Certain Circular Welded Carbon Steel Pipes and Tubes From Taiwan: Preliminary Results of Antidumping Duty Administrative Review and Partial Rescission of Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

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

SUMMARY:

In response to a request from the petitioners, the Department of Commerce (the Department) is conducting an administrative review of the antidumping duty order on certain circular welded steel pipes and tubes from Taiwan. The review covers one manufacturer/exporter of the subject merchandise to the United States, and the period May 1, 1998 through April 30, 1999. We find that Yieh Hsing Enterprise Co. Ltd., (Yieh Hsing) made sales of subject merchandise below normal value; if these preliminary results are adopted in our final results of administrative review, we will instruct the Customs Service to assess antidumping duties based on the difference between the export price and the normal value. Regarding six other companies, we rescind the review.

Interested parties are invited to comment on these preliminary results. Parties who submit argument in this proceeding are requested to submit with the argument (1) A statement of the issue and (2) a brief summary of the argument (no longer than five pages, including footnotes).

EFFECTIVE DATE:

June 7, 2000.

FOR FURTHER INFORMATION CONTACT:

Thomas Killiam or Robert James, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone (202) 482-5222 or (202) 482-0649, respectively.

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. In addition, unless otherwise indicated, all citations to the Department's regulations are to the regulations codified at 19 CFR Part 351 (1998).

SUPPLEMENTARY INFORMATION:

Background

On May 28, 1999, the petitioners, Allied Tube & Conduit Corp., Wheatland Tube Company, and the Sawhill Tubular Division of Armco Inc., requested reviews of seven Taiwanese companies: An Mau Steel Co. (now renamed Sheng Yu Steel Co. Ltd., and hereafter referred to as Sheng Yu), Far East Machinery Co., Ltd. (FEMCO), Kao Hsing Chang Iron & Steel Corporation (KHC), Tai Feng Industries Ltd. (TFI), Yieh Hsing, Yu Din Steel Co. Ltd. (Yu Din), and Yieh Loong Co., Ltd. (Yieh Loong).

We initiated the reviews on June 30, 1999 (64 FR 35124). In response to our requests for information, FEMCO, ShengYu, and Yieh Loong reported that they made no U.S. sales or shipments of subject merchandise during the period of review (POR). On inquiry by the Department, Customs did not report any shipments by these companies during the POR. On September 2, 1999, petitioners withdrew their request as to Yu Din, KHC and Yieh Loong. Concerning TFI, that company ceased operations in November 1983. See Circular Welded Carbon Steel Pipes and Tubes from Taiwan; Final Results of Administrative Review of Antidumping Duty Order, 51 FR 43946 (December 5, 1986). For these reasons we rescind the review with respect to FEMCO, KHC, Sheng Yu, TFI, Yieh Loong and Yu Din, in accordance with 19 CFR 351.213(d).

In the most recently completed review of Yieh Hsing, the Department disregarded below-cost home market sales which failed the cost test. See Certain Circular Welded Carbon Steel Pipes and Tubes From Taiwan: Final Results of Antidumping Duty Administrative Review, 64 FR 69488 (December 13, 1999). Therefore, pursuant to section 773(b)(2)(A)(ii) of the Act, the Department has a reasonable basis to believe or suspect that Yieh Hsing made sales in the home market below the cost of production in the current review period. Accordingly, in accordance with section 773(b) of the Act, on January 24, 2000, the Department initiated an investigation of sales below cost.

Under section 751(a)(3)(A) of the Act, the Department may extend the deadline for completion of an administrative review if it determines that it is not practicable to complete the review within the statutory time limit of 365 days. On January 28, 2000, the Department extended the time limit for the preliminary results to May 30, 2000. See Extension of Time Limits for Antidumping Duty Administrative Review, 65 FR 6359 (February 9, 2000).

Period of Review

The review covers the period May 1, 1998 through April 30, 1999. The Department is conducting this review in accordance with section 751 of the Act.

Scope of the Review

Imports covered by this review are shipments of certain circular welded carbon steel pipes and tubes. The Department defines such merchandise as welded carbon steel pipes and tubes of circular cross section, with walls not thinner than 0.065 inch and 0.375 inch or more but not over 41/2 inches in outside diameter. These products are commonly referred to in the industry as “standard pipe” and are produced to various American Society for Testing Materials specifications, most notably A-53, A-120, or A-135. Standard pipe is currently classified under Harmonized Tariff Schedule of the United States (HTSUS) item numbers 7306.30.5025, 7306.30.5032, 7306.30.5040, and 7306.30.5055. Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the merchandise under review is dispositive.

Fair Value Comparisons

To determine whether sales of subject merchandise in the United States were made at less than fair value, we compared export price (EP) to the normal value (NV), as described in the “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. transactions.

Export Price

The Department treated Yieh Hsing's sales to the United States as EP sales, as defined in section 772(a) of the Act, because the merchandise was sold to unaffiliated U.S. purchasers prior to the date of importation and the constructed export price methodology was not warranted by the facts of the record. We based EP on the delivered, packed prices to unrelated purchasers in the United States. We made adjustments, where applicable, for foreign inland freight, foreign brokerage charges, and ocean freight in accordance with section 772(c) of the Act.

Normal Value

In order to determine whether there were sufficient sales of certain circular welded carbon steel pipes and tubes in the home market (HM) to serve as a viable basis for calculating NV, we compared the volume of home market sales of foreign like product to the volume of subject merchandise sold in the United States, in accordance with section 773(a)(1)(C) of the Act. Yieh Hsing's aggregate volume of HM sales of the foreign like product were greater than five percent of its aggregate volume of U.S. sales of the subject merchandise. Therefore, we have based NV on HM sales. In accordance with section 773(a)(6) of the Act, we adjusted NV, where appropriate, by deducting home market packing expenses and adding U.S. packing expenses. We also made deductions from NV for HM inland freight, early payment discounts, and other discounts. We made an adjustment to NV for differences in credit expenses, pursuant to section 773(a)(6)(C) of the Act. We made adjustments to NV, where appropriate, for differences in costs attributable to differences in the physical characteristics of the merchandise, pursuant to section 773(a)(6)(C)(ii) of the Act.

