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[Federal Register Volume 66, Number 37 (Friday, February 23, 2001)]
[Notices]
[Pages 11259-11266]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-4537]

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-580-601]

Top-of-the-Stove Stainless Steel Cooking Ware From Korea: 
Preliminary Results and Rescission, in Part, of Antidumping Duty 
Administrative Review

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

ACTION: Notice of preliminary results and rescission, in part, of 
antidumping duty administrative review.

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SUMMARY: In response to a request by the Stainless Steel Cookware 
Committee (the Committee), the Department of Commerce (the Department) 
is conducting an administrative review of the antidumping duty order on 
top-of-the-stove stainless steel cooking ware from Korea. The period of 
review (POR) is January 1, 1999, through December 31, 1999.
    We preliminarily determine that certain manufacturers/exporters 
sold subject merchandise at less than normal value (NV) during the POR. 
If these preliminary results are adopted in the final results of this 
administrative review, we will instruct Customs to assess antidumping 
duties on all appropriate entries. We invite interested parties to 
comment on the preliminary results. Parties who submit comments in this 
proceeding should also submit with the argument: (1) a statement of the

[[Page 11260]]

issue(s), and (2) a brief summary of the argument (not to exceed five 
pages).

EFFECTIVE DATE: February 23, 2001.

FOR FURTHER INFORMATION CONTACT: Nova Daly (Dong Won) and John Conniff 
(Daelim), AD/CVD Enforcement, Office 4, Group II, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 
20230; (202) 482-0989 and (202) 482-1009, respectively.

SUPPLEMENTARY INFORMATION:

The Applicable Statute

    Unless otherwise indicated, all citations to the Tariff Act of 
1930, as amended (the Act), are references to the provisions effective 
January 1, 1995, the effective date of the amendments made to the Act 
by the Uruguay Round Agreements Act (URAA). In addition, unless 
otherwise indicated, all citations to the Department's regulations are 
to the regulations at 19 CFR Part 351 (2000).

Background

    The Department published an antidumping duty order on top-of-the-
stove stainless steel cooking ware (cookware) from Korea on January 20, 
1987 (52 FR 2139). On January 13, 2000, the Department published a 
notice of ``Opportunity to Request an Administrative Review'' of the 
antidumping duty order on cookware from Korea (65 FR 2114) covering the 
period January 1, 1999, through December 31, 1999.
    On January 31, 2000, in accordance with 19 CFR 351.213(b), the 
Committee (the petitioner), whose members are Regal Ware, Inc., All-
Clad Metalcrafters, LLC, and Vita-Craft Corporation, requested that we 
conduct an administrative review of twenty-seven specific 
manufacturers/exporters of cookware from Korea: Daelim Trading Co., 
Ltd. (Daelim), Dong Won Metal Co., Ltd. (Dong Won), Chefline 
Corporation (Chefline), Sam Yeung Ind. Co., Ltd. (Samyeung), Namyang 
Kitchenflower Co., Ltd., Kyung-Dong Industrial Co., Ltd., Ssang Yong 
Ind. Co., Ltd. (Ssangyong), O. Bok Stainless Steel Co., Ltd., Dong Hwa 
Stainless Steel Co., Ltd., Il Shin Co., Ltd., Hai Dong Stainless Steel 
Ind. Co., Ltd., Han Il Stainless Steel Ind. Co., Ltd., Bae Chin Metal 
Ind. Co., East One Co., Ltd., Charming Art Co., Ltd., Poong Kang Ind. 
Co., Ltd., Won Jin Ind. Co., Ltd., Wonkwang Inc., Sungjin International 
Inc., Sae Kwang Aluminum Co., Ltd., Woosung Co., Ltd., (Woosung), Hanil 
Stainless Steel Ind. Co., Ltd.,\1\ Seshin Co., Ltd., Pionix 
Corporation, East West Trading Korea, Ltd., Clad Co., Ltd., and B.Y. 
Enterprise, Ltd. In accordance with 19 CFR 351.221(b), we published a 
notice of initiation of the review on February 28, 2000 (65 FR 10466).
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    \1\ Same company as Han I1 Stainless Steel Ind. Co., Ltd. listed 
above.
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    On March 3, 2000, we issued Section A antidumping questionnaires to 
each of the twenty-seven manufacturers/exporters listed above. In 
response to our request for information, Sugjin International, Inc., O. 
Bok Stainless Steel Co., Ltd., Won Jin Ind. Co., Ltd., Hai Dong 
Stainless Co., Ltd., Pionix Corporation, Seshin Co., Ltd., Dong Hwa 
Stainless Steel Co., Ltd., Wonkwang Inc., and Charming Art Co., Ltd., 
reported that they had no sales or shipments during the POR. Our review 
of Customs import data indicated that there were no entries of subject 
merchandise made by these manufacturers/exporters during the POR. 
Accordingly, we are preliminarily rescinding the review with respect to 
the above nine manufacturers/exporters of cookware.
    The following companies failed to respond to the Department's 
Section A questionnaire: B.Y. Enterprise, Ltd., Clad Co., Ltd., Sae 
Kwang Aluminum Co., Ltd., East One Co., Ltd., East West Trading Korea, 
Ltd., Bae Chin Metal Ind. Co., Han I1 Stainless Steel Ind. Co., Ltd., 
I1 Shin Co., Ltd., Kyung-Dong Industrial Co., Ltd., Poong Kang Ind. 
Co., Ltd., and Namyang Kitchen Flower Co., Ltd. On March 28, 2000, we 
informed each of these companies that because they failed to respond to 
the Department's questionnaire, we may use facts available (FA) to 
determine their dumping margins.
    On March 17, 2000, counsel for Chefline requested that the 
Department rescind the review with respect to Woosung. Woosung is 
Chefline's original corporate name which was changed to Chefline in 
March 1996. Since Chefline submitted uncontested evidence on the record 
to support their claim and petitioner did not object to Chefline's 
request for rescission, we are rescinding the review with respect to 
Woosung. In addition, on April 3, 2000, Chefline informed the 
Department that it would not be responding to the Department's Section 
A questionnaire.
    On April 3, 2000, Daelim, Dong Won, Samyeung, and Ssangyong 
responded to Section A of the antidumping questionnaire. On June 29, 
2000, the Department issued Sections B, C and D of the Department's 
questionnaire to these four companies. Daelim, Dong Won, and Samyeung 
filed responses to Sections B and C on August 23, 2000. On August 23, 
2000, Ssangyong notified the Department that it would no longer 
participate in this review.
    On August 24, 2000, the Department issued Section A supplemental 
questionnaires to Daelim, Dong Won, and Samyeung. The responses to 
these supplemental questionnaires were received on September 15, 2000. 
We issued Section B and C supplemental questionnaires to these 
companies on September 11, 2000. The responses to the supplemental 
questionnaires were submitted by the companies on October 2, 2000.
    On September 20, 2000, the Department initiated a cost of 
production (COP) investigation with respect to Dong Won and Samyeung 
and requested that they respond to Section D of the Department's 
questionnaire. On September 25, 2000, the Department initiated a COP 
investigation with respect to Daelim and issued the Section D 
questionnaire, in accordance with section 773(b) of the Act. We 
initiated the COP investigations as a result of the petitioner's COP 
allegations, which are company-specific, employ a reasonable 
methodology, provide evidence of below cost sales, and include models 
which are representative of the broader range of cookware products sold 
by Dong Won, Samyeung, and Daelim in accordance with section 773(b) of 
the Act. For further discussion on the initiation of the COP 
investigations, see 1999 Administrative Review of Antidumping Duty 
Order on Top-Of-The-Stove Stainless Steel Cook Ware (``cookware'') from 
Korea: Analysis of Petitioner's Allegation of Sales Below the Cost of 
Production for Samyeung Ind. Co., Ltd. (Samyeung) dated September 20, 
2000 and 1999 Administrative Review of Antidumping Duty Order on Top-
Of-The-Stove Stainless Steel Cook Ware (``cookware'') from Korea: 
Analysis of Petitioner's Allegation of Sales Below the Cost of 
Production for Dong Won Metal Co., Ltd. (Dong Won) dated September 20, 
2000. Also, see 1999 Administrative Review of Antidumping Duty Order on 
Top-Of-The-Stove Stainless Steel Cook Ware (cookware) from Korea: 
Analysis of Petitioner's Allegation of Sales Below the Cost of 
Production for Dae-Lim Co., Ltd. (Daelim) dated September 25, 2000.
    Dong Won's response to the Section D questionnaire was received by 
the Department on October 18, 2000. On October 25, 2000, Samyeung 
notified the Department that it would no longer participate in this 
review. On November 1, 2000, the Department issued a Section D 
supplemental questionnaire

