Certain Corrosion-Resistant Carbon Steel Flat Products from Canada: Preliminary Results of Antidumping Duty Administrative Review, 53621-53627 [E5-4947]
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Federal Register / Vol. 70, No. 174 / Friday, September 9, 2005 / Notices
This action does not affect current
contracts awarded prior to the effective date
of this addition or options that may be
exercised under those contracts.
G. John Heyer,
General Counsel.
[FR Doc. E5–4900 Filed 9–8–05; 8:45 am]
DEPARTMENT OF COMMERCE
International Trade Administration
[A–122–822]
Certain Corrosion–Resistant Carbon
Steel Flat Products from Canada:
Preliminary Results of Antidumping
Duty Administrative Review
BILLING CODE 6353–01–P
Import Administration,
International Trade Administration,
U.S. Department of Commerce.
SUMMARY: In response to timely
requests, the U.S. Department of
Commerce (the Department) is
conducting an administrative review of
the antidumping duty order on certain
corrosion–resistant carbon steel flat
products (CORE) from Canada for the
period August 1, 2003, through July 31,
2004. The review covers two
respondents, Dofasco Inc. and Sorevco
and Company, Ltd. (collectively
Dofasco), and Stelco Inc. (Stelco).
The Department preliminarily
determines that Dofasco made sales to
the United States at less than normal
value (NV). If these preliminary results
are adopted in our final results of this
administrative review, we will instruct
U.S. Customs and Border Protection
(CBP) to assess antidumping duties on
entries of Dofasco’s merchandise during
the period of review. The Department
also preliminarily determines that
Stelco did not make sales to the United
States at less than NV. If these
preliminary results are adopted in our
final results of this administrative
review, we will instruct CBP to
liquidate without regard to antidumping
duties entries of Stelco’s merchandise
during the period of review. The
preliminary results are listed below in
the section titled ‘‘Preliminary Results
of Review.’’
EFFECTIVE DATE: September 9, 2005.
FOR FURTHER INFORMATION CONTACT: Kyle
Lamborn or Douglas Kirby, AD/CVD
Operations, Office 6, Import
Administration, International Trade
Administration, U.S. Department of
Commerce, 14th & Constitution Avenue,
NW, Washington, DC 20230; telephone:
202–482–3586 and 202–482–3782,
respectively.
AGENCY:
COMMISSION ON CIVIL RIGHTS
Sunshine Act Notice
AGENCY:
U.S. Commission on Civil
Rights.
Friday, September 16,
2005, 9:30 a.m., Commission Meeting.
DATE AND TIME:
U.S. Commission on Civil Rights,
624 9th Street, NW., Room 540,
Washington, DC 20425.
PLACE:
STATUS:
Agenda
I. Approval of Agenda
II. Approval of Minutes of Meeting Held
Friday, July 22 and Continued on
Friday, August 26, 2005
III. Commission Briefing: The PATRIOT
Act as it Relates to Anti-Arab and
Anti-Muslim Intolerance
• Introductory Remarks by Chairman
• Speakers’ Presentations
• Questions by Commissioners and
Staff Director to Speakers
IV. Announcements
V. Staff Director’s Report
VI. State Advisory Committee Issues
• State Advisory Committee Reports
• Other State Advisory Committee
Issues
VII. Program Planning
• Elementary and Secondary School
Desegregation
VIII. Discussion of Commission
Briefings
• Stagnation of the Black Middle
Class Briefing Report
• Future Briefing
SUPPLEMENTARY INFORMATION:
IX. Future Agenda Items
Background
FOR FURTHER INFORMATION CONTACT:
Terri Dickerson, Press and
Communications (202) 376–8582.
Kenneth L. Marcus,
Staff Director, Acting General Counsel.
[FR Doc. 05–17968 Filed 9–7–05; 8:49 am]
BILLING CODE 6335–01–M
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The Department published the
antidumping duty order on CORE from
Canada on August 19, 1993. See
Antidumping Duty Orders: Certain
Corrosion–Resistant Carbon Steel Flat
Products and Certain Cut–to-Length
Carbon Steel Plate From Canada, 58 FR
44162, as amended by Amended Final
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53621
Determinations of Sales at Less Than
Fair Value and Antidumping Orders:
Certain Corrosion–Resistant Carbon
Steel Flat Products and Certain Cut–toLength Carbon Steel Plate From Canada,
60 FR 49582 (September 26, 1995)
(Amended Final and Order). On August
3, 2004, the Department published in
the Federal Register a notice of
‘‘Opportunity to Request Administrative
Review’’ of the antidumping duty order
on CORE from Canada for the period
August 1, 2003, through July 31, 2004.
See Antidumping or Countervailing
Duty Order, Finding, or Suspended
Investigation; Opportunity to Request
Administrative Review, 69 FR 46496.
Based on timely requests, in accordance
with section 751(a) of the Tariff Act of
1930, as amended (the Act), the
Department initiated an administrative
review of the antidumping duty order
on CORE from Canada, covering the
period August 1, 2003, through July 31,
2004. See Initiation of Antidumping and
Countervailing Duty Administrative
Reviews and Request for Revocation in
Part, 69 FR 56745 (September 22, 2004).
This administrative review covers the
following exporters: Dofasco, Impact
Steel Canada, Ltd. (Impact Steel), and
Stelco. On April 1, 2005, the
Department rescinded the
administrative review of Impact Steel
because Impact Steel timely withdrew
its request, and no other party requested
an administrative review of Impact
Steel. See Notice of Rescission, in Part,
of Antidumping Duty Administrative
Review: Corrosion–Resistant Carbon
Steel Flat Products From Canada, 70 FR
17648 (April 7, 2005).
On April 15, 2005, the Department
extended the deadline for the
preliminary results of this antidumping
duty administrative review from May 3,
2005, to August 31, 2005. Notice of
Extension of Time Limit for Preliminary
Results of Antidumping Duty
Administrative Review: Corrosion–
Resistant Carbon Steel Flat Products
From Canada, 70 FR 20863 (April 22,
2005).
Period of Review
The period of review (POR) is August
1, 2003, through July 31, 2004.
Scope of the Order
The product covered by the order is
certain corrosion–resistant steel, and
includes flat–rolled carbon steel
products, of rectangular shape, either
clad, plated, or coated with corrosion–
resistant metals such as zinc, aluminum,
or zinc-, aluminum-, nickel- or iron–
based alloys, whether or not corrugated
or painted, varnished or coated with
plastics or other nonmetallic substances
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in addition to the metallic coating, in
coils (whether or not in successively
superimposed layers) and of a width of
0.5 inch or greater, or in straight lengths
which, if of a thickness less than 4.75
millimeters, are of a width of 0.5 inch
or greater and which measures at least
10 times the thickness or if of a
thickness of 4.75 millimeters or more
are of a width which exceeds 150
millimeters and measures at least twice
the thickness, as currently classifiable in
the U.S. Harmonized Tariff Schedule
(HTSUS) under item numbers
7210.30.0030, 7210.30.0060,
7210.41.0000, 7210.49.0030,
7210.49.0090, 7210.61.0000,
7210.69.0000, 7210.70.6030,
7210.70.6060, 7210.70.6090,
7210.90.1000, 7210.90.6000,
7210.90.9000, 7212.20.0000,
7212.30.1030, 7212.30.1090,
7212.30.3000, 7212.30.5000,
7212.40.1000, 7212.40.5000,
7212.50.0000, 7212.60.0000,
7215.90.1000, 7215.90.3000,
7215.90.5000, 7217.20.1500,
7217.30.1530, 7217.30.1560,
7217.90.1000, 7217.90.5030,
7217.90.5060, and 7217.90.5090.
Although the HTSUS subheadings are
provided for convenience and customs’
purposes, the Department’s written
description of the merchandise under
the order is dispositive.
Included in the order are corrosion–
resistant flat–rolled products of non–
rectangular cross-section where such
cross-section is achieved subsequent to
the rolling process (i.e., products which
have been ‘‘worked after rolling’’) for
example, products which have been
beveled or rounded at the edges.
Excluded from the order are flat–rolled
steel products either plated or coated
with tin, lead, chromium, chromium
oxides, both tin and lead (‘‘terne plate’’),
or both chromium and chromium oxides
(‘‘tin–free steel’’), whether or not
painted, varnished or coated with
plastics or other nonmetallic substances
in addition to the metallic coating. Also
excluded from the order are clad
products in straight lengths of 0.1875
inch or more in composite thickness
and of a width which exceeds 150
millimeters and measures at least twice
the thickness. Also excluded from the
order are certain clad stainless flat–
rolled products, which are three–
layered corrosion–resistant carbon steel
flat–rolled products less than 4.75
millimeters in composite thickness that
consist of a carbon steel flat–rolled
product clad on both sides with
stainless steel in a 20%-60%-20% ratio.
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ANALYSIS
Affiliation and Collapsing
For purposes of this review, we have
collapsed Dofasco, Sorevco, and Do Sol
Galva Ltd. (DSG) and treated them as a
single respondent, as we have done in
prior segments of the proceeding. There
have been no changes to the pertinent
facts such as, for example, ownership
structure, that warrant reconsideration
of our decisions to collapse these
companies. As noted on page A–8 of
Dofasco’s Section A questionnaire
response dated December 22, 2004,
Sorevco still operates as a 50–50 joint
venture between Dofasco and Ispat
Sidbec. See Final Determinations of
Sales at Less Than Fair Value: Certain
Hot–Rolled Carbon Steel Flat Products,
Certain Cold–Rolled Carbon Steel Flat
Products, Certain Corrosion–Resistant
Carbon Steel Flat Products, and Certain
Cut–to-Length Carbon Steel Plate From
Canada, 58 FR 37099, 37107 (July 9,
1993), for our analysis regarding
collapsing Sorevco.
Do Sol Galva Ltd. (DSG) is a
galvanizing line operated as a limited
partnership between Dofasco and
Arcelor. As in the prior review; 1) DSG
remains a partnership between Dofasco
(80% ownership interest), and the
European steel producer Arcelor (20%
ownership interest); 2) Dofasco
continues to operate DSG, which is
located at the Dofasco Hamilton plant,
and to treat this line as its number five
galvanizing line; and 3) all of the DSG
production workers are still employed
by Dofasco. See pages A–5 and A–8 of
Dofasco’s Section A questionnaire
response dated December 22, 2004. For
all intents and purposes, DSG is still
considered another production line run
on Dofasco’s property. See Certain
Certain Corrosion–Resistant Carbon
Steel Flat Products from Canada:
Preliminary Results of Antidumping
Duty Administrative Review, 69 FR
55138, 55139 (September 13, 2004),
unchanged in Certain Corrosion–
Resistant Carbon Steel Flat Products
From Canada: Final Results of
Antidumping Duty Administrative
Review, 70 FR 13458 (March 21, 2005)
(Final Results of 10th Review), for our
analysis regarding collapsing DSG. As
we are collapsing Dofasco, Sorevco, and
DSG for purposes of the preliminary
results, we will instruct CBP to apply
Dofasco’s rate to merchandise produced,
exported, or processed by Sorevco or
DSG.
