionnaire, 
the Department received Krakatau's response to sections B, C, and D of 
the questionnaire and non-functional sales databases.
    On March 1, 2001, the Department sent Krakatau a request for 
supplemental information regarding section A of the Department's 
questionnaire. On March 2, 2001, the Department received a letter from 
the petitioners notifying the Department that Krakatau had failed to 
serve them a computer diskette containing the sales and cost databases, 
which was due February 28, 2001. On March 5, 2001, the Department sent 
a letter to Krakatau notifying it that the sales databases it submitted 
to the Department on February 28, 2001 were not functional and provided 
instructions on the proper format for submitting computer data. In 
addition, this letter instructed Krakatau to send copies of the revised 
home and U.S. market sales databases to the petitioners. Sixty-four 
days after issuing the questionnaire, the Department received, on March 
9, 2001, the revised sales databases, in addition to the cost 
reconciliation package and an unsolicited addendum to the February 28, 
2001 section D response. However, Krakatau submitted only three copies 
of the proprietary version of its response, rather than the six copies 
required by the Department's regulations. In addition, Krakatau failed 
to submit a public version of these documents.
    On March 12, 2001, the Department received Krakatau's response to 
the Department's supplemental section A questionnaire. On March 14, 
2001, the Department sent Krakatau a supplemental questionnaire 
regarding section D of the Department's questionnaire. On March 15, 
2001, the Department sent a letter to Krakatau stating that its March 
9, 2001 submission did not contain the correct number of proprietary 
and public copies. In that letter, we again provided Krakatau with the 
same detailed information concerning the correct

[[Page 22165]]

procedures for submitting information as was originally provided on 
January 23, 2001. On March 16, 2001, the Department sent Krakatau a 
request for supplemental information covering sections B and C of the 
questionnaire. The Department issued a second supplemental section D 
questionnaire on March 23, 2001. Shortly thereafter, on March 30, 2001, 
the Department received Krakatau's supplemental response to section D 
of the questionnaire. On April 2, 2001, the Department received 
Krakatau's supplemental response to sections B and C of the 
Department's questionnaire. However, the software program Krakatau used 
to compress the size of its supplemental data and the inconsistent use 
of different date formats in the home market invoice date field, caused 
the Department a significant delay in accessing the supplemental data 
for our analysis. In addition, one of the petitioners notified the 
Department that Krakatau failed to serve it with a diskette containing 
the supplemental sales databases, which was due April 2, 2001. Since 
the date of the Department's preliminary determination was 
approximately three weeks away, we provided this petitioner with a copy 
of the supplemental data we received from Krakatau. See Memorandum to 
the File, dated April 2, 2001. On April 16, 2001, the Department issued 
Krakatau a second supplemental questionnaire covering sections B and C, 
with a due date of April 26, 2001. Since this due date is after the 
preliminary determination (i.e., April 23, 2001), the information 
received in this response will be taken into account for the final 
determination.

Period of Investigation

    The POI for this investigation is October 1, 1999 through September 
30, 2000. This period corresponds to the four most recent fiscal 
quarters prior to the month of the filing of the petition (i.e., 
November 2000).

Scope of Investigation

    For purposes of this investigation, the products covered are 
certain hot-rolled carbon steel flat products of a rectangular shape, 
of a width of 0.5 inch or greater, neither clad, plated, nor coated 
with metal and whether or not painted, varnished, or coated with 
plastics or other non-metallic substances, in coils (whether or not in 
successively superimposed layers), regardless of thickness, and in 
straight lengths of a thickness of less than 4.75 mm and of a width 
measuring at least 10 times the thickness. Universal mill plate (i.e., 
flat-rolled products rolled on four faces or in a closed box pass, of a 
width exceeding 150 mm, but not exceeding 1250 mm, and of a thickness 
of not less than 4.0 mm, not in coils and without patterns in relief) 
of a thickness not less than 4.0 mm is not included within the scope of 
this investigation.
    Specifically included within the scope of this investigation are 
vacuum degassed, fully stabilized (commonly referred to as 
interstitial-free (IF)) steels, high strength low alloy (HSLA) steels, 
and the substrate for motor lamination steels. IF steels are recognized 
as low carbon steels with micro-alloying levels of elements such as 
titanium or niobium (also commonly referred to as columbium), or both, 
added to stabilize carbon and nitrogen elements. HSLA steels are 
recognized as steels with micro-alloying levels of elements such as 
chromium, copper, niobium, vanadium, and molybdenum. The substrate for 
motor lamination steels contains micro-alloying levels of elements such 
as silicon and aluminum.
    Steel products to be included in the scope of this investigation, 
regardless of definitions in the Harmonized Tariff Schedule of the 
United States (HTSUS), are products in which: (i) Iron predominates, by 
weight, over each of the other contained elements; (ii) the carbon 
content is 2 percent or less, by weight; and (iii) none of the elements 
listed below exceeds the quantity, by weight, respectively indicated:

