[Federal Register Volume 61, Number 19 (Monday, January 29, 1996)]
[Notices]
[Pages 2792-2797]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-1456]



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

DEPARTMENT OF COMMERCE
International Trade Administration
[A-405-802]


Certain Cut-To-Length Carbon Steel Plate From Finland: 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 July 18, 1995, the Department of Commerce (the Department) 
published the preliminary results of the administrative review of the 
antidumping duty order on certain cut-to-length carbon steel plate from 
Finland. This review covers one manufacturer/exporter of the subject 
merchandise to the United States during the period of review (POR), 
February 4, 1993, through July 31, 1994. We gave interested parties an 
opportunity to comment on our preliminary results. Based on our 
analysis of the comments received, we have changed the results from 
those presented in the preliminary results of review.

EFFECTIVE DATE: January 29, 1996.

FOR FURTHER INFORMATION CONTACT: Nancy Decker or Robin Gray, Office of 
Agreements Compliance, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, N.W., Washington, D.C. 20230; telephone: (202) 
482-3793.

SUPPLEMENTARY INFORMATION:

Background

    On July 18, 1995, the Department published in the Federal Register 
(60 FR 36776) the preliminary results of the administrative review of 
the antidumping duty order on certain cut-to-length carbon steel plate 
from Finland (58 FR 44165, August 19, 1993). The Department has now 
completed this administrative review in accordance with section 751 of 
the Tariff Act of 1930, as amended (the Act).

Applicable Statute and Regulations

    Unless otherwise stated, all citations to the statute and to the 
Department's regulations are references to the provisions as they 
existed on December 31, 1994.

Scope of This Review

    The products covered by this administrative review constitute one 
``class or kind'' of merchandise: certain cut-to-length carbon steel 
plate. These products include hot-rolled carbon steel universal mill 
plates (i.e., flat-rolled products rolled on four faces or in a closed 
box pass, of a width exceeding 150 millimeters but not exceeding 1,250 
millimeters and of a thickness of not less than 4 millimeters, not in 
coils and without patterns in relief), of rectangular shape, neither 
clad, plated nor coated with metal, whether or not painted, varnished, 
or coated with plastics or other nonmetallic substances; and certain 
hot-rolled carbon steel flat-rolled products in straight lengths, of 
rectangular shape, hot rolled, neither clad, plated, nor coated with 
metal, whether or not painted, varnished, or coated with plastics or 
other nonmetallic substances, 4.75 millimeters or more in thickness and 
of a width which exceeds 150 millimeters and measures at least twice 
the thickness, as currently classifiable in the Harmonized Tariff 
Schedule (HTS) under item numbers 7208.31.0000, 7208.32.0000, 
7208.33.1000, 7208.33.5000, 7208.41.0000, 7208.42.0000, 7208.43.0000, 
7208.90.0000, 7210.70.3000, 7210.90.9000, 7211.11.0000, 7211.12.0000, 
7211.21.0000, 7211.22.0045, 7211.90.0000, 7212.40.1000, 7212.40.5000, 
and 7212.50.0000. Included are flat-rolled products of nonrectangular 
cross-section where such cross-section is achieved subsequent to the 
rolling process (i.e., products which have been ``worked after 
rolling'')--for example, products which have been beveled or rounded at 
the edges. Excluded is grade X-70 plate. These HTS item numbers are 
provided for convenience and Customs purposes. The written description 
remains dispositive.
    The POR is February 4, 1993, through July 31, 1994. This review 
covers entries 

[[Page 2793]]
of certain cut-to-length carbon steel plate by Rautaruukki Oy 
(Rautaruukki).

