[Federal Register Volume 74, Number 108 (Monday, June 8, 2009)]
[Notices]
[Pages 27097-27103]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-13343]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-423-808]


Stainless Steel Plate in Coils from Belgium: Preliminary Results 
of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration, U.S. 
Department of Commerce.
SUMMARY: The Department of Commerce (the Department) is conducting an 
administrative review of the antidumping duty order on stainless steel 
plate in coils (SSPC) from Belgium. For the period of review (POR) May 
1, 2007, through April 30, 2008, we have preliminarily determined that 
U.S. sales have been made below normal value (NV). If these preliminary 
results are adopted in our final results, we will instruct U.S. Customs 
and Border Protection (CBP) to assess antidumping duties based on the 
difference between the constructed export price (CEP) and NV. See 
``Preliminary Results of Review'' section of this notice. Interested 
parties are invited to comment on these preliminary results.

EFFECTIVE DATE: June 8, 2009.

FOR FURTHER INFORMATION CONTACT: Joy Zhang or George McMahon, AD/CVD 
Operations, Office 3, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington DC 20230; telephone: (202) 482-1168 
or (202) 482-1167, respectively.

Background

    On May 5, 2008, the Department issued a notice of opportunity to 
request an administrative review of this order for the POR. See 
Antidumping or Countervailing Duty Order, Finding, or Suspended 
Investigation; Opportunity To Request Administrative Review, 73 FR 
24532 (May 5, 2008). On May 30, 2008, the Department received a timely 
request for an administrative review of this antidumping duty order 
from Allegheny Ludlum Corporation, North American Stainless, Butler-
Armco Independent Union, Zanesville Armco Independent Union, and the 
United Steelworkers of America, AFL-CIO/CLC (collectively, 
Petitioners). On June 2, 2008, the Department received a timely request 
for an administrative review from the respondent, Ugine & ALZ Belgium 
(U&A Belgium), respectively. On June 29, 2007, we published a notice 
initiating an administrative review of the antidumping duty order on 
SSPC from Belgium covering one respondent, U&A Belgium. See Initiation 
of Antidumping and Countervailing Duty Administrative Reviews, Request 
for Revocation in Part and Deferral of Administrative Review, 72 FR 
35690 (June 29, 2007).
    In the prior administrative review of this antidumping duty order, 
U&A Belgium reported that it is wholly owned by Arcelor S.A. and stated 
that Arcelor S.A. was in the process of merging with Mittal Steel, N.V. 
(Mittal) to form Arcelor Mittal S.A. See Stainless Steel Plate in Coils 
from Belgium: Preliminary Results of Antidumping Duty Administrative 
Review, 73 FR 32298 (June 6, 2008). In the instant review, U&A Belgium 
stated ``{t{time} he merger between AMS Belgium's former parent Arcelor 
S.A. and Mittal Steel N.V. was completed on November 13, 2007. Although 
this is midway through the review period, AMS Belgium has prepared its 
responses to the Department's questionnaires as if ArcelorMittal were 
fully consolidated for the entire reporting period.'' See U&A Belgium's 
Section A questionnaire response, dated September 18, 2008, at page 6, 
footnote 1. Due to the completion of the aforementioned merger and 
based on U&A Belgium's reporting of a consolidated questionnaire 
response, we have conducted a successor-in-interest analysis. Based 
upon our findings, we have changed our reference to this company from 
U&A Belgium to ArcelorMittal Stainless Belgium (AMS Belgium) hereafter. 
See the Department's memo to the File titled, ``Successor-in-Interest 
analysis for AMS Belgium,'' dated June 1, 2009 on file in the Central 
Records Unit (CRU), room 1117 of the main Department building.
    On July 15, 2008, the Department issued an antidumping duty 
questionnaire to AMS Belgium. We received AMS Belgium's response to 
Section A of the Department's questionnaire on September 18, 2008, and 
Sections B-D on October 3, 2008. On December 8, 2008, the Department 
received comments from the Petitioners on the Sections A through C 
responses for AMS Belgium. After reviewing the Sections A through D 
responses from AMS Belgium, the Department issued supplemental 
questionnaires to AMS Belgium. The Department issued additional 
supplemental questions, after reviewing AMS Belgium's supplemental 
questionnaire responses. On January 21, 2009, the Department issued an 
extension of the deadline for the preliminary results of this 
antidumping duty administrative review from January 31, 2009, until 
June 1, 2009. See Stainless Steel Plate in Coils From Belgium: Notice 
of Extension of Time Limit for Preliminary Results of Administrative 
Review, 74 FR 3563 (January 21, 2009).