[[Page 11261]]

to Dong Won. The response to this supplemental questionnaire was 
received on November 21, 2000.
    Daelim's response to this section of the questionnaire was received 
on October 31, 2000. On November 26, 2000, the Department issued a 
Section D supplemental questionnaire to Daelim. The response to this 
supplemental questionnaire was received on November 30, 2000.
    Under section 751(a)(3)(A) of the Act, the Department may extend 
the deadline for issuing a preliminary determination in an 
administrative review if it determines that it is not practicable to 
complete the preliminary review within the statutory time limit of 245 
days. On August 15, 2000, the Department published a notice of 
extension of the time limit for the preliminary results in this case to 
January 30, 2001. See Top-of-the-Stove Stainless Steel Cooking Ware 
From Korea: Extension of Preliminary Results of Antidumping Duty 
Administrative Review, 65 FR 51797 (August 25, 2000). The Department is 
conducting this administrative review in accordance with section 751 of 
the Act.

Scope of Review

    The merchandise subject to this antidumping order is top-of-the-
stove stainless steel cookware from Korea. The subject merchandise is 
all non-electric cooking ware of stainless steel which may have one or 
more layers of aluminum, copper or carbon steel for more even heat 
distribution. The subject merchandise includes skillets, frying pans, 
omelette pans, saucepans, double boilers, stock pots, dutch ovens, 
casseroles, steamers, and other stainless steel vessels, all for 
cooking on stove top burners, except tea kettles and fish poachers. 
Excluded from the scope of the order are stainless steel oven ware and 
stainless steel kitchen ware. The subject merchandise is currently 
classifiable under Harmonized Tariff Schedule (HTS) item numbers 
7323.93.00 and 9604.00.00. The HTS item numbers are provided for 
convenience and Customs purposes only. The written description remains 
dispositive.
    The Department has issued several scope clarifications for this 
order. The Department found that certain stainless steel pasta and 
steamer inserts (63 FR 41545, August 4, 1998), certain stainless steel 
eight-cup coffee percolators (58 FR 11209, February 24, 1993), and 
certain stainless steel stock pots and covers are within the scope of 
the order (57 FR 57420, December 4, 1992). Moreover, as a result of a 
changed circumstances review, the Department revoked the order on Korea 
in part with respect to certain stainless steel camping ware (1) made 
of single-ply stainless steel having a thickness no greater than 6.0 
millimeters; and (2) consisting of 1.0, 1.5, and 2.0 quart saucepans 
without handles and with lids that also serve as fry pans (62 FR 3662, 
January 24, 1997).