Consumption Tax Methodology

    In light of the Federal Circuit's decision in Federal Mogul v. 
United States, CAFC No. 94-1097, the Department has changed its 
treatment of home market consumption taxes. Where merchandise exported 
to the United States is exempt from the consumption tax, the Department 
will add to the U.S. price the absolute amount of such taxes charged on 
the comparison sales in the home market. This is the same methodology 
that the Department adopted following the decision of the Federal 
Circuit in Zenith v. United States, 988 F. 2d 1573, 1582 (1993), and 
which was suggested by that court in footnote 4 of its decision. The 
Court of International Trade (CIT) overturned this methodology in 
Federal Mogul v. United States, 834 F. Supp. 1391 (1993), and the 
Department acquiesced in the CIT's decision. The Department then 
followed the CIT's preferred methodology, which was to calculate the 
tax to be added to U.S. price by multiplying the adjusted U.S. price by 
the foreign market tax rate; the Department made adjustments to this 
amount so that the tax adjustment would not alter a ``zero'' pre-tax 
dumping assessment.
    The foreign exporters in the Federal Mogul case, however, appealed 
that decision to the Federal Circuit, which reversed the CIT and held 
that the statute did not preclude Commerce from using the ``Zenith 
footnote 4'' methodology to calculate tax-neutral dumping assessments 
(i.e., assessments that are unaffected by the existence or amount of 
home market consumption taxes). Moreover, the Federal Circuit 
recognized that certain international agreements of the United States, 
in particular the General Agreement on Tariffs and Trade (GATT) and the 
Tokyo Round Antidumping Code, required the calculation of tax-neutral 
dumping assessments. The Federal Circuit remanded the case to the CIT 
with instructions to direct Commerce to determine which tax methodology 
it will employ.
    The Department has determined that the ``Zenith footnote 4'' 
methodology should be used. First, as the Department has explained in 
numerous administrative determinations and court filings over the past 
decade, and as the Federal Circuit has now recognized, Article VI of 
the GATT and Article 2 of the Tokyo Round Antidumping Code required 
that dumping assessments be tax-neutral. This requirement continues 
under the new Agreement on Implementation of Article VI of the General 
Agreement on Tariffs and Trade. Second, the URAA explicitly amended the 
antidumping law to remove consumption taxes from the home market price 
and to eliminate the addition of taxes to U.S. price, so that no 
consumption tax is included in the price in either market. The 
Statement of Administrative Action (p. 159) explicitly states that this 
change was intended to result in tax neutrality.
    While the ``Zenith footnote 4'' methodology is slightly different 
from the URAA methodology, in that section 772(d)(1)(C) of the pre-URAA 
law required that the tax be added to United States price rather than 
subtracted from home market price, it does result in tax-neutral duty 
assessments. In sum, the Department has elected to treat consumption 
taxes in a manner consistent with its longstanding policy of tax-
neutrality and with the GATT.

