10542 Federal Register / Vol. 60, No. 38 / Monday, February 27, 1995 / Notices

above COP does not imply that they

were below cost.

Interfit claims that the concurrence

memorandum from the preliminary

determination (September 26, 1994, at

page 3) and a November 15, 1994 letter

from the Department to the counsel for

Interfit, led the company to believe that

the transfer prices would be used so

long as they were determined to be at

arm’s length. Interfit assumed that if the

Department had at that time ‘‘reasonable

grounds’’ to believe that the pipe was

sold to Interfit at less than the COP, the

Department would have stated that cost

was an issue.

DOC Position

The fact that Interfit failed to provide

evidence that Vallourec’s price for the

input pipe was above the cost of

producing the pipe, despite numerous

requests from the Department for this

information, provides the Department

with ‘‘reasonable grounds to believe or

suspect’’ that the transfer prices paid by

Interfit were less than Vallourec’s cost

of production. Therefore, in computing

the CV, we have valued the pipe on the

basis of the BIA used to calculate COP

for the home market sales below cost

test. Because the transfer prices have

been disregarded in accordance with

section 773(e)(3) of the Act, we do not

need to address the issue of whether the

transfer prices satisfy the criteria under

section 773(e)(2). The Department’s

preliminary determination expressly

noted that whether the transfer prices

were at arm’s length would be examined

at verification. In addition, the

Department continued to pursue data

that would confirm that the transfer

prices are above COP. See,

Supplemental/Deficiency Section D

Questionnaire (November 15, 1994),

Section D Verification Agenda

(December 5, 1994), Fax to Counsel for

Interfit (December 8, 1994), and Section

D Verification Report (January 12, 1995).

Therefore, contrary to Interfit’s claims,

the question of cost remained an issue.

Suspension of Liquidation

In accordance with section 735(c)(4)

of the Act, we are directing the U.S.

Customs Service to continue to suspend

liquidation of all entries of butt-weld

pipe fittings from France, as defined in

the ‘‘Scope of Investigation’’ section of

this notice, that are produced and sold

by Interfit and that are entered, or

withdrawn from warehouse, for

consumption on or after October 4,

1994.

The Customs Service shall require a

cash deposit or the posting of a bond

equal to the estimated weighted-average

amount by which the foreign market

value of the subject merchandise

exceeds the United States price as

shown below. The suspension of

liquidation will remain in effect until

further notice. The weighted-average

dumping margins are as follows:

Manufacturer/producer/exporter Margin

(percent)

Interfit, S.A. ............................... 32.58

All Others .................................. 32.58

ITC Notification

In accordance with section 735(d) of

the Act, we have notified the ITC of our

determination.

Notice to Interested Parties

This notice also serves as the only

reminder to parties subject to

administrative protective order (APO) of

their responsibility concerning the

return or destruction of proprietary

information disclosed under APO in

accordance with 19 CFR 353.35(d).

Failure to comply is a violation of the

APO.

This determination is published

pursuant to section 735(d) of the Act (19

U.S.C. 1671(d)).

Dated: February 16, 1995.

Barbara R. Stafford,

Acting Assistant Secretary for Import

Administration.

[FR Doc. 95–4724 Filed 2–24–95; 8:45 am]

BILLING CODE 3510–DS–P

[A–508–807]

Notice of Final Determination of Sales

at Less Than Fair Value: Certain

Carbon Steel Butt-Weld Pipe Fittings

From Israel

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

EFFECTIVE DATE: February 27, 1995.

FOR FURTHER INFORMATION CONTACT:

Jennifer Yeske or Gary Bettger, Office of

Countervailing Investigations, Import

Administration, International Trade

Administration, U.S. Department of

Commerce, 14th Street and Constitution

Avenue, NW., Washington, DC 20230;

telephone (202) 482–0189 and 482–

2239, respectively.

Final Determination

We determine that certain carbon

steel butt-weld pipe fittings from Israel

are being sold in the United States at

less than fair value, as provided in

section 735 of the Tariff Act of 1930, as

amended (the ‘‘Act’’). The estimated

margin is shown in the ‘‘Suspension of

Liquidation’’ section of this notice.