    1.80 percent of manganese, or
    2.25 percent of silicon, or
    1.00 percent of copper, or
    0.50 percent of aluminum, or
    1.25 percent of chromium, or
    0.30 percent of cobalt, or
    0.40 percent of lead, or
    1.25 percent of nickel, or
    0.30 percent of tungsten, or
    0.10 percent of molybdenum, or
    0.10 percent of niobium, or
    0.15 percent of vanadium, or
    0.15 percent of zirconium.

    All products that meet the physical and chemical description 
provided above are within the scope of this investigation unless 
otherwise excluded. The following products, by way of example, are 
outside or specifically excluded from the scope of this investigation:

    <bullet> Alloy hot-rolled steel products in which at least one of 
the chemical elements exceeds those listed above (including, e.g., 
American Society for Testing and Materials (ASTM) specifications A543, 
A387, A514, A517, A506).
    <bullet> Society of Automotive Engineers (SAE)/American Iron & 
Steel Institute (AISI) grades of series 2300 and higher.
    <bullet> Ball bearing steels, as defined in the HTSUS.
    <bullet> Tool steels, as defined in the HTSUS.
    <bullet> Silico-manganese (as defined in the HTSUS) or silicon 
electrical steel with a silicon level exceeding 2.25 percent.
    <bullet> ASTM specifications A710 and A736.
    <bullet> USS abrasion-resistant steels (USS AR 400, USS AR 500).
    <bullet> All products (proprietary or otherwise) based on an alloy 
ASTM specification (sample specifications: ASTM A506, A507).
    <bullet> Non-rectangular shapes, not in coils, which are the result 
of having been processed by cutting or stamping and which have assumed 
the character of articles or products classified outside chapter 72 of 
the HTSUS.

    The merchandise subject to these investigations is classified in 
the HTSUS under the following tariff classification numbers: 
7208.10.15.00, 7208.10.30.00, 7208.10.60.00, 7208.25.30.00, 
7208.25.60.00, 7208.26.00.30, 7208.26.00.60, 7208.27.00.30, 
7208.27.00.60, 7208.36.00.30, 7208.36.00.60, 7208.37.00.30, 
7208.37.00.60, 7208.38.00.15, 7208.38.00.30, 7208.38.00.90, 
7208.39.00.15, 7208.39.00.30, 7208.39.00.90, 7208.40.60.30, 
7208.40.60.60, 7208.53.00.00, 7208.54.00.00, 7208.90.00.00, 
7211.14.00.90, 7211.19.15.00, 7211.19.20.00, 7211.19.30.00, 
7211.19.45.00, 7211.19.60.00, 7211.19.75.30, 7211.19.75.60, and 
7211.19.75.90. Certain hot-rolled carbon steel flat products covered by 
this investigation, including vacuum degassed fully stabilized; high 
strength low alloy; and the substrate for motor lamination steel may 
also enter under the following tariff classification numbers: 
7225.11.00.00, 7225.19.00.00, 7225.30.30.50, 7225.30.70.00, 
7225.40.70.00, 7225.99.00.90, 7226.11.10.00, 7226.11.90.30, 
7226.11.90.60, 7226.19.10.00, 7226.19.90.00, 7226.91.50.00, 
7226.91.70.00, 7226.91.80.00, and 7226.99.00.00. Subject merchandise 
may also enter under 7210.70.30.00, 7210.90.90.00, 7211.14.00.30, 
7212.40.10.00, 7212.40.50.00, and 7212.50.00.00. Although the HTSUS 
tariff classification numbers are provided for convenience and U.S. 
Customs Service (Customs) purposes, the written description of the 
merchandise under investigation is dispositive.