Consistent with our determination in
past segments of this proceeding, in
these preliminary results, we have not
collapsed Dofasco and its toll producer
DJ Galvanizing Ltd. Partnership (DJG)
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(formerly DNN Galvanizing Ltd.
Partnership (DNN)). Therefore, for
CORE that is processed by DJG before it
is exported to the United States, we
will, for assessment and cash deposit
purposes, instruct CBP to: (1) Apply
Dofasco’s rate on merchandise supplied
by Dofasco or DSG; (2) apply the
company specific rate on merchandise
supplied by other previously reviewed
companies; and, (3) apply the ‘‘all
others’’ rate for merchandise supplied
by companies which have not been
reviewed in the past.
Model–Match Criteria
In its questionnaire response, Dofasco
reported ‘‘surface type’’ as a physical
characteristic, and argued that it should
be incorporated as a model–match
criterion in order to capture the
different applications and uses of the
products based on that criterion. See
Dofasco’s section B questionnaire
response dated January 12, 2005, at
pages B–7 to B–9. Dofasco claims that
the higher cost of CORE for exposed, as
opposed to unexposed, applications also
justifies the inclusion of a new model–
match criterion.
For purposes of the preliminary
results, we have not changed the
model–match criteria to account for
‘‘surface type.’’ We excluded this field
in the prior administrative review
because: (1) Dofasco has not defined its
proposed new product characteristic in
sufficiently precise terms for the
Department to consider integrating this
characteristic into its model match
hierarchy; (2) Dofasco has not
demonstrated that any industry–wide,
commercially accepted standards exist
that recognize the material
characteristics of exposed products
made only from the hot–dipped
galvanized process; (3) we do not find
significant cost differences between
exposed and unexposed galvanized
steels; (4) we continue to find a degree
of interchangeability of use for Dofasco’s
Extragal products that can reasonably be
attributed to the subjective preferences
of the customer rather than
commercially significant differences in
the physical characteristics of the
product; and, (5) the record evidence
demonstrates that there have been no
new technological advancements in this
field since the original investigation.
See Final Results of 10th Review, and
accompanying Issues and Decision
Memorandum at Comment 1. Dofasco
has provided the same information on
the record of this administrative review.
Therefore, because no new information
has been provided to warrant our
reconsideration in the instant review,
we continue to find that it is
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inappropriate to incorporate ‘‘surface
type’’ as a physical characteristic into
our model match hierarchy.
Product Comparisons
In accordance with section 771(16) of
the Act, we considered all products
produced by the respondents that are
covered by the description in the
‘‘Scope of the Order’’ section, above,
and sold in the home market during the
POR, to be foreign like products for
purposes of determining appropriate
product comparisons to U.S. sales.
Where there were no sales of identical
merchandise in the home market to
compare to U.S. sales, we compared
U.S. sales to the most similar foreign
like product on the basis of the
characteristics listed in Appendix V of
the Department’s November 9, 2004,
antidumping questionnaires.
Normal Value Comparisons
To determine whether sales of subject
merchandise to the United States were
made at less than NV, we compared the
export price (EP) or the constructed
export price (CEP) to NV, as described
in the ‘‘Export Price and Constructed
Export Price,’’ and ‘‘Normal Value’’
sections of this notice. In accordance
with section 777A(d)(2) of the Act, we
calculated monthly weighted–average
prices for NV and compared these to
individual U.S. transaction prices.
Export Price and Constructed Export
Price
A. Classification of U.S. Sales
In accordance with section 772(a) of
the Act, we used EP when the subject
merchandise was sold, directly or
indirectly, to the first unaffiliated
purchaser in the United States prior to
importation, and CEP was not otherwise
warranted by facts on the record. In
accordance with section 772(b) of the
Act, CEP is the price at which subject
merchandise is first sold (or agreed to be
sold) in the United States before or after
the date of importation by or for the
account of the producer or exporter of
such merchandise, or by a seller
affiliated with the producer or exporter.
As discussed below, based on evidence
on the record, we conclude that certain
sales are made by Dofasco’s U.S.
affiliate, Dofasco U.S.A. (DUSA), and
should thus be classified as CEP sales.
Also, as discussed below, we conclude
that Dofasco’s other sales are EP, and
that all Stelco’s sales are EP.
Dofasco’s sales in the United States
through its affiliate, DUSA, were
reported as channel 2 (shipped directly
to the U.S. customer) or channel 3
(shipped indirectly to the U.S.
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customer) sales. We find that for these
sales, both parties to the transaction
(DUSA and the unaffiliated customer)
were located in the United States, and
that the transfer of ownership was
executed in the United States. See
Dofasco’s section A questionnaire
response at A–26. Therefore, consistent
with our determination in prior reviews,
we are classifying Dofasco’s Channels 2
and 3 sales as CEP sales. See Certain
Corrosion–Resistant Carbon Steel Flat
Products From Canada: Final Results of
Antidumping Duty Administrative
Review, 69 FR 2566 (January 16, 2004),
and accompanying Issues and Decision
Memorandum (Final Results of 9th
Review) at Comment 1, and Final
Results of 10th Review at Comment 5.
We have classified Dofasco’s Channel
1 (direct shipments) and 4 (direct
through commission agents) sales, and
all of Stelco’s U.S. sales, as EP sales. As
in prior reviews, we find these to be
direct sales made in Canada without the
involvement of any affiliated party in
the United States. Id. Accordingly, we
are treating these respective sales as EP
sales for both Dofasco and Stelco.
The Department calculated EP or CEP
based on packed prices to customers in
the United States. We made deductions
from the starting price (net of discounts
and rebates) for movement expenses
(foreign and U.S. movement, U.S.
customs duty and brokerage, and post–
sale warehousing) in accordance with
section 772(c)(2) of the Act and section
351.401(e) of the Department’s
regulations. In addition, for CEP sales,
in accordance with sections 772(d)(1)
and (2) of the Act, we deducted from the
starting price credit expenses, indirect
selling expenses, including inventory
carrying costs, commissions, royalties,
and warranty expenses incurred in the
United States and Canada associated
with economic activities in the United
States. As in prior reviews, certain
Dofasco sales have undergone minor
further processing in the United States
as a condition of sale. The Department
has deducted the price charged to
Dofasco by the unaffiliated contractor
for this minor further processing from
gross unit price to determine U.S. price,
consistent with section 772(d)(2) of the
Act. See Certain Corrosion Resistant
Carbon Steel Flat Products From
Canada: Preliminary Results of
Antidumping Duty Administrative
Review, 68 FR 53105, 53106 (September,
9, 2003), for a discussion of this
adjustment, finalized in Final Results of
9th Review at 69 FR 2566, 2567.
Date of Sale
As provided in section 351.401(i) of
the Department’s regulations, we
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53623
determined the date of sale based on the
date on which the exporter or producer
established the material terms of sale.
See Allied Tube and Conduit Corp. v.
United States, 127 F. Supp. 2d 207, 219
(CIT 2000). Dofasco reported, as in the
prior review, that except for long–term
contracts and sales of secondary
products, the date on which all material
terms of sale are established is the final
order acknowledgment or re–
acknowledgment date, where prices and
quantity are binding upon buyer and
seller. See page A–23 of Dofasco’s
Section A questionnaire response dated
December 22, 2004. Therefore, for these
sales, we used this reported date as the
date of sale. For Dofasco’s sales made
pursuant to long–term contracts, we
used the date of the contract as date of
sale, which is when prices are fixed and
the customer agrees to purchase one
hundred percent of its requirements for
a particular part from Dofasco. Id. page
A–24. For Dofasco’s sales of secondary
products for which there is no order
acknowledgment date, we preliminarily
determine that date of shipment best
reflects the date on which the material
terms of sale are established since date
of shipment is almost always the day
before the invoice is produced. Id. page
A–23. Accordingly, for these sales, we
have relied on the date of shipment as
the date of sale. See, e.g., Notice of Final
Determination of Sales at Less Than
Fair Value: Certain Durum Wheat and
Hard Red Spring Wheat from Canada,
68 FR 52741 (Sept. 5, 2003) and
accompanying Issues and Decision
Memorandum at Comment 3 (Wheat
from Canada). Dofasco did not have
sales of secondary products to the
United States during the POR.
Stelco reported that, generally, the
quantity and product specifications are
not set until the date of shipment,
which is the date on which the invoice
is issued. Therefore, for Stelco’s sales,
we determined that the date of invoice
reflects the date of sale since this is
when the material terms of the sale are
fixed. In those instances when the date
of shipment occurred prior to the date
of invoice (when Stelco ships directly
from a processor to a customer and the
paperwork necessary to invoice the
customer is delayed), Stelco reported,
and we used, the date of shipment as
the date of sale. See Stelco Section B
questionnaire response, dated December
23, 2004, at B–2; see, e.g., Wheat from
Canada at Comment 3.
B. Universe of Sales in Margin
Calculation
Section 751(a)(2)(A) of the Act states
that a dumping calculation should be
performed for each entry during the
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POR. Our standard practice for EP sales
is to use entry date to determine the
universe of U.S. sales in the margin
calculation. See Circular Welded Non–
Alloy Steel Pipe From the Republic of
Korea; Final Results of Antidumping
Duty Administrative Review, 63 FR
32833, 32836 (June 6, 1998), and
accompanying Issues and Decision
Memorandum at Comment 2.
Accordingly, we have included in our
analysis for these final results all entries
of EP sales made during the POR.
The Department’s normal practice for
CEP sales is to review each transaction
that has a date of sale within the POR.
See section 351.212 of the Department’s
regulations and the preamble to that
section in Antidumping Duties;
Countervailing Duties; Final Rule, 62 FR
27296, 27314–15 (May 19, 1997).
However, in Notice of Final Results of
Antidumping Duty Administrative
Review of Circular Welded Non–alloy
Steel Pipe from the Republic of Korea,
66 FR 18747 (April 11, 2001), at
Comment 2, the Department recognized
unique circumstances that could lead us
to base the margin for CEP sales on the
sales of merchandise entered, rather
than sold during the POR. In that case,
there was no dispute that the
respondents could tie their sales to
specific entries during the POR because
their U.S. sales were made to order, the
date of sale occurred prior to the date
of entry, the merchandise was shipped
directly from the factory to the final
customer, and the respondents were
generally the importer of record.