Analysis of Comments Received

    We gave interested parties an opportunity to comment on the 
preliminary results. We received case and rebuttal briefs from 
Rautaruukki (the respondent) and petitioners. Petitioners requested a 
public hearing but subsequently withdrew their request for a hearing. 
Therefore, no hearing was held.
    Comment 1: Petitioners argue that best information available (BIA) 
must be used for Finnsteel's costs. According to petitioners, 
Rautaruukki admitted that Finnsteel, its U.S. selling subsidiary, was 
involved in the U.S. sales of subject merchandise. Petitioners claim 
that nonetheless Rautaruukki failed to report any of Finnsteel's costs 
on sales of subject merchandise. Although Rautaruukki subsequently 
claimed that Finnsteel is not actively involved in the sales to the 
U.S. of the subject merchandise, petitioners note Rautaruukki could not 
substantiate its claim at verification. Petitioners argue that the 
Department failed to include Finnsteel's costs in calculating the 
preliminary results. Petitioners contend that expenses were incurred by 
Finnsteel as a direct result of specific sales. Finnsteel would not 
perform such activities absent specific sales of subject merchandise. 
Petitioners argue that the expenses could have been tied to specific 
sales--if Rautaruukki and Finnsteel had kept adequate records. 
Rautaruukki should have separated and reported Finnsteel's direct 
expenses for these services. Since it failed to do so, the Department 
cannot determine which of Finnsteel's costs are direct. Since at least 
some of Finnsteel's costs were direct selling expenses, the Department 
must assign BIA to those unreported expenses. The Department should 
follow its standard practice and assume all of Finnsteel's expenses 
were direct expenses. Since Finnsteel's selling expenses were either 
not reported or not reported separately, the Department should use the 
reported indirect selling expense as BIA for direct selling expenses.
    Respondent counters that there is no evidence on the record that 
Finnsteel is actively involved in the sales of the subject merchandise 
in this administrative review. Rautaruukki explained in its response 
that its U.S. sales during the POR were made directly from 
Rautaruukki's Raahe Steel Works to the unrelated customer. Respondent 
notes the verification report states that Rautaruukki reported that it 
handled all of the transactions and all activity related to the sale of 
subject merchandise from Finland. Respondent also notes that the 
Department also found that all documentation examined at verification 
only listed Rautaruukki and the U.S. customer. Also, the unrelated U.S. 
customer submitted a sworn affidavit confirming that it purchased the 
subject merchandise directly from Rautaruukki during the POR. 
Respondent notes that although Finnsteel acted as a ``communications 
link'' for sales of subject merchandise during the POR, Finnsteel's 
role did not rise to the level of active participation in the sales 
process to warrant treating the U.S. sales as exporter's sales price 
(ESP) transactions. Respondent argues that the record in this 
administrative review clearly demonstrates that Finnsteel acted only as 
a communications link with the unrelated customer. Therefore, the U.S. 
sales in this administrative review were purchase price, and no further 
adjustment is warranted.
    Department's Position: We agree with respondent. Respondent 
reported that normally transactions are handled through Finnsteel; 
however, sales of subject merchandise made to the U.S. during the POR 
were exclusively handled by Rautaruukki. At verification, we found no 
evidence of Finnsteel's involvement in the sales of subject merchandise 
during the POR. All documents examined supported the conclusion that 
Finnsteel did not participate in these transactions. Sales were made 
directly from Rautaruukki to the U.S. customer. Because of the lack of 
evidence of Finnsteel's involvement, we cannot assume Finnsteel 
incurred costs on the sales of subject merchandise to the United States 
during the POR. Therefore, the Department is 