Verification

    As provided in section 782(i) of the Act, from December 4, 2000, to 
December 22, 2000, we verified sales and cost information provided by 
Daelim and Dong Won, using standard verification procedures, including 
an examination of relevant sales and financial records, and selection 
of original documentation containing relevant information. Our 
verification results are outlined in the public version of the 
verification report and are on file in the Central Records Unit (CRU) 
located in room B-099 of the main Department of Commerce Building, 14th 
Street and Constitution Avenue, NW, Washington, DC.

Facts Available (FA)

Application of FA

    Section 776(a)(2) of the Act provides that if any interested party: 
(A) Withholds information that has been requested by the Department; 
(B) fails to provide such information by the deadlines for submission 
of the information or in the form or manner requested; (C) 
significantly impedes an antidumping investigation; or (D) provides 
such information but the information cannot be verified, the Department 
shall, subject to section 782(d) of the Act, use facts otherwise 
available in making its determination.
    Section 782(e) of the Act provides that the Department shall not 
decline to consider information deemed ``deficient'' under section 
782(d) of the Act if: (1) The information is submitted by the deadline 
established for its submission; (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 in providing the information and meeting the requirements 
established by the Department with respect to the information; and (5) 
the information can be used without undue difficulties.
    As stated above, on March 3, 2000, we issued Section A 
questionnaires to twenty-seven manufacturers/exporters of the subject 
merchandise. The following companies failed to respond to the 
Department's Section A questionnaire: B.Y. Enterprise, Ltd., Clad Co., 
Ltd., Sae Kwang Aluminum Co., Ltd., East One Co., Ltd., East West 
Trading Korea, Ltd., Bae Chin Metal Ind. Co., Han Il Stainless Steel 
Ind. Co., Ltd., Il Shin Co., Ltd., Kyung-Dong Industrial Co., Ltd., 
Poong Kang Ind. Co., Ltd., and Namyang Kitchen Flower Co., Ltd. On 
March 28, 2000, we informed each of these companies that because they 
failed to respond to the Department's questionnaire, we may use FA to 
determine their dumping margins. On April 3, 2000, Chefline informed 
the Department that it would not be responding to the Department's 
Section A questionnaire. Because these companies wholly failed to 
respond to our questionnaire, pursuant to section 776(a)(2)(A) of the 
Act, we have applied FA to calculate their dumping margins. Further, 
based on the facts in this review, described below, the Department has 
preliminarily determined that the use of FA is warranted for Ssangyong 
and Samyeung.
    First, Ssangyong and Samyeung did not respond to Sections B and C 
of the questionnaire. On April 3, 2000, Ssangyong responded to the 
Section A questionnaire. On June 29, the Department issued Sections B 
and C of the questionnaire to Ssangyong. On July 18, 2000, Ssangyong 
requested an extension to respond to Sections B and C due to its 
claimed lack of experience in answering the Department's 
questionnaires. On July 24, 2000, the Department granted Ssangyong an 
extension until August 18, 2000 to respond to Sections B and C. On 
August 14, 2000, the Department granted Ssangyong an additional 
extension until August 23, 2000, for Ssangyong to respond to Sections B 
and C. See Extension Letters from the Department to Ssangyong dated 
July 24, 2000 and August 14, 2000 (Ssangyong Extension Letters). In 
both the July 24, 2000 and August 14, 2000 letters, the Department 
notified Ssangyong that if it did not submit the information requested 
by the applicable deadline, the Department may find that Ssangyong has 
not acted to the best of its ability and thus may use an adverse 
inference in selecting among FA, as provided for in section 776(b) of 
the Act. Ssangyong subsequently failed to respond to Sections B and C 
of the questionnaire and, on August 23, 2000, submitted a letter 
stating that it would not participate further in this proceeding.
    On September 20, 2000, the Department initiated a COP investigation 
and issued a Section D questionnaire to Samyeung. On October 5, 2000, 
Samyeung requested an

[[Page 11262]]