We find that Dofasco’s Channel 2 and
3 CEP sales follow a similar fact pattern
and therefore, we consider the date of
entry to be the appropriate date for
establishing the universe of sales for
purposes of calculating a margin. First,
we are able to tie almost all these sales
to entries since Dofasco, in the instant
review, provided exact entry dates for
the vast majority of its U.S. sales. As
was done in the previous review, for the
few CEP transactions where the entry
date was not obtained from its customs
broker, Dofasco reasonably reported
shipment date as the entry date because
entry into the United States normally
occurs the same day as shipment from
its factory. See Dofasco’s January 12,
2005, section C questionnaire response
at page C–71. Second, the merchandise
was shipped directly from the factory to
the location specified by the customer.
See Dofasco’s December 22, 2004,
section A questionnaire response at
page A–14 and A–15. Third, since the
vast majority of these sales were made
pursuant to long–term contracts, and the
date of the long–term contract was used
as the date of sale, the dates of sale
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occurred prior to the dates of entry. See
Dofasco’s December 22, 2004, section A
questionnaire response at page A–28.
Therefore, for these reasons, we have
performed a margin calculation on each
Channel 2 and 3 CEP sale, entered
during the POR. The date of sale for
these entries is primarily the date of
contract. Also included is a limited
number of entries of ‘‘spot’’ sales for
which the date of sale is based on date
of order acknowledgment. See page A–
26 of Dofasco’s section A questionnaire
response dated December 22, 2004. This
is consistent with our finding in the
Final Results of 10th Review at
Comment 5.
Normal Value
A. Home Market 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 five percent or
more of the aggregate volume of U.S.
sales), we compared the volume of each
respondent’s home market sales of the
foreign like product to the volume of
U.S. sales of subject merchandise. Based
on this comparison, we determined for
both Dofasco and Stelco, that the
quantity of sales in their home market
exceeded five percent of their sales of
CORE to the United States. See section
351.404(b) of the Department’s
regulations. Therefore, in accordance
with section 773(a)(1)(B)(i) of the Act,
we have based NV on the price at which
the foreign like product was first sold
for consumption in the home market, in
the usual commercial quantities, in the
ordinary course of trade, and, to the
extent practicable, at the same level of
trade (LOT) as the EP or CEP. See ‘‘Level
of Trade’’ section below.
B. Affiliated Party Transactions and
Arm’s–Length Test
We used sales to affiliated customers
in the home market only where we
determined such sales were made at
arm’s–length prices (i.e., at prices
comparable to the prices at which the
respondent sold identical merchandise
to unaffiliated customers). To test
whether the sales to affiliates were made
at arm’s–length prices, we compared the
unit prices of sales to affiliated and
unaffiliated customers net of all
movement charges, direct selling
expenses, discounts and packing. In
accordance with the Department’s
practice, if the prices charged to an
affiliated party were, on average,
between 98 and 102 percent of the
prices charged to unaffiliated parties for
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Sfmt 4703
merchandise identical or most similar to
that sold to the affiliated party, we
consider the sales to be at arm’s–length
prices. See section 351.403(c) of the
Department’s regulations. Where the
affiliated party transactions did not pass
the arm’s–length test, all sales to that
affiliated party have been excluded from
the NV calculation. Because the
aggregate volume of sales to these
affiliates is less than 5 percent of total
home market sales, we did not request
downstream sales. See section
351.403(d) of the Department’s
regulations; see also Antidumping
Proceedings: Affiliated Party Sales in
the Ordinary Course of Trade, 67 FR
69186 (November 15, 2002).
C. Cost of Production Analysis
The Department disregarded certain
Dofasco and Stelco sales that failed the
cost test in the prior review. We,
therefore, have reasonable grounds to
believe or suspect, pursuant to section
773(b)(2)(A)(ii) of the Act, that sales of
the foreign like product under
consideration for the determination of
NV in this review may have been made
at prices below the cost of production
(COP). Thus, pursuant to section
773(b)(1) of the Act, we examined
whether Dofasco’s and Stelco’s sales in
the home market were made at prices
below the COP.
We compared sales of the foreign like
product in the home market with
model–specific COP figures in the POR.
In accordance with section 773(b)(3) of
the Act, we calculated COP based on the
sum of the costs of materials and
fabrication employed in producing the
foreign like product, plus selling,
general and administrative (SG&A)
expenses, and all costs and expenses
incidental to placing the foreign like
product in a packed condition and
ready for shipment. In our sales–belowcost analysis, we used home market
sales and COP information provided by
Dofasco and Stelco in their
questionnaire responses.
We compared the weighted–average
COPs to home market sales of the
foreign like product, as required under
section 773(b) of the Act, in order to
determine whether these sales had been
made at prices below the COP. In
determining whether to disregard home
market sales made at prices below the
COP, we examined whether such sales
were made (1) within an extended
period of time in substantial quantities,
and (2) at prices which permitted the
recovery of all costs within a reasonable
period of time in the normal course of
trade, in accordance with section
773(b)(1)(A) and (B) of the Act. On a
product–specific basis, we compared
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the COP to home market prices, less any
movement charges, discounts, and
direct and indirect selling expenses.
Pursuant to section 773(b)(2)(C) of the
Act, where less than 20 percent of a
respondent’s sales of a given model
were at prices less than the COP, we did
not disregard any below–cost sales of
that model because the below–cost sales
were not made in substantial quantities
within an extended period of time.
Where 20 percent or more of a
respondent’s sales of a given model
were at prices less than the COP, we
disregarded the below–cost sales
because they were made in substantial
quantities within an extended period of
time, in accordance with sections
773(b)(2)(B) and (C) of the Act. Because
we compared prices to average costs in
the POR, we also determined that the
below–cost prices did not permit the
recovery of costs within a reasonable
period of time, in accordance with
section 773(b)(1)(B) of the Act.
D. Constructed Value
In accordance with section 773(a)(4)
of the Act, we used constructed value
(CV) as the basis for NV when there
were no above–cost contemporaneous
sales of identical or similar merchandise
in the comparison market. We
calculated CV in accordance with
section 773(e) of the Act. We included
the cost of materials and fabrication,
SG&A, and profit. In accordance with
section 773(e)(2)(A) of the Act, we based
SG&A expenses and profit on the
amounts incurred and realized by the
respondent in connection with the
production and sale of the foreign like
product in the ordinary course of trade
for consumption in the foreign country.
For selling expenses, we used the
weighted–average home market selling
expenses.
For those product comparisons for
which there were sales at prices above
the COP, we based NV on home market
prices to affiliated (when made at prices
determined to be arms–length) or
unaffiliated parties, in accordance with
section 773(a)(1)(A) and (B) of the Act.
We made adjustments for differences in
cost attributable to differences in
physical characteristics of the
merchandise, pursuant to section
773(a)(6)(C)(ii) of the Act, and for
circumstance–of-sales (COS)
differences, in accordance with
773(a)(6)(C)(iii) of the Act and section
351.410 of the Department’s regulations.
We relied on our model match criteria
in order to match U.S. sales of subject
merchandise to comparison sales of the
foreign like product based on the
reported physical characteristics of the
subject merchandise. Where there were
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no sales of identical merchandise in the
home market to compare to U.S. sales,
we compared U.S. sales to the next most
similar foreign like product on the basis
of the characteristics and reporting
instructions listed in the Department’s
questionnaire.
Home market starting prices were
based on packed prices net of discounts
and rebates. We made adjustments,
where applicable, for packing and
movement expenses, in accordance with
sections 773(a)(6)(A) and (B) of the Act.
For comparisons to EP, we made COS
adjustments to NV by deducting home
market packing, movement, and direct
selling expenses (e.g., credit, warranties,
and royalties), and adding U.S. packing,
movement, and direct selling expenses.
For comparison to CEP, we made COS
adjustments by deducting home market
direct selling expenses pursuant to
section 773(a)(6)(C)(iii) of the Act and
section 351.410 of the Department’s
regulations. We offset commissions paid
on sales to the United States by the
lesser of U.S. commissions or
comparison (home) market indirect
selling expenses.
Level of Trade
Section 773(a)(1)(B)(i) of the Act
states that, to the extent practicable, the
Department will calculate NV based on
sales at the same LOT as the EP or CEP.
Sales are made at different LOTs if they
are made at different marketing stages
(or their equivalent). See section
351.412(c)(2) of the Department’s
regulations. Substantial differences in
selling activities are a necessary, but not
sufficient, condition for determining
that there is a difference in the stages of
marketing. Id.; see also Notice of Final
Determination of Sales at Less Than
Fair Value: Certain Cut–to-Length
Carbon Steel Plate From South Africa,
62 FR 61731, 61732 (November 19,
1997) (South African Plate Final). In
order to determine whether the
comparison sales were at different
stages in the marketing process than the
U.S. sales, we reviewed the distribution
system in each market (i.e., the chain of
distribution),1 including selling
functions,2 class of customer (customer
1 The marketing process in the United States and
in the comparison markets begins with the producer
and extends to the sale to the final user or
consumer. The chain of distribution between the
two may have many or few links, and the
respondents’ sales occur somewhere along this
chain. In performing this evaluation, we considered
the narrative responses of each respondent to
properly determine where in the chain of
distribution the sale occurs.
2 Selling functions associated with a particular
chain of distribution help us to evaluate the level(s)
of trade in a particular market. For purposes of this
preliminary determination, we have organized the
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53625
category), and the level of selling
expenses for each type of sale.
Pursuant to section 773(a)(1)(B)(i) of
the Act, in identifying levels of trade for
EP and comparison market sales (i.e.,
NV based on either home market or
third country prices3), we consider the
starting prices before any adjustments.
For CEP sales, we consider only the
selling activities reflected in the price
after the deduction of expenses and
profit under section 772(d) of the Act.
See Micron Technology, Inc. v. United
States, 243 F. 3d 1301, 1314–1315 (Fed.
Cir. 2001).
When the Department is unable to
match U.S. sales to sales of the foreign
like product in the comparison market
at the same LOT as the EP or CEP, the
Department may compare the U.S. sale
to sales at a different LOT in the
comparison market. In comparing EP or
CEP sales at a different LOT in the
comparison market, where available
data make it practicable, we make a LOT
adjustment under section 773(a)(7)(A) of
the Act. Finally, for CEP sales only, if
a NV LOT is more remote from the
factory than the CEP LOT and we are
unable to make a level of trade
adjustment, the Department shall grant
a CEP offset, as provided in section
773(a)(7)(B) of the Act. See South
African Plate Final at 62 FR 61731,
61732–33 (November 19, 1997).
A. Dofasco LOT Analysis
We obtained information from
Dofasco regarding the marketing stages
involved in making the reported home
market and U.S. sales, including a
description of the selling activities
performed by the respondents for each
channel of distribution. In the current
review, as in the previous review,
Dofasco claimed that sales in both the
home market and the United States
market were made at different LOTs. In
the previous review, we concluded that
Dofasco did sell at different LOTs. See
Final Results of 10th Review.
