Federal Register / Vol. 60, No. 72 / Friday, April 14, 1995 / Notices 19019

[A–122–057]

Replacement Parts for Self-Propelled

Bituminous Paving Equipment From

Canada; Final Results of Antidumping

Duty Administrative Review

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

ACTION: Notice of final results of

antidumping duty administrative

review.

SUMMARY: On November 21, 1994, the

Department of Commerce (the

Department) published the preliminary

results of its administrative review of

the antidumping duty order on

replacement parts for self-propelled

bituminous paving equipment from

Canada (59 FR 59993). The review

period is September 1, 1990 through

August 31, 1991. This review involves

one manufacturer/exporter of this

merchandise, the Allatt Paving Division

of Ingersoll-Rand Canada Inc. (Allatt).

After considering the comments

submitted by petitioner and respondent,

we determine the dumping margin for

this period to be 6.86 percent.

EFFECTIVE DATE: April 14, 1995.

FOR FURTHER INFORMATION CONTACT:

Gayle Longest or Kelly Parkhill, Office

of Countervailing Compliance, Import

Administration, International Trade

Administration, U.S. Department of

Commerce, Washington, DC 20230;

telephone: (202) 482–2786.

SUPPLEMENTARY INFORMATION:

Background

On November 21, 1994, the

Department published in the Federal

Register the preliminary results of its

administrative review of the

antidumping duty order on replacement

parts for self-propelled bituminous

paving equipment from Canada (59 FR

59993) covering the period September 1,

1990 through August 31, 1991. This

review involves one manufacturer/

exporter of this merchandise, Allatt. The

Department has now completed this

administrative review in accordance

with section 751 of the Tariff Act of

1930, as amended (the Act).

Scope of the Review

Imports covered by this review are

shipments of replacement parts for selfpropelled bituminous paving

equipment, excluding attachments and

parts for attachments. This merchandise

is currently classifiable under

Harmonized Tariff Schedule (HTS) item

numbers 4016.93.10, 7315.11.00,

7315.89.50, 7315.90.00, 8336.50.00,

8479.99.00, 8481.20.00, 8482.10.10,

8483.90.90, 8539.29.20, 8544.20.00,

8544.41.00, 8544.51.80, 8544.60.20, and

9015.30.40. The HTS item numbers are

provided for convenience and Customs

purposes. The written description

remains dispositive.

Analysis of Comments Received

We gave interested parties an

opportunity to comment on the

preliminary results. We received

comments from the petitioner, BlawKnox, and from the Road Machinery

Division of Ingersoll-Rand, which is the

successor to the respondent.

Comment 1: The petitioner claims

that the Department improperly made

adjustments to foreign market value

(FMV) for pre-sale home market

movement costs through a

circumstance-of-sale adjustment and the

exporter’s sales price (ESP) offset.

Petitioner maintains that these

adjustments are prohibited by the

decision of the Court of Appeals for the

Federal Circuit (the Federal Circuit) in

Ad Hoc Committee of AD–NM–TX–FL

Producers of Gray Portland Cement v.

United States, 13 F.3d 398 (Fed. Cir.

1994).

Respondent maintains that IngersollRand did not claim pre-sale home

market movement charges, and therefore

that the issue is moot. (See

Supplemental Questionnaire Response

dated December 2, 1993, Section B–1

Format Sheets, p. 2).

Department’s Response: We agree

with the respondent. No pre-sale home

market movement charges were claimed

and the Department did not make any

adjustment to FMV for these expenses.

Comment 2: The respondent argues

that the Department incorrectly adjusted

the United States price (USP) to account

for certain home market taxes. The

respondent maintains that the

Department’s current methodology is

the result of the decision of the Court of

International Trade (CIT) in FederalMogul Corp. v. United States, Slip Op.

93–194 (CIT 1993) (Federal-Mogul), in

which the court ordered the Department

to adjust USP by the ad valorem tax rate

at the same point in the chain of

commerce at which the tax is imposed

in the home market. Thus, the

respondent claims that the first step of

the Department’s current tax

methodology, as mandated in FederalMogul, is to increase USP by applying

the home market tax rate to the price of

U.S. sales at the point at which the

product would be taxed in the home

market. According to the respondent,

the second step of the Department’s tax

methodology involves making an

additional deduction to USP and FMV

by multiplying each adjustment by the

ad valorem tax rate. The respondent

disagrees with the second step of the

Department’s methodology because it

believes that the second round of

adjustments does not conform with the

requirement that the Department

calculate accurate margins.

Furthermore, even if these second step

adjustments are warranted, the

respondent maintains that the

Department has not applied the stated

methodology correctly.

