Oil Country Tubular Goods, Other Than Drill Pipe, from Korea: Preliminary Results of Antidumping Duty Administrative Review, 51797-51802 [06-7348]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 71, Number 169 (Thursday, August 31, 2006)]
[Notices]
[Pages 51797-51802]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 06-7348]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-580-825]


Oil Country Tubular Goods, Other Than Drill Pipe, from Korea: 
Preliminary Results of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration, U.S. 
Department of Commerce.
SUMMARY: In response to a request filed by IPSCO Tubulars, Inc., Lone 
Star Steel Company, and Maverick Tube Corporations (collectively, the 
``petitioners''), and SeAH Steel Corporation (``SeAH''), the U.S. 
Department of Commerce (``the Department'') is conducting an 
administrative review of the antidumping duty order on oil country 
tubular goods, other than drill pipe (``OCTG'') from Korea. This review 
covers the following producers/exporters: SeAH and Husteel Co., Ltd. 
(``Husteel'') and SeAH. The period of review (``POR'') is August 1, 
2004 through July 31, 2005. The preliminary results are discussed below 
in the section entitled ``Preliminary Results of Review.'' We 
preliminarily find that both Husteel and SeAH made sales below normal 
value (``NV''). If these preliminary results are adopted in our final 
results, we will instruct U.S. Customs and Border Protection (``CBP'') 
to assess antidumping duties based on the difference between the 
constructed export price (``CEP'') and the NV.

EFFECTIVE DATE: August 31, 2006.

FOR FURTHER INFORMATION CONTACT: Scott Lindsay, Nicholas Czajkowski, or 
Dara Iserson, AD/CVD Operations, Office 6, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, N.W., Washington, DC 20230, telephone: 
(202) 482-0780, (202) 482-1395, or (202) 482-4052, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On August 11, 1995, the Department published in the Federal 
Register an antidumping duty order on OCTG from Korea (60 FR 41058). On 
August 1, 2005, the Department published the notice of opportunity to 
request an administrative review of the antidumping order on OCTG from 
Korea. See Antidumping or Countervailing Duty Order, Finding, or 
Suspended Investigation: Opportunity To Request Administrative Review, 
69 FR 44085 (August 1, 2005). On August 31, 2005, the Department 
received a properly filed, timely request for an administrative review 
of Husteel and SeAH from petitioners and a request from SeAH for a 
review of its sales. On September 28, 2005, the Department published a 
notice of initiation for this

[[Page 51798]]

antidumping duty administrative review. See Notice of Initiation of 
Antidumping and Countervailing Duty Administrative Reviews and Request 
for Revocation in Part, 70 FR 56631 (September 28, 2005).
    On October 26, 2005, the Department issued questionnaires\1\ to 
Husteel and SeAH. Both Husteel and SeAH submitted Section A responses 
on January 9, 2005. Husteel submitted its Section B-D responses on 
January 27, 2006. SeAH submitted its Section B-E responses on February 
2, 2006. The Department issued supplemental questionnaires to Husteel 
and SeAH on April 7, 2006 and received responses on May 1, 2006. The 
Department issued additional questionnaires to Husteel and SeAH on July 
18, 2006. Husteel and SeAH submitted their responses on August 4, 2006 
and August 16, 2006, respectively.
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    \1\ Section A of the questionnaire requests general information 
concerning a company's corporate structure and business practices, 
the merchandise under investigation that it sells, and the manner in 
which it sells that merchandise in all of its markets. Section B 
requests a complete listing of all home market sales, or, if the 
home market is not viable, of sales in the most appropriate third-
country market (this section is not applicable to respondents in 
non-market economy cases). Section C requests a complete listing of 
U.S. sales. Section D requests information on the cost of production 
of the foreign like product and the constructed value of the 
merchandise under investigation. Section E requests information on 
further manufacturing.
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    On April 25, 2006, the Department published a notice extending the 
deadline for the preliminary results of this administrative review from 
May 3, 2006 until August 24, 2006. See Oil Country Tubular Goods from 
Korea: Notice of Extension of Time Limit for Preliminary Results of 
Administrative Review, 71 FR 23897 (April 25, 2006).