extension for filing a response to Section D based on (1) its claim 
that the company had limited resources and (2) the concurrent 
Department deadlines for both the Section D questionnaire and 
supplemental questionnaires. The Department granted Samyeung an 
extension on the Section D questionnaire and notified Samyeung that if 
it did not submit the information requested by the applicable deadline, 
the Department may find that Samyeung has not acted to the best of its 
ability and thus may use an adverse inference in selecting among FA, as 
provided for in section 776(b) of the Act. See Extension Letter from 
the Department to Samyeung dated October 10, 2000 (Samyeung Extension 
Letter). However, Samyeung failed to respond to the Section D 
questionnaire and, on October 25, 2000, submitted a letter stating that 
it would no longer continue to participate in this proceeding. See 
Memorandum on Application of Facts Available for Sam Yeung Ind. Co., 
Ltd. (Samyeung) in the Preliminary Results of the 1999 Administrative 
Review, dated January 30, 2001 (Facts Available Memorandum).
    Second, in addition to their failure to respond to the Department's 
questionnaire, the information provided by these two respondents is so 
incomplete that it cannot serve as a reliable basis for reaching the 
applicable determination. Ssangyong's failure to respond to Sections B 
and C of the questionnaire is a critical omission. Without U.S. and 
home market sales data, the Department cannot calculate a dumping 
margin for Ssangyong. Likewise, Samyeung's failure to provide cost data 
is significant. Without cost data, we are unable to determine whether 
foreign market sales were made below COP and, thus, we are prevented 
from calculating an accurate normal value and dumping margin for 
Samyeung. Therefore, we find that the information on the record for 
Ssangyong and Samyeung is so incomplete that it cannot serve as a 
reliable basis for reaching the applicable determination and thus, 
Ssangyong and Samyeung have not satisfied the third criterion under 
section 782(e) of the Act.
    In addition, the Department finds, pursuant to section 776(b) of 
the Act, that Ssangyong and Samyeung did not act to the best of their 
ability to comply with requests for information. In its August 23, 2000 
letter, Ssangyong stated that ``faced with the substantial amount of 
detailed information that the Department has requested to be submitted 
in a very short time period, Ssangyong has concluded that it lacks the 
administrative resources to prepare and submit responses to Sections B 
and C of the questionnaire and otherwise to continue participating 
further in the proceeding.'' Samyeung, in its October 25, 2000 letter, 
stated that the short time period given to answer the Section D 
questionnaire was too burdensome for the company to comply. However, we 
note that Ssangyong was granted two extensions totaling 23 days to 
respond to the Section B and C questionnaire and Samyeung was granted a 
two-week extension to respond to the cost questionnaire. Also, neither 
Ssangyong nor Samyeung requested an additional extension of time to 
respond to the questionnaire. Further, neither company suggested 
alternative methods for providing the requested information. We note 
that it was Ssangyong and Samyeung's responsibility to provide a ``full 
explanation and suggested alternative forms'' of responding to the 
questionnaire under section 782(c) of the Act. The Department considers 
Ssangyong and Samyeung's refusal to submit their respective 
questionnaire responses, despite the fact the Department granted 
extensions of time for filing the responses, and their refusal to 
participate further in the review, as a failure to cooperate to the 
best of their ability with respect to our requests for information. 
Thus, Ssangyong and Samyeung have failed to satisfy the fourth 
criterion of section 782(c) of the Act.
    Lastly, the information cannot be used without undue difficulties. 
As a result of Ssangyong and Samyeung's failure to provide the 
necessary information requested, the information provided by Ssangyong 
and Samyeung is not complete enough to calculate a margin based upon 
the statutory and regulatory criteria. For example, as discussed above, 
Ssangyong did not respond to Sections B and C of the Department's 
questionnaire and Samyeung did not respond to Section D of the 
Department's questionnaire. Thus, Ssangyong and Samyeung have also 
failed to satisfy the fifth criterion of section 782(e) of the Act.
    Given the above analysis, the Department determines that Ssangyong 
and Samyeung have not met all five factors enumerated in section 782(e) 
of the Act. Therefore, for the reasons stated above, the use of FA is 
warranted for these companies.

Selection of Adverse FA

    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).
    Because B.Y. Enterprise, Ltd., Clad Co., Ltd., Sae Kwang Aluminum 
Co., Ltd., East One Co., Ltd., East West Trading Korea, Ltd., Bae Chin 
Metal Ind. Co., Han Il Stainless Steel Ind. Co., Ltd., Il Shin Co., 
Ltd., Kyung-Dong Industrial Co., Ltd., Poong Kang Ind. Co., Ltd., 
Namyang Kitchen Flower Co., Ltd., and Chefline did not cooperate by 
wholly failing to respond to the Department's questionnaire response, 
and in order to ensure that they do not benefit from that lack of 
cooperation, we are employing an adverse inference in selecting from 
facts otherwise available.
    Further, because Ssangyong failed completely to respond to Sections 
B and C of the questionnaire and Samyeung failed completely to respond 
to Section D of the questionnaire, the Department was prevented from 
making critical decisions involving the calculation of Sangyong and 
Samyeung's dumping margins. In addition, as required by section 782(d) 
of the Act, Sangyong and Samyeung were put on notice, via Department 
extension letters and other correspondence, that failure to respond to 
the Department's requests for information constituted a deficiency 
which could result in the use of FA. See, e.g., Ssangyong Extension 
Letters. Moreover, section 782(e) of the Act is not applicable as the 
information Ssangyong and Samyeung submitted is so incomplete that it 
cannot serve as a reliable basis for making a preliminary 
determination. Accordingly, the Department finds that Ssangyong and 
Samyeung did not act to the best of their ability to comply with the 
request for information and thus, under section 776(b) of the Act, an 
adverse inference is warranted.
    Pursuant to section 776(b) of the Act, we are basing the margin for 
the 14 companies listed above on adverse FA for purposes of these 
preliminary results. As adverse FA, we have used the highest rate 
calculated for any respondent in any segment of this proceeding. This 
rate is 31.23 percent. See Final Determination of Sales at Less Than 
Fair Value; Certain Stainless Steel Cookware from Korea, 51 FR 42873 
(November 26, 1986) (Final LTFV Determination). Corroboration of 
Information Used as FA
    Section 776(b) of the Act authorizes the Department to use as 
adverse FA information derived from the petition, the final 
determination from the less

