Stainless Steel Sheet and Strip in Coils From Japan: Preliminary Results of Antidumping Duty Administrative Review, 18369-18372 [E5-1655]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 70, Number 68 (Monday, April 11, 2005)]
[Notices]
[Pages 18369-18372]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-1655]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-588-845]


Stainless Steel Sheet and Strip in Coils From Japan: Preliminary 
Results of Antidumping Duty Administrative Review

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

.SUMMARY: In response to timely requests by the petitioners,\1\ the 
Department of Commerce is conducting an administrative review of the 
antidumping duty order on stainless steel sheet and strip in coils from 
Japan with respect to one company. The period of review is July 1, 
2003, through June 30, 2004. We preliminarily determine that, because 
the respondent did not participate in this review, it is appropriate to 
base its rate on adverse facts available.
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    \1\ The petitioners are Allegheny Ludlum, North American 
Stainless, Local 3303 United Auto Worker, United Steelworkers of 
America, AFL-CIO/CLC, and Zanesville Armco Independent Organization.
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    Interested parties are invited to comment on these preliminary 
results. If these preliminary results are adapted in our final results 
of administrative review, we will instruct U.S. Customs and Border 
Protection (CBP) to assess antidumping duties on all appropriate 
entries.

DATES: Effective Date: April 11, 2005.

FOR FURTHER INFORMATION CONTACT: Sophie Castro or P. Lee Smith, AD/CVD 
Operations, Office 2, Import Administration, Room B-099, International 
Trade Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
0588 or (202) 482-1655, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On June 8, 1999, the Department published in the Federal Register 
an amended final determination and antidumping duty order on stainless 
steel sheet and strip in coils from Japan (64 FR 30573).
    In response to a timely request by the petitioners, the Department 
published a notice of initiation of an administrative review with 
respect to the following company: Kawasaki Steel Corporation (KSC) and 
its alleged successor-in-interest JFE Steel Corporation (JFE) (69 FR 
52857, August 30, 2004). The period of review (POR) is July 1, 2003, 
through June 30, 2004.
    On September 8, 2004, the Department issued an antidumping duty 
questionnaire to KSC, which included questions addressing whether JFE 
is KSC's successor-in-interest. The response to the questionnaire was 
due on October 15, 2004, and subsequently extended to October 20, 2004. 
On September 16, 2004, counsel filed a notice of appearance indicating 
that it was representing JFE, and noting that KSC had changed its name 
to JFE prior to the POR. Moreover, in that letter, counsel pointed out 
that if the Department required notification of appearance on behalf of 
KSC based on the Department's initiation of the review with respect to 
both JFE and KSC, then the Department should consider the notice of 
appearance on behalf of JFE to serve as such notification for KSC (see, 
Letter to the Secretary of Commerce from KSC/JFE, dated September 16, 
2004). On October 20, 2004, KSC/JFE's counsel contacted the Department 
to state that KSC/JFE would not be submitting a response to the 
Department's antidumping questionnaire. KSC/JFE's counsel did not give 
any indication as to why KSC/JFE would not be submitting a response. 
See Memorandum from P. Lee Smith to the File, dated October 15, 2004, 
and Memorandum from Sophie Castro and P. Lee Smith to the File, dated 
October 20, 2004, regarding phone conversations with counsel for KSC/
JFE.

[[Page 18370]]