Scope Of The Order

    The products covered by this order are OCTG, hollow steel products 
of circular cross-section, including only oil well casing and tubing, 
of iron (other than cast iron) or steel (both carbon and alloy), 
whether seamless or welded, whether or not conforming to American 
Petroleum Institute (``API'') or non-API specifications, whether 
finished or unfinished (including green tubes and limited service OCTG 
products). This scope does not cover casing or tubing pipe containing 
10.5 percent or more of chromium, or drill pipe. The products subject 
to this order are currently classified in the Harmonized Tariff 
Schedule of the United States (``HTSUS'') under sub-headings: 
7304.29.10.10, 7304.29.10.20, 7304.29.10.30, 7304.29.10.40, 
7304.29.10.50, 7304.29.10.60, 7304.29.10.80, 7304.29.20.10, 
7304.29.20.20, 7304.29.20.30, 7304.29.20.40, 7304.29.20.50, 
7304.29.20.60, 7304.29.20.80, 7304.29.30.10, 7304.29.30.20, 
7304.29.30.30, 7304.29.30.40, 7304.29.30.50, 7304.29.30.60, 
7304.29.30.80, 7304.29.40.10, 7304.29.40.20, 7304.29.40.30, 
7304.29.40.40, 7304.29.40.50, 7304.29.40.60, 7304.29.40.80, 
7304.29.50.15, 7304.29.50.30, 7304.29.50.45, 7304.29.50.60, 
7304.29.50.75, 7304.29.60.15, 7304.29.60.30, 7304.29.60.45, 
7304.29.60.60, 7304.29.60.75, 7305.20.20.00, 7305.20.40.00, 
7305.20.60.00, 7305.20.80.00, 7306.20.10.30, 7306.20.10.90, 
7306.20.20.00, 7306.20.30.00, 7306.20.40.00, 7306.20.60.10, 
7306.20.60.50, 7306.20.80.10, and 7306.20.80.50. The HTSUS sub-headings 
are provided for convenience and customs purposes. The written 
description remains dispositive of the scope of the order.

Analysis

Product Comparisons

    Because neither HuSteel's home market sales nor its third country 
sales pass the viability test, we are using constructed value (``CV'') 
as the basis for normal value (``NV'') for HuSteel. See ``Selection of 
Comparison Market'' section, below. In accordance with section 771(16) 
of the Tariff Act of 1930, as amended (``the Act''), we considered all 
products manufactured by SeAH that are covered by the description 
contained in the ``Scope of the Order'' section above and that were 
sold in the comparison market during the POR, to be the foreign like 
product for purposes of determining the appropriate product comparisons 
to U.S. sales. Where SeAH made no sales of identical merchandise in the 
comparison 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 October 26, 
2005 antidumping questionnaire.

Date of Sale

    It is the Department's practice to use the invoice date as the date 
of sale. However, 19 CFR 351.401(i) states that the Secretary may use a 
date other than the date of invoice if the Secretary is satisfied that 
a different date better reflects the date on which the exporter or 
producer establishes the material terms of sale.'' See 19 CFR 
351.401(i); see also Allied Tube and Conduit Corp. v. United States, 
132 F. Supp. 2d 1087,1090-1093 (CIT 2001).

Husteel:

    U.S. Sales: For its U.S. sales, Husteel has reported that its 
customers contact Husteel USA, Husteel's U.S. affiliate, by phone and 
negotiate quantity and price. After production is complete and the 
merchandise has been shipped from Korea, Husteel USA issues its invoice 
to the unaffiliated U.S. customer. Husteel reported the date of sale to 
be the invoice date because material terms of sales are subject to 
change until Husteel USA issues its invoice to the unaffiliated U.S. 
customer. However, the Department finds that shipment date (the date 
subject merchandise is shipped from Korea to the U.S. unaffiliated 
customer) always precedes the date Husteel USA issues its invoice to 
the U.S. unaffiliated customer. Thus, because shipment occurs prior to 
invoice date, we are following our practice of using shipment date as 
date of sale. See Magnesium Metal from the Russian Federation: Notice 
of Final Determination of Sales at Less Than Fair Value, 70 FR 9041 
(February, 24, 2005), and accompanying Magnesium Metal from the Russian 
Federation: Notice of Final Determination of Sales at Less Than Fair 
Value Issues and Decisions Memorandum at Comment 14. Since we are using 
CV for purposes of NV, the issue of appropriate date of sale in the 
comparison market is moot.

SeAH:

    U.S. Sales: All of SeAH's U.S. OCTG sales were made out of 
inventory in the United States and, in most cases, further manufactured 
in the United States by Pusan Pipe America (``PPA''), SeAH's U.S. 
affiliate. For its U.S. sales, SeAH reported that its customers contact 
PPA to inquire about a sale. Once price and quantity are agreed to, its 
customer issues a purchase order. After further manufacturing is 
completed, PPA ships the OCTG directly to the unaffiliated customer. 
PPA issues its invoice to the customer after shipment. SeAH has 
reported the actual date of shipment from PPA to the unaffiliated 
customer as the date of sale. SeAH reports that material terms of sale 
are subject to change until shipment of the merchandise from PPA in the 
United States. However, the Department only accepts shipment date as 
date of sale if shipment occurs before invoice date. In this instance, 
all of PPA's shipments occurred prior to invoice date, we will used 
ship date as the date of sale. See id.
    Comparison Market Sales: For sales to Canada, the comparison market 
in this review (see ``Normal Value Comparisons'' below), PPA receives 
an

[[Page 51799]]

inquiry from the customer by fax or telephone. Once SeAH and PPA agree 
on the price to be charged to the unaffiliated customer, that customer 
then sends a written purchase order to PPA. SeAH ships the merchandise 
from Korea directly to the unaffiliated customer in Canada and issues 
an invoice to PPA. PPA then invoices the unaffiliated Canadian 
customer. As such, SeAH reported the shipment date from Korea as date 
of sale. See id.