Scope of the Order

    The product covered by this order is certain stainless steel plate 
in coils. Stainless steel is an alloy steel containing, by weight, 1.2 
percent or less of carbon and 10.5 percent or more of chromium, with or 
without other elements. The subject plate products are flat-rolled 
products, 254 mm or over in width and 4.75 mm\1\ or more in thickness, 
in coils, and annealed or otherwise heat treated and pickled or 
otherwise descaled. The subject plate may also be further processed 
(e.g., cold-rolled, polished, etc.) provided that it maintains the 
specified dimensions of plate following such processing. Excluded from 
the scope of this order are the following: (1) Plate not in coils, (2) 
plate that is not annealed or otherwise heat treated and pickled or

[[Page 27098]]

otherwise descaled, (3) sheet and strip, and (4) flat bars.
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    \1\ On May 11, 2007, the Department received a scope inquiry 
request from U&A Belgium regarding whether the scope of the orders 
on SSPC from Belgium excludes stainless steel products with an 
actual thickness less than 4.75mm, regardless of its nominal 
thickness. The Department conducted a scope inquiry applicable to 
all countries subject to the SSPC antidumping and countervailing 
duty orders. In the Department's scope ruling, dated December 3, 
2008, the Department determined that SSPC with a nominal thickness 
of 4.75mm, but with an actual thickness less than 4.75mm, and within 
the dimensional tolerances for this thickness of plate, is included 
in the scope of the antidumping duty orders on SSPC from Belgium, 
Italy, South Africa, the Republic of Korea, and Taiwan and 
countervailing duty orders on SSPC from Belgium and South Africa. 
See Memorandum from Melissa G. Skinner to Stephen J. Claeys titled 
``Stainless Steel Plate in Coils from Belgium: Final Scope Ruling,'' 
dated December 3, 2008.
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    The merchandise subject to this order is currently classifiable in 
the Harmonized Tariff Schedule of the United States (HTSUS) at 
subheadings: 7219.11.00.30, 7219.11.00.60, 7219.12.00.06, 
7219.12.00.21, 7219.12.00.26, 7219.12.00.51, 7219.12.00.56, 
7219.12.00.66, 7219.12.00.71, 7219.12.00.81, 7219.31.00.10, 
7219.90.00.10, 7219.90.00.20, 7219.90.00.25, 7219.90.00.60, 
7219.90.00.80, 7220.11.00.00, 7220.20.10.10, 7220.20.10.15, 
7220.20.10.60, 7220.20.10.80, 7220.20.60.05, 7220.20.60.10, 
7220.20.60.15, 7220.20.60.60, 7220.20.60.80, 7220.90.00.10, 
7220.90.00.15, 7220.90.00.60, and 7220.90.00.80. Although the HTSUS 
subheadings are provided for convenience and customs purposes, the 
written description of the merchandise subject to this order is 
dispositive.

Period of Review

    The period of review is May 1, 2007, through April 30, 2008.

Verification

    As provided in section 782(i) of the Tariff Act of 1930, as amended 
(the Act), we have verified information provided by AMS Belgium and 
ArcelorMittal Stainless International USA (AMSI USA), AMS Belgium's 
U.S. affiliated distributor, in the administrative review of the order 
on subject merchandise from Belgium using standard verification 
procedures, including the examination of relevant sales and cost 
information, financial records, and the selection and review of 
original documentation containing relevant information. Our 
verification results are outlined in the public version of our 
verification report, which is on file in the CRU.

Facts Available

    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. Section 
776(a) of the Act provides that the Department will apply ``facts 
otherwise available'' if, inter alia, necessary information is not 
available on the record or an interested party: 1) withholds 
information that has been requested by the Department; 2) fails to 
provide such information within the deadlines established, or in the 
form or manner requested by the Department, subject to subsections 
(c)(1) and (e) of section 782 of the Act; 3) significantly impedes a 
proceeding; or 4) provides such information, but the information cannot 
be verified.
    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); Notice of Final Determination 
of Sales at Less Than Fair Value: Certain Cold-Rolled Carbon Steel Flat 
Products from Sweden, 67 FR 47522, 47523 (July 19, 2002).

A. Certain Selling Expense\2\
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    \2\ Due to the proprietary nature of this particular expense, 
see the Department's discussion of this expense in the proprietary 
version of the Department's Sales Calculation Memorandum, dated June 
1, 2009.
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    During the sales verification, the Department found that AMS 
Belgium did not include a certain selling expense in its calculation of 
indirect selling expenses. The Department inquired about this omission 
and the company officials explained that this certain selling expense 
was reported in its general and administrative expenses (G&A). See the 
Department's Sales Verification Report, dated June 1, 2009, at 
constructed export price (CEP) Verification Exhibit (CEP VE) 16. 
However, further examination demonstrated that this certain selling 
expense was not included in the reported G&A. See AMS Belgium's Section 
D Questionnaire Response, dated October 3, 2008, at Exhibit 19. Based 
upon further inquiry during the sales verification, company officials 
indicated that AMS Belgium's accounts identify provisions only for a 
certain selling expense and not an actual (realized) amount of this 
certain selling expense. See CEP VE 16. However, this response 
contradicted information obtained during the cost verification of AMS 
Belgium. Specifically, the Department's cost verification team examined 
G&A (which they calculated based on 2007 COPA financial statements) and 
noted an amount which was excluded from G&A and listed as a selling 
expense. See the Department's Cost Verification Report, dated June 1, 
2009, at Exhibit 16. This amount includes a net actual (realized) 
amount of this certain selling expense. Due the proprietary nature of 
this discussion and data, see the Sales and Cost Verification Reports, 
dated June 1, 2009 (Sales Verification Report, Cost Verification 
Report), for additional details. Id.
    Due to the fact that AMS Belgium could not accurately identify 
where in its response it reported the certain selling expense in 
question, the Department was unable to verify the certain selling 
expense. Furthermore, AMS Belgium did not establish whether the 
specific amount of the certain selling expense in question was 
attributable to either the home market or the U.S. market. AMS 
Belgium's contradictory statements regarding the certain selling 
expense undermined AMS Belgium's reporting of indirect selling 
expenses. As a result, we find that it is appropriate to resort to 
facts otherwise available to account for the unreported information. 
See Notice of Final Results of Antidumping Duty Administrative Review, 
Rescission of Administrative Review in Part, and Final Determination to 
Not Revoke Order in Part: Canned Pineapple Fruit from Thailand, 68 FR 
65247 (November 19, 2003), and accompanying Issues and Decision 
Memorandum at Comment 20b. As facts available, we are applying the 
certain selling expense obtained from the cost verification and 
attributing these expenses to home market indirect selling expenses. 
See Cost Verification Exhibit (CVE) 16.