Scope of the Order

    The products covered by this order are certain stainless steel 
sheet and strip 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 sheet and strip 
is a flat-rolled product in coils that is greater than 9.5 mm in width 
and less than 4.75 mm in thickness, and that is annealed or otherwise 
heat treated and pickled or otherwise descaled. The subject sheet and 
strip may also be further processed (e.g., cold-rolled, polished, 
aluminized, coated, etc.) provided that it maintains the specific 
dimensions of sheet and strip following such processing.
    The merchandise subject to this order is currently classifiable in 
the Harmonized Tariff Schedule of the United States (HTS) at 
subheadings: 7219.13.00.31, 7219.13.00.51, 7219.13.00.71, 
7219.13.00.81, 7219.14.00.30, 7219.14.00.65, 7219.14.00.90, 
7219.32.00.05, 7219.32.00.20, 7219.32.00.25, 7219.32.00.35, 
7219.32.00.36, 7219.32.00.38, 7219.32.00.42, 7219.32.00.44, 
7219.33.00.05, 7219.33.00.20, 7219.33.00.25, 7219.33.00.35, 
7219.33.00.36, 7219.33.00.38, 7219.33.00.42, 7219.33.00.44, 
7219.34.00.05, 7219.34.00.20, 7219.34.00.25, 7219.34.00.30, 
7219.34.00.35, 7219.35.00.05, 7219.35.00.15, 7219.35.00.30, 
7219.35.00.35, 7219.90.00.10, 7219.90.00.20, 7219.90.00.25, 
7219.90.00.60, 7219.90.00.80, 7220.12.10.00, 7220.12.50.00, 
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, 7220.20.70.05, 7220.20.70.10, 7220.20.70.15, 
7220.20.70.60, 7220.20.70.80, 7220.20.80.00, 7220.20.90.30, 
7220.20.90.60, 7220.90.00.10, 7220.90.00.15, 7220.90.00.60, and 
7220.90.00.80. Although the HTS subheadings are provided for 
convenience and customs purposes, the Department's written description 
of the merchandise under review is dispositive.
    Excluded from the scope of this order are the following: (1) Sheet 
and strip that is not annealed or otherwise heat treated and pickled or 
otherwise descaled, (2) sheet and strip that is cut to length, (3) 
plate (i.e., flat-rolled stainless steel products of a thickness of 
4.75 mm or more), (4) flat wire (i.e., cold-rolled sections, with a 
prepared edge, rectangular in shape, of a width of not more than 9.5 
mm), and (5) razor blade steel. Razor blade steel is a flat-rolled 
product of stainless steel, not further worked than cold-rolled (cold-
reduced), in coils, of a width of not more than 23 mm and a thickness 
of 0.266 mm or less, containing, by weight, 12.5 to 14.5 percent 
chromium, and certified at the time of entry to be used in the 
manufacture of razor blades. See Chapter 72 of the HTS, ``Additional 
U.S. Note'' 1(d).
    Flapper valve steel is also excluded from the scope of the order. 
This product is defined as stainless steel strip in coils containing, 
by weight, between 0.37 and 0.43 percent carbon, between 1.15 and 1.35 
percent molybdenum, and between 0.20 and 0.80 percent manganese. This 
steel also contains, by weight, phosphorus of 0.025 percent or less, 
silicon of between 0.20 and 0.50 percent, and sulfur of 0.020 percent 
or less. The product is manufactured by means of vacuum arc remelting, 
with inclusion controls for sulphide of no more than 0.04 percent and 
for oxide of no more than 0.05 percent. Flapper valve steel has a 
tensile strength of between 210 and 300 ksi, yield strength of between 
170 and 270 ksi, plus or minus 8 ksi, and a hardness of between 460 and 
590. Flapper valve steel is most commonly used to produce specialty 
flapper valves in compressors.
    Also excluded is a product referred to as suspension foil, a 
specialty steel product used in the manufacture of suspension 
assemblies for computer disk drives. Suspension foil is described as 
302/304 grade or 202 grade stainless steel of a thickness between 14 
and 127 microns, with a thickness tolerance of plus-or-minus 2.01 
microns, and surface glossiness of 200 to 700 percent Gs. Suspension 
foil must be supplied in coil widths of not more than 407 mm, and with 
a mass of 225 kg or less. Roll marks may only be visible on one side, 
with no scratches of measurable depth. The material must exhibit 
residual stresses of 2 mm maximum deflection, and flatness of 1.6 mm 
over 685 mm length.
    Certain stainless steel foil for automotive catalytic converters is 
also excluded from the scope of this order. This stainless steel strip 
in coils is a specialty foil with a thickness of between 20 and 110 
microns used to produce a metallic substrate with a honeycomb structure 
for use in automotive catalytic converters. The steel contains, by 
weight, carbon of no more than 0.030 percent, silicon of no more than 
1.0 percent, manganese of no more than 1.0 percent, chromium of between 
19 and 22 percent, aluminum of no less than 5.0 percent, phosphorus of 
no more than 0.045 percent, sulfur of no more than 0.03 percent, 
lanthanum of less than 0.002 or greater than 0.05 percent, and total 
rare earth elements of more than 0.06 percent, with the balance iron.
    Permanent magnet iron-chromium-cobalt alloy stainless strip is also 
excluded from the scope of this order. This ductile stainless steel 
strip contains, by weight, 26 to 30 percent chromium, and 7 to 10 
percent cobalt, with the remainder of iron, in widths 228.6 mm or less, 
and a thickness between 0.127 and 1.270 mm. It exhibits magnetic 
remanence between 9,000 and 12,000 gauss, and a coercivity of between 
50 and 300 oersteds. This product is most commonly used in electronic 
sensors and is currently available under proprietary trade names such 
as ``Arnokrome III.'' \2\
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    \2\ ``Arnokrome III'' is a trademark of the Arnold Engineering 
Company.
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    Certain electrical resistance alloy steel is also excluded from the 
scope of this order. This product is defined as a non-magnetic 
stainless steel manufactured to American Society of Testing and 
Materials (ASTM) specification B344 and containing, by weight, 36 
percent nickel, 18 percent chromium, and 46 percent iron, and is most 
notable for its resistance to high temperature corrosion. It has a 
melting point of 1390 degrees Celsius and displays a creep rupture 
limit of 4 kilograms per square millimeter at 1000 degrees Celsius. 
This steel is most commonly used in the production of heating ribbons 
for circuit breakers and industrial furnaces, and in rheostats for 
railway locomotives. The product is currently available under 
proprietary trade names such as ``Gilphy 36.'' \3\
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    \3\ ``Gilphy 36'' is a trademark of Imphy, S.A.
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    Certain martensitic precipitation-hardenable stainless steel is 
also excluded from the scope of this order. This high-strength, ductile 
stainless steel product is designated under the Unified Numbering 
System (UNS) as S45500-grade steel, and contains, by weight, 11 to 13 
percent chromium, and 7 to 10 percent nickel. Carbon, manganese, 
silicon and molybdenum each comprise, by weight, 0.05 percent or less, 
with phosphorus and sulfur each comprising, by weight, 0.03 percent or 
less. This steel has copper, niobium, and titanium added to achieve 
aging, and will exhibit yield strengths as high as 1700 Mpa and 
ultimate tensile strengths as high as 1750 Mpa after aging, with 
elongation percentages of 3 percent or less in 50 mm. It is generally 
provided in thicknesses between 0.635 and 0.787 mm, and in widths of 
25.4 mm. This product is most commonly