[[Page 2794]]
not making a sales adjustment for Finnsteel's costs in these final 
results.
    Comment 2: Petitioners argue that the Department must correct two 
errors in the margin calculation program. Due to one of the errors, the 
Department's sales below cost test for the preliminary results used a 
cost of manufacture (COM) that was only a fraction of the true COM. One 
line read ``TOTCOM2 = FOREX = TOTCOM1'', while it should have read 
``TOTCOM2 = FOREX + TOTCOM1''. The second error occurred in the 
calculation of home market selling expenses for use in cost (SELLCOP). 
Petitioners contend the Department failed to include certain expenses, 
which were reported in the other expense field, in the calculation of 
SELLCOP.
    Respondent argues that the Department's margin calculation program 
is correct. The Department gave interested parties a chance to comment 
on the proposed programming language in October 1994. Petitioners 
submitted comments in that same month. The petitioners' attempt to 
present new comments regarding the Department's computer programming 
language is untimely and should be rejected on that basis. Moreover, 
the Department's margin calculation program is correct and needs no 
adjustments.
    Department's Position: We agree with the petitioners. The 
programming language that was released for comments in October 1994 was 
preliminary and was not company specific. Both of the errors that the 
petitioners have claimed are related to company specific programming. 
In these final results, we have changed the program to read ``TOTCOM2 = 
FOREX + TOTCOM1''. This error resulted in incorrect cost test results. 
However, the Department's May 18, 1995, analysis memo and the Federal 
Register notice of the preliminary results in this administrative 
review did not reflect the incorrect cost results. After correcting the 
errors, the Department did in fact find sales below cost for 
Rautaruukki in this administrative review. Therefore, the discussion of 
sales below cost found in the preliminary notice and the May 18, 1995 
analysis memo is consistent with the corrected, final cost test 
results. Finally, while we have not allowed a direct sales adjustment 
for the other expense field as discussed in the preliminary results, we 
have included this other expense field in the calculation of SELLCOP 
for these final results because these are costs incurred.
    Comment 3: Petitioners argue that Rautaruukki incorrectly reported 
its general and administrative expenses (G&A). The Department has a 
long-standing practice of requiring G&A expenses to be reported as a 
percentage of cost of sales. Also, the G&A factor is normally 
calculated using G&A recorded in the company's audited financial 
statements for the year that most closely corresponds to the POR (see 
Furfuryl Alcohol from Thailand, 60 FR 22557, 22560-61 (May 8, 1995)). 
Petitioners argue that Rautaruukki did not use the regular methodology 
accepted by the Department. It based G&A on 1993 data and data from 
eight months of 1994, and it calculated a per ton G&A amount. 
Petitioners maintain this is erroneous in two respects. First, it did 
not use data from the audited financial statements (the 1994 data was 
from an interim financial statement which was not audited). The 1994 
data constitutes the type of part-year data the Department does not use 
because G&A expenses are incurred sporadically throughout the fiscal 
year or are based on estimates that are adjusted to actual at year-end. 
Second, the calculation is a per ton G&A amount, rather than a factor 
that is a percentage of cost, as required by the questionnaire and 
Department practice. The Department should recalculate the G&A expense 
using Rautaruukki's 1993 audited financial statements and other 
verified 1993 information.
    Respondent argues that it correctly reported G&A expenses and that 