[[Page 22166]]

Facts Available

1. Application of Facts Available
    Section 776(a)(2) of the Act provides that, if an interested party 
(A) withholds information requested by the Department, (B) fails to 
provide such information by the deadline, or in the form or manner 
requested, subject to sections 782(c)(1) and (e) of the Act, (C) 
significantly impedes a proceeding, or (D) provides information that 
cannot be verified, the Department shall use, subject to sections 
782(d) of the Act, facts otherwise available in reaching the applicable 
determination. Pursuant to section 782(e) of the Act, the Department 
shall not decline to consider submitted information if all of the 
following requirements are met: (1) The information is submitted by the 
established deadline; (2) the information can be verified; (3) the 
information is not so incomplete that it cannot serve as a reliable 
basis for reaching the applicable determination; (4) the interested 
party has demonstrated that it acted to the best of its ability; and 
(5) the information can be used without undue difficulties.
    In selecting from among the facts otherwise available, section 
776(b) of the Act authorizes the Department to use an adverse 
inference, if the Department finds that an interested party failed to 
cooperate by not acting to the best of its ability to comply with the 
request for information. See, e.g., Certain Welded Carbon Steel Pipes 
and Tubes From Thailand: Final Results of Antidumping Duty 
Administrative Review, 62 FR 53808, 53819-20 (October 16, 1997). 
Finally, section 776(b) of the Act states that an adverse inference may 
include reliance on information derived from the petition. See also 
Statement of Administrative Action (SAA) accompanying the URAA, H.R. 
Rep. No. 103-316 at 870 (1994).
    For the reasons discussed below, the Department determines that, in 
accordance with sections 776(a)(2)(B) and 776(b) of the Act, the use of 
adverse facts available is appropriate for the preliminary 
determination for Krakatau. The evidence on the record establishes that 
the use of total facts available for Krakatau is warranted because 
Krakatau failed to provide complete sales and cost questionnaire 
responses within the meaning of section 776(a)(2)(B) of the Act. In its 
initial and supplemental responses, Krakatau failed to provide the 
information in the manner requested in the Department's January 4, 2001 
antidumping questionnaire, the March 16, 2001 sections B and C 
supplemental questionnaire, and the March 14 and 23, 2001 supplemental 
section D questionnaires.
    We also note that at no time did Krakatau notify the Department, 
pursuant to section 782(c)(1) of the Act, that it was unable to submit 
the information requested in the requested form and manner, nor did it 
suggest alternative forms in which it would be able to submit the 
requested information. Throughout the course of this antidumping 
investigation, the Department gave Krakatau, a pro se company, 
assistance and opportunities to comply with the Department's requests 
for information. Specifically, taking into consideration the fact that 
the respondent is a pro se company, the Department provided Krakatau 
detailed information and guidance on how to properly calculate and 
report sales and cost data and adjustments, granted Krakatau extensions 
to reply to requests for information, and provided an opportunity to 
explain and correct the deficiencies in its responses. However, at no 
point in the investigation did Krakatau notify the Department that it 
had any difficulties in submitting the information in the form and 
manner requested, seek guidance on alternative reporting requirements, 
or propose an alternate form for submitting the required data, as 
contemplated in section 782(c)(1) of the Act. Despite the efforts at 
assistance on the part of the Department, Krakatau failed to provide 
information reliable enough that it can serve as a basis for reaching 
the applicable determination.
    Pursuant to section 782(e)(3) of the Act, the sales information 
Krakatau provided in its initial and supplemental responses was 
deficient such that the Department cannot consider it as a reliable 
basis for reaching the applicable determination. Our analysis of 
Krakatau's sales response found deficiencies that prohibit us from 
conducting an accurate model match, which prevents us from ensuring 
that products sold in the U.S. market are accurately matched to 
identical or most similar products sold in the home market. Without 
properly matching products sold in the U.S. and home markets, we cannot 
accurately identify similar matches and, as appropriate, calculate an 
accurate difference in merchandise (DIFMER) adjustment to account for 
the differences in the products being matched. In addition, we found 
that Krakatau's deficiencies in reporting multiple home and U.S. market 
sales adjustments prevent us from calculating fully adjusted home and 
U.S. market prices. Without fully adjusted home and U.S. market prices, 
we are unable to calculate an accurate dumping margin.
    Since these functions are essential elements to a dumping analysis, 
we find that Krakatau's responses cannot serve as a reliable basis for 
this preliminary determination. Specifically, Krakatau failed to 
provide: (1) Accurate quality classifications for sales in the home and 
U.S. market; (2) minimum specified yield strength classifications for 
sales in the home and U.S. market; (3) a method for identifying sales 
of non-foreign like product in its home market sales database; and (4) 
an explanation and appropriate supporting documents for how it 
calculated brokerage and handling, short-term interests rates (which 
are used in the calculation of imputed credit expenses), advertising, 
technical service, indirect selling expenses, inventory carrying costs, 
and packing. See March 16, 2001 sales supplemental questionnaire and 
April 2, 2001 sales supplemental response. See also Memorandum from 
Holly A. Kuga to Bernard T. Carreau, Certain Hot-Rolled Carbon Steel 
Flat Products from Indonesia: Preliminary Determination of Sales at 
Less Than Fair Value: The Use of Facts Available for PT Krakatau Steel 
and Corroboration of Secondary Information, dated April 23, 2001 
(Krakatau Facts Available Memorandum).
    Regarding Krakatau's cost response, our analysis found deficiencies 
in the initial and supplemental responses that prohibit us from 
accurately determining Krakatau's COP for each of the control numbers 
(CONNUMs) reported in its home and U.S. sales databases. The primary 
problem is that Krakatau calculated a company-wide average cost, and 
then to obtain individual product costs, applied this average cost to 
the cumulative yield for each individual production process each 
product (by CONNUM) passed through, rather than calculating product-
specific costs. Without product-specific costs, the Department is 
unable to accurately determine whether home markets sales were sold at 
prices above, or below, the COP. Without a proper cost test, the 
Department is unable to calculate the proper NV in price-to-price 
comparisons.\3\ In addition, the absence of product-specific costs 
prevents us from calculating a valid DIFMER (assuming that the correct 
sales were selected for comparison). Lastly, we note that Krakatau 
failed to provide a COP for certain of its reported home