Normal Value Comparisons

    To determine whether Husteel's or SeAH's sales of subject 
merchandise to the United States were made at less than NV, we compared 
each company's CEP to the NV, as described in the ``Constructed Export 
Price'' and ``Normal Value'' sections of this notice, in accordance 
with section 777A(d)(2) of the Act.

Selection of Comparison Market

    The Department determines the viability of a comparison market by 
comparing the aggregate quantity of comparison market sales to U.S. 
sales. A home market is not considered a viable comparison market if 
the aggregate quantity of sales of the foreign like product in that 
market amounts to less than five percent of the quantity of sales of 
subject merchandise to the United States during the POR. See section 
773(a)(1)(C)(ii) of the Act; see also 19 CFR 351.404(b). Husteel and 
SeAH each reported that the aggregate quantity of sales of the foreign 
like product in Korea during the POR amounted to less than five percent 
of the quantity of each company's sales of subject merchandise to the 
United States during the POR.
    In its January 9, 2006 questionnaire response, Husteel reported 
having no sales of OCTG to any other countries besides the United 
States and Singapore during the POR. Since the quantity of foreign like 
product sold by Husteel to Singapore was less than five percent of the 
quantity of subject merchandise sold to the United States, the 
Department is using CV for Husteel as the basis for NV for this review 
based on Husteel's cost of production (``COP''), in accordance with 
section 773(a)(4) of the Act.
    In its January 9, 2006 questionnaire response, SeAH reported sales 
of OCTG to Canada and Indonesia during the POR. Since the quantity of 
foreign like product sold by SeAH to Canada was more than five percent 
and the quantity sold to Indonesia was less than five percent of the 
quantity of subject merchandise sold to the United States, the 
Department determined that only Canada qualified as a viable comparison 
market based on the criterion established in section 773(a)(1) of the 
Act. Therefore, we are basing NV on sales to Canada except where there 
were no usable product matches. In those instances, in accordance with 
section 773(a)(4) of the Act, the Department used CV as the basis for 
NV.

Normal Value

Price-to-Price Comparisons:
    SeAH: Where appropriate, we made adjustments to NV in accordance 
with section 773(a)(6) of the Act. We deducted movement expenses, 
including foreign inland freight, third country brokerage, 
international freight, and marine insurance as well as credit expenses, 
and packing expenses from the NV. We made further adjustments for 
differences in costs attributable to differences in physical 
characteristics of merchandise in accordance with section 
773(a)(6)(C)(ii) of the Act. We also made a CEP offset in accordance 
with section 773(a)(7)(B) of the Act (see ``Level of Trade/CEP Offset'' 
section below).\2\ Finally, the Department added U.S. packing expenses 
to calculate the foreign unit price in dollars (``FUPDOL'') to use as 
the NV.
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    \2\ The CEP offset is equal to the lesser of the total weighted 
average comparison market inventory carrying costs and indirect 
selling expenses or the sum of indirect selling expenses and 
inventory carrying costs for U.S. sales.
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Constructed Value:
    Husteel: We used CV as the basis for NV for all sales because, as 
discussed above, Husteel had no viable comparison market in accordance 
with section 773(a)(4) of the Act. We calculated CV in accordance with 
section 773(e) of the Act. We added the costs of materials, labor, and 
factory overhead to calculate the cost of manufacturing (``COM'') in 
accordance with section 773(e)(1) of the Act. We then added interest 
expenses; selling, general and administrative expenses (``SG&A''); 
profit; and U.S. packing expenses to COM to calculate the CV in 
accordance with sections 773(e)(2) and (3) of the Act. In accordance 
with section 773(e)(2)(B)(iii) of the Act, we calculated profit and 
selling expenses based on the public version of SeAH's 2004 financial 
statements.
    SeAH: We used CV as the basis for NV for sales in which there were 
no usable contemporaneous sales of the foreign like product in the 
comparison market, in accordance with section 773(a)(4) of the Act. We 
calculated CV in accordance with section 773(e) of the Act. We added 
reported materials, labor, and factory overhead costs to derive the 
COM, in accordance with 773(e)(1) of the Act. We then added interest 
expenses, SG&A, profit, and U.S. packing expenses to derive the CV, in 
accordance with sections 773(e)(2) and (3) of the Act. We calculated 
profit based on the total value of sales and total COP reported by SeAH 
in its questionnaire response, in accordance with section 773(e)(2)(A) 
of the Act. We revised SeAH's G&A expense rate calculation to include 
certain donation expenses. See Memorandum to Neal M. Halper through 
Peter S. Scholl from Laurens van Houten: Cost of Production and 
Constructed Value Calculation Adjustments for the Preliminary Results - 
SeAH Steel Corporation, Ltd. (August 24, 2006) (on the record of this 
review and on file in the Central Records Unit (``CRU''), room B-099 of 
the main Commerce building). Finally, we deducted comparison market 
credit expenses expenses from CV to calculate the FUPDOL, pursuant to 
section 773(e)(2)(b) of the Act.