the cost verification report states that the Department verified all 
appropriate expenses for Raahe were included in G&A and that the 
appropriate methodologies were applied. Furthermore, respondent claims 
the Department found no discrepancies between the Group profit and loss 
report and the reported consolidated financial statements. Respondent 
notes in support of its argument for using an annual G&A factor, 
petitioners reference cases which are antidumping investigations and 
not administrative reviews. Respondent contends that petitioners 
reliance on these investigations is misplaced when applied to this 
administrative review. In an investigation where sales span a six-month 
period, the Department generally looks to a full-year period in 
computing G&A, because such a period encompasses operating results over 
a longer time span than the period of investigation and typically 
reports the results of at least one business cycle. In this 
administrative review, the POR covers an eighteen month period, and 
Rautaruukki provided annual and interim financial reports which are 
prepared in the ordinary course of business. Respondent claims these 
reports cover the entirety of the POR; therefore, they represent the 
most complete and accurate information available, and they exceed the 
standard of Furfuryl Alcohol from Thailand.
    Department's Position: We agree with petitioners. It is our 
standard practice to base G&A on an amount derived from annual audited 
financial statements and to calculate it as a percentage of cost rather 
than a per ton amount. See Final Determination of LTFV: Certain Hot-
Rolled Carbon Steel Flat Products, Certain Cold-Rolled Carbon Steel 
Flat Products, Certain Corrosion-Resistant Carbon Steel Flat Products, 
and Certain Cut-to-Length Carbon Steel Plate From Canada, 58 FR 37099 
(July 9, 1993)(Comment #43). The fact that this is an administrative 
review, rather than an investigation, has no relevance. The 1994 data 
used by Rautaruukki is still partial year data based on unaudited 
financial statements. We do not use partial year data because G&A 
expenses are often incurred sporadically throughout the year and are 
often accrued based on estimates until they are adjusted to actual at 
year-end. It is also our standard practice to calculate G&A based on a 
percentage of cost, rather than a per ton amount because G&A expenses 
are more closely associated with costs than with weight. Id. Therefore, 
we have recalculated G&A for Rautaruukki as a percentage of cost using 
only 1993 data from Rautaruukki's audited financial statements. 
Regarding Rautaruukki's argument that the Department verified their G&A 
expense, the Department's verification confirmed that all appropriate 
expenses were included in the reported G&A. The verification report 
statements that the allocation methodology was verified only indicated 
that the figures and methodology reported by Rautaruukki accurately 
traced to their books and records. This allocation methodology is not 
that traditionally utilized by the Department in allocating G&A.
    Comment 4: Petitioners argue that the interest expense factor was 
calculated using the same methodology used for the G&A factor, and thus 
suffers from the same flaws as the G&A factor. Additionally the 
unaudited 1994 amount used in the interest expense calculation suffers 
from an additional flaw--it is incorrect because Rautaruukki 
erroneously deducted short-term interest that it paid. Instead, 
petitioners argue the Department should take Rautaruukki's 1993 
consolidated interest expense less dividend income, divided by total 
cost of goods sold less selling expenses. Petitioners claim this is a 
conservative interest expense factor highly favorable to Rautaruukki 
because it assumes all interest income is short-