[[Page 18371]]

used in the manufacture of television tubes and is currently available 
under proprietary trade names such as ``Durphynox 17.'' \4\
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    \4\ ``Durphynox 17'' is a trademark of Imphy, S.A.
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    Finally, three specialty stainless steels typically used in certain 
industrial blades and surgical and medical instruments are also 
excluded from the scope of this order. These include stainless steel 
strip in coils used in the production of textile cutting tools (e.g., 
carpet knives).\5\ This steel is similar to AISI grade 420 but 
containing, by weight, 0.5 to 0.7 percent of molybdenum. The steel also 
contains, by weight, carbon of between 1.0 and 1.1 percent, sulfur of 
0.020 percent or less, and includes between 0.20 and 0.30 percent 
copper and between 0.20 and 0.50 percent cobalt. This steel is sold 
under proprietary names such as ``GIN4 Mo.'' The second excluded 
stainless steel strip in coils is similar to AISI 420-J2 and contains, 
by weight, carbon of between 0.62 and 0.70 percent, silicon of between 
0.20 and 0.50 percent, manganese of between 0.45 and 0.80 percent, 
phosphorus of no more than 0.025 percent and sulfur of no more than 
0.020 percent. This steel has a carbide density on average of 100 
carbide particles per 100 square microns. An example of this product is 
``GIN5'' steel. The third specialty steel has a chemical composition 
similar to AISI 420 F, with carbon of between 0.37 and 0.43 percent, 
molybdenum of between 1.15 and 1.35 percent, but lower manganese of 
between 0.20 and 0.80 percent, phosphorus of no more than 0.025 
percent, silicon of between 0.20 and 0.50 percent, and sulfur of no 
more than 0.020 percent. This product is supplied with a hardness of 
more than Hv 500 guaranteed after customer processing, and is supplied 
as, for example, ``GIN6.'' \6\
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    \5\ This list of uses is illustrative and provided for 
descriptive purposes only.
    \6\ ``GIN4 Mo,'' ``GIN5'' and `` GIN6'' are the proprietary 
grades of Hitachi Metals America, Ltd.
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Use of Facts Available