[[Page 11263]]

than fair value (LTFV) investigation, a previous administrative review, 
or any other information placed on the record.
    Section 776(c) of the Act requires the Department to corroborate, 
to the extent practicable, secondary information used as FA. Secondary 
information is defined as ``[i]nformation derived from the petition 
that gave rise to the investigation or review, the final determination 
concerning the subject merchandise, or any previous review under 
section 751 concerning the subject merchandise.'' See Statement of 
Administrative Action (SAA) accompanying the URAA, H.R. Doc. No. 103-
316 at 870 (1994).
    The SAA further provides that the term ``corroborate'' means that 
the Department will satisfy itself that the secondary information to be 
used has probative value (see SAA at 870). Thus, to corroborate 
secondary information, the Department will, to the extent practicable, 
examine the reliability and relevance of the information used.
    The rate selected was calculated using verified information in the 
investigation. See Final LTFV Determination. The only source for 
calculated margins is administrative determinations. Thus, in an 
administrative review, if the Department chooses as adverse facts 
available a calculated dumping margin from a prior segment of the 
proceeding, it is not necessary to question the reliability of the 
margin for that time period. Furthermore, we have no new information 
that would lead us to reconsider the reliability of this rate.
    As to the relevance of the margin used for adverse FA, the courts 
have stated that ``[b]y requiring corroboration of adverse inference 
rates, Congress clearly intended that such rates should be reasonable 
and have some basis in reality.'' F.Lli De Cecco Di Filippo Fara S. 
Martino S.p.A., v. U.S., 216 F.3d 1027, 1034 (Fed. Cir. 2000).
    In determining a relevant and reasonable adverse FA rate, the 
Department notes that the FA rate selected is the highest calculated 
margin for any respondent in this proceeding. See Final LTFV 
Determination. It is reasonable to assume that if Ssangyong, Samyeung, 
and the other non-responding parties listed above could have 
demonstrated that their dumping margins are lower, they would have 
participated in this review and attempted to do so. See Rhone Poulenc, 
Inc. v. United States, 899 F.2d 1185, 1190-91 (Fed. Cir. 1990). 
Therefore, given these 14 companies' failure to cooperate to the best 
of their ability in this review, we have no reason to believe that 
their dumping margins would be any less than the highest rate we have 
ever calculated or that other available rates would reasonably ensure 
that they do not benefit by failing to cooperate fully. None of these 
companies have previously participated in this proceeding and therefore 
have been receiving the ``All Others'' rate of 8.10 percent. The ``All 
Others'' rate is obviously not enough to induce cooperation by these 
companies. We therefore have resorted to the highest calculated rate 
used throughout the proceeding and the rate that has been used as the 
FA rate in previous reviews. To further establish the relevance of the 
FA rate, we looked at the range of sales-specific margins for one of 
the cooperating respondents. Based on the range of margins, a 
significant number of sales by Dong Won are above the FA rate. See 
Facts Available Memorandum. Therefore, a rate of 31.23 percent can be 
considered relevant and, as such, appropriately used as FA for the non-
responding parties. Thus, we used the highest rate determined in any 
segment of this proceeding of 31.23 percent.

Normal Value Comparisons

    To determine whether sales of cookware from South Korea to the 
United States were made at less than NV, we compared the export price 
(EP) to the NV for both Dong Won and Daelim, as specified in the EP and 
NV sections of this notice, below. In accordance with section 
777A(d)(2) of the Act, we calculated monthly weighted-average prices 
for NV and compared these to individual EP transactions.

EP

    For Dong Won and Daelim, we used the Department's EP methodology, 
in accordance with section 772(a) of the Act, because the subject 
merchandise was sold by each producer outside the United States 
directly to the first unaffiliated purchaser in the United States prior 
to importation (or to unaffiliated trading companies for export to the 
United States) and CEP methodology was not otherwise warranted. We made 
deductions from the starting price for movement expenses in accordance 
with section 772(c) of the Act. Movement expenses included, where 
appropriate, brokerage and handling, international freight, and marine 
insurance, in accordance with section 772(c)(2)(A) of the Act. For Dong 
Won, we disallowed a duty drawback adjustment to the starting price. 
See Calculation Memorandum for Dong Won, dated January 30, 2001. See 
also Report on the Verification of the Sales and Cost Responses for 
Dong Won, dated January 30, 2001.

NV

1. Viability

    In order to determine whether there is a sufficient volume of sales 
in the home market to serve as a viable basis for calculating NV (i.e., 
the aggregate volume of home market sales of the foreign like product 
is equal to or greater than five percent of the aggregate volume of 
U.S. sales), we compared the respondent's volume of home market sales 
of the foreign like product to the volume of U.S. sales of the subject 
merchandise, in accordance with section 773(a)(1) of the Act. Since 
Daelim's aggregate volume of home market sales of the foreign like 
product was greater than five percent of its aggregate volume U.S. 
sales for the subject merchandise, we determined that the home market 
provides a viable basis for calculating NV. Therefore, pursuant to 
section 773(a)(1)(B) of the Act, we based NV on home market sales. 
Because Dong Won's aggregate volume of home market sales of the foreign 
like product was less than five percent of its aggregate volume of U.S. 
sales for the subject merchandise, we determined that the home market 
was not viable. Therefore, we have based NV for Dong Won on third 
country sales in the usual commercial quantities and in the ordinary 
course of trade. Since Dong Won's aggregate volume of sales of the 
foreign like product in Canada were more than five percent of its 
aggregate volume of U.S. sales of the subject merchandise, we used 
sales to Canada as the third country comparison sales. Furthermore, the 
Department noted that Canada was Dong Won's largest third country 
market for cookware in terms of both value and quantity, and the 
cookware that Dong Won exported to Canada was more similar to the 
subject merchandise exported to the United States than the cookware 
exported to other comparison markets. For a further discussion, see 
Memorandum Re: Selection of Third Country Comparison Market, dated June 
28, 2000.