[[Page 2795]]
term, which the Department did not verify, and only Rautaruukki's G&A 
(rather than consolidated G&A, which is not on the record) is deducted, 
which results in a larger denominator and thus a lower factor.
    Respondent argues that it correctly reported its interest expenses. 
For the reasons stated in Comment three above, Rautaruukki correctly 
reported its interest expenses by providing the Department with the 
most complete and accurate information available. Additionally, 
petitioners' interest expense factor calculation is flawed. The net 
financial expense figure is grossly overstated because petitioners' 
figure includes currency exchange differences as interest expenses.
    Department's Position: We agree with petitioners in part. As with 
G&A expenses, it is our standard practice to base interest expense on 
an amount derived from audited consolidated annual financial statements 
and to calculate interest expense as a percentage of cost See e.g. 
Preliminary Determination of Sales at LTFV: Grain-Oriented Electrical 
Steel from Italy, 59 FR 5991 (1994). Furthermore, the choice of 
allocation methodologies is left to the Department's discretion. See 
PPG Industries v. United States 746 F. Supp. 119 (CIT 1990). The 1994 
data used by Rautaruukki is partial year data based on unaudited 
financial statements. Therefore, we have recalculated interest expense 
for Rautaruukki using only 1993 data.
    We also agree with respondent in part that the petitioners' figure 
is overstated because it contains currency exchange differences as 
interest expense. To calculate interest expense for the final results, 
we have used the interest expense examined at verification, which is 
based on the consolidated financial statements, divided by consolidated 
cost of sales taken directly from the consolidated financial statements 
in the annual report.
    Comment 5: Respondent argues that the Department erred in 
collapsing home market control numbers (CONNUMHs) IO6X and TA6X and 
thereby made incorrect product matches. The questionnaire established a 
hierarchy of product characteristics that the Department would use in 
identifying individual plate products. Each unique combination of these 
characteristics is treated as a distinct product. The Department 
discovered instances where multiple control numbers were being assigned 
to the same set of product characteristics. The Department collapsed 
CONNUMHs IO6X and TA6X, which it understood had identical product 
characteristics. These were matched to the U.S. sales of CONNUMU IO6X. 
In doing so, the Department mistakenly matched sales of beveled plate 
to sales of plate which had not undergone the further manufacturing 
process required to produce beveled plate. In terms of quality, the two 
product control numbers are identical. CONNUMs starting with IO through 
LL represent basic cut-to-length plates which are not painted, and 
CONNUMs starting with RA through UX represent plates with a beveled 
edge. Beveled plate is produced only after an additional manufacturing 
process, which is performed on a separate production line. It incurs 
additional costs which must be taken into consideration in 
Rautaruukki's pricing decisions. These additional costs are reflected 
in Rautaruukki's home market database. In collapsing these control 
numbers, respondent argues the Department incorrectly collapsed two 
products with different product characteristics. In so doing, 
respondent claims the Department incorrectly compared sales of beveled 
plate in the home market with sales of normal plate in the U.S. market.
    Petitioners counter that the Department correctly collapsed 
CONNUMHs IO6X and TA6X. Nowhere in its brief does Rautaruukki identify 
the product characteristics which it believes are different for the two 
CONNUMHs. This is because there are no product characteristics that are 
different. According to petitioners a review of the products in IO6X 
and TA6X shows that they are identical for the eight physical 
characteristics identified by the questionnaire. By separating the 
products in CONNUMHs IO6X and TA6X, Rautaruukki introduced into a 
primary place in the hierarchy a product characteristic--beveling--that 
was not selected by the Department. Petitioners argue such unilateral 
modification of the Department's hierarchy should not be permitted. 
When the Department gave interested parties an opportunity to comment 
on the model match hierarchy in August 1994, Rautaruukki submitted 
comments. Those comments did not contain a single reference to 
beveling. In fact, no interested parties identified beveling as a 
physical characteristic that ought to be included in the plate 
hierarchy. Petitioners contend Rautaruukki had ample opportunity to 
suggest any modifications it believed to be necessary and suggest 
Rautaruukki simply ignored the Department's hierarchy and created its 
own. In doing so, petitioners argue Rautaruukki attempted to usurp the 
Department's statutory duty to determine what constitutes identical 
merchandise.
    Department's Position: We agree with petitioners. On August 12, 
1994, the Department solicited comments on the proposed model matching 
criteria. On August 26, 1994, Rautaruukki filed comments. However, 
Rautaruukki's comments did not propose beveling as a relevant 
characteristic to use in product matching. Furthermore, in its 
questionnaire response and supplemental response Rautaruukki failed to 
establish the relevance of beveling as a product matching criteria. 
Therefore, the Department has no basis upon which to differentiate 
beveled plate from non-beveled plate for matching and price comparison 
purposes. The Department has broad discretion to devise the methodology 
for determining the model match methodology as confirmed by the Courts 
in Torrington Co. v. United States, 881 F. Supp. 622, 635 (CIT 1995) 
and Smith-Corona Group v. United States, 713 F.2d 1568 (Fed. Cir. 
1983), cert. denied, 465 U.S. 1022 (1984). Furthermore, beveled plate 
does not possess physical characteristics which make it unique from 
non-beveled plate with regard to applications and uses. We have 
therefore continued to collapse IO6X and TA6X.
    Comment 6: Respondent argues the Department should compare U.S. 
sales to a trading company to home market sales to end-users. In its 
preliminary results, the Department reclassified the levels of trade in 
the home market database by collapsing sales to and sales through 
wholesalers into a single lot. It matched this collapsed level of trade 
with the level of trade reported in the U.S. market (sales to a trading 
company). Respondent claims the Department should have compared U.S. 
sales to home market sales to end-users for the following reasons: 
Rautaruukki has a closer relationship with the wholesalers/distributors 
in the home market; the home market wholesalers/distributors have a 
common inventory system whereas for U.S. sales, Rautaruukki does not 
know the ultimate customer in the United States, and therefore no 
common inventory system can exist; the home market wholesalers/
distributors hold and fill orders from inventory unlike either the U.S. 
customer or the home market end-user; home market wholesalers/
distributors are eligible for certain rebates, for which the U.S. 
customer and home market end-users are not; respondent argues the sales 
verification report states that since there is no inventory for 
purchase price sales to the U.S., the customer level of trade for the 
two markets should be 