B. Other Transportation Expenses

    During the sales verification, AMS Belgium reported a minor 
correction regarding the U.S. sales other transportation expenses data 
field (USOTHTR1U). AMS Belgium reported a minor correction that affects 
only those U.S. sales transactions where USOTHTR1U was based on an 
average calculation of other transportation expenses. See Sales 
Verification Report at Exhibit VE-1. However, during the CEP sales 
verification, the Department found that AMS Belgium maintained the 
actual broker invoices available to calculate the actual transportation 
expense for the aforementioned U.S. sales observations, rather than 
apply an average. AMS Belgium provided a recalculation of the other 
transportation expenses for the U.S. sales in question based on the 
actual broker invoices. However, the Department found that the 
recalculated amounts provided by AMS Belgium were in error. 
Specifically, we

[[Page 27099]]

calculated USOTHTR1U using the two broker's invoices provided at 
verification and found that the actual per-unit prices for this field 
differed from the revised amount reported by AMS Belgium. See CEP 
Verification Exhibit 19. Therefore, the Department is rejecting AMS 
Belgium's minor correction number 6, as reported at the sales 
verification, and its calculation value of other transportation 
expenses provided in CEP VE 19.
    Due to the fact that AMS Belgium was unable to support the amounts 
calculated and reported for the other transportation expense data 
field, the Department was unable to verify the other transportation 
expense for the certain transactions that were reported based on an 
average. The Department obtained broker invoices during the CEP sales 
verification that we used to recalculate other transportation expenses 
for two U.S. sales transactions. As facts available, the Department is 
using one of the other transportation expenses obtained at the CEP 
sales verification to replace the other transportation expense reported 
by AMS Belgium for the transactions that were originally reported by 
AMS Belgium based on an average amount.

C. Adverse Inferences

    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., Notice of Final Results of Antidumping Duty 
Administrative Review: Stainless Steel Bar from India, 70 FR 54023, 
54025-26 (September 13, 2005); see also Notice of Final Determination 
of Sales at Less Than Fair Value and Final Negative Critical 
Circumstances: Carbon and Certain Alloy Steel Wire Rod from Brazil, 67 
FR 55792, 55794-96 (August 30, 2002). The Statement of Administrative 
Action provides guidance by explaining that adverse inferences are 
appropriate ``to ensure that the party does not obtain a more favorable 
result by failing to cooperate than if it had cooperated fully.'' See 
Statement of Administrative Action accompanying the Uruguay Round 
Agreements Act, H.R. Rep. No. 103-316, Vol. 1, at 870 (1994). 
Furthermore, ``affirmative evidence of bad faith on the part of a 
respondent is not required before the Department may make an adverse 
inference.'' See Antidumping Duties; Countervailing Duties; Final Rule, 
62 FR 27296, 27340 (May 19, 1997); see also Nippon Steel Corp. v. 
United States, 337 F.3d 1373, 1382 (Fed. Cir. 2003) (Nippon).