2. COP Analysis

    Based on the cost allegations submitted by petitioners on September 
20, 2000, and in accordance with section 773(b)(2)(A)(i) of the Act, 
the Department found reasonable grounds to believe or suspect that Dong 
Won and Daelim had made sales in the foreign market at prices below the 
cost of producing the merchandise, in accordance with section 773(b)(1) 
of the Act. See Memorandum to Thomas

[[Page 11264]]

Futtner, Administrative Review of Antidumping Duty Order on Top of the 
Stove Stainless Steel Cooking Ware From Korea: Analysis of Petitioners' 
Allegation of Sales Below the Cost of Production for Dong Won Metal 
Co., Ltd. (``Dong Won''), dated May 20, 2000, and Memorandum to Thomas 
Futtner, Administrative Review of Antidumping Duty Order on Top of the 
Stove Stainless Steel Cooking Ware From Korea: Analysis of Petitioners' 
Allegation of Sales Below the Cost of Production for Dae-Lim Co., Ltd. 
(``Daelim''). As a result, the Department initiated COP investigations 
to determine whether Dong Won and Daelim made foreign market sales 
during the POR at prices below their COP within the meaning of section 
773(b) of the Act. We conducted the COP analysis described below.
A. Calculation of COP
    In accordance with section 773(b)(3) of the Act, we calculated, 
respectively, COP based on the sum of Daelim and Dong Won's cost of 
materials and fabrication (COM) for the foreign like product, plus 
amounts for SG&A, financial expense, and packing costs. Daelim was 
unable to segregate between its long-term and short-term investment 
income in its calculation of net interest expense. Therefore, we did 
not grant Daelim an interest income offset. See Cost Verification 
Report for Daelim, dated January 30, 2001. For the preliminary results, 
we relied on Dong Won's submitted information without adjustment.
B. Test of Foreign Market Sales Prices
    We compared COP to foreign market sale prices 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 foreign 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 permitted the recovery of all costs within a reasonable period of 
time, in accordance with sections 773(b)(1)(A) and (B) of the Act. On a 
product-specific basis, we compared the COP to foreign market prices, 
less any applicable movement charges, discounts and rebates, and 
selling expenses.
C. Results of the COP Test
    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 
less than the COP, we did not disregard any below-cost sales of that 
product because we determined that the below-cost sales were not made 
in substantial quantities. Where 20 percent or more of the respondent's 
sales of a given product during the POR were at prices less than the 
COP, we determined such sales to have been made in substantial 
quantities within an extended period of time, within the meaning of 
section 773(b)(2)(B) of the Act. Because we compared prices to POR or 
fiscal year average costs, we also determined that such sales were not 
made at prices which would permit recovery of all costs within a 
reasonable period of time, in accordance with section 773(b)(2)(D) of 
the Act.
    We found, looking at Dong Won's third country market sales and 
Daelim's home market sales, that both made sales at below COP prices 
within an extended period of time in substantial quantities. Further, 
we found that these sales prices did not permit for the recovery of 
costs within a reasonable period of time. Therefore, we excluded these 
sales from our analysis and used the remaining sales as the basis for 
determining NV, in accordance with section 773(b)(1) of the Act.

Product Comparisons

    In accordance with section 771(16) of the Act, we considered all 
products sold in the foreign markets as described in the ``Scope of the 
Review'' section of this notice, above, that were in the ordinary 
course of trade for purposes of determining appropriate product 
comparisons to U.S. sales. Where there were no sales of identical 
merchandise in the foreign markets made in the ordinary course of trade 
(i.e., sales within the contemporaneous window which passed the cost 
test), we compared U.S. sales to sales of the most similar foreign like 
product made in the ordinary course of trade, based on the 
characteristics listed in sections B and C of our antidumping 
questionnaire, or constructed value (CV), as appropriate.

Level of Trade (LOT)

    In accordance with section 773(a)(1)(B) of the Act, to the extent 
practicable, we determine NV based on sales in the comparison market at 
the same LOT as the US transaction. The NV LOT is that of the starting-
price sales in the comparison market or, when NV is based on CV, that 
of the sales from which we derive selling, general and administrative 
(SG&A) expenses and profit. For EP sales, the U.S. LOT is also the 
level of the starting-price sale, which is usually from the exporter to 
the importer.
    To determine whether NV sales are at a different LOT than EP sales, 
we examine stages in the marketing process and selling functions along 
the chain of distribution between the producer and the unaffiliated 
customer. If the comparison-market sales are at a different LOT, and 
the difference affects price comparability, as manifested in a pattern 
of consistent price differences between the sales on which NV is based 
and the export transaction, we make a LOT adjustment under section 
773(a)(7)(A) of the Act.
    In determining whether separate LOTs actually existed in the home 
and U.S. markets for each respondent, we examined whether the 
respondent's sales involved different marketing stages (or their 
equivalent) based on the channel of distribution, customer categories, 
and selling functions (or services offered) to each customer or 
customer category, in both markets.
    Dong Won reported sales through one LOT, consisting of two channels 
of distribution for its Canadian sales. The first channel of 
distribution was direct sales with two customer categories (i.e., 
distributors/wholesalers and retailers). The second channel of 
distribution was also sales to the two customer categories listed above 
but through Korean trading companies. Dong Won reported only EP sales 
in the U.S. market. For EP sales, Dong Won reported the same channels 
of distribution and customer categories as those in the third country 
market (i.e., direct sales to distributors/wholesalers and retailers 
and direct sales to distributers/wholesalers and retailers through 
Korean trading companies). Dong Won claimed in its response that its 
U.S. and third country market sales were made at the same LOT. For this 
reason, Dong Won has not asked for a LOT adjustment to NV for 
comparison to its EP sales.
    In analyzing Dong Won's selling activities for the third country 
and U.S. market, we determined that essentially the same services were 
provided for both markets. These selling activities in both markets 
were minimal in nature and limited to some low levels of technical 
service, warranty, ocean freight, and advertising expenses, with high 
levels of inland freight expenses. No other services were rendered for 
either third country or EP sales. Therefore, based upon this 
information, we have preliminarily determined that the LOT for all EP 
sales is the same as the LOT for all sales in the third country market. 
Accordingly, because we find the U.S. sales and third country market 
sales to be at the same LOT, no LOT adjustment under section 
773(a)(7)(A) of the Act is warranted for Dong Won. See Memorandum on 
LOT for Dong Won, dated January 30, 2001.