[[Page 2796]]
different; since respondent claims it does not know the ultimate 
customer, it considers its U.S. customer as an end-user; and plate with 
identical CONNUMs were sold both to the U.S. customer and to end-users 
in the home market.
    The respondent further argues that in an antidumping investigation, 
the Department normally calculates foreign market value (FMV) and U.S. 
price (USP) based on the same commercial level of trade. The Department 
normally asks if the levels of trade reported by the respondent are in 
fact distinct and discernable, based on the respondent's explanation of 
their functions. Respondent notes that while the Department often 
matches according to customer type (see Stainless Steel Hollow Products 
from Sweden, 58 FR 69,332), this is not always the case (see 
Antifriction Bearings from France, 58 FR 39,768). In the instant case, 
the respondent argues that the U.S. customer is the functional 
equivalent to an end-user in the home market because: (1) Rautaruukki 
does not know the ultimate customer in the U.S. market; (2) the same 
product is sold to home market end-users and to the U.S. customer; (3) 
neither the home market end-users nor the U.S. customer qualify for the 
rebate; and (4) the home market end-users and the U.S. customer do not 
hold inventory or share a common inventory system. In Stainless Steel 
Bar from Spain (59 FR 66931), the Department accepted level of trade 
classifications based upon when the customer wanted delivery. These 
were distinguished by which party bore the costs and risks of 
maintaining a finished goods inventory. In the instant administrative 
review, respondent argues that sales to the United States should be 
compared with sales to home market end-users because, unlike 
wholesales/distributors in the home market, neither bears the cost of 
maintaining inventory.
    Petitioners argue that Rautaruukki's complaints are without merit. 
The criteria for determining level of trade comparability are the 
extent to which the customers: (1) perform equivalent functions in 
their respective markets, and/or (2) are positioned in equivalent 
positions in the chain of distribution from the manufacturer to the 
ultimate customer (see Disposable Pocket Lighters from Thailand, 60 FR 
14263, 14264 (March 16, 1995)). By these criteria, petitioners maintain 
there is clearly a close correspondence between the U.S. trading 
company and the home market wholesalers/distributors--both are 
Rautaruukki's first unrelated customer in a particular market, and both 
sell directly to the ultimate customer. In both cases, petitioners note 
that Rautaruukki invoices the distributor, which then in turn 
separately invoices its own customer (the end-user). The nearly 
congruent function and position of the U.S. trading company and the 
home market wholesalers/distributors are illustrated in Rautaruukki's 
own distribution channel flow charts for the two markets. They are 
virtually carbon copies of each other, and at one point, the U.S. 
trading company is referred to as a distributor. Given the verified 
facts, petitioners maintain the Department was correct in its decision, 
which was in accordance with its long-standing practice and regulations 
that require the FMV/USP comparisons to be made at the same or most 
comparable level of trade.
    Petitioners further argue that it is the respondent's burden to 
show there are discernable functions that would make its proposed 
matching level a better choice than the Department's choice. Of the 
four points raised by the respondent in making their argument, the 
first three do not relate in any way to the functions performed by the 
buyer and, therefore are irrelevant to the determination of level of 
trade. The fact that Rautaruukki does not know its distributor's end-
user customers in the United States says nothing about the 
distributor's functions, or those of home market end-users. Even if the 
point were relevant, Rautaruukki also does not know the end-user 
purchaser on many of its sales to home market distributors. There is no 
precedent for the payment of rebates being relevant to the functions of 
a customer or its position in the chain of distribution. The fact that 
plate with the same CONNUMs was sold to both the U.S. customer and to 
end-users in the home market is in no way indicative of the functions 
performed by any customer. Moreover, sales of identical merchandise 
were also made to distributors in the home market.
    Petitioners continue that this reduces Rautaruukki's argument to 
the claim that home market end-users and the U.S. customer do not hold 
inventory or share a common inventory system. Even if true, this claim 
alone would not be a basis to reverse the Department's decision. In any 
event, the facts on the record do not support Rautaruukki's assertion 
that the U.S. buyer does not hold inventory. There is no reason for the 
Department to reverse its decision.
    Department's Position: We agree with the petitioners. The 
Department's practice in finding similar levels of trade in each market 
requires a comparison of customers in each of the markets to determine 
whether they perform equivalent functions in their respective markets, 
and/or are in equivalent positions in the chain of distribution from 
the manufacturer to the ultimate customer. See Antifriction Bearings 
(Other Than Tapered Roller Bearings) and Parts Thereof From France, et 
al.; Final Results of Antidumping Duty Administrative Reviews, Partial 
Termination of Administrative Review, and Revocation in Part of 
Antidumping Duty Orders, 60 FR 10900, 10940-41 (February 28, 1995) 
(Issue 9, Comment 3). For Rautaruukki, the U.S. trading company and the 
home market wholesalers/distributors function at similar levels of 
trade. They are the first unrelated customer and both sell directly to 
the ultimate customer. For both markets, Rautaruukki's distributor 
invoices the end-user, while Rautaruukki invoices the distributor. The 
respondent did not demonstrate any functions, which differentiate the 
level of trade for wholesalers/distributors in the home market and the 
trading company in the U.S., to illustrate an alternate level of trade 
is necessary. The first three factors cited by the respondent are not 
elements normally considered by the Department in determining level of 
trade. Nor does the respondent provide any compelling reason why the 
Department should consider those factors in this instance. The 
respondent's first issue, that Rautaruukki does not know the U.S. 
trading company's end-user customers, does not illustrate the functions 
of the U.S. trading company or the home market end-users. In fact, 
Rautaruukki also claims it does not know the end-user purchasers on 
many of its sales to home market distributors yet Rautaruukki argues 
that these sales would be at a different level of trade. With regard to 
the third point, the Department does not consider either rebates or the 
fact that the same products are sold to home market end-users and to 
the U.S. customer as relevant to the functions of a customer or its 
position in the chain of distribution. As for the fourth point, while 
the U.S. customer may not have a common inventory system, there is 
nothing on the record to indicate that the U.S. customer does not hold 
any inventory. Therefore, we are continuing to match U.S. sales to the 
trading company with home market sales to/through wholesalers/
distributors.
    Comment 7: The respondent argues that it correctly reported rebates 
which were successfully verified by the Department. However, in the 
preliminary results, the Department denied Rautaruukki's reported 
rebate to 