Case History

Since the publication of the

preliminary determination in the

Federal Register on October 4, 1994 (59

FR 50568), the following events have

occurred:

On October 5, 1994, pursuant to

section 353.20(b)(1) of the Department’s

regulations (19 CFR 353.20(b)(1)(1994),

Pipe Fittings Carmiel, Inc. (‘‘Carmiel’’)

requested that the final determination in

this case be postponed. On November

14, 1994, the Department published in

the Federal Register a notice postponing

the publication of the final

determination in this case until not later

than February 16, 1995 (59 FR 56461).

On October 20, 1994, Carmiel filed a

second supplemental/deficiency

response, which included a revised

home market sales listing. On November

27, November 28, and December 4,

1994, we verified Carmiel’s sales

information at its offices in Tel Aviv,

Israel. On January 23, 1995, and on

January 30, 1995, petitioner and

respondent submitted case and rebuttal

briefs to the Department.

Scope of the Investigation

The products covered by this

investigation are certain carbon steel

butt-weld pipe fittings having an inside

diameter of less than fourteen inches

(355 millimeters), imported in either

finished or unfinished condition. Pipe

fittings are formed or forged steel

products used to join pipe sections in

piping systems where conditions

require permanent welded connections,

as distinguished from fittings based on

other methods of fastening (e.g.,

threaded, grooved, or bolted fittings).

Butt-weld fittings come in a variety of

shapes which include ‘‘elbows,’’ ‘‘tees,’’

‘‘caps,’’ and ‘‘reducers.’’ The edges of

finished pipe fittings are beveled, so

that when a fitting is placed against the

end of a pipe (the ends of which have

also been beveled), a shallow channel is

created to accommodate the ‘‘bead’’ of

the weld which joins the fitting to the

pipe. These pipe fittings are currently

classifiable under subheading

7307.93.3000 of the Harmonized Tariff

Schedule of the United States

(‘‘HTSUS’’). Although the HTSUS

subheading is provided for convenience

and customs purposes, our written

description of the scope of this

investigation is dispositive.

Period of Investigation

The period of investigation (‘‘POI’’) is

September 1, 1993, through February

28, 1994.
Federal Register / Vol. 60, No. 38 / Monday, February 27, 1995 / Notices 10543

Product Comparisons

Carmiel sold identical products in

both Israel and the United States during

the POI. Therefore, in making our fair

value comparisons, we compared sales

of merchandise identical in all respects.

Fair Value Comparisons

To determine whether Carmiel’s sales

for export to the United States were

made at less than fair value, we

compared the United States price

(‘‘USP’’) to the foreign market value

(‘‘FMV’’), as specified in the ‘‘United

States Price’’ and ‘‘Foreign Market

Value’’ sections of this notice. In

accordance with 19 CFR 353.58, we

made comparisons at the same level of

trade.

We made revisions to Carmiel’s

reported data, where appropriate, based

on verification findings.

United States Price

Because Carmiel’s U.S. sales were

made to unrelated purchasers in the

United States prior to importation, and

because the exporter’s sales price

methodology was not indicated by other

circumstances, we based USP on the

purchase price (‘‘PP’’) sales

methodology in accordance with section

772(b) of the Act.

We calculated Carmiel’s USP based

on packed C.I.F. prices to unrelated

customers in the United States. We

made deductions, where appropriate,

for marine insurance, ocean freight,

foreign inland freight, port fees, and

customs agents fees and expenses.

We made an adjustment to U.S. price

for the value-added tax (‘‘VAT’’) paid on

the comparison sales in Israel, in

accordance with our practice, pursuant

to the Court of International Trade (CIT)

decision in Federal-Mogul, et al v.