[[Page 11265]]

    Daelim reported sales through one LOT, consisting of two channels 
of distribution for its home market sales. The first channel of 
distribution was sales through its affiliate in the home market, Living 
Star. The second channel of distribution was direct sales on a very 
sporadic basis to its employees or, in extremely limited circumstances, 
to home market customers. We have preliminarily determined that these 
direct sales are outside the ordinary course of trade, and therefore 
have not considered them in the calculation of NV. See Memorandum on 
LOT for Daelim, dated January 30, 2001. Daelim reported only EP sales 
in the U.S. market. For EP sales, Daelim reported one LOT, consisting 
of two channels of distribution. The first channel of distribution was 
sales to unaffiliated U.S. importers. The second channel of 
distribution was sales to an unaffiliated Korean trading company.
    In analyzing Daelim's selling activities for the home market, we 
determined that the selling activities were minimal in nature and 
limited to some low levels of technical service, warranty, ocean 
freight, and advertising expenses, with high levels of inland freight 
expenses. No selling activities or services were rendered for EP sales. 
Therefore, based upon this information, we have preliminarily 
determined that there are differences in the number, type, and degree 
of selling functions performed in the home market as compared to EP 
sales.
    Section 773(a)(7)(A)(ii) of the Act states that the Department will 
grant a LOT adjustment only ``if the difference in the level of trade 
is demonstrated to affect price comparability, based on a pattern of 
consistent price differences between sales at different levels of trade 
in the country in which normal value is determined.'' As discussed 
above, we find that the U.S. market LOT (EP sales) is different from 
the home market LOT. However, since we have determined that there is 
only one LOT in the home market, we are unable to calculate ``a pattern 
of consistent price differences between sales at different levels of 
trade in the country in which normal value is determined.'' Thus, in 
this instance, we have not granted Daelim a LOT adjustment to NV.

Date of Sale

    For both foreign market and U.S. transactions, Daelim and Dong Won 
reported the date of the contract (i.e., purchase order) as the date of 
sale, i.e., the date when the material terms of sale are finalized. The 
respondents note that the purchase order confirms all major terms of 
sale--price, quantity, and product specification--as agreed to by the 
respondents and the customer. During the course of the review, the 
Department found that there were instances where the material terms of 
sale had changed after the issuance of an original purchase order. The 
Department noted and verified that, in those instances where the 
material terms of sale had changed after the issuance of an original 
purchase order, a new purchase order had been issued and the new 
purchase order served as the reported date of sale. For a detailed 
explanation, see Dong Won's sales verification report (January 30, 
2001). Therefore, because the Department found that there were no 
changes in the material terms of sale between the purchase order (or 
revised purchase order) and the invoice, the Department preliminarily 
determines that the purchase order date is the most appropriate date to 
use for the date of sale.

CV

    In accordance with section 773(e) of the Act, we calculated CV 
based on the respondents' respective cost of materials and fabrication 
employed in producing the subject merchandise, SG&A expenses, the 
profit incurred and realized in connection with the production and sale 
of the foreign like product, and U.S. packing costs. We used the cost 
of materials, fabrication, and G&A expenses as reported in the CV 
portion of the questionnaire response, adjusted for Daelim as discussed 
in the COP section above. We used the U.S. packing costs as reported in 
the U.S. sales portion of the respondents' questionnaire responses. For 
selling expenses, we used the average of the selling expenses reported 
for home market sales that survived the cost test, weighted by the 
total quantity of those sales. For actual profit, we first calculated, 
based on the home market sales that survived the cost test, the 
difference between the home market sales value and home market COP, and 
divided the difference by the home market COP. We then multiplied this 
percentage by the COP for each U.S. model to derive an actual profit.