    As noted above in the ``Background'' section, KSC/JFE did not 
submit a response to the Department's antidumping questionnaire. 
Because of KSC/JFE's refusal to cooperate in this review, we determine 
that the application of facts available is appropriate, pursuant to 
section 776(a)(2) of the Tariff Act of 1930 (the Act).
    Section 776(a)(2) of the Act provides that ``if an interested party 
or any other person (A) withholds information that has been requested 
by the administering authority; (B) fails to provide such information 
by the deadlines for the submission of the information or in the form 
and manner requested, subject to subsections (c)(1) and (e) of section 
782; (C) significantly impedes a proceeding under this title; or (D) 
provides such information but the information cannot be verified as 
provided in section 782(i), the administering authority shall, subject 
to section 782(d), use the facts otherwise available in reaching the 
applicable determination under this title.''
    Because this company refused to participate in this administrative 
review, we find that, in accordance with sections 776(a)(2)(A), (B), 
and (C) of the Act, the use of total facts available is appropriate 
(see, e.g., Stainless Steel Sheet and Strip in Coils from Taiwan: Final 
Results and Partial Rescission of Antidumping Duty Administrative 
Review, 69 FR 5960, 5963 (February 9, 2004) (for a more detailed 
discussion, see Stainless Steel Sheet and Strip in Coils from Taiwan: 
Preliminary Results and Partial Rescission of Antidumping Duty 
Administrative Review, 68 FR 46582 (August 6, 2003)).
    Section 776(b) of the Act provides that, if the Department finds 
that an interested party ``has failed to cooperate by not acting to the 
best of its ability to comply with a request for information,'' the 
Department may use information that is adverse to the interests of the 
party as facts otherwise available. 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 (SAA) accompanying the URAA, H.R. Doc. No. 
103-316, at 870 (1994). Furthermore, ``an affirmative finding of bad 
faith on the part of the 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).
    Section 776(b) of the Act authorizes the Department to use as 
adverse facts available information derived from the petition, the 
final determination from the less-than-fair-value (LTFV) investigation, 
a previous administrative review, or any other information placed on 
the record. Under section 782(c) of the Act, a respondent has a 
responsibility not only to notify the Department if it is unable to 
provide requested information, but also to provide a ``full explanation 
and suggested alternative forms.'' KSC/JFE did not respond to the 
Department's request for information, nor did it provide any 
explanation for this action, thereby failing to comply with this 
provision of the statute. Therefore, we determine that KSC/JFE failed 
to cooperate to the best of its ability, making the use of an adverse 
inference appropriate.
    The Department's practice when selecting an adverse rate from among 
the possible sources of information is to ensure that the margin is 
sufficiently adverse ``as to effectuate the purpose of the facts 
available rule to induce respondents to provide the Department with 
complete and accurate information in a timely manner.'' See Final 
Determination of Sales at Less than Fair Value: Static Random Access 
Memory Semiconductors from Taiwan, 63 FR 8909, 8932 (February 23, 
1998). In this proceeding, consistent with Department practice (see, 
e.g., Preliminary Results of Antidumping Duty Administrative Review 
Stainless Steel Bar from the United Kingdom, 69 FR 905, 905-06 (January 
7, 2004)), we have preliminarily assigned to exports of the subject 
merchandise produced by KSC/JFE the rate of 57.87 percent, which is 
based on the highest margin alleged in the petition for any Japanese 
producer.
    Section 776(c) of the Act provides that where the Department 
selects from among the facts otherwise available and relies on 
``secondary information,'' the Department shall, to the extent 
practicable, corroborate that information from independent sources 
reasonably at the Department's disposal. Secondary information is 
described in the SAA 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 SAA at 870 and 19 
CFR 351.308(c)(1). The SAA states that ``corroborate'' means to 
determine that the information used has probative value. Id. To 
corroborate secondary information, the Department will, to the extent 
practicable, examine the reliability and relevance of the information 
to be used. See 19 CFR 351.308(d).
    As explained below, the Department has, to the extent practicable, 
corroborated the information used as adverse facts available because 
information from a petition is considered secondary information. See 19 
CFR 351.308(c)-(d). We reviewed the adequacy and accuracy of the 
information in the petition during our pre-initiation analysis of the 
petition, to the extent appropriate information was available for this 
purpose (e.g., import statistics, call reports, and data from business 
contacts). Further, during the

[[Page 18372]]

investigation segment of the proceeding, the Department determined that 
the adverse facts available petition rate has probative value by 
comparing this rate to actual sales made by KSC during the period of 
investigation, the only respondent whose information the Department was 
able to verify and use for margin calculation purposes. In the 
investigation segment, after comparing the information in the petition 
to KSC's verified sales data, we found that the petition data was 
reliable for use as adverse facts available. See Corroboration 
Memorandum Detailing Application of Total Adverse Facts Available from 
James Doyle, Program Manager, to Roland MacDonald, Director Office VII, 
dated May 19, 1999, placed on the record of this review on January 4, 
2005.
    We preliminarily determine that the margin of 57.87 percent, 
selected as adverse facts available, is relevant, reliable, and 
therefore has probative value based on the corroborative procedures 
conducted in the investigation segment. Furthermore, no record evidence 
or argument has been submitted since that time that would cause the 
Department to call into question the accuracy of the data in the 
petition. Moreover, since KSC/JFE failed to cooperate, no additional 
information has been presented in the current review that would call 
into question the reliability or relevance of the margin, or the 
calculation on which it was based. Accordingly, we determine that this 
rate is an appropriate rate to be applied in this review to exports of 
the subject merchandise produced by KSC/JFE as facts otherwise 
available.