We examined the chain of
distribution and the selling activities
associated with sales reported by
Dofasco to three distinct customer
categories (automotive, construction,
and service centers) in its single channel
of distribution in the home market. See
Memorandum from Kyle Lamborn (AD/
CVD Financial Analyst) through Sean
Carey (Acting Program Manager) to the
common selling functions into four major
categories: sales process and marketing support,
technical service, freight and delivery, and
inventory maintenance.
3 Where NV is based on CV, we determine the NV
LOT based on the LOT of the sales from which we
derive selling expenses, G&A and profit for CV,
where possible.
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File; Certain Corrosion–Resistant
Carbon Steel Flat Products from
Canada: Analysis of Dofasco Inc.
(Dofasco) and Sorevco for the
Preliminary Results, (August 31, 2005)
(Dofasco Analysis Memo, on file in the
Central Record Unit (CRU), room B–099
of the main Commerce building. We
found that sales to the construction and
service center customer categories, were
similar with respect to technical service,
freight services, and warehouse/
inventory maintenance, and that they
differed only slightly with respect to
sales process. Therefore, we found that
these customer categories constituted a
distinct level of trade (LOTH2). We
found that sales to automotive customer
category differed significantly from
LOTH2 with respect to sales process
and technical service and therefore,
constitute a distinct level of trade
(LOTH1). Thus, based upon our analysis
of the home market, we found that
LOTH1 and LOTH2 constitute two
different levels of trade.
Dofasco reported EP sales through two
channels of distribution: Channel 1
including sales to automotive, service
centers, and construction, and Channel
4 sales to construction. We examined
the chain of distribution and the selling
activities associated with sales to
construction and service center
categories through these channels and
found them to be similar with respect to
technical service, freight services, and
warehouse/inventory maintenance; they
differed only slight with respect to the
sales process. Therefore, we found that
these two channels of distribution to
these customer categories constituted a
distinct level of trade (LOTU2). We
found that sales to the automotive
customer category differed significantly
from LOTU2 with respect to sales
process and technical service, but were
similar with respect to freight service
and warehouse/inventory maintenance.
Since the sales process and technical
service functions comprise significant
selling activities, we find that these
factors are determinative in finding that
sales to this automotive customer
category constitute a separate level of
trade (LOTU1). Thus, based upon our
analysis of Dofasco’s EP sales, we find
that LOTU1 and LOTU2 constitute two
different levels of trade.
We then compared the two EP levels
of trade to the two home market LOTs.
We found that LOTU2 differed
considerably from LOTH1 with respect
to sales process, technical services and
freight services. However, LOTU2 was
similar to LOTH2 with respect to sales
process, technical service, and
warehouse/inventory maintenance. We
also found that LOTU1 differed
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15:19 Sep 08, 2005
Jkt 205001
considerably from LOTH2 with respect
to sales process, technical services, and
freight services. However, LOTU1 was
similar to LOTH1 with respect to sales
process, technical service, and
warehouse/inventory maintenance.
Consequently, we matched LOTU2 sales
to sales at the same level of trade in the
home market (LOTH2), and LOTU1
sales to sales at the same level of trade
in the home market (LOTH1). Where we
did not match products at the same
LOT, and there was a pattern of
consistent prices differences between
different LOTs, we made a LOT
adjustment. See section 773(a)(7)(A) of
the Act; see, also Dofasco Analysis
Memo at page 2.
Dofasco had two channels of
distribution related to its CEP sales to
automotive customers through Dofasco
USA. These channels of distribution
had the same selling functions and thus
constitute a single level of trade
(LOTU3). We compared LOTU3 to our
two home market LOTs. We found that
LOTU3 differed considerably from
LOTH2 with respect to sales process,
technical services and freight services.
However, the LOTU3 was similar to
LOTH1 with respect to sales process,
technical service, and warehouse/
inventory maintenance. Consequently,
we matched LOTU3 sales to sales at the
same LOT in the home market (LOTH1)
and, where possible, we matched CEP
sales to NV based on home market sales
in LOTH1 and made no CEP offset
adjustment. Where we did not match
products at the same LOT, and there
was a pattern of consistent prices
differences between different LOTs, we
made a LOT adjustment. See section
773(a)(7)(A) of the Act. Where we are
unable to make a LOT adjustment, we
considered granting a CEP offset as
provided for in section 773(a)(7)(B) of
the Act. After comparing the CEP LOT
(LOTU3) with the LOTH1, we have
preliminarily determined that the
LOTH1 is not more remote from the
factory than the LOTU3. As indicated by
Exhibit I.A.8 of Dofasco’s Section A
response, dated December 22, 2004, as
well as elsewhere in Dofasco’s response,
the vast majority of selling functions for
both U.S. and home market sales are
performed by Dofasco in Canada.
Therefore, a CEP offset is not warranted
under section 773(a)(7)(B) of the Act.
B. Stelco LOT Analysis
Stelco stated in its response that it
was not claiming a LOT adjustment.
However, Stelco did provide a chart of
its selling functions, which we
analyzed. In the home market, Stelco
sold directly to end–users and service
centers. Stelco performed a variety of
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Fmt 4703
Sfmt 4703
distinct selling functions in both home
market channels of distribution,
including research and development,
engineering services, personnel training,
and technical advice. All of Stelco’s
U.S. sales are EP sales to end–users.
We examined Stelco’s chain of
distribution and the selling activities in
the home market, and categorized its
channel of sales under two customer
categories, sales to end–users and
service centers. See Memorandum to the
File, From Douglas Kirby Through Sean
Carey, re: Analysis of Stelco for the
Preliminary Results, dated August 31,
2004 (Stelco Preliminary Analysis
Memorandum), on file in the CRU. We
found that sales to end–users (LOTH1)
differed significantly from sales to
service centers (LOTH2) with respect to
sales process and technical service, and
slightly with regard to freight services.
Therefore, we found that these customer
categories in the home market constitute
two distinct levels of trade in the home
market.
Stelco reported only EP sales through
one channel of distribution to just one
customer category in the United States,
end–users (LOTU3). Therefore, Stelco
has only a single LOT in the United
States. We compared the EP LOT to the
two home market LOTs. We found that
LOTU3 differed significantly from
LOTH1 with respect to sales process
and slightly with regard to technical
services. Even though both LOTU3 and
LOTH1 comprise end–users, Stelco
noted in its response that its selling
activities for its U.S. sales were made at
a lesser intensity than for its home
market sales, and that they included
sales of samples at ‘‘small quantities of
non–repeat business that is directed to
a die developer rather than to the
customer’s stamping facility.’’ See
Stelco’s Sections A, B and C
supplemental questionnaire response,
dated May 20, 2005 at 4. We then
compared LOTU3 to LOTH2 and found
that they differed with respect to
technical support and freight services.
Our comparisons of the EP LOT to the
two NV LOTs noted above, taken in
conjunction with the narrative
description that characterizes some
types of U.S. customers as being distinct
from typical end–users or service
centers, leads us to conclude that the EP
LOT is significantly different from those
found in the home market. Therefore,
we disregarded level of trade and we
compared LOTU3 EP sales to all home
market LOTs.
Currency Conversion
For purposes of the preliminary
results, in accordance with section
773(a) of the Act, we made currency
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conversions based on the official
exchange rates in effect on the dates of
the U.S. sales as certified by the Federal
Reserve Bank of New York.
Preliminary Results of Review
As a result of this review, we
preliminarily find that the following
weighted–average dumping margins
exist:
Producer/Manufacturer/Exporter
Weighted–
Average
Margin
Dofasco Inc., Sorevco Inc., Do
Sol Galva Ltd. .........................
Stelco Inc. ...................................
11.08 %
De minimis
Cash Deposit Requirements
If the preliminary results are adopted
in the final results of review, the
following deposit requirements will be
effective upon completion of the final
results of this administrative review for
all shipments of the subject
merchandise entered, or withdrawn
from warehouse, for consumption on or
after the publication of the final results
of this administrative review, as
provided in section 751(a)(1) of the Act:
(1) The cash deposit rate for Dofasco,
Sorevco, and DSG will be that
established in the final results of this
review for Dofasco (and entities
collapsed with Dofasco); (2) the cash
deposit rate for Stelco will be that
established in the final results of this
review (currently de minimis); (3) for
previously reviewed or investigated
companies not covered in this review,
the cash deposit rate will continue to be
the company–specific rate published for
the most recent period; (4) if the
exporter is not a firm covered in this
review, a prior review, or the less–thanfair–value (LTFV) investigation, but the
manufacturer is, the cash deposit rate
will be the rate established for the most
recent period for the manufacturer of
the subject merchandise; and (5) if
neither the exporter nor the
manufacturer is a firm covered in this or
any previous proceeding conducted by
the Department, the cash deposit rate
will continue to be the ‘‘all others’’ rate
established in the LTFV investigation,
which is 18.71 percent. See Amended
Final and Order. For shipments
processed by DJG we will, (1) apply
Dofasco’s rate on merchandise supplied
by Dofasco or DSG; (2) apply the
company specific rate on merchandise
supplied by other previously reviewed
companies; and, (3) apply the ‘‘all
others’’ rate for merchandise supplied
by companies which have not been
reviewed in the past. These cash deposit
requirements, when imposed, shall
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15:19 Sep 08, 2005
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remain in effect until publication of the
final results of the next administrative
review.
Duty Assessment
Upon publication of the final results
of review, the Department shall
determine, and CBP shall assess,
antidumping duties on all appropriate
entries. The Department will issue
appraisement instructions directly to
CBP on the 41st day after the date of
publication of the final results of
review. The final results of this review
shall be the basis for the assessment of
antidumping duties on entries of
merchandise covered by this review and
for future deposits of estimated duties.
For duty assessment purposes, we
calculate an importer–specific
assessment rate by dividing the total
dumping margins calculated for the U.S.
sales of each importer by the respective
total entered value of these sales. If the
preliminary results are adopted in the
final results of review, this rate will be
used for the assessment of antidumping
duties on all entries of the subject
merchandise by that importer during the
POR.
The Department clarified its
‘‘automatic assessment’’ regulation on
April 30, 2003. See Notice of Policy
Concerning Assessment of Antidumping
Duties, 68 FR 23954 (May 6, 2003). This
clarification will apply to entries of
subject merchandise during the POR
produced by companies included in
these final results of review for which
the reviewed companies did not know
their merchandise was destined for the
United States. In such instances, we will
instruct CBP to liquidate unreviewed
entries at the ‘‘all others’’ rate if there is
no rate for the intermediate
company(ies) involved in the
transaction.
