Commerce chooses a basis appropriate to ensure that its calculations depend on arm's length transactions. Commerce uses the ESP if the foreign manufacturer imports through a related company in the United States. Certain adjustments are authorized. Commerce explained how it calculated Sharp's dumping margin. FMV, the minuend in the dumping margin equation, is based on home market sales, third country sales, or constructed value.
Commerce considers differences between quantities sold in the foreign and domestic markets.
Commerce considers differences in physical characteristics of the products. Preliminary Results at 26,062. Applying the ESP offset, Commerce reduces the FMV by the amount of indirect selling expense incurred in making foreign sales. That allowance, however, may not exceed the ESP offset cap, which is set at the amount of indirect selling expense incurred on sales in the United States. Similarly, the ESP offset cap has been held not to conflict with the statute and to have a rational basis.