According to the respondent, the

Department states in its preliminary

results that the second step of the tax

methodology is made to avoid creating

dumping margins where they would not

exist if no taxes were imposed, in

accordance with Silicomanganese From

Venezuela (59 FR 31205) and Zenith

Electronics Corp. v. United States,

988F.2d 1573 (Fed. Cir. 1993) (Zenith).

The respondent argues that the

Department has misinterpreted the

holding of the Zenith opinion. The

respondent claims that the Zenith

decision does not require the

Department to make specific

adjustments to avoid margin creation

resulting from the multiplier effect.

Furthermore, the respondent argues that

the Department’s current tax

methodology actually increases

dumping margins, which is in conflict

with the Department’s duty to calculate

accurate margins. Despite the CIT’s

decision upholding the Department’s

current tax methodology (see

Independent Radionic Workers of

America v. United States, 862 F. Supp.

422, 426 (CIT 1994); see also Torrington

Co. v. United States, 866 F. Supp. 1434,

1436 (CIT 1994)), the respondent claims

that the statute does not authorize the

second step to the Department’s tax

methodology and that this methodology

has not yet been reviewed by the

Federal Circuit.

In addition, the respondent argues

that even if the Department’s tax

methodology is valid under the law, the

Department did not correctly apply it in

the preliminary results of this case. The

respondent maintains that the second

step tax adjustment is made to eliminate

any residual tax that would have been

included in the ultimate USP or FMV as

a result of movement costs that were

included in the tax base but were later

deducted in deriving the ultimate

comparison price. See Silicomanganese

from Venezuela (59 FR 31205). The

respondent claims that in the

preliminary results the Department

incorrectly made tax adjustments for all

price adjustments, including other price

adjustments that were not deductions.

Specifically, the respondent argues

that the Department made a tax
19020 Federal Register / Vol. 60, No. 72 / Friday, April 14, 1995 / Notices

adjustment to both PP and ESP sales for

the difference-in-merchandise

adjustment (difmer), which is incorrect

because the difmer is an independent

statutory adjustment made to FMV to

account for differences in physical

characteristics when a product sold in

the United States does not have an exact

match with a product sold in the home

market. See 19 U.S.C. § 1677b(a)(4)(C);

19 CFR 353.57. According to the

respondent, because the difmer is not an

adjustment for differences in

circumstances of sale, pursuant to 19

U.S.C. § 1677(a)(4)(B), it should not

affect the tax added to USP or FMV. The

respondent claims that the Department’s

tax adjustment for the difmer is in

conflict with the directive established in

Daewoo Electronics Co., Ltd. v. United

States, 760 F. Supp. 200 (CIT 1991)

(Daewoo), in which it is stated that tax

adjustments are appropriate only to

account for differences in the

circumstances of sale. Thus, the

respondent claims, by making this

inappropriate adjustment to the difmer,

the Department has increased the FMV

unnecessarily, and thereby increased

any dumping margins in comparisons

where the difmer was a positive

number.

Furthermore, the respondent does not

agree with tax adjustments that the

Department made to FMV

corresponding to adjustments that were

added to derive FMV. The respondent

claims that tax adjustments made for

additions to FMV are in conflict with

the Department’s stated policy of

making tax adjustments only for costs

which are deducted from the USP on

which the tax was calculated. Moreover,

the respondent argues that after the

Department makes its tax adjustments

corresponding to deductions, USP and

FMV no longer contain any residual tax

resulting from costs that were a part of

the original tax base. However, when

the Department makes tax adjustments

for costs that it adds to FMV, these costs

result in creating margins that the initial

adjustments were supposed to prevent.

Thus, the respondent maintains, the

Department should only make

adjustments for costs that are deducted

from the original tax base.

Department’s Position: The tax

methodology used in this administrative

review is the Department’s current

administrative practice. See FederalMogul. In Federal-Mogul, the CIT

rejected our revised implementation of

the Act’s instructions on taxes and

prohibited us from applying a purely

tax-neutral margin calculation

methodology. Accordingly, the

Department changed its practice, as

instructed by the CIT, and adjusted USP

for home market tax by multiplying the

home market tax rate by the USP at the

point in the chain of commerce of the

U.S. merchandise that is analogous to

the point in the home market chain of

commerce at which the foreign

government applies the home market

consumption tax, and have added the

result to USP. In accordance with our

tax methodology, we have also deducted

from the USP and FMV those portions

of the respective home market tax and

the USP tax adjustments attributable to

expenses included in the foreign market

and U.S. bases of the tax if those

expenses are later deducted to calculate

FMV and USP. Specifically, we are

deducting the difference between home

market selling expenses and U.S. selling

expenses, whether they are added to or

deducted from FMV. Furthermore, all

adjustments to U.S. price are required to

be multiplied by the tax rate, including

the difmer. These adjustments to the

foreign market tax and the U.S. price tax

adjustment are necessary to prevent the

methodology for calculating the U.S.

price tax adjustment from creating

antidumping duty margins where no

margins would exist if no taxes were

levied upon foreign market sales.