1. Certain Selling Expense

    AMS Belgium had several opportunities to correct the data on the 
record regarding its exclusion of the certain selling expense from its 
indirect selling expenses. These include the original questionnaire, 
subsequent supplemental sales and cost questionnaires, and ultimately 
during the sales and cost verifications. However, AMS Belgium did not 
request clarification regarding how it should report its certain 
selling expense during this administrative review. Instead, AMS Belgium 
provided contradictory statements to the Department that first 
indicated that the certain selling expense was included in its reported 
selling expenses, then subsequently indicated that it was reported in 
G&A.
    AMS Belgium maintained complete information regarding its certain 
selling expense in its financial information system. See CEP VE 16. 
However, it failed to properly report the certain selling amount in 
question, despite statements made to the contrary.
    AMS Belgium's exclusion of its certain selling expense from its 
reported indirect selling expenses is deficient because: 1) AMS Belgium 
had the necessary information within its control and it did not 
properly report this information; and 2) it failed to put forth its 
maximum effort as required by the Department's questionnaire. As a 
result, we preliminarily find that AMS Belgium failed to cooperate to 
the best of its ability. Therefore, for the preliminary results we are 
using facts available with an adverse inference to determine indirect 
selling expenses. Specifically, with respect to indirect selling 
expenses, we are attributing the entire certain selling expense amount 
in question to the calculation of home market indirect selling 
expenses. As a practice, the Department will normally include these 
certain selling expenses as part of the respondent's indirect selling 
expenses. This adjustment is considered adverse to AMS Belgium's 
interests for reasons that are proprietary in nature. See the Sales 
Calculation Memorandum for additional details. For more detail 
concerning the AFA rates, see Memorandum from Joy Zhang, to The File, 
through James Terpstra titled ``Calculation Memorandum for 
ArcelorMittal Stainless Belgium (AMS Belgium) for the Preliminary 
Results of the Seventh Administrative Review of Stainless Steel Plate 
in Coils (SSPC) from Belgium,'' dated June 1, 2009 (Sales Calculation 
Memorandum) on file in the CRU.

2. Other Transportation Expenses

    AMS Belgium had several opportunities to correct the data on record 
regarding its USOTHTR1U expenses reported in both its questionnaire 
responses and minor corrections obtained at the sales verification. AMS 
Belgium's USOTHTR1U, for the transactions that were based on an average 
calculation, were not supported by the corresponding broker's invoices. 
Furthermore, neither AMS Belgium nor AMSI USA were able to explain to 
the Department or provide documentation that would clarify why this 
expense for these transactions was found to be in error.
    AMS Belgium's inaccurate reporting for USOTHTR1U is deficient 
because: 1) AMS Belgium had the necessary information within its 
control and it did not properly report this information; and 2) it 
failed to put forth its maximum effort as required by the Department's 
questionnaire. As a result, we preliminarily find that AMS Belgium 
failed to cooperate to the best of its ability. Therefore, for the 
preliminary results we are using facts available with an adverse 
inference to determine other transportation expenses for certain 
transactions. Specifically, the Department is applying adverse facts 
available (AFA) and will use the highest reported expense for this 
field obtained during the constructed export price (CEP) verification 
for the U.S. sales transactions where the other transportation expense 
data field was based on an average calculation. See Sales Calculation 
Memorandum.

Analysis

Product Comparisons

    In accordance with section 771(16) of the Act, we considered all 
products produced by the respondent that are covered by the description 
contained in the ``Scope of the Order'' section above and were sold in 
the home market during the POR, to be the foreign like product for 
purposes of determining appropriate product comparisons to U.S. sales. 
Where there were no sales of identical merchandise in the home market 
to compare to U.S. sales, we compared U.S. sales to the most similar 
foreign like product on the basis of the characteristics listed in 
Appendix V of the initial antidumping questionnaire we provided to AMS 
Belgium. See the Department's Antidumping Duty Questionnaire issued to 
AMS Belgium, dated July 15, 2008, on the record in the CRU, Room 1117 
of the Main Commerce Building.

[[Page 27100]]

Normal Value Comparisons

    To determine whether sales of subject merchandise to the United 
States were made at less than normal value, we compared CEP to NV, as 
described in the ``Constructed Export Price'' and ``Normal Value'' 
sections of this notice. In accordance with section 777A(d)(2) of the 
Act, we calculated monthly weighted-average prices for NV and compared 
these to individual U.S. transaction prices.

Home Market Viability

    In accordance with section 773(a)(1)(C) of the Act, to determine 
whether there was a sufficient volume of sales in the home market to 
serve as a viable basis for calculating NV, we compared AMS Belgium's 
volume of home market sales of the foreign like product to the volume 
of U.S. sales of the subject merchandise. Pursuant to section 
773(a)(1)(B) and 19 CFR 351.404(b), because AMS Belgium's aggregate 
volume of home market sales of the foreign like product was greater 
than five percent of its aggregate volume of U.S. sales of the subject 
merchandise, we determined that the home market was viable. Moreover, 
there is no evidence on the record supporting a particular market 
situation in the exporting company's country that would not permit a 
proper comparison of home market and U.S. prices.

Constructed Export Price

    In accordance with section 772(b) of the Act, CEP is the price at 
which the subject merchandise is first sold (or agreed to be sold) in 
the United States before or after the date of importation by or for the 
account of the producer or exporter of such merchandise, or by a seller 
affiliated with the producer or exporter, to a purchaser not affiliated 
with the producer or exporter.
    As stated at 19 CFR 351.401(i), the Department will use the 
respondent's invoice date as the date of sale unless another date 
better reflects the date upon which the exporter or producer 
establishes the essential terms of sale. AMS Belgium reported the 
invoice date as the date of sale for both the U.S. market and the home 
market because the date of invoice reflects the date on which the 
material terms of sale were finalized.
    For purposes of this review, AMS Belgium classified all of its 
export sales of SSPC to the United States as CEP sales. During the POR, 
AMS Belgium made sales in the United States through its U.S. affiliate, 
AMSI USA, which then resold the merchandise to unaffiliated customers 
in the United States. The Department calculated CEP based on packed 
prices to customers in the United States. We made deductions from the 
starting price, net of discounts, for movement expenses (foreign and 
U.S. movement, U.S. customs duty and brokerage, and post-sale 
warehousing) in accordance with section 772(c)(2) of the Act and 19 CFR 
351.401(e). In addition, because AMS Belgium reported CEP sales, in 
accordance with section 772(d)(1) of the Act, we deducted from the 
starting price, credit expenses, warranty expenses, and indirect 
selling expenses, including inventory carrying costs, incurred in the 
United States and Belgium and associated with economic activities in 
the United States.