Price-to-Price Comparisons

    For those comparison products for which there were sales that 
passed the cost test, we based the respondents' NV on the price at 
which the foreign like product is first sold for consumption in Korea 
(Daelim) or Canada (Dong Won), in the usual commercial quantities, in 
the ordinary course of trade in accordance with section 773(a)(1)(B)(i) 
of the Act. We based NV on sales at the same LOT as the EP sales.
    In accordance with section 773(a)(6) of the Act, we made 
adjustments to the foreign market price, where appropriate, for 
discounts, movement expenses (inland freight, brokerage and handling, 
and international freight). To account for differences in circumstances 
of sale between the foreign market and the United States, where 
appropriate, we adjusted the foreign market price by deducting foreign 
market direct selling expenses (including credit) and commissions and 
by adding U.S. direct selling expenses (including U.S. credit 
expenses). Because Dong Won could not substantiate the payment of 
duties for goods purchased, we disallowed a duty drawback adjustment to 
the starting price. For a further discussion, see Dong Won's sales 
verification report (January 30, 2001). Where commissions were paid on 
foreign market sales and no commissions were paid on U.S. sales, we 
increased NV by the lesser of either: (1) The amount of commission paid 
on the foreign market sales or (2) the indirect selling expenses 
incurred on U.S. sales. See 19 CFR 351.410(e). In order to adjust for 
differences in packing between the two markets, we deducted foreign 
market packing costs and added U.S. packing costs, where appropriate, 
in accordance with sections 773(a)(6)(A) and (B) of the Act.
    With respect to both CV and home market prices, we made 
adjustments, where appropriate, for inland freight, inland insurance, 
and discounts. We also reduced CV and home market prices by packing 
costs incurred in the home market, in accordance with section 
773(a)(6)(B)(i) of the Act. In addition, we increased CV and home 
market prices for U.S. packing costs, in accordance with section 
773(a)(6)(A) of the Act. We made further adjustments to home market 
prices, when applicable, to account for differences in physical 
characteristics of the merchandise, in accordance with section 
773(a)(6)(C)(ii) of the Act. Finally, pursuant to section 
773(a)(6)(C)(iii) of the Act, we made an adjustment for differences in 
circumstances of sale by deducting home market direct selling expenses 
and adding any direct selling expenses associated with U.S. sales not 
deducted under the provisions of section 772(d)(1) of the Act.

Preliminary Results of the Review

    As a result of our review, we preliminarily determine that the 
following weighted-average dumping margins exist for the period January 
1, 1999, through December 31, 1999:

[[Page 11266]]

------------------------------------------------------------------------
                                                                 Margin
                    Manufacturer/exporter                      (percent)
------------------------------------------------------------------------
Dong Won Metal Co., Ltd......................................      14.14
Dae-Lim Trading Co., Ltd.....................................       1.69
Sam Yeung Ind. Co., Ltd......................................      31.23
Ssang Yong Ind. Co., Ltd.....................................      31.23
Chefline Corporation.........................................      31.23
B.Y Enterprise, Ltd..........................................      31.23
Clad Co., Ltd................................................      31.23
Sae Skwang Aluminum Co., Ltd.................................      31.23
East One Co., Ltd............................................      31.23
East West Trading Korea, Ltd.................................      31.23
Bae Chin Metal Ind. Co.......................................      31.23
Han Il Stainless Steel Ind. Co., Ltd.........................      31.23
Il Shin Co., Ltd.............................................      31.23
Kyung-Dong Industrial Co., Ltd...............................      31.23
Poong Kang Ind. Co., Ltd.....................................      31.23
Namyang Kitchen Flower Co., Ltd..............................      31.23
------------------------------------------------------------------------

    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 5 days of the date of publication of 
this notice. Any interested party may request a hearing within 30 days 
of the date of publication of this notice. Parties who submit arguments 
in this proceeding are requested to submit with each argument: (1) A 
statement of the issue and (2) a brief summary of the argument. All 
case briefs must be submitted within 30 days of the date of publication 
of this notice. Rebuttal briefs, which are limited to issues raised in 
the case briefs, may be filed not later than seven days after the case 
briefs are filed. Further, we would appreciate it if parties submitting 
written comments would provide the Department with an additional copy 
of the public version of any such comments on diskette. A hearing, if 
requested, will be held two days after the date the rebuttal briefs are 
filed or the first business day thereafter.
    The Department will publish a notice of the final results of this 
administrative review, which will include the results of its analysis 
of the issues raised in any written comments, within 120 days from the 
publication of these preliminary results.
    The Department shall determine, and Customs shall assess, 
antidumping duties on all appropriate entries. The Department will 
issue appraisement instructions directly to Customs. The final results 
of this review shall be the basis for the assessment of antidumping 
duties on entries of merchandise covered by the determination and for 
future deposits of estimated duties. We have calculated importer-
specific ad valorem duty assessment rates based on the ratio of the 
total amount of dumping margins calculated for the examined sales to 
the entered value of sales used to calculate those duties. We will 
direct Customs to liquidate without regard to antidumping duties any 
entries for which the assessment rate is de minimis, i.e., less than 
0.5 percent.
    Furthermore, the following deposit requirements will be effective 
upon completion of the final results of these administrative reviews 
for all shipments of top-of-stove stainless steel cooking ware from 
Korea entered, or withdrawn from warehouse, for consumption on or after 
publication date of the final results of these administrative reviews, 
as provided by section 751(a)(1) of the Act: (1) The cash deposit rate 
for the reviewed companies will be the rate established in the final 
results of this administrative review, except if the rate is less than 
0.5 percent ad valorem and, therefore, de minimis, no cash deposit will 
be required; (2) for exporters not covered in this review, but covered 
in the original LTFV investigation or a previous review, the cash 
deposit rate will continue to be the company-specific rate published in 
the most recent period; (3) if the exporter is not a firm covered in 
this review, a previous 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 or any previous reviews or the LTFV investigation, the cash 
deposit rate will be 8.10 percent, the ``all-others'' rate established 
in the LTFV investigation. 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 preliminary reminder to importers of their 
responsibility under 19 CFR 351.402(f) 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 administrative review and this notice are in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act. Effective January 20, 
2001, Bernard T. Carreau is fulfilling the duties of the Assistant 
Secretary for Import Administration.

    Dated: January 30, 2001.
Bernard T. Carreau,
Deputy Assistant Secretary, AD/CVD Enforcement II.
[FR Doc. 01-4537 Filed 2-22-01; 8:45 am]
BILLING CODE 3510-DS-P
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