Public Comment
Pursuant to section 351.224(b) of the
Department’s regulations, the
Department will disclose to any party to
the proceeding the calculations
performed in connection with these
preliminary results, within five days
after the date of publication of this
notice. Pursuant to section 351.309 of
the Department’s regulations, interested
parties may submit case briefs in
response to these preliminary results no
later than 30 days after the date of
publication of this notice. Rebuttal
briefs, limited to issues raised in case
briefs, may be filed no later than 5 days
after the time limit for filing case briefs.
Parties who submit arguments in this
proceeding are requested to submit with
the argument: (1) A statement of the
issue, (2) a brief summary of the
PO 00000
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Fmt 4703
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53627
argument, and (3) a table of authorities.
Further, the Department requests that
parties submitting briefs provide the
Department with an additional copy of
the public version of any such
comments on a computer diskette. Case
and rebuttal briefs must be served on
interested parties in accordance with
section 351.303(f) of the Department’s
regulations. Any interested party may
request a hearing within 30 days of
publication of this notice. Any hearing,
if requested, will normally be held two
days after the date for submission of
rebuttal briefs. The Department will
issue the final results of this
administrative review, which will
include the results of its analysis of
issues raised in any such written
comments or at a hearing, within 120
days after the publication of this notice,
unless extended. See section 351.213(h)
of the Department’s regulations.
Notification to Importers
This notice serves as a preliminary
reminder to importers of their
responsibility under section 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.
These preliminary results of this
administrative review and notice are
issued and published in accordance
with sections 751(a)(1) and 777(i)(1) of
the Act.
Dated: August 31, 2005.
Barbara E. Tillman,
Acting Assistant Secretary for Import
Administration.
[FR Doc. E5–4947 Filed 9–8–05; 8:45 am]
BILLING CODE 3510–DS–S
DEPARTMENT OF COMMERCE
International Trade Administration
[A–580–807]
Polyethylene Terephthalate Film from
Korea; Five-year (Sunset) Reviews of
Antidumping Duty Order; Final Results
Import Administration,
International Trade Administration,
Department of Commerce.
SUMMARY: On February 2, 2005, the
Department of Commerce (the
Department) initiated a sunset review of
the antidumping duty order on
polyethylene terephthalate (PET) film
AGENCY:
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Agencies
[Federal Register Volume 70, Number 174 (Friday, September 9, 2005)]
[Notices]
[Pages 53621-53627]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-4947]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
International Trade Administration
[A-122-822]
Certain Corrosion-Resistant Carbon Steel Flat Products from
Canada: Preliminary Results of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration, U.S.
Department of Commerce.
SUMMARY: In response to timely requests, the U.S. Department of
Commerce (the Department) is conducting an administrative review of the
antidumping duty order on certain corrosion-resistant carbon steel flat
products (CORE) from Canada for the period August 1, 2003, through July
31, 2004. The review covers two respondents, Dofasco Inc. and Sorevco
and Company, Ltd. (collectively Dofasco), and Stelco Inc. (Stelco).
The Department preliminarily determines that Dofasco made sales to
the United States at less than normal value (NV). If these preliminary
results are adopted in our final results of this administrative review,
we will instruct U.S. Customs and Border Protection (CBP) to assess
antidumping duties on entries of Dofasco's merchandise during the
period of review. The Department also preliminarily determines that
Stelco did not make sales to the United States at less than NV. If
these preliminary results are adopted in our final results of this
administrative review, we will instruct CBP to liquidate without regard
to antidumping duties entries of Stelco's merchandise during the period
of review. The preliminary results are listed below in the section
titled ``Preliminary Results of Review.''
EFFECTIVE DATE: September 9, 2005.
FOR FURTHER INFORMATION CONTACT: Kyle Lamborn or Douglas Kirby, AD/CVD
Operations, Office 6, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th & Constitution
Avenue, NW, Washington, DC 20230; telephone: 202-482-3586 and 202-482-
3782, respectively.
SUPPLEMENTARY INFORMATION:
Background
The Department published the antidumping duty order on CORE from
Canada on August 19, 1993. See Antidumping Duty Orders: Certain
Corrosion-Resistant Carbon Steel Flat Products and Certain Cut-to-
Length Carbon Steel Plate From Canada, 58 FR 44162, as amended by
Amended Final Determinations of Sales at Less Than Fair Value and
Antidumping Orders: Certain Corrosion-Resistant Carbon Steel Flat
Products and Certain Cut-to-Length Carbon Steel Plate From Canada, 60
FR 49582 (September 26, 1995) (Amended Final and Order). On August 3,
2004, the Department published in the Federal Register a notice of
``Opportunity to Request Administrative Review'' of the antidumping
duty order on CORE from Canada for the period August 1, 2003, through
July 31, 2004. See Antidumping or Countervailing Duty Order, Finding,
or Suspended Investigation; Opportunity to Request Administrative
Review, 69 FR 46496. Based on timely requests, in accordance with
section 751(a) of the Tariff Act of 1930, as amended (the Act), the
Department initiated an administrative review of the antidumping duty
order on CORE from Canada, covering the period August 1, 2003, through
July 31, 2004. See Initiation of Antidumping and Countervailing Duty
Administrative Reviews and Request for Revocation in Part, 69 FR 56745
(September 22, 2004). This administrative review covers the following
exporters: Dofasco, Impact Steel Canada, Ltd. (Impact Steel), and
Stelco. On April 1, 2005, the Department rescinded the administrative
review of Impact Steel because Impact Steel timely withdrew its
request, and no other party requested an administrative review of
Impact Steel. See Notice of Rescission, in Part, of Antidumping Duty
Administrative Review: Corrosion-Resistant Carbon Steel Flat Products
From Canada, 70 FR 17648 (April 7, 2005).
On April 15, 2005, the Department extended the deadline for the
preliminary results of this antidumping duty administrative review from
May 3, 2005, to August 31, 2005. Notice of Extension of Time Limit for
Preliminary Results of Antidumping Duty Administrative Review:
Corrosion-Resistant Carbon Steel Flat Products From Canada, 70 FR 20863
(April 22, 2005).
Period of Review
The period of review (POR) is August 1, 2003, through July 31,
2004.
Scope of the Order
The product covered by the order is certain corrosion-resistant
steel, and includes flat-rolled carbon steel products, of rectangular
shape, either clad, plated, or coated with corrosion-resistant metals
such as zinc, aluminum, or zinc-, aluminum-, nickel- or iron-based
alloys, whether or not corrugated or painted, varnished or coated with
plastics or other nonmetallic substances
[[Page 53622]]
in addition to the metallic coating, in coils (whether or not in
successively superimposed layers) and of a width of 0.5 inch or
greater, or in straight lengths which, if of a thickness less than 4.75
millimeters, are of a width of 0.5 inch or greater and which measures
at least 10 times the thickness or if of a thickness of 4.75
millimeters or more are of a width which exceeds 150 millimeters and
measures at least twice the thickness, as currently classifiable in the
U.S. Harmonized Tariff Schedule (HTSUS) under item numbers
7210.30.0030, 7210.30.0060, 7210.41.0000, 7210.49.0030, 7210.49.0090,
7210.61.0000, 7210.69.0000, 7210.70.6030, 7210.70.6060, 7210.70.6090,
7210.90.1000, 7210.90.6000, 7210.90.9000, 7212.20.0000, 7212.30.1030,
7212.30.1090, 7212.30.3000, 7212.30.5000, 7212.40.1000, 7212.40.5000,
7212.50.0000, 7212.60.0000, 7215.90.1000, 7215.90.3000, 7215.90.5000,
7217.20.1500, 7217.30.1530, 7217.30.1560, 7217.90.1000, 7217.90.5030,
7217.90.5060, and 7217.90.5090. Although the HTSUS subheadings are
provided for convenience and customs' purposes, the Department's
written description of the merchandise under the order is dispositive.
Included in the order are corrosion-resistant flat-rolled products
of non-rectangular cross-section where such cross-section is achieved
subsequent to the rolling process (i.e., products which have been
``worked after rolling'') for example, products which have been beveled
or rounded at the edges. Excluded from the order are flat-rolled steel
products either plated or coated with tin, lead, chromium, chromium
oxides, both tin and lead (``terne plate''), or both chromium and
chromium oxides (``tin-free steel''), whether or not painted, varnished
or coated with plastics or other nonmetallic substances in addition to
the metallic coating. Also excluded from the order are clad products in
straight lengths of 0.1875 inch or more in composite thickness and of a
width which exceeds 150 millimeters and measures at least twice the
thickness. Also excluded from the order are certain clad stainless
flat-rolled products, which are three-layered corrosion-resistant
carbon steel flat-rolled products less than 4.75 millimeters in
composite thickness that consist of a carbon steel flat-rolled product
clad on both sides with stainless steel in a 20%-60%-20% ratio.
ANALYSIS
Affiliation and Collapsing
For purposes of this review, we have collapsed Dofasco, Sorevco,
and Do Sol Galva Ltd. (DSG) and treated them as a single respondent, as
we have done in prior segments of the proceeding. There have been no
changes to the pertinent facts such as, for example, ownership
structure, that warrant reconsideration of our decisions to collapse
these companies. As noted on page A-8 of Dofasco's Section A
questionnaire response dated December 22, 2004, Sorevco still operates
as a 50-50 joint venture between Dofasco and Ispat Sidbec. See Final
Determinations of Sales at Less Than Fair Value: Certain Hot-Rolled
Carbon Steel Flat Products, Certain Cold-Rolled Carbon Steel Flat
Products, Certain Corrosion-Resistant Carbon Steel Flat Products, and
Certain Cut-to-Length Carbon Steel Plate From Canada, 58 FR 37099,
37107 (July 9, 1993), for our analysis regarding collapsing Sorevco.
Do Sol Galva Ltd. (DSG) is a galvanizing line operated as a limited
partnership between Dofasco and Arcelor. As in the prior review; 1) DSG
remains a partnership between Dofasco (80% ownership interest), and the
European steel producer Arcelor (20% ownership interest); 2) Dofasco
continues to operate DSG, which is located at the Dofasco Hamilton
plant, and to treat this line as its number five galvanizing line; and
3) all of the DSG production workers are still employed by Dofasco. See
pages A-5 and A-8 of Dofasco's Section A questionnaire response dated
December 22, 2004. For all intents and purposes, DSG is still
considered another production line run on Dofasco's property. See
Certain Certain Corrosion-Resistant Carbon Steel Flat Products from
Canada: Preliminary Results of Antidumping Duty Administrative Review,
69 FR 55138, 55139 (September 13, 2004), unchanged in Certain
Corrosion-Resistant Carbon Steel Flat Products From Canada: Final
Results of Antidumping Duty Administrative Review, 70 FR 13458 (March
21, 2005) (Final Results of 10th Review), for our analysis regarding
collapsing DSG. As we are collapsing Dofasco, Sorevco, and DSG for
purposes of the preliminary results, we will instruct CBP to apply
Dofasco's rate to merchandise produced, exported, or processed by
Sorevco or DSG.