Preliminary Results of Review

    As a result of this review, we preliminarily determine that the 
weighted-average dumping margin for the period July 1, 2003, through 
June 30, 2004, is as follows:

------------------------------------------------------------------------
                                                               Percent
                   Manufacturer/exporter:                       margin
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Kawasaki Steel Corporation/JFE Steel Corporation.\7\.......       57.87
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\7\ See ``Assessment Rates and Cash Deposit Requirements'' below.

    Any interested party may request a hearing within 30 days of 
publication. See 19 CFR 351.310(c). Interested parties who wish to 
request a hearing or to participate if one is requested, must submit a 
written request to the Assistant Secretary for Import Administration, 
Room B-099, within 30 days of the date of publication of this notice. 
Requests should contain: (1) The party's name, address and telephone 
number; (2) the number of participants; and (3) a list of issues to be 
discussed. See 19 CFR 351.310(c).
    Issues raised in the hearing will be limited to those raised in the 
respective case briefs. Case briefs from interested parties must be 
submitted within 30 days of the issuance of this notice and rebuttal 
briefs, limited to the issues raised in the respective case briefs, 
must be submitted within 35 days of the issuance of this notice. 
Parties who submit case briefs or rebuttal briefs in this proceeding 
are requested to submit with each argument (1) a statement of the issue 
and (2) a brief summary of the argument. Parties are also encouraged to 
provide a summary of the arguments not to exceed five pages and a table 
of statutes, regulations, and cases cited.
    The Department will issue the final results of this administrative 
review, including the results of its analysis of issues raised in any 
written briefs, not later than 120 days after the date of publication 
of this notice, pursuant to section 751(a)(3)(A) of the Act.

Assessment Rates and Cash Deposit Requirements \8\
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    \8\ While the Department initiated this administrative review 
with respect to merchandise manufactured or exported by KSC as well 
as its alleged successor-in-interest, JFE, due to KSC/JFE's non-
response to the Department's questionnaire, the Department did not 
have the opportunity to conduct a successor-in-interest analysis in 
order to confirm whether, for antidumping purposes, JFE is the 
successor-in-interest to KSC with respect to the subject 
merchandise. Therefore, consistent with our decision to apply 
adverse facts available to KSC/JFE for its failure to respond to the 
Department's request for information and, because both the 
petitioners and respondents have consistently referred to KSC as JFE 
(see Respondent counsel's Notice of Appearance, dated September 16, 
2004, and Petitioner's Request for Review, dated July 30, 2004), the 
Department will issue instructions to CBP to collect cash deposits 
and assess antidumping duties on merchandise manufactured by KSC or 
by its alleged successor-in-interest JFE at the same rate in order 
to capture all entries of the subject merchandise by either KSC or 
JFE. Should an administrative review of KSC or JFE be requested and 
initiated in the future, we intend to conduct a successor-in-
interest analysis at that time.
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    The Department shall determine, and CBP shall assess, antidumping 
duties on all appropriate entries, in accordance with 19 CFR 351.212. 
The Department will issue appropriate appraisement instructions for the 
company subject to this review directly to CBP within 15 days of 
publication of the final results of this review. The final results of 
this review shall be the basis for the assessment of antidumping duties 
on entries of merchandise covered by the final results of this review 
and for future deposits of estimated duties, where applicable.
    The following cash deposit requirements will be effective for all 
shipments of the subject merchandise entered, or withdrawn from 
warehouse, for consumption on or after the publication date of the 
final results of this administrative review, as provided by section 
751(a)(1) of the Act: (1) The cash deposit rate for the reviewed 
company will be that established in the final results of this review, 
except if the rate is less than 0.50 percent, and therefore, de minimis 
within the meaning of 19 CFR 351.106(c)(1), in which case the cash 
deposit rate will be zero; (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) the cash deposit rate 
for all other manufacturers or exporters will continue to be 40.18 
percent, the ``All Others'' rate made effective by the LTFV 
investigation. See Notice of Amendment of Final Determination of Sales 
at Less Than Fair Value and Antidumping Duty Order: Stainless Steel 
Sheet and Strip in Coils from Japan, 64 FR 40565 (July 27, 1999). These 
requirements, when imposed, shall remain in effect until publication of 
the final results of the next administrative review.

Notification to Importers

    This notice also 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.
    This administrative review and notice are published in accordance 
with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.221.

    Dated: April 4, 2005.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. E5-1655 Filed 4-8-05; 8:45 am]
BILLING CODE 3510-DS-P