United States, Slip Op. 93–194 (CIT

October 7, 1993). (See Final

Determination of Sales at Less Than

Fair Value: Calcium Aluminate Cement,

Cement Clinker and Flux from France,

59 FR 14136, March 25, 1994).

Foreign Market Value

In order to determine whether the

sales in the home market are an

adequate basis for the FMV, the

Department generally compares the

quantity of such or similar merchandise

sold in the home market during the POI

to the quantity sold for exportation to

third countries. In this case, Carmiel

made sales only to the United States and

Israel during the POI. Based on the

substantial quantity of home market

sales in relation to its U.S. sales, we

determined that the home market was

viable.

In our preliminary determination, we

stated that the appropriate date of sale

is the date of the first written document

which sets the price and quantity for the

sale (see Certain Stainless Steel ButtWeld Pipe and Tube Fittings From

Japan; Final Results of Antidumping

Duty Administrative Review (59 FR

12240, 12241; March 16, 1994) and

Antifriction Bearings (Other Than

Tapered Rolling Bearings) and Parts

Thereof From France, et al., (58 FR

39729, 39783; July 26, 1993)).

Accordingly, on October 20, 1994,

respondent submitted a new home

market sales listing using the invoice

date as the date of sale. We confirmed

at verification that the invoice date is

the first written document setting the

terms of sale in the home market and is,

thus, the appropriate date of sale.

We have calculated FMV using the

delivered prices reported by Carmiel in

its October 20, 1994 home market sales

listing. We adjusted the prices for

certain discounts offered to home

market customers. Also, in light of the

decision of the Court of Appeals for the

Federal Circuit in Ad Hoc Committee of

AZ–NM–TX–FL Producers of Gray

Portland Cement v. United States,

13#F.3d 398 (Fed. Cir., 1994), we

adjusted for post-sale home market

movement charges under the

circumstances-of-sale provision of the

Act (Section 773(a)(4)(B)). This

adjustment included home market

inland freight.

We also made circumstance-of-sale

adjustments, where appropriate, for

differences in credit expenses, pursuant

to 19 CFR 353.56(a)(2). In calculating

U.S. credit expense, we used the interest

rate paid by Carmiel for short-term New

Israeli Shekel (‘‘NIS’’) loans linked to

the dollar. In calculating the home

market credit expense, we used

Carmiel’s borrowing rate for unlinked

short-term NIS loans.

We adjusted for VAT in accordance

with our standard practice. (See the

United States Price section of this

notice, above.)

Currency Conversion

We made currency conversions based

on the official exchange rates in effect

on the dates of the U.S. sales, as

published in the International Monetary

Fund’s International Financial Statistics

(see 19 CFR 353.60).

Final Negative Determination of Critical

Circumstances

Petitioner alleged that critical

circumstances exist with respect to

imports of pipe fittings from Israel. In

our preliminary determination,

pursuant to section 733(e)(1) of the Act

and 19 CFR 353.16, we analyzed the

allegation using the Department’s

standard methodology. Because the

information on which our analysis was

based has not changed, we have

performed the same analysis as

explained in the preliminary finding.

Based on this analysis, the Department

determines, in accordance with section

735(a)(3) of the Act, that critical

circumstances do not exist with respect

to imports of certain carbon steel buttweld pipe fittings from Israel.

Verification

As provided in section 776(b) of the

Act, we verified information provided

by the respondent using standard

verification procedures, including the

examination of relevant sales, cost and

financial records, and selection of

original source documentation.

Interested Party Comments

Comment 1

Carmiel argues that U.S. sales relating

to the September 22, 1993, invoice are

outside the period of investigation. The

company claims that the terms of these

sales were set in the purchase order,

which is dated March 25, 1993. Carmiel

argues that while the actual quantity

shipped changed slightly before the

shipment date, this change was very

small and resulted from limitations

imposed by the size of the shipping

containers.

DOC Position

We agree with respondent. Carmiel

appropriately excluded these sales from

its U.S. sales listing because the terms

of the sales were set well before the POI.

We agree that the change in quantity

was minor and does not constitute a

change in the basic terms of the sale.

Comment 2

At verification, Carmiel officials

notified the Department that they had

not reported an additional home market

discount which was given to customers

who made prompt payments. The

information pertaining to these

discounts was submitted to the

Department after the verification was

completed, and the Department

returned the information as untimely.