Consistent with our determination in past segments of this
proceeding, in these preliminary results, we have not collapsed Dofasco
and its toll producer DJ Galvanizing Ltd. Partnership (DJG) (formerly
DNN Galvanizing Ltd. Partnership (DNN)). Therefore, for CORE that is
processed by DJG before it is exported to the United States, we will,
for assessment and cash deposit purposes, instruct CBP to: (1) Apply
Dofasco's rate on merchandise supplied by Dofasco or DSG; (2) apply the
company specific rate on merchandise supplied by other previously
reviewed companies; and, (3) apply the ``all others'' rate for
merchandise supplied by companies which have not been reviewed in the
past.
Model-Match Criteria
In its questionnaire response, Dofasco reported ``surface type'' as
a physical characteristic, and argued that it should be incorporated as
a model-match criterion in order to capture the different applications
and uses of the products based on that criterion. See Dofasco's section
B questionnaire response dated January 12, 2005, at pages B-7 to B-9.
Dofasco claims that the higher cost of CORE for exposed, as opposed to
unexposed, applications also justifies the inclusion of a new model-
match criterion.
For purposes of the preliminary results, we have not changed the
model-match criteria to account for ``surface type.'' We excluded this
field in the prior administrative review because: (1) Dofasco has not
defined its proposed new product characteristic in sufficiently precise
terms for the Department to consider integrating this characteristic
into its model match hierarchy; (2) Dofasco has not demonstrated that
any industry-wide, commercially accepted standards exist that recognize
the material characteristics of exposed products made only from the
hot-dipped galvanized process; (3) we do not find significant cost
differences between exposed and unexposed galvanized steels; (4) we
continue to find a degree of interchangeability of use for Dofasco's
Extragal products that can reasonably be attributed to the subjective
preferences of the customer rather than commercially significant
differences in the physical characteristics of the product; and, (5)
the record evidence demonstrates that there have been no new
technological advancements in this field since the original
investigation. See Final Results of 10th Review, and accompanying
Issues and Decision Memorandum at Comment 1. Dofasco has provided the
same information on the record of this administrative review.
Therefore, because no new information has been provided to warrant our
reconsideration in the instant review, we continue to find that it is
[[Page 53623]]
inappropriate to incorporate ``surface type'' as a physical
characteristic into our model match hierarchy.
Product Comparisons
In accordance with section 771(16) of the Act, we considered all
products produced by the respondents that are covered by the
description in the ``Scope of the Order'' section, above, and sold in
the home market during the POR, to be foreign like products for
purposes of determining appropriate product comparisons to U.S. sales.
Where there were no sales of identical merchandise in the home market
to compare to U.S. sales, we compared U.S. sales to the most similar
foreign like product on the basis of the characteristics listed in
Appendix V of the Department's November 9, 2004, antidumping
questionnaires.
Normal Value Comparisons
To determine whether sales of subject merchandise to the United
States were made at less than NV, we compared the export price (EP) or
the constructed export price (CEP) to NV, as described in the ``Export
Price and Constructed Export Price,'' and ``Normal Value'' sections of
this notice. In accordance with section 777A(d)(2) of the Act, we
calculated monthly weighted-average prices for NV and compared these to
individual U.S. transaction prices.
Export Price and Constructed Export Price
A. Classification of U.S. Sales
In accordance with section 772(a) of the Act, we used EP when the
subject merchandise was sold, directly or indirectly, to the first
unaffiliated purchaser in the United States prior to importation, and
CEP was not otherwise warranted by facts on the record. In accordance
with section 772(b) of the Act, CEP is the price at which subject
merchandise is first sold (or agreed to be sold) in the United States
before or after the date of importation by or for the account of the
producer or exporter of such merchandise, or by a seller affiliated
with the producer or exporter. As discussed below, based on evidence on
the record, we conclude that certain sales are made by Dofasco's U.S.
affiliate, Dofasco U.S.A. (DUSA), and should thus be classified as CEP
sales. Also, as discussed below, we conclude that Dofasco's other sales
are EP, and that all Stelco's sales are EP.
Dofasco's sales in the United States through its affiliate, DUSA,
were reported as channel 2 (shipped directly to the U.S. customer) or
channel 3 (shipped indirectly to the U.S. customer) sales. We find that
for these sales, both parties to the transaction (DUSA and the
unaffiliated customer) were located in the United States, and that the
transfer of ownership was executed in the United States. See Dofasco's
section A questionnaire response at A-26. Therefore, consistent with
our determination in prior reviews, we are classifying Dofasco's
Channels 2 and 3 sales as CEP sales. See Certain Corrosion-Resistant
Carbon Steel Flat Products From Canada: Final Results of Antidumping
Duty Administrative Review, 69 FR 2566 (January 16, 2004), and
accompanying Issues and Decision Memorandum (Final Results of 9th
Review) at Comment 1, and Final Results of 10th Review at Comment 5.
We have classified Dofasco's Channel 1 (direct shipments) and 4
(direct through commission agents) sales, and all of Stelco's U.S.
sales, as EP sales. As in prior reviews, we find these to be direct
sales made in Canada without the involvement of any affiliated party in
the United States. Id. Accordingly, we are treating these respective
sales as EP sales for both Dofasco and Stelco.
The Department calculated EP or CEP based on packed prices to
customers in the United States. We made deductions from the starting
price (net of discounts and rebates) for movement expenses (foreign and
U.S. movement, U.S. customs duty and brokerage, and post-sale
warehousing) in accordance with section 772(c)(2) of the Act and
section 351.401(e) of the Department's regulations. In addition, for
CEP sales, in accordance with sections 772(d)(1) and (2) of the Act, we
deducted from the starting price credit expenses, indirect selling
expenses, including inventory carrying costs, commissions, royalties,
and warranty expenses incurred in the United States and Canada
associated with economic activities in the United States. As in prior
reviews, certain Dofasco sales have undergone minor further processing
in the United States as a condition of sale. The Department has
deducted the price charged to Dofasco by the unaffiliated contractor
for this minor further processing from gross unit price to determine
U.S. price, consistent with section 772(d)(2) of the Act. See Certain
Corrosion Resistant Carbon Steel Flat Products From Canada: Preliminary
Results of Antidumping Duty Administrative Review, 68 FR 53105, 53106
(September, 9, 2003), for a discussion of this adjustment, finalized in
Final Results of 9th Review at 69 FR 2566, 2567.
Date of Sale
As provided in section 351.401(i) of the Department's regulations,
we determined the date of sale based on the date on which the exporter
or producer established the material terms of sale. See Allied Tube and
Conduit Corp. v. United States, 127 F. Supp. 2d 207, 219 (CIT 2000).
Dofasco reported, as in the prior review, that except for long-term
contracts and sales of secondary products, the date on which all
material terms of sale are established is the final order
acknowledgment or re-acknowledgment date, where prices and quantity are
binding upon buyer and seller. See page A-23 of Dofasco's Section A
questionnaire response dated December 22, 2004. Therefore, for these
sales, we used this reported date as the date of sale. For Dofasco's
sales made pursuant to long-term contracts, we used the date of the
contract as date of sale, which is when prices are fixed and the
customer agrees to purchase one hundred percent of its requirements for
a particular part from Dofasco. Id. page A-24. For Dofasco's sales of
secondary products for which there is no order acknowledgment date, we
preliminarily determine that date of shipment best reflects the date on
which the material terms of sale are established since date of shipment
is almost always the day before the invoice is produced. Id. page A-23.
Accordingly, for these sales, we have relied on the date of shipment as
the date of sale. See, e.g., Notice of Final Determination of Sales at
Less Than Fair Value: Certain Durum Wheat and Hard Red Spring Wheat
from Canada, 68 FR 52741 (Sept. 5, 2003) and accompanying Issues and
Decision Memorandum at Comment 3 (Wheat from Canada). Dofasco did not
have sales of secondary products to the United States during the POR.
Stelco reported that, generally, the quantity and product
specifications are not set until the date of shipment, which is the
date on which the invoice is issued. Therefore, for Stelco's sales, we
determined that the date of invoice reflects the date of sale since
this is when the material terms of the sale are fixed. In those
instances when the date of shipment occurred prior to the date of
invoice (when Stelco ships directly from a processor to a customer and
the paperwork necessary to invoice the customer is delayed), Stelco
reported, and we used, the date of shipment as the date of sale. See
Stelco Section B questionnaire response, dated December 23, 2004, at B-
2; see, e.g., Wheat from Canada at Comment 3.
B. Universe of Sales in Margin Calculation
Section 751(a)(2)(A) of the Act states that a dumping calculation
should be performed for each entry during the
[[Page 53624]]
POR. Our standard practice for EP sales is to use entry date to
determine the universe of U.S. sales in the margin calculation. See
Circular Welded Non-Alloy Steel Pipe From the Republic of Korea; Final
Results of Antidumping Duty Administrative Review, 63 FR 32833, 32836
(June 6, 1998), and accompanying Issues and Decision Memorandum at
Comment 2. Accordingly, we have included in our analysis for these
final results all entries of EP sales made during the POR.
The Department's normal practice for CEP sales is to review each
transaction that has a date of sale within the POR. See section 351.212
of the Department's regulations and the preamble to that section in
Antidumping Duties; Countervailing Duties; Final Rule, 62 FR 27296,
27314-15 (May 19, 1997). However, in Notice of Final Results of
Antidumping Duty Administrative Review of Circular Welded Non-alloy
Steel Pipe from the Republic of Korea, 66 FR 18747 (April 11, 2001), at
Comment 2, the Department recognized unique circumstances that could
lead us to base the margin for CEP sales on the sales of merchandise
entered, rather than sold during the POR. In that case, there was no
dispute that the respondents could tie their sales to specific entries
during the POR because their U.S. sales were made to order, the date of
sale occurred prior to the date of entry, the merchandise was shipped
directly from the factory to the final customer, and the respondents
were generally the importer of record.
We find that Dofasco's Channel 2 and 3 CEP sales follow a similar
fact pattern and therefore, we consider the date of entry to be the
appropriate date for establishing the universe of sales for purposes of
calculating a margin. First, we are able to tie almost all these sales
to entries since Dofasco, in the instant review, provided exact entry
dates for the vast majority of its U.S. sales. As was done in the
previous review, for the few CEP transactions where the entry date was
not obtained from its customs broker, Dofasco reasonably reported
shipment date as the entry date because entry into the United States
normally occurs the same day as shipment from its factory. See
Dofasco's January 12, 2005, section C questionnaire response at page C-
71. Second, the merchandise was shipped directly from the factory to
the location specified by the customer. See Dofasco's December 22,
2004, section A questionnaire response at page A-14 and A-15. Third,
since the vast majority of these sales were made pursuant to long-term
contracts, and the date of the long-term contract was used as the date
of sale, the dates of sale occurred prior to the dates of entry. See
Dofasco's December 22, 2004, section A questionnaire response at page
A-28. Therefore, for these reasons, we have performed a margin
calculation on each Channel 2 and 3 CEP sale, entered during the POR.