Normal Value

    In accordance with section 773(a)(1)(B)(i) of the Act, we have 
based NV on the price at which the foreign like product was first sold 
for consumption in the home market, in the usual commercial quantities 
and in the ordinary course of trade. In addition, because the NV level 
of trade (LOT) is at a more advanced stage of distribution than the CEP 
LOT, and available data provide no appropriate basis to determine an 
LOT adjustment between NV and CEP, we made a CEP offset pursuant to 
section 773(a)(7)(B) of the Act. See ``Level of Trade'' section, below.
    We used sales to affiliated customers only where we determined such 
sales were made at arm's-length prices (i.e., at prices comparable to 
the prices at which the respondent sold identical merchandise to 
unaffiliated customers).

Arm's-Length Test

    Sales to affiliated customers in the home market not made at arm's 
length were excluded from our analysis. To test whether these sales 
were made at arm's length, we compared the starting prices of sales to 
affiliated and unaffiliated customers net of all movement charges, 
direct selling expenses, discounts, and packing. In accordance with the 
Department's current practice, if the prices charged to an affiliated 
party were, on average, between 98 and 102 percent of the prices 
charged to unaffiliated parties for merchandise identical or most 
similar to that sold to the affiliated party, we consider the sales to 
be at arm's-length prices. See 19 CFR 351.403(c). Conversely, where the 
affiliated party did not pass the arm's-length test, all sales to that 
affiliated party have been excluded from the NV calculation. See 
Antidumping Proceedings: Affiliated Party Sales in the Ordinary Course 
of Trade, 67 FR 69186 (November 15, 2002).

Calculation of COP

    The Department disregarded sales below the cost of production (COP) 
in the last completed review. See Stainless Steel Plate in Coils From 
Belgium: Final Results of Antidumping Duty Administrative Review, 73 FR 
75398 (December 11, 2008). We therefore have reasonable grounds to 
believe or suspect, pursuant to section 773(b)(2)(A)(ii) of the Act, 
that sales of the foreign like product under consideration for the 
determination of NV in this review may have been made at prices below 
COP. Thus, pursuant to section 773(b)(1) of the Act, we examined 
whether AMS Belgium's sales in the home market were made at prices 
below the COP.
    In accordance with section 773(b)(3) of the Act, we calculated COP 
based on the sum of the cost of materials and fabrication for the 
foreign like product, plus an amount for selling, general and 
administrative expenses (SG&A), interest expenses, and home market 
packing costs. We relied on the COP data submitted by AMS Belgium, 
except for the following:
    1. Consistent with recent cases,\3\ we have evaluated whether a 
shorter cost averaging period methodology is appropriate in this case 
due to the occurrence of significant cost changes through the POR, 
rather than our established practice of using annual cost averages. In 
determining whether distortions result from significant cost 
fluctuations in the context of our antidumping duty calculations, we 
considered record evidence using two primary factors: (1) whether the 
cost changes throughout the POR were significant; and 2) whether sales 
during the shorter averaging period could be reasonably linked with the 
COP or CV during the same averaging period. Record evidence indicates 
that AMS Belgium experienced significant changes in the total cost of 
manufacturing (COM) during the POR, and that these changes are 
primarily attributable to the price volatility for

[[Page 27101]]