Carmiel argues that the Department

should accept the information and make

an adjustment for this discount.

According to Carmiel, these discounts

were inadvertently omitted from the

company’s response because the

response was prepared by an outside

consultant using data that was not

computerized. Furthermore, Carmiel

argues that the information should be

considered verified, regardless of when
10544 Federal Register / Vol. 60, No. 38 / Monday, February 27, 1995 / Notices

it was submitted, because the team

verified the actual prices paid on home

market sales.

Petitioner argues that the Department

should deny Carmiel the adjustment

because the information was submitted

after the deadline for submission of

factual information. Petitioner notes that

Carmiel chose not to report this

information on a timely basis.

DOC Position

We agree with petitioner. Section

353.31(a)(i) of the Department’s

regulations states that the last date

factual information can be submitted for

consideration in a final determination is

‘‘seven days before the scheduled date

on which the verification is to

commence.’’ This information was not

submitted prior to the start of

verification and, therefore, it is

untimely. It also is unclear that the

information was ‘‘inadvertently’’

omitted as Carmiel claims. At

verification, Carmiel officials stated that

they had chosen not to report this

discount because the value of the

discount was insignificant compared to

the amount of work involved. Thus,

even if the Department were to consider

inadvertency as an excuse, it has not

been established in this instance.

Finally, while the Department’s verifiers

did examine several home market sales,

they saw no documentation regarding

these discounts and thus, there is no

basis for considering these discounts to

have been verified.

Comment 3

Carmiel argues that the Department

should calculate the home market credit

expense using a higher interest rate than

that used for the preliminary

determination. Carmiel points out that,

at verification, the team saw evidence of

company borrowing at a much higher

interest rate, indicating that the

company’s home market credit costs

were actually higher than reported.

Using the lower rate to make the credit

adjustment would understate the

company’s expenses. Therefore, the

Department should use either the higher

rate, or an average of the reported rate

and the higher rate.

Petitioner claims that there is no

verified information indicating the

extent of Carmiel’s borrowing which is

taken out at the higher interest rate.

While officials stated that the majority

of Carmiel’s short-term financing was at

the higher rate, this claim was not

substantiated. Additionally, petitioner

argues, rational economic behavior

suggests that the majority of Carmiel’s

financing would be at the lower rates.

Moreover, the Department does not

possess enough verified information to

appropriately weight the two rates in

order to calculate an average. Finally,

petitioner points out that Carmiel chose

to report the lower, more conservative

rate.

DOC Position

Carmiel reported the lower rate in its

response, and we verified this rate.

While we also verified that Carmiel

received some financing at the higher

rate, we do not have verified

information regarding the total amount

of Carmiel’s borrowings at this rate. We

agree with petitioner that without

knowing what portion of Carmiel’s

short-term financing is at the higher

rate, it is not possible to calculate a

relevant average of the two rates.

Therefore, we have used the lower

interest rate reported by respondents in

making the home market credit

adjustment.

Comment 4

Carmiel states that the Department’s

adjustments for VAT in this case are a

misapplication of the statute because

Carmiel reported its home market sales

‘‘net’’ of VAT. Carmiel recognizes that

this adjustment was made as a result of

the CIT decision in Federal-Mogul Corp

v. United States, 15 ITRD 1127 (CIT

1993); however, Carmiel argues that the

court also misinterpreted the statute.

According to Carmiel, the statute only

requires the Department to adjust for

VAT when it is included in or added to

the home market prices reported. Thus,

when the tax is not included in or

added to the prices reported, the

Department should not then add the tax

to FMV. Carmiel claims that adding

VAT to both FMV and USP, as was done

in the preliminary determination,

resulted in significant distortions to

Carmiel’s margin.

Petitioner argues that the Department

appropriately adjusted for VAT by

adding the tax to both FMV and USP

and that this adjustment did not distort

Carmiel’s margins. Petitioner cites

Calcium Aluminate Coment, Cement

Clinker and Flux from France, 59 FR

14136, 14138 25, 1994) in support of the

argument that the Department must

include an adjustment for VAT in the

USP to account for VAT in the home

market. Because respondent has

reported home market sales values

excluding VAT, the Department should

add VAT to the net FMV and USP.