The date of sale for these entries is primarily the date of contract.
Also included is a limited number of entries of ``spot'' sales for
which the date of sale is based on date of order acknowledgment. See
page A-26 of Dofasco's section A questionnaire response dated December
22, 2004. This is consistent with our finding in the Final Results of
10th Review at Comment 5.
Normal Value
A. Home Market 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 five percent or more of the aggregate volume of U.S. sales), we
compared the volume of each respondent's home market sales of the
foreign like product to the volume of U.S. sales of subject
merchandise. Based on this comparison, we determined for both Dofasco
and Stelco, that the quantity of sales in their home market exceeded
five percent of their sales of CORE to the United States. See section
351.404(b) of the Department's regulations. Therefore, in accordance
with section 773(a)(1)(B)(i) of the Act, we have based NV on the price
at which the foreign like product was first sold for consumption in the
home market, in the usual commercial quantities, in the ordinary course
of trade, and, to the extent practicable, at the same level of trade
(LOT) as the EP or CEP. See ``Level of Trade'' section below.
B. Affiliated Party Transactions and Arm's-Length Test
We used sales to affiliated customers in the home market only where
we determined such sales were made at arm's-length prices (i.e., at
prices comparable to the prices at which the respondent sold identical
merchandise to unaffiliated customers). To test whether the sales to
affiliates were made at arm's-length prices, we compared the unit
prices of sales to affiliated and unaffiliated customers net of all
movement charges, direct selling expenses, discounts and packing. In
accordance with the Department's practice, if the prices charged to an
affiliated party were, on average, between 98 and 102 percent of the
prices charged to unaffiliated parties for merchandise identical or
most similar to that sold to the affiliated party, we consider the
sales to be at arm's-length prices. See section 351.403(c) of the
Department's regulations. Where the affiliated party transactions did
not pass the arm's-length test, all sales to that affiliated party have
been excluded from the NV calculation. Because the aggregate volume of
sales to these affiliates is less than 5 percent of total home market
sales, we did not request downstream sales. See section 351.403(d) of
the Department's regulations; see also Antidumping Proceedings:
Affiliated Party Sales in the Ordinary Course of Trade, 67 FR 69186
(November 15, 2002).
C. Cost of Production Analysis
The Department disregarded certain Dofasco and Stelco sales that
failed the cost test in the prior review. We, therefore, have
reasonable grounds to believe or suspect, pursuant to section
773(b)(2)(A)(ii) of the Act, that sales of the foreign like product
under consideration for the determination of NV in this review may have
been made at prices below the cost of production (COP). Thus, pursuant
to section 773(b)(1) of the Act, we examined whether Dofasco's and
Stelco's sales in the home market were made at prices below the COP.
We compared sales of the foreign like product in the home market
with model-specific COP figures in the POR. In accordance with section
773(b)(3) of the Act, we calculated COP based on the sum of the costs
of materials and fabrication employed in producing the foreign like
product, plus selling, general and administrative (SG&A) expenses, and
all costs and expenses incidental to placing the foreign like product
in a packed condition and ready for shipment. In our sales-below-cost
analysis, we used home market sales and COP information provided by
Dofasco and Stelco in their questionnaire responses.
We compared the weighted-average COPs to home market sales of the
foreign like product, as required under section 773(b) of the Act, in
order to determine whether these sales had been made at prices below
the COP. In determining whether to disregard home market sales made at
prices below the COP, we examined whether such sales were made (1)
within an extended period of time in substantial quantities, and (2) at
prices which permitted the recovery of all costs within a reasonable
period of time in the normal course of trade, in accordance with
section 773(b)(1)(A) and (B) of the Act. On a product-specific basis,
we compared
[[Page 53625]]
the COP to home market prices, less any movement charges, discounts,
and direct and indirect selling expenses.
Pursuant to section 773(b)(2)(C) of the Act, where less than 20
percent of a respondent's sales of a given model were at prices less
than the COP, we did not disregard any below-cost sales of that model
because the below-cost sales were not made in substantial quantities
within an extended period of time. Where 20 percent or more of a
respondent's sales of a given model were at prices less than the COP,
we disregarded the below-cost sales because they were made in
substantial quantities within an extended period of time, in accordance
with sections 773(b)(2)(B) and (C) of the Act. Because we compared
prices to average costs in the POR, we also determined that the below-
cost prices did not permit the recovery of costs within a reasonable
period of time, in accordance with section 773(b)(1)(B) of the Act.
D. Constructed Value
In accordance with section 773(a)(4) of the Act, we used
constructed value (CV) as the basis for NV when there were no above-
cost contemporaneous sales of identical or similar merchandise in the
comparison market. We calculated CV in accordance with section 773(e)
of the Act. We included the cost of materials and fabrication, SG&A,
and profit. In accordance with section 773(e)(2)(A) of the Act, we
based SG&A expenses and profit on the amounts incurred and realized by
the respondent in connection with the production and sale of the
foreign like product in the ordinary course of trade for consumption in
the foreign country. For selling expenses, we used the weighted-average
home market selling expenses.
For those product comparisons for which there were sales at prices
above the COP, we based NV on home market prices to affiliated (when
made at prices determined to be arms-length) or unaffiliated parties,
in accordance with section 773(a)(1)(A) and (B) of the Act. We made
adjustments for differences in cost attributable to differences in
physical characteristics of the merchandise, pursuant to section
773(a)(6)(C)(ii) of the Act, and for circumstance-of-sales (COS)
differences, in accordance with 773(a)(6)(C)(iii) of the Act and
section 351.410 of the Department's regulations. We relied on our model
match criteria in order to match U.S. sales of subject merchandise to
comparison sales of the foreign like product based on the reported
physical characteristics of the subject merchandise. Where there were
no sales of identical merchandise in the home market to compare to U.S.
sales, we compared U.S. sales to the next most similar foreign like
product on the basis of the characteristics and reporting instructions
listed in the Department's questionnaire.
Home market starting prices were based on packed prices net of
discounts and rebates. We made adjustments, where applicable, for
packing and movement expenses, in accordance with sections 773(a)(6)(A)
and (B) of the Act. For comparisons to EP, we made COS adjustments to
NV by deducting home market packing, movement, and direct selling
expenses (e.g., credit, warranties, and royalties), and adding U.S.
packing, movement, and direct selling expenses. For comparison to CEP,
we made COS adjustments by deducting home market direct selling
expenses pursuant to section 773(a)(6)(C)(iii) of the Act and section
351.410 of the Department's regulations. We offset commissions paid on
sales to the United States by the lesser of U.S. commissions or
comparison (home) market indirect selling expenses.
Level of Trade
Section 773(a)(1)(B)(i) of the Act states that, to the extent
practicable, the Department will calculate NV based on sales at the
same LOT as the EP or CEP. Sales are made at different LOTs if they are
made at different marketing stages (or their equivalent). See section
351.412(c)(2) of the Department's regulations. Substantial differences
in selling activities are a necessary, but not sufficient, condition
for determining that there is a difference in the stages of marketing.
Id.; see also Notice of Final Determination of Sales at Less Than Fair
Value: Certain Cut-to-Length Carbon Steel Plate From South Africa, 62
FR 61731, 61732 (November 19, 1997) (South African Plate Final). In
order to determine whether the comparison sales were at different
stages in the marketing process than the U.S. sales, we reviewed the
distribution system in each market (i.e., the chain of
distribution),\1\ including selling functions,\2\ class of customer
(customer category), and the level of selling expenses for each type of
sale.
---------------------------------------------------------------------------
\1\ The marketing process in the United States and in the
comparison markets begins with the producer and extends to the sale
to the final user or consumer. The chain of distribution between the
two may have many or few links, and the respondents' sales occur
somewhere along this chain. In performing this evaluation, we
considered the narrative responses of each respondent to properly
determine where in the chain of distribution the sale occurs.
\2\ Selling functions associated with a particular chain of
distribution help us to evaluate the level(s) of trade in a
particular market. For purposes of this preliminary determination,
we have organized the common selling functions into four major
categories: sales process and marketing support, technical service,
freight and delivery, and inventory maintenance.
---------------------------------------------------------------------------
Pursuant to section 773(a)(1)(B)(i) of the Act, in identifying
levels of trade for EP and comparison market sales (i.e., NV based on
either home market or third country prices\3\), we consider the
starting prices before any adjustments. For CEP sales, we consider only
the selling activities reflected in the price after the deduction of
expenses and profit under section 772(d) of the Act. See Micron
Technology, Inc. v. United States, 243 F. 3d 1301, 1314-1315 (Fed. Cir.
2001).
---------------------------------------------------------------------------
\3\ Where NV is based on CV, we determine the NV LOT based on
the LOT of the sales from which we derive selling expenses, G&A and
profit for CV, where possible.
---------------------------------------------------------------------------
When the Department is unable to match U.S. sales to sales of the
foreign like product in the comparison market at the same LOT as the EP
or CEP, the Department may compare the U.S. sale to sales at a
different LOT in the comparison market. In comparing EP or CEP sales at
a different LOT in the comparison market, where available data make it
practicable, we make a LOT adjustment under section 773(a)(7)(A) of the
Act. Finally, for CEP sales only, if a NV LOT is more remote from the
factory than the CEP LOT and we are unable to make a level of trade
adjustment, the Department shall grant a CEP offset, as provided in
section 773(a)(7)(B) of the Act. See South African Plate Final at 62 FR
61731, 61732-33 (November 19, 1997).
A. Dofasco LOT Analysis
We obtained information from Dofasco regarding the marketing stages
involved in making the reported home market and U.S. sales, including a
description of the selling activities performed by the respondents for
each channel of distribution. In the current review, as in the previous
review, Dofasco claimed that sales in both the home market and the
United States market were made at different LOTs. In the previous
review, we concluded that Dofasco did sell at different LOTs. See Final
Results of 10th Review.
We examined the chain of distribution and the selling activities
associated with sales reported by Dofasco to three distinct customer
categories (automotive, construction, and service centers) in its
single channel of distribution in the home market. See Memorandum from
Kyle Lamborn (AD/CVD Financial Analyst) through Sean Carey (Acting
Program Manager) to the
[[Page 53626]]
File; Certain Corrosion-Resistant Carbon Steel Flat Products from
Canada: Analysis of Dofasco Inc. (Dofasco) and Sorevco for the
Preliminary Results, (August 31, 2005) (Dofasco Analysis Memo, on file
in the Central Record Unit (CRU), room B-099 of the main Commerce
building. We found that sales to the construction and service center
customer categories, were similar with respect to technical service,
freight services, and warehouse/inventory maintenance, and that they
differed only slightly with respect to sales process. Therefore, we
found that these customer categories constituted a distinct level of
trade (LOTH2). We found that sales to automotive customer category
differed significantly from LOTH2 with respect to sales process and
technical service and therefore, constitute a distinct level of trade
(LOTH1). Thus, based upon our analysis of the home market, we found
that LOTH1 and LOTH2 constitute two different levels of trade.