Sales Below Cost Investigation

In accordance with section 773(b)(1) of the Act, in determining whether to disregard home market sales made at prices below COP, we examined whether such sales were made within an extended period of time in substantial quantities, and whether such sales were made at prices which would permit recovery of all costs within a reasonable period of time.

Pursuant to section 773(b)(2)(C) of the Act, where less than 20 percent of a respondent's sales of a given model were at prices less than COP, we did not disregard any below-cost sales of that model because these below-cost sales were not made in substantial quantities. We found that, for certain models, 20 percent or more of the home market sales were sold at below-cost prices. Where 20 percent or more of a respondent's home market sales of a given model were at prices less than the COP, we disregarded the below-cost sales because such sales were found to be made (1) In substantial quantities within an extended period of time and (2) at prices which would not permit recovery of all costs within a reasonable period of time, in accordance with section 773(b)(2)(D) of the Act (i.e., the sales were made at prices below the weighted-average per unit COP for the POR). We used the remaining above-cost sales as the basis of determining NV if such sales existed, in accordance with section 773(b)(1).

Constructed Value

In accordance with section 773(e)(1) of the Act, we calculated constructed value (CV) based on the sum of the respondent's cost of materials, fabrication, and general expenses. In accordance with section 773(e)(2)(A) of the Act, we based selling, general, and administrative (SG&A) expenses and profit on the amounts incurred and realized by Yieh Hsing in connection with the production and sale of the foreign like product in the ordinary course of trade for consumption in the home market. For selling expenses, we used the weighted-average HM selling expenses. Pursuant to section 773(e)(3) of the Act, we included U.S. packing in CV.

Product Comparisons

Where there were no contemporaneous sales of identical or similar foreign like product in the comparison market to compare to U.S. sales, we compared U.S. sales to most similar home market merchandise or to CV.

Level of Trade

In accordance with section 773(a)(1)(B)(i) of the Act, to the extent practicable, we determine NV based on sales in the comparison market at the same level of trade (LOT). See, e.g., Certain Carbon Steel Plate from South Africa, Final Determination of Sales at Less Than Fair Value, 62 FR 61731 , 61732-33 (November 19, 1998). Yieh Hsing provided information with respect to its selling activities in both markets. Yieh Hsing offers each of its three categories of home market customers the same degree of sales support, including general technical advice and sale-specific warranty service. We therefore determine that Yieh Hsing sells to one level of trade in the home market. For its U.S. customers, Yieh Hsing provided freight and delivery arrangements, but no other services; otherwise, the levels of customer assistance and sales support which Yieh Hsing provided its home market and U.S. customers were not significantly different. For these reasons we determine that Yieh Hsing's sales in the two markets were at the same LOT, and no LOT adjustment is warranted.

Sales Comparisons

To determine whether sales of certain circular welded carbon steel pipes and tubes in the United States were made at less than NV, we compared EP to the NV, as described in the “Export Price” and “Normal Value'' sections of this notice. In accordance with section 777(A)(d)(d) of the Act, we calculated monthly weighted-average prices for NV and compared these to individual U.S. transactions.

Where there were no above-cost sales of identical merchandise in the home market made in the ordinary course of trade to compare to U.S. sales, we compared U.S. sales to most similar home market merchandise, based on the information provided by Yieh Hsing in response to our antidumping questionnaire.

Preliminary Results of Review

We preliminarily determine that the following margins exist for the period May 1, 1998 through April 31, 1999:

Interested parties may request a hearing not later than 30 days after publication of this notice. Interested parties may also submit written arguments in case briefs on these preliminary results within 30 days of the date of publication of this notice. Rebuttal briefs, limited to issues raised in case briefs, may be filed no later than five days after the time limit for filing case briefs. Parties who submit arguments are requested to submit with each argument a statement of the issue and a brief summary of the argument. All memoranda to which we refer in this notice can be found in the public reading room, located in the Central Records Unit, room B-009 of the main Department of Commerce building. Any hearing, if requested, will be held two days after the scheduled date for submission of rebuttal briefs.

The Department will publish the final results of this administrative review, including a discussion of its analysis of issues raised in any case or rebuttal brief or at a hearing. The Department will issue final results of this review within 120 days of publication of these preliminary results.

Upon completion of the final results in this review, the Department shall determine, and the Customs Service shall assess, antidumping duties on all appropriate entries. In accordance with 19 CFR 351.212 (b), we have calculated an importer/customer-specific assessment rate based on the ratio of the total amount of antidumping duties calculated for the examined sales to the quantity of those same sales. This Department will issue appraisement instructions on each exporter directly to the Customs Service.

Furthermore, the following deposit requirements will be effective upon completion of the final results of this administrative review for all shipments of certain circular welded carbon steel pipes and tubes from Taiwan entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of this administrative review, as provided for by section 751(a)(1) of the Act: (1) The cash deposit rates for Yieh Hsing will be the rate established in the final results of this administrative review, except that no cash deposit will be required if the rate is de minimis, i.e., less than 0.50 percent; (2) for previously reviewed or investigated companies not listed above, the cash deposit rate will continue to be the company-specific rate published for the most recent period; (3) if the exporter is not a firm covered in this review, a prior review, or the original 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) for all other producers and/or exporters of this merchandise, the cash deposit rate shall be 9.7%, 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 also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.401(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this period of review. 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 notice are issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.213(h).