nickel, a major input consumed in the production of the merchandise 
under consideration. AMS Belgium also showed that through its alloy 
surcharge levied on sales during the POR there is a reasonable level of 
correlation between falling direct material costs and final sale 
prices. Thus, we preliminarily find that the change in COM for AMS 
Belgium is significant enough to warrant a departure from our standard 
annual costing approach and that these significant cost changes would 
create distortions in the Department's sales-below-cost test as well as 
the overall margin calculation in the preliminary results. Therefore, 
for the preliminary results, we have applied an alternative cost 
calculation method where we used indexed quarterly average direct 
material costs and annual weighted-average conversion costs in the COP 
and CV calculations. See Memorandum from Ernest Gziryan, Senior 
Accountant, to Neal Halper, Director, Office of Accounting, titled 
``Cost of Production and Constructed Value Calculation Adjustments for 
the Preliminary Results ArcelorMittal Stainless Belgium,'' dated June 
1, 2009. (Cost Calculation Memorandum)
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    \3\ See Stainless Steel Sheet and Strip in Coils from Mexico; 
Final Results of Antidumping Duty Administrative Review, 74 FR 6365 
(February 9, 2009), and accompanying Issues and Decision Memorandum 
at Comment 5; Stainless Steel Plate in Coils from Belgium; Final 
Results of Antidumping Duty Administrative Review, 73 FR 75398, 
75399 (December 11, 2008), and accompanying Issues and Decision 
Memorandum at Comment 4; and Certain Steel Concrete Reinforcing Bars 
from Turkey; Final Results of Antidumping Duty Administrative Review 
and Determination To Revoke in Part, 73 FR 66218 (November 7, 2008), 
and accompanying Issues and Decision Memorandum at Comment 2.
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    2. We increased the reported per-unit COM to include an 
unreconciled difference which represents additional production costs 
per books that were not reflected in the reported costs.
    3. We revised AMS Belgium's reported general and administrative 
(G&A) expenses to include certain items recorded on the company's 2007 
financial statements that relate to the general operations of the 
company.
    We compared the weighted-average model-specific COPs to home market 
sales of the foreign like product, as required under section 773(b) of 
the Act, in order to determine whether these sales had been made at 
prices below the COP. In determining whether to disregard home market 
sales made at prices below the COP, we examined whether such sales were 
made (1) within an extended period of time in substantial quantities, 
and (2) at prices which did not permit recovery of all costs within a 
reasonable period of time in the normal course of trade, in accordance 
with sections 773(b)(1)(A) and (B) of the Act. On a product-specific 
basis, we compared the COP to home market prices, less any movement 
charges, discounts, and direct and indirect selling expenses.
    Pursuant to section 773(b)(2)(C) of the Act, where less than 20 
percent of the respondent's sales of a given product were at prices 
which represent less than the COP, we did not disregard any below-cost 
sales of that product because the below-cost sales were not made in 
substantial quantities within an extended period of time. Where 20 
percent or more of the respondent's sales of a given product were at 
prices which represented less than the COP, we determined that they 
were made in substantial quantities within an extended period of time, 
in accordance with section 773(b)(2)(C) of the Act. Because we compared 
prices to POR-average costs, we also determined that the below-cost 
prices did not permit the recovery of costs within a reasonable period 
of time, in accordance with section 773(b)(1)(B) of the Act. Therefore, 
we disregarded the below-cost sales and used the remaining sales as the 
basis for NV, in accordance with section 773(b)(1) of the Act.

CEP to NV Comparison

    For those sales at prices above COP, we based NV on home market 
prices to affiliated (when made at prices determined to be at arm's 
length) or unaffiliated parties, in accordance with 19 CFR 351.403. 
Home market starting prices were based on packed prices to affiliated 
or unaffiliated purchasers in the home market, net of discounts. We 
made adjustments, where applicable, for packing and movement expenses, 
in accordance with sections 773(a)(6)(A) and (B) of the Act. We also 
made adjustments for differences in costs attributable to differences 
in physical characteristics of the merchandise pursuant to section 
773(a)(6)(C)(ii) of the Act. For comparison to CEP, we deducted home 
market direct selling expenses pursuant to section 773(a)(6)(C)(iii) of 
the Act and 19 CFR 351.410(c).
    Section 773(a)(4) of the Act provides that where NV cannot be based 
on comparison-market sales, NV may be based on constructed value (CV). 
Accordingly, for those products for which we could not determine the NV 
based on comparison-market sales, either because there were no useable 
sales of a comparable product or all sales of the comparable products 
failed the COP test, we based NV on CV.
    Section 773(e) of the Act provides that CV shall be based on the 
sum of the cost of materials and fabrication for the imported 
merchandise, plus amounts for SG&A and interest expenses, profit, and 
U.S. packing costs. We calculated the cost of materials and fabrication 
based on the methodology described in the ``Cost of Production 
Analysis'' section, above. We based SG&A and interest expenses and 
profit on the actual amounts incurred and realized by respondent in 
connection with the production and sale of the foreign like product in 
the ordinary course of trade for consumption in the home market, in 
accordance with section 773(e)(2)(A) of the Act.
    We made adjustments to CV for differences in circumstances of sale 
in accordance with section 773(a)(8) of the Act and 19 CFR 351.410. For 
comparisons to CEP, we made circumstance-of-sale adjustments by 
deducting comparison market direct selling expenses from CV. See 19 CFR 
351.410(c).

Level of Trade

    Section 773(a)(1)(B)(i) of the Act states that, to the extent 
practicable, the Department will calculate NV based on sales at the 
same level of trade (LOT) as the EP or CEP. Sales are made at different 
LOTs if they are made at different marketing stages (or their 
equivalent). See 19 CFR 351.412(c)(2). Substantial differences in 
selling activities are a necessary, but not sufficient, condition for 
determining that there is a difference in the stages of marketing. See 
Notice of Final Determination of Sales at Less Than Fair Value: Certain 
Cut-to-Length Carbon Steel Plate From South Africa, 62 FR 61731, 61732 
(November 19, 1997) (Plate from South Africa). In order to determine 
whether the comparison sales were at different stages in the marketing 
process than the U.S. sales, we reviewed the distribution system in 
each market (i.e., the chain of distribution), including selling 
functions, class of customer (customer category), and the level of 
selling expenses for each type of sale.
    Pursuant to section 773(a)(1)(B)(i) of the Act, in identifying LOTs 
for export price (EP) and comparison-market sales (i.e., NV based on 
either home market or third-country prices),\4\ we consider the 
starting prices before any adjustments. For CEP sales, we consider only 
the selling activities reflected in the price after the deduction of 
expenses and CEP profit under section 772(d) of the Act. See Micron 
Technology Inc. v. United States, 243 F.3d 1301, 1314-1315 (Fed. Cir. 
2001). Where NV is based on CV, we determine the NV LOT based on the 
LOT of the sales from which we derive SG&A expenses, and profit for CV, 
where possible.
---------------------------------------------------------------------------