[[Page 22167]]

market CONNUMs and failed to provide a CV for certain of its reported 
U.S. market CONNUMs. For home market sales without a COP, we cannot 
perform the cost test to determine whether these sales were sold above 
their COP. For U.S. sales without a reported CV, we have no means of 
determining NV if there are no home market sales matches.
---------------------------------------------------------------------------

    \3\ Without a proper cost test, it is impossible to determine 
whether 20 percent or more of the home market sales are below cost 
and hence, would be excluded from the calculation of NV.
---------------------------------------------------------------------------

    Because of Krakatau's failure to provide product-specific costs 
that account for the physical characteristics of unique products, we 
find that Krakatau's cost responses cannot serve as a reliable basis 
for this preliminary determination. Specifically, Krakatau failed to 
provide: (1) Costs that account for differences in quality, carbon, 
strength, thickness, width, pickling, edge trim, and pattern; (2) costs 
that account for differences in the chemistry or alloy content of 
specific grades of steel; (3) costs that account for differences in 
individual production processes; (4) the financial statements of its 
affiliates or of its parent corporation; (5) an explanation or 
supporting documents for the adjustments it made to the calculation of 
the scrap credit and direct material cost for ``Sponge Iron 
Consumption;'' (6) an explanation of why it did not incorporate the 
daily time utilization reports in its cost methodology; (7) a COP for 
multiple CONNUMs contained in the home market sales database; and (8) a 
CV for multiple CONNUMs contained in the U.S. market sales database. As 
a result, the information on the record is insufficient for purposes of 
calculating a dumping margin. See March 14 and March 23, 2001 cost 
supplemental questionnaires. See also Krakatau Facts Available 
Memorandum.
    Of the many deficiencies in Krakatau's cost response, the most 
problematic deficiency is that Krakatau calculated one company-wide 
average cost and then, to obtain individual product costs, applied this 
average cost to the cumulative yield for the individual path each 
product (by CONNUM) passed through. The cumulative yield of subsequent 
cost centers through which a product passes will account for the losses 
that occur at those cost centers. However, this methodology does not 
account for processing differences within each cost center. For 
example, within the hot rolling mill, products with different 
thicknesses are not differentiated in terms of cost based on their 
rolling times. In another example, the costs associated with the 
pickling process are not assigned to products based on whether or not 
the product was pickled, but rather only by applying the yield loss 
associated with the pickling cost center to the average cost of hot 
rolling. As discussed above, the failure to provide product-specific 
costs makes it impossible to (1) conduct the sales below cost test, (2) 
calculate the 20% comparability test used in the DIFMER adjustment, and 
(3) calculate CV.
    Moreover, we find that the cumulative effect of these errors is to 
erode our confidence in Krakatau's response as a whole. Therefore, 
pursuant to section 782(e)(3) of the Act, the Department finds that the 
information on the record, as discussed above, is so incomplete that it 
cannot serve as a reliable basis for reaching the applicable 
determination.
    We also find that the application of an adverse inference in this 
case is appropriate. Krakatau failed to act to the best of its ability 
to comply with the Department's requests for information when it failed 
to provide: (1) Accurate quality and yield strength characteristics 
(which prevents the Department from conducting an accurate model 
match), (2) a method for identifying sales of non-foreign like product 
in its home market sales database, (3) an explanation and appropriate 
supporting documents for how it calculated certain sales expense 
adjustments, and (4) product-specific costs. Despite the Department's 
directions in the original and supplemental questionnaires, and the 
extensions granted, Krakatau made no effort to provide any explanation 
or propose an alternate form of submitting the data. See Krakatau Facts 
Available Memorandum.
    Furthermore, the information cannot be obtained elsewhere. Without 
this critical information, the Department cannot accurately determine 
the dumping margin for Krakatau. In addition, as outlined in the Case 
History section above, the company's failure to properly submit 