[[Page 2797]]
certain home market wholesalers/distributors because Rautaruukki's 
computer tape reported these rebates to a different number of home 
market wholesalers/distributors than were identified in the narrative 
response. Respondent argues that part of this discrepancy is explained 
by the fact that certain companies merged. Respondent also argues that 
although certain home market wholesalers/distributors were not 
specifically identified in the narrative response, Rautaruukki did 
submit the relevant information in the home market sales database. 
Accordingly respondent argues the Department should allow the 
adjustment.
    The petitioners argue that the denial of these rebates was correct. 
Petitioners note that the Department verified the number of companies 
that received this rebate as reported in the narrative response, not as 
reported in the home market sales tape. Accordingly, petitioners 
maintain Rautaruukki's argument adds nothing new to this issue--their 
brief cites to no evidence on the record that one of the companies 
received the rebate, and Rautaruukki admits that it never specifically 
identified another company in its narrative response. Therefore, 
petitioners argue the Department should continue to exclude the rebate 
amounts on sales to certain companies in the final results.
    Department's Position: We agree with respondent that the Department 
should allow all rebates. Although Rautaruukki did not specifically 
address all rebates in its narrative, they did report all the rebates 
in their database. After further examination of the verification 
exhibits, we have determined that all rebates were accurately reported 
and verified by the Department and that all these parties did receive 
the rebates as reported.

Final Results of Review

    As a result of our review, we have determined that no margin exists 
for Rautaruukki Oy for the period February 4, 1993, through July 31, 
1994.
    The Department shall determine, and the Customs service shall 
assess, antidumping duties on all appropriate entries. Individual 
differences between United States price and foreign market value 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 this notice of final results of review for all 
shipments of plate from Finland 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 rates for the 
reviewed company will be the rate for that firm as stated above; (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, or the original 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 (4) 
if neither the exporter nor the manufacturer is a firm covered in this 
review, the cash rate will be 32.25 percent. This is the ``all others'' 
rate from the LTFV investigation. See Final Determination of Sales at 
Less Than Fair Value: Certain Cut-To-Length Carbon Steel Plate from 
Finland, 58 FR 37122 (July 9, 1993). 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.
    This administrative review and this notice are in accordance with 
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and section 353.22 
of the Department's regulations.

    Dated: January 19, 1996.
Susan G. Esserman,
Assistant Secretary for Import Administration.
[FR Doc. 96-1456 Filed 1-26-96; 8:45 am]
BILLING CODE 3510-DS-P