    \4\ Where NV is based on CV, we determine the NV LOT based on 
the LOT of the sales from which we derive SG&A expenses, and profit 
for CV, where possible.
---------------------------------------------------------------------------

    When the Department is unable to match U.S. sales of the foreign 
like product in the comparison market at the same LOT as the EP or CEP, 
the Department may compare the U.S. sale

[[Page 27102]]

to sales at a different LOT in the comparison-market. In comparing EP 
or CEP sales at a different LOT in the comparison-market, where 
available data make it practicable, we make an LOT adjustment under 
section 773(a)(7)(A) of the Act. Finally, for CEP sales only, if the NV 
LOT is at a more advanced stage of distribution than the LOT of the CEP 
and there is no basis for determining whether the difference in LOTs 
between NV and CEP affects price comparability (i.e., no LOT adjustment 
was practicable), the Department shall grant a CEP offset, as provided 
in section 773(a)(7)(B) of the Act. See Plate from South Africa, 62 FR 
at 61732-33.
    In this administrative review, we obtained information from the 
respondent, AMS Belgium, regarding the marketing stages involved in 
making the reported foreign market and U.S. sales, including a 
description of the selling activities performed by AMS Belgium for each 
channel of distribution. The Department's LOT findings are summarized 
below.
    AMS Belgium reported two channels of distribution and two LOTs in 
the U.S. market. AMS Belgium's two U.S. channels of distribution are: 
1) direct shipment sales in which the merchandise was shipped directly 
from AMS Belgium to the final customer; and (2) sales from inventory 
maintained by ArcelorMittal Stainless International USA (AMSI USA). See 
October 3, 2008, Section C Questionnaire Response at 13. AMS Belgium 
reported several selling functions for its sales to the United States. 
See selling functions chart included at AMSI USA CEP Verification 
Report, dated June 1, 2009, at VE 3. During the sales verification, AMS 
Belgium provided a detailed explanation of its selling activities and 
indicated that its selling activities for U.S. sales are performed in 
support of AMSI USA.
    Our analysis of these selling functions performed by AMS Belgium in 
the United States shows that the selling activities and services do not 
vary according to the channel of distribution. Id. We find that there 
is no variation in type or level of services provided by AMS Belgium 
for the channels of distribution in the United States. AMS Belgium 
provides comparable services for the two channels of distribution in 
the United States, which only differ based on whether the sale is 
shipped directly to the final customer or to AMSI USA's inventory. 
Therefore, based on the lack of differentiation between the type and 
level of activities associated with AMS Belgium's sales into the two 
distribution channels, we preliminarily determine that there is only 
one LOT in the U.S. market. See Sales Calculation Memorandum.
    With respect to the Belgian market, AMS Belgium reported five 
customer categories in a single channel of distribution. Specifically, 
AMS Belgium reported that it sells SSPC to customers in the home market 
in a single LOT through its affiliated sales agent, ArcelorMittal 
Stainless Europe S.A (AMSE S.A.). AMS Belgium performs the following 
selling functions in the home market: strategic and economic planning, 
market research, technical advice regarding product characteristics and 
use of product, visiting customers, product information and training 
sessions, advertising, sales negotiations, communication with mill, 
scheduling production and freight arrangements, packing, after sales 
servicing support or claims, and personnel training, personnel exchange 
and manpower assistance. See Sales Verification Report at CEP VE 3. We 
examined the selling functions performed for the five customer 
categories and found that the selling activities and services do not 
vary by customer category. See Sales Calculation Memorandum. Therefore, 
we preliminarily conclude that AMS Belgium's sales in the home market 
constitute one LOT.
    AMS Belgium performed the twelve aforementioned selling activities 
in the home market. The selling functions for the U.S. market are 
primarily performed by AMSI USA with the exception of the packing 
selling function, which is handled solely by AMS Belgium. As indicated 
above, AMS Belgium's selling activities for its U.S. sales are 
performed in support of AMSI USA. We analyzed the differences among the 
reported selling activities which demonstrated that AMS Belgium's sales 
in the home market were at different stages in the marketing process 
than the U.S. sales. Finally, we compared the U.S. and home market 
LOTs. In our comparison of the U.S. and home market LOTs, we eliminated 
from consideration selling functions performed by AMSI USA and only 
considered the portion of the selling functions performed by AMS 
Belgium after making adjustments under section 772(d) of the Act. As a 
result of our comparison, we preliminarily determined that AMS 
Belgium's home market LOT is at a more advanced stage of distribution 
than the CEP LOT.
    We then considered whether we could make an LOT adjustment. In this 
case, AMS Belgium only sold at one LOT in the comparison market; 
therefore, there is no information available to determine a pattern of 
consistent price differences between the sales on which NV is based and 
the comparison market sales at the LOT of the export transaction, in 
accordance with the Department's normal methodology as described above. 
See 19 CFR 351.412(d). Further, we do not have record information which 
would allow us to examine pricing patterns based on the respondent's 
sales of other products, and there are no other respondents or other 
record information on which such an analysis could be based. 
Accordingly, because only one LOT exists in the home market we could 
not make an LOT adjustment. However, because the LOT in the comparison 
market is at a more advanced stage of distribution than the LOT of the 
CEP transactions, we made a CEP offset adjustment in accordance with 
section 773(a)(7)(B) of the Act and 19 CFR 351.412(f). This offset is 
equal to the amount of indirect selling expenses incurred in the 
comparison market not exceeding the amount of indirect selling expenses 
and commissions deducted from the U.S. price in accordance with section 
772(d)(1)(D) of the Act. For a detailed discussion, see Sales 
Calculation Memorandum.