information and data to the record of this proceeding delayed the 
Department in making critical decisions involving the calculation of 
Krakatau's dumping margin. The company was put on notice by 
Department's extension letters and other correspondence that failure to 
properly submit information and data to the Department constituted a 
deficiency which could result in the use of facts available. See the 
Department's letters to Krakatau dated January 23, February 8, March 5, 
and March 15, 2001.
    Krakatau's submission of information is so incomplete that it 
cannot serve as a reliable basis for reaching the applicable 
determination. Its failure to comply with the Department's procedures 
for submitting information and data to the record of this proceeding, 
and its repeated failure to provide information to the Department which 
could not be obtained elsewhere, demonstrate a consistent pattern of 
unresponsiveness and a failure to cooperate to the best of its ability 
with the Department's requests for information. Despite the 
Department's directions in the questionnaires and the letters granting 
extensions, Krakatau did not provide the information requested by the 
Department, made no effort to explain any difficulties it was having in 
supplying the information, and did not propose an alternate form of 
submitting the information. For these reasons, we find that Krakatau 
did not act to the best of its ability in responding to the 
Department's requests for information, see, e.g., Circular Stainless 
Steel Hollow Products, and that, consequently, an adverse inference is 
warranted under section 776(b) of the Act. See Krakatau Facts Available 
Memorandum.
    Pursuant to section 776(b) of the Act, the Department is basing 
Krakatau's margin on adverse facts available for purposes of the 
preliminary determination. Section 776(b) of the Act authorizes the 
Department to use as adverse facts available information derived from 
the petition, the final determination from the LTFV investigation, a 
previous administrative review, or any other information placed on the 
record. As adverse facts available, we are applying the margin for 
Indonesia published in the Department's notice of initiation, which is 
59.25 percent. See Notice of Initiation of Antidumping Duty 
Investigations: Certain Hot-Rolled Carbon Steel Flat Products From 
Argentina, India, Indonesia, Kazakhstan, the Netherlands, the People's 
Republic of China, Romania, South Africa, Taiwan, Thailand, and 
Ukraine, 65 FR 77568 (December 12, 2000)) (HRS Initiation Notice).
2. Selection and Corroboration of Facts Available
    Section 776(b) of the Act states that an adverse inference may 
include reliance on information derived from the petition. See also SAA 
at 829-831. Section 776(c) of the Act provides that, when the 
Department relies on secondary information (such as the petition) in 
using the facts otherwise available, it must, to the extent 
practicable, corroborate that information from independent sources that 
are reasonably at its disposal.
    The SAA clarifies that ``corroborate'' means that the Department 
will satisfy itself that the secondary information to be used has 
probative value (see SAA at 870). The SAA also states that independent 
sources used to corroborate

[[Page 22168]]

such evidence may include, for example, published price lists, official 
import statistics and customs data, and information obtained from 
interested parties during the particular investigation (see SAA at 
870).
    In order to determine the probative value of the margin in the 
petition for use as adverse facts available for purposes of this 
determination, we examined evidence supporting the calculations in the 
petition. In accordance with section 776(c) of the Act, to the extent 
practicable, we examined the key elements of the export price (EP) and 
normal value (NV) calculations on which the margin in the petition was 
based. Our review of the EP and NV calculations indicated that the 
information in the petition has probative value, as certain information 
included in the margin calculations in the petition is from public 
sources concurrent with the relevant POI. For purposes of the 
preliminary determination, we attempted to further corroborate the 
information in the petition. We re-examined the EP and NV data which 
formed the basis for the margin in the petition in light of information 
obtained during the investigation and, to the extent practicable, found 
that it has probative value.
    Accordingly, in selecting adverse facts available with respect to 
Krakatau, the Department determined to apply a margin rate of 59.25 
percent, the margin published in the Department's notice of initiation.