Dofasco reported EP sales through two channels of distribution:
Channel 1 including sales to automotive, service centers, and
construction, and Channel 4 sales to construction. We examined the
chain of distribution and the selling activities associated with sales
to construction and service center categories through these channels
and found them to be similar with respect to technical service, freight
services, and warehouse/inventory maintenance; they differed only
slight with respect to the sales process. Therefore, we found that
these two channels of distribution to these customer categories
constituted a distinct level of trade (LOTU2). We found that sales to
the automotive customer category differed significantly from LOTU2 with
respect to sales process and technical service, but were similar with
respect to freight service and warehouse/inventory maintenance. Since
the sales process and technical service functions comprise significant
selling activities, we find that these factors are determinative in
finding that sales to this automotive customer category constitute a
separate level of trade (LOTU1). Thus, based upon our analysis of
Dofasco's EP sales, we find that LOTU1 and LOTU2 constitute two
different levels of trade.
We then compared the two EP levels of trade to the two home market
LOTs. We found that LOTU2 differed considerably from LOTH1 with respect
to sales process, technical services and freight services. However,
LOTU2 was similar to LOTH2 with respect to sales process, technical
service, and warehouse/inventory maintenance. We also found that LOTU1
differed considerably from LOTH2 with respect to sales process,
technical services, and freight services. However, LOTU1 was similar to
LOTH1 with respect to sales process, technical service, and warehouse/
inventory maintenance. Consequently, we matched LOTU2 sales to sales at
the same level of trade in the home market (LOTH2), and LOTU1 sales to
sales at the same level of trade in the home market (LOTH1). Where we
did not match products at the same LOT, and there was a pattern of
consistent prices differences between different LOTs, we made a LOT
adjustment. See section 773(a)(7)(A) of the Act; see, also Dofasco
Analysis Memo at page 2.
Dofasco had two channels of distribution related to its CEP sales
to automotive customers through Dofasco USA. These channels of
distribution had the same selling functions and thus constitute a
single level of trade (LOTU3). We compared LOTU3 to our two home market
LOTs. We found that LOTU3 differed considerably from LOTH2 with respect
to sales process, technical services and freight services. However, the
LOTU3 was similar to LOTH1 with respect to sales process, technical
service, and warehouse/inventory maintenance. Consequently, we matched
LOTU3 sales to sales at the same LOT in the home market (LOTH1) and,
where possible, we matched CEP sales to NV based on home market sales
in LOTH1 and made no CEP offset adjustment. Where we did not match
products at the same LOT, and there was a pattern of consistent prices
differences between different LOTs, we made a LOT adjustment. See
section 773(a)(7)(A) of the Act. Where we are unable to make a LOT
adjustment, we considered granting a CEP offset as provided for in
section 773(a)(7)(B) of the Act. After comparing the CEP LOT (LOTU3)
with the LOTH1, we have preliminarily determined that the LOTH1 is not
more remote from the factory than the LOTU3. As indicated by Exhibit
I.A.8 of Dofasco's Section A response, dated December 22, 2004, as well
as elsewhere in Dofasco's response, the vast majority of selling
functions for both U.S. and home market sales are performed by Dofasco
in Canada. Therefore, a CEP offset is not warranted under section
773(a)(7)(B) of the Act.
B. Stelco LOT Analysis
Stelco stated in its response that it was not claiming a LOT
adjustment. However, Stelco did provide a chart of its selling
functions, which we analyzed. In the home market, Stelco sold directly
to end-users and service centers. Stelco performed a variety of
distinct selling functions in both home market channels of
distribution, including research and development, engineering services,
personnel training, and technical advice. All of Stelco's U.S. sales
are EP sales to end-users.
We examined Stelco's chain of distribution and the selling
activities in the home market, and categorized its channel of sales
under two customer categories, sales to end-users and service centers.
See Memorandum to the File, From Douglas Kirby Through Sean Carey, re:
Analysis of Stelco for the Preliminary Results, dated August 31, 2004
(Stelco Preliminary Analysis Memorandum), on file in the CRU. We found
that sales to end-users (LOTH1) differed significantly from sales to
service centers (LOTH2) with respect to sales process and technical
service, and slightly with regard to freight services. Therefore, we
found that these customer categories in the home market constitute two
distinct levels of trade in the home market.
Stelco reported only EP sales through one channel of distribution
to just one customer category in the United States, end-users (LOTU3).
Therefore, Stelco has only a single LOT in the United States. We
compared the EP LOT to the two home market LOTs. We found that LOTU3
differed significantly from LOTH1 with respect to sales process and
slightly with regard to technical services. Even though both LOTU3 and
LOTH1 comprise end-users, Stelco noted in its response that its selling
activities for its U.S. sales were made at a lesser intensity than for
its home market sales, and that they included sales of samples at
``small quantities of non-repeat business that is directed to a die
developer rather than to the customer's stamping facility.'' See
Stelco's Sections A, B and C supplemental questionnaire response, dated
May 20, 2005 at 4. We then compared LOTU3 to LOTH2 and found that they
differed with respect to technical support and freight services.
Our comparisons of the EP LOT to the two NV LOTs noted above, taken
in conjunction with the narrative description that characterizes some
types of U.S. customers as being distinct from typical end-users or
service centers, leads us to conclude that the EP LOT is significantly
different from those found in the home market. Therefore, we
disregarded level of trade and we compared LOTU3 EP sales to all home
market LOTs.
Currency Conversion
For purposes of the preliminary results, in accordance with section
773(a) of the Act, we made currency
[[Page 53627]]
conversions based on the official exchange rates in effect on the dates
of the U.S. sales as certified by the Federal Reserve Bank of New York.
Preliminary Results of Review
As a result of this review, we preliminarily find that the
following weighted-average dumping margins exist:
------------------------------------------------------------------------
Weighted-
Producer/Manufacturer/Exporter Average Margin
------------------------------------------------------------------------
Dofasco Inc., Sorevco Inc., Do Sol Galva Ltd........... 11.08 %
Stelco Inc............................................. De minimis
------------------------------------------------------------------------
Cash Deposit Requirements
If the preliminary results are adopted in the final results of
review, the following deposit requirements will be effective upon
completion of the final results of this administrative review for all
shipments of the subject merchandise entered, or withdrawn from
warehouse, for consumption on or after the publication of the final
results of this administrative review, as provided in section 751(a)(1)
of the Act: (1) The cash deposit rate for Dofasco, Sorevco, and DSG
will be that established in the final results of this review for
Dofasco (and entities collapsed with Dofasco); (2) the cash deposit
rate for Stelco will be that established in the final results of this
review (currently de minimis); (3) for previously reviewed or
investigated companies not covered in this review, the cash deposit
rate will continue to be the company-specific rate published for the
most recent period; (4) if the exporter is not a firm covered in this
review, a prior review, or the less-than-fair-value (LTFV)
investigation, but the manufacturer is, the cash deposit rate will be
the rate established for the most recent period for the manufacturer of
the subject merchandise; and (5) if neither the exporter nor the
manufacturer is a firm covered in this or any previous proceeding
conducted by the Department, the cash deposit rate will continue to be
the ``all others'' rate established in the LTFV investigation, which is
18.71 percent. See Amended Final and Order. For shipments processed by
DJG we will, (1) apply Dofasco's rate on merchandise supplied by
Dofasco or DSG; (2) apply the company specific rate on merchandise
supplied by other previously reviewed companies; and, (3) apply the
``all others'' rate for merchandise supplied by companies which have
not been reviewed in the past. These cash deposit requirements, when
imposed, shall remain in effect until publication of the final results
of the next administrative review.
Duty Assessment
Upon publication of the final results of review, the Department
shall determine, and CBP shall assess, antidumping duties on all
appropriate entries. The Department will issue appraisement
instructions directly to CBP on the 41st day after the date of
publication of the final results of review. The final results of this
review shall be the basis for the assessment of antidumping duties on
entries of merchandise covered by this review and for future deposits
of estimated duties. For duty assessment purposes, we calculate an
importer-specific assessment rate by dividing the total dumping margins
calculated for the U.S. sales of each importer by the respective total
entered value of these sales. If the preliminary results are adopted in
the final results of review, this rate will be used for the assessment
of antidumping duties on all entries of the subject merchandise by that
importer during the POR.
The Department clarified its ``automatic assessment'' regulation on
April 30, 2003. See Notice of Policy Concerning Assessment of
Antidumping Duties, 68 FR 23954 (May 6, 2003). This clarification will
apply to entries of subject merchandise during the POR produced by
companies included in these final results of review for which the
reviewed companies did not know their merchandise was destined for the
United States. In such instances, we will instruct CBP to liquidate
unreviewed entries at the ``all others'' rate if there is no rate for
the intermediate company(ies) involved in the transaction.
Public Comment
Pursuant to section 351.224(b) of the Department's regulations, the
Department will disclose to any party to the proceeding the
calculations performed in connection with these preliminary results,
within five days after the date of publication of this notice. Pursuant
to section 351.309 of the Department's regulations, interested parties
may submit case briefs in response to these preliminary results no
later than 30 days after the date of publication of this notice.
Rebuttal briefs, limited to issues raised in case briefs, may be filed
no later than 5 days after the time limit for filing case briefs.
Parties who submit arguments in this proceeding are requested to submit
with the argument: (1) A statement of the issue, (2) a brief summary of
the argument, and (3) a table of authorities. Further, the Department
requests that parties submitting briefs provide the Department with an
additional copy of the public version of any such comments on a
computer diskette. Case and rebuttal briefs must be served on
interested parties in accordance with section 351.303(f) of the
Department's regulations. Any interested party may request a hearing
within 30 days of publication of this notice. Any hearing, if
requested, will normally be held two days after the date for submission
of rebuttal briefs. The Department will issue the final results of this
administrative review, which will include the results of its analysis
of issues raised in any such written comments or at a hearing, within
120 days after the publication of this notice, unless extended. See
section 351.213(h) of the Department's regulations.
Notification to Importers
This notice serves as a preliminary reminder to importers of their
responsibility under section 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.
These preliminary results of this administrative review and notice
are issued and published in accordance with sections 751(a)(1) and
777(i)(1) of the Act.
Dated: August 31, 2005.
Barbara E. Tillman,
Acting Assistant Secretary for Import Administration.
[FR Doc. E5-4947 Filed 9-8-05; 8:45 am]
BILLING CODE 3510-DS-S