The adjustment to avoid the margin

creation effect is in accordance with the

Federal Circuit’s holding that the

application of the USP tax adjustment

under section 772(d)(1)(C) of the Tariff

Act should not create a dumping margin

if pre-tax FMV does not exceed USP.

See Zenith. In addition, the Federal

Circuit specifically has held that an

adjustment should be made to mitigate

the impact of expenses that are

deducted from FMV and USP upon the

USP tax adjustment and the amount of

tax included in FMV. See Daewoo.

However, the mechanics of the

Department’s adjustments to the U.S.

and foreign market tax amounts as

described above are not identical to

those suggested in Daewoo. With regard

to the respondent’s concern that this

methodology expands the margins, the

Federal Circuit in Zenith held that ‘‘[b]y

engaging in dumping, the exporters

themselves are responsible for the

multiplier effect. The multiplier effect

does not create a dumping margin

where one does not already exist.’’ See

Zenith at 1581–82. For the foregoing

reasons, we have not amended our

treatment of U.S. and home market taxes

for these final results.

Comment 3: The respondent argues

that in calculating the FMV for ESP

sales, the program was incorrect in that

the U.S. packing costs were multiplied

by the absolute amount of tax rather

than multiplied by the tax rate. In

addition, the respondent claims that

when the Department recalculated the

U.S. credit expense for ESP and PP

sales, the Department applied the credit

rate to the unit price, without first

subtracting discounts. Thus, the

respondent maintains that corrections

should be made to the FMV calculation

for ESP sales and to the U.S. credit

expenses. Department’s Position: We agree with

the respondent. We have corrected our

calculations for these inadvertent errors.

Comment 4: The respondent

maintains that there were two different

tax rates in Canada during the review

period: the FST, which was a valueadded tax that was included in the price

of the subject merchandise until

December 31, 1990, and the GST, a

goods and services tax levied after

January 1, 1991, which is not included

in the price charged to the customer.

The respondent argues that in FederalMogul Corp. v. United States, Slip Op.

94–186, 8–9 (CIT, Dec. 7, 1994), the CIT

determined that such home market taxes

should only be applied to the part of the

review period in which the tax was in

effect. The respondent argues that to

prevent the tax rate change from

distorting the dumping margin, the

Department should use the tax rate that

would be applied to the U.S. sale in

comparisons where the tax rates differ

because the sale in one market occurred

in 1990 and the sale in the other market

occurred in 1991.

Department’s Position: We agree that

the home market tax rate should be

adjusted to account for the differences

in tax rates during 1990 and 1991;

however, we disagree with respondent’s

proposal to use the tax rate that would

be applied to the U.S. sale in

comparisons where the tax rates differ.

To account for the differences in the tax

rates during the two periods, the

Department instead derived a weightedaverage tax rate for the period of review

based on the volume of home market

sales made during 1990 and 1991. In our

calculations for these final results, we

have used the home market weightedaverage tax rate specific to the period of

review for all comparisons of home

market and U.S. sales.

Final Results of Review

We determine the following dumping

margin to exist for the period September

1, 1990 through August 31, 1991:

Manufacturer/exporter Margin

(percent)

Allatt (Ingersoll-Rand) ............. 6.86

The Department will instruct the

Customs Service to assess antidumping

duties on all appropriate entries.
Federal Register / Vol. 60, No. 72 / Friday, April 14, 1995 / Notices 19021

Individual differences between USP and

FMV may vary from the percentages

stated above. The Department will issue

appraisement instructions directly to

the Customs Service.

Furthermore, the following deposit

requirements will be effective upon

publication of these final results of

administrative review for all shipments

of the subject merchandise, entered, or

withdrawn from warehouse, for

consumption as provided by section

751(a)(1) of the Tariff Act: (1) The cash

deposit rate for the reviewed company

will be the rate as listed; (2) for

previously reviewed or investigated

companies not listed above, the cash

deposit rate will continue to be the

company-specific rate published for the

most recent period; (3) if the exporter is

not a firm covered in this review, a prior

review, or the original less-than-fairvalue investigation, but the

manufacturer is, the cash deposit rate

will be the rate established for the most

recent period for the manufacturer of

the merchandise; and (4) cash deposits

for all other manufacturers or exporters

will be 20.12 percent. This is the ‘‘new

shipper’’ rate established during the first

final results published by the

Department in the Federal Register on

February 16, 1982 (47 FR 6681). We

have determined that this rate is the

appropriate rate, because we are unable

to ascertain the ‘‘all others’’ rate from

the Treasury less-than-fair-value

investigation. These deposit

requirements shall remain in effect until

publication of the final results of the

next administrative review.