All Others Rate

    Section 735(c)(5)(B) of the Act provides that, where the estimated 
weighted-average dumping margins established for all exporters and 
producers individually investigated are zero or de minimis margins, or 
are determined entirely under section 776 of the Act, the Department 
may use any reasonable method to establish the estimated ``all others'' 
rate for exporters and producers not individually investigated. This 
provision contemplates that we weight-average margins other than facts 
available margins to establish the ``all others'' rate. Where the data 
do not permit weight-averaging such rates, the SAA, at 873, provides 
that we may use other reasonable methods. Because the petition 
contained only an estimated price-to-CV dumping margin, which the 
Department adjusted for purposes of initiation, there are no additional 
estimated margins available with which to create the ``all others'' 
rate. Therefore, we applied the published margin of 59.25 percent as 
the ``all others'' rate.

Suspension of Liquidation

    In accordance with section 733(d) of the Act, we are directing 
Customs to suspend liquidation of all entries of HRS from Indonesia 
that are entered, or withdrawn from warehouse, for consumption on or 
after the date of publication of this notice in the Federal Register. 
We will instruct Customs to require a cash deposit or the posting of a 
bond equal to the amount by which the NV exceeds the EP, as indicated 
in the chart below. These suspension-of-liquidation instructions will 
remain in effect until further notice. The dumping margins are as 
follows:

------------------------------------------------------------------------
                                                                Margin
                    Manufacturer/exporter                      (percent)
------------------------------------------------------------------------
PT Krakatau Steel...........................................       59.25
All Others..................................................       59.25
------------------------------------------------------------------------

Disclosure

    The Department will disclose calculations performed within five 
days of the date of publication of this notice to the parties of the 
proceedings in these investigations in accordance with 19 CFR 
351.224(b).

ITC Notification

    In accordance with section 733(f) of the Act, we have notified the 
ITC of our sales at LTFV determination. If our final antidumping 
determination is affirmative, the ITC will determine whether the 
imports covered by that determination are materially injuring, or 
threaten material injury to, the U.S. industry. The deadline for that 
ITC determination would be the later of 120 days after the date of this 
preliminary determination or 45 days after the date of our final 
determination.

Public Comment

    Case briefs must be submitted no later than 35 days after the 
publication of this notice in the Federal Register. Rebuttal briefs 
must be filed within five business days after the deadline for 
submission of case briefs. A list of authorities used, a table of 
contents, and an executive summary of issues should accompany any 
briefs submitted to the Department. Executive summaries should be 
limited to five pages total, including footnotes. Public versions of 
all comments and rebuttals should be provided to the Department and 
made available on diskette.
    Section 774 of the Act provides that the Department will hold a 
hearing to afford interested parties an opportunity to comment on 
arguments raised in case or rebuttal briefs, provided that such a 
hearing is requested by any interested party. If a request for a 
hearing is made in an investigation, the hearing will tentatively be 
held two days after the deadline for submission of the rebuttal briefs, 
at the U.S. Department of Commerce, 14th Street and Constitution 
Avenue, NW, Washington, DC 20230. In the event that the Department 
receives requests for hearings from parties to more than one HRS case, 
the Department may schedule a single hearing to encompass all cases. 
Parties should confirm by telephone the time, date, and place of the 
hearing 48 hours before the scheduled time.
    Interested parties who wish to request a hearing, or to participate 
if one is requested, must submit a written request within 30 days of 
the publication of this notice. Requests should specify the number of 
participants and provide a list of the issues to be discussed. Oral 
presentations will be limited to issues raised in the briefs.
    If this investigation proceeds normally, we will make our final 
determination in this investigation no later than 75 days after the 
date of this preliminary determination.
    This determination is published pursuant to sections 733(f) and 
777(i)(1) of the Act. Effective January 20, 2001, Bernard T. Carreau is 
fulfilling the duties of the Assistant Secretary for Import 
Administration.

    Dated: April 23, 2001.
Bernard T. Carreau,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 01-10849 Filed 5-2-01; 8:45 am]
BILLING CODE 3510-DS-U