DOC Postition

The statute provides for dumping

determinations to be made on a tax

inclusive basis. Section 772(d)(1)(c) of

the Act provides for an offsetting

adjustment to U.S. price, based on the

presumption that home market prices

include VAT. Accordingly, the

Department has insisted that HM prices

be reported on a VAT inclusive basis

(see 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, May

3, 1989). Allowing respondents to

choose whether to report HM prices net

of taxes would allow them to partially

determine their own dumping margins.

Because respondent reported its home

market sales net of VAT, we have added

the VAT back onto the home market

price and adjusted the USP accordingly.

Comment 5

Petitioner argues that two companies,

Keshta Ltd. (‘‘Keshta’’) and Keshet Steel

Import/Export Company (‘‘Keshet’’), are

so closely related to Carmiel that the

three companies should be treated as

one for the purposes of the final

determination.

Carmiel states that since it reported

the sales of both Keshet and Keshta, the

companies are essentially being treated

as one company. Furthermore, since

Carmiel is the only exporter, Keshet and

Keshta would be subject to the all others

rate (Carmiel’s rate) if they did begin to

export to the United States.

DOC Position

We verified that neither Keshet nor

Keshta made sales to the United States

during the POI. Moreover, we verified

that the sales of both Keshet and Keshta

were included in Carmiel’s home

market sales response. Therefore, the

three companies have been treated as

one company for purposes of this

determination.

Comment 6

Petitioner argues that certain of

Carmiel’s movement expenses are most

likely incurred by value and, thus,

should have been allocated by value

rather than by weight.

Carmiel argues that the results of

allocating by value versus allocating by

weight will be virtually the same given

the small amounts in question and the

fact that the price and weight of the

elbows in question rise proportionately.

Furthermore, Carmiel states that the

costs were allocated according to the

Department’s instructions. Therefore,

the Department should continue to use

the costs as allocated by Carmiel and as

verified by the Department.

DOC Position

We agree with petitioner that marine

insurance and agents fees should have
Federal Register / Vol. 60, No. 38 / Monday, February 27, 1995 / Notices 10545

been allocated by value, rather than

weight. In response to Carmiel’s

assertion that it followed the

Department’s instructions, we note that

the Department’s August 3, 1994

deficiency questionnaire, at page 4,

instructed respondent to allocate

expenses on the basis that they are

incurred. Since these expenses are

incurred by value, they should be

allocated on such basis. Accordingly,

we have reallocated marine insurance

and agents fees by value.

Comment 7

Petitioner states that the payment date

for one home market invoice should be

corrected based on findings at

verification.

Carmiel notes that, while several

payment dates were found to be

incorrect at verification, the payment

date problems were minor and resulted

from the fact that its records are not

computerized. Therefore, correcting the

payment dates will not have a

significant effect. Nonetheless,

respondent states that all of the verified

payment dates should be corrected.

DOC Position

We agree with both petitioner and

respondent. It would be inappropriate to

use payment dates which we know to be

incorrect for the final determination.

Therefore, we have corrected the

misreported payment dates on the

verified sales. We have used these

corrected payment dates to calculate the

home market credit adjustment.

Suspension of Liquidation

We are directing the U.S. Customs

Service to continue to suspend

liquidation of all entries of butt-weld

pipe fittings from Israel, as defined in

the ‘‘Scope of Investigation’’ section of

this notice, that are produced and sold

by Carmiel and that are entered, or

withdrawn from warehouse, for

consumption on or after October 4,

1994.

The Customs Service shall require a

cash deposit or the posting of a bond

equal to the estimated weighted-average

amount by which the foreign market

value of the subject merchandise

exceeds the United States price as

shown below. The suspension of

liquidation will remain in effect until

further notice. The weighted-average

dumping margins are as follows:

Manufacturer/producer/exporter Margin

(percent)

Pipe Fittings Carmiel, Inc. ........ 8.84

All Others .................................. 8.84

Adjustment of Deposit Rate for

Countervailing Duties

Article VI, paragraph 5 of the General

Agreement on Tariffs and Trade

provides that ‘‘[no] product * * * shall

be subject to both antidumping and

countervailing duties to compensate for

the same situation for dumping or

export subsidization.’’ This provision is

implemented by section 772(d)(1)(D) of

the Act. Since antidumping duties

cannot be assessed on the portion of the

margin attributable to export subsidies,

there is no basis to require a cash

deposit or bond for that amount.