This notice also serves as a final

reminder to importers of their

responsibility under 19 CFR 353.26 to

file a certificate regarding the

reimbursement of antidumping duties

prior to liquidation of the relevant

entries during this review period.

Failure to comply with this requirement

could result in the Secretary’s

presumption that reimbursement of

antidumping duties occurred and

subsequent assessment of double

antidumping duties.

This notice also serves as the only

reminder to parties subject to

administrative protective order (APO) of

their responsibilities concerning the

return or destruction of proprietary

information disclosed under APO in

accordance with 19 CFR 353.34(d).

Failure to comply is a violation of the

APO.

This administrative review and notice

are in accordance with section 751(a)(1)

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

CFR 353.22.

Dated: April 7, 1995.

Susan G. Esserman,

Assistant Secretary for Import

Administration.

[FR Doc. 95–9274 Filed 4–13–95; 8:45 am]

BILLING CODE 3510–DS–P

[C–201–003]

Ceramic Tile From Mexico; Final

Results of Countervailing Duty

Administrative Review

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

ACTION: Notice of final results of

countervailing duty administrative

review.

SUMMARY: On November 10, 1994, the

Department of Commerce (the

Department) published in the Federal

Register its preliminary results of

administrative review of the

countervailing duty order on ceramic

tile from Mexico (59 FR 56057) for the

period January 1, 1992 through

December 31, 1992. We have now

completed this review and determine

the total bounty or grant to be zero or

de minimis for 32 companies, and 2.08

percent ad valorem for all other

companies. In accordance with 19 CFR

355.7, any rate less than 0.5 percent ad

valorem is de minimis. We will instruct

the U.S. Customs Service to assess

countervailing duties as indicated

above.

EFFECTIVE DATE: April 14, 1995.

FOR FURTHER INFORMATION CONTACT:

Gayle Longest or Kelly Parkhill, Office

of Countervailing Compliance, Import

Administration, International Trade

Administration, U.S. Department of

Commerce, 14th Street and Constitution

Avenue, NW., Washington, DC 20230;

telephone: (202) 482–2786.

SUPPLEMENTARY INFORMATION:

Background

On November 10, 1994, the

Department published in the Federal

Register (59 FR 56057) the preliminary

results of its administrative review of

the countervailing duty order on

ceramic tile from Mexico (47 FR 20012;

May 10, 1982). The Department has now

completed this administrative review in

accordance with section 751 of the

Tariff Act of 1930, as amended (the Act).

We invited interested parties to

comment on the preliminary results. On

December 12, 1994, a case brief was

submitted by Ceramica Regiomontana,

S.A., a producer of the subject

merchandise which exported ceramic

tile to the United States during the

review period (respondent).

The review period is January 1, 1992,

through December 31, 1992. This review

involves 33 companies and the

following programs:

(1) BANCOMEXT Financing for

Exporters;

(2) The Program for Temporary

Importation of Products used in the

Production of Exports (PITEX);

(3) Other BANCOMEXT preferential

financing;

(4) Other Dollar-Denominated Financing

Programs;

(5) Fiscal Promotion Certificates

(CEPROFI);

(6) Import duty reductions and

exemptions;

(7) State tax incentives;

(8) Article 15 Loans;

(9) NAFINSA FONEI-type financing;

and

(10) NAFINSA FOGAIN-type financing.

In accordance with the recent Court of

International Trade (CIT) decision in

Ceramica Regiomontana, S.A. et al. v.

United States, Slip Op. 94–74, the

Department is changing the rate of 2.55

percent ad valorem preliminarily

assigned to Ceramica Regiomontana to

the country-wide rate of 2.08 percent ad

valorem.

Applicable Statute and Regulations

The Department is conducting this

administrative review in accordance

with section 751(a) of the Act. Unless

otherwise indicated, all citations to the

statute and to the Department’s

regulations are in reference to the

provisions as they existed on December

31, 1994.

Scope of Review

Imports covered by this review are

shipments of Mexican ceramic tile,

including non-mosaic, glazed, and

unglazed ceramic floor and wall tile.

During the review period, such

merchandise was classifiable under the

Harmonized Tariff Schedule (HTS) item

numbers 6907.10.0000, 6907.90.0000,

6908.10.0000, and 6908.90.0000. The

HTS item numbers are provided for

convenience and Customs purposes.

The written description remains

dispositive.

Calculation Methodology for

Assessment and Cash Deposit Purposes

We calculated the total bounty or

grant on a country-wide basis by first

calculating the bounty or grant for each

company subject to the administrative

review. We then weight-averaged the

rate received by each company using as

the weight its share of total Mexican

exports to the United States of the