Currency Conversion

    We made currency conversions pursuant to 19 CFR 351.415 based on 
the exchange rates certified by the Federal Reserve Bank.

Preliminary Results of Review

    We preliminarily determine that for the period May 1, 2007, through 
April 30, 2008, the following dumping margin exists:

------------------------------------------------------------------------
                                                                Margin
                    Manufacturer/Exporter                      (percent)
------------------------------------------------------------------------
ArcelorMittal Stainless Belgium (AMS Belgium)...............        6.70
------------------------------------------------------------------------

Duty Assessment and Cash Deposit Requirements

    The Department shall determine, and CBP shall assess, antidumping 
duties on all appropriate entries. Pursuant to 19 CFR 351.212(b), the 
Department calculates an assessment rate for each importer of the 
subject merchandise for each respondent. The Department will issue 
appropriate assessment instructions directly to CBP 15 days after 
publication of the final results of this review.
    Furthermore, the following cash deposit rates will be effective 
with respect to all shipments of SSPC from Belgium entered, or 
withdrawn from warehouse, for consumption on or after the publication 
date of the final results, as provided for by section 751(a)(1) of the 
Act: (1) for U&A Belgium, the cash

[[Page 27103]]

deposit rate will be the rate established in the final results of this 
review; (2) for previously reviewed or investigated companies not 
listed above, the cash deposit rate will be the company-specific rate 
established for the most recent period; (3) if the exporter is not a 
firm covered in this review, a prior review, or the less-than-fair-
value (LTFV) investigation, but the manufacturer is, the cash deposit 
rate will be the rate established for the most recent period for the 
manufacturer of the subject merchandise; and (4) if neither the 
exporter nor the manufacturer is a firm covered by this review, a prior 
review, or the LTFV investigation, the cash deposit rate shall be the 
all-others rate established in the LTFV investigation, which is 9.86 
percent. See Notice of Final Determination of Sales at Less Than Fair 
Value: Stainless Steel Plate in Coils From Belgium, 64 FR 15476 (March 
31, 1999). These deposit rates, when imposed, shall remain in effect 
until further notice.

Public Comment

    Pursuant to 19 CFR 351.224(b), the Department will disclose to 
parties to the proceeding any calculations performed in connection with 
these preliminary results within five days after the date of 
publication of this notice. Pursuant to 19 CFR 351.309, interested 
parties may submit written comments in response to these preliminary 
results. Unless extended by the Department, case briefs are to be 
submitted within 30 days after the date of publication of this notice, 
and rebuttal briefs, limited to arguments raised in case briefs, are to 
be submitted no later than five days after the time limit for filing 
case briefs. Parties who submit arguments in this proceeding are 
requested to submit with the argument: (1) a statement of the issues, 
and (2) a brief summary of the argument. Case and rebuttal briefs must 
be served on interested parties in accordance with 19 CFR 351.303(f).
    Also, pursuant to 19 CFR 351.310(c), within 30 days of the date of 
publication of this notice, interested parties may request a public 
hearing on arguments to be raised in the case and rebuttal briefs. 
Unless the Secretary specifies otherwise, the hearing, if requested, 
will be held two days after the date for submission of rebuttal briefs. 
Parties will be notified of the time and location. The Department will 
publish the final results of this administrative review, including the 
results of its analysis of issues raised in any case or rebuttal brief, 
no later than 120 days after publication of these preliminary results, 
unless extended. See 19 CFR 351.213(h).

Notification to Importers

    This notice serves as a preliminary reminder to importers of their 
responsibility under 19 CFR 351.402(f) 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.
    These preliminary results of this administrative review and notice 
are issued and published in accordance with sections 751(a)(1) and 
777(i)(1) of the Act.

    Dated June 1, 2009.
Ronald K. Lorentzen,
Acting Assistant Secretary for Import Administration.
[FR Doc. E9-13343 Filed 6-5-09; 8:45 am]
BILLING CODE 3510-DS-S