Accordingly, the level of export

subsidies as determined in the final

affirmative determination in the

concurrent countervailing duty

investigation of certain carbon steel

butt-weld pipe fittings from Israel,

which was 2.26 percent, will be

subtracted from the margin for cash

deposit or bonding purposes. This

results in a deposit rate of 6.58 percent

for Carmiel and a deposit rate of 6.58

percent for all others.

ITC Notification

In accordance with section 735(d) of

the Act, we have notified the ITC of our

determination.

Notice to Interested Parties

This notice also serves as the only

reminder to parties subject to

administrative protective order (APO) of

their responsibility concerning the

return or destruction of proprietary

information disclosed under APO in

accordance with 19 CFR 353.35(d).

Failure to comply is a violation of the

APO.

This determination is published

pursuant to section 735(d) of the Act (19

U.S.C. 1673(d)).

Dated: February 16, 1995.

Barbara R. Stafford,

Acting Assistant Secretary for Import

Administration.

[FR Doc. 95–4725 Filed 2–24–95; 8:45 am]

BILLING CODE 3510–S–P

[A–533–811]

Notice of Final Determination of Sales

at Less Than Fair Value: Certain

Carbon Steel Butt-Weld Pipe Fittings

From India

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

EFFECTIVE DATE: February 27, 1995.

FOR FURTHER INFORMATION CONTACT: Sue

Strumbel, Office of Countervailing

Investigations, Import Administration,

International Trade Administration,

U.S. Department of Commerce, 14th

Street and Constitution Avenue, NW,

Washington, DC 20230; telephone (202)

482–1442.

Final Determination

We determine that certain carbon

steel butt-weld pipe fittings from India

are being sold in the United States at

less than fair value, as provided in

section 735 of the Tariff Act of 1930, as

amended (the ‘‘Act’’). The estimated

margins shown in the ‘‘Suspension of

Liquidation’’ section of this notice.

Case History

Since the publication of the

preliminary determination in the

Federal Register on October 4, 1994 (59

FR 50562), the following events have

occurred:

On October 5, 1994, Sivanandha Pipe

Fittings Ltd. (Sivanandha) and Karmen

Steels of India (Karmen), requested that

the final determination in this case be

postponed. On November 14, 1994, the

Department published in the Federal

Register a notice postponing the

publication of the final determination in

this case until February 16, 1995 (59 FR

56461).

From October 31 to November 5,

1994, we verified Sivanandha’s and

Karmen’s sales information in Madras,

India.

We received case and rebuttal briefs

on January 23 and January 30, 1995,

respectively, from petitioner and

respondents.

Scope of the Investigation

The products covered by this

investigation are certain carbon steel

butt-weld pipe fittings having an inside

diameter of less than fourteen inches

(355 millimeters), imported in either

finished or unfinished condition. Pipe

fittings are formed or forged steel

products used to join pipe sections in

piping systems where conditions

require permanent welded connections,

as distinguished from fittings based on

other methods of fastening (e.g.,

threaded, grooved, or bolted fittings).

Butt-weld fittings come in a variety of

shapes which include ‘‘elbows,’’ ‘‘tees,’’

‘‘caps,’’ and ‘‘reducers.’’ The edges of

finished pipe fittings are beveled, so

that when a fitting is placed against the

end of a pipe (the ends of which have

also been beveled), a shallow channel is

created to accommodate the ‘‘bead’’ of

the weld which joins the fitting to the

pipe. These pipe fittings are currently

classifiable under subheading

7307.93.3000 of the Harmonized Tariff

Schedule of the United States (HTSUS).

Although the HTSUS subheading is