United States Price/Constructed Export Price

    In accordance with section 772(b) of the Act, CEP is the price at 
which the 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, to a purchaser not affiliated 
with the producer or exporter, as adjusted under sections 772(c) and 
(d) of the Act. In Husteel's and SeAH's questionnaire responses, each 
company classified all of its export sales of OCTG to the United States 
as CEP sales.
    We preliminarily determine that all of Husteel's export sales of 
OCTG to the United States are properly classified as CEP sales because 
they were made for the account of Husteel by Husteel USA. Husteel 
reported one channel of distribution in the U.S. market: ``produced to 
order'' sales, shipped directly from Korea to the unaffiliated U.S. 
customers.
    We preliminarily determine that all of SeAH's export sales of OCTG 
to the United States are properly classified as CEP sales because they 
were made for the account of SeAH by PPA. SeAH reported one channel of 
distribution in the U.S. market: merchandise was shipped by SeAH to 
PPA, then sold out of inventory by PPA to the unaffiliated customers. 
Many of SeAH's sales to the United States are further manufactured by 
an affiliated U.S. company.
    Husteel's CEP: The Department calculated Husteel's starting price 
as its gross unit price to its unaffiliated U.S. customers, taking into 
account, where necessary, billing adjustments and discounts, pursuant 
to section 772(c)(1)

[[Page 51800]]

of the Act. The Department made deductions from the starting price for 
movement expenses, including foreign inland freight, foreign and U.S. 
brokerage and handling, international freight, marine insurance and 
U.S. customs duties in accordance with section 772(c)(2) of the Act. 
See Memorandum from Dara Iserson, Case Analyst, to the File: Analysis 
of Husteel Co., Ltd. (``Husteel'') for the Preliminary Results of the 
Administrative Review of Oil Country Tubular Goods, Other Than Drill 
Pipe from Korea, dated August 24, 2006 (``Husteel's Preliminary 
Analysis Memo''), on the record of this review and on file in the CRU. 
In accordance with section 772(d)(1) of the Act, the Department also 
deducted U.S. credit expenses, inventory carrying costs, and indirect 
selling expenses to derive Husteel's net U.S. price. We also deducted 
CEP profit in accordance with section 772(d)(3) of the Act.
    SeAH's CEP: The Department calculated SeAH's starting price as its 
gross unit price to its unaffiliated U.S. customers, taking into 
account, where necessary, billing adjustments and early payment 
discounts, pursuant to section 772(c)(1) of the Act. Where applicable, 
the Department made deductions from the starting price for movement 
expenses, including foreign inland freight, foreign and U.S. brokerage 
and handling, international freight, marine insurance and U.S. customs 
duties in accordance with section 772(c)(2) of the Act. See Memorandum 
from Nicholas Czajkowski, Case Analyst, to the File: Analysis of SeaH 
Steel Corporation (``SeAH'') for the Preliminary Results of the 
Administrative Review of Oil Country Tubular Goods, Other Than Drill 
Pipe from Korea, dated August 24, 2006 (``SeAH's Preliminary Analysis 
Memo''), on the record of this review and on file in the CRU. In 
accordance with section 772(d)(1) of the Act, the Department also 
deducted U.S. credit expenses, inventory carrying costs, and indirect 
selling expenses incurred in the United States. We also deducted the 
cost of further manufacturing, where applicable, in accordance with 
section 772(d)(2) of the Act. In addition, we deducted CEP profit in 
accordance with section 772(d)(3) of the Act.

Level of Trade/CEP Offset

    In accordance with section 773(a)(1)(B) of the Act, to the extent 
practicable, we determined NV based on sales made in the comparison 
market at the same level of trade (``LOT'') as the CEP sales. The NV 
LOT is based on the starting price of the sales in the comparison 
market. In Micron Technology, Inc. v. United States, 243 F.3d 1301, 
1315 (Fed. Cir. 2001) (``Micron Technology''), the Court of Appeals for 
the Federal Circuit held that the statute unambiguously requires 
Commerce to remove the selling activities set forth in section 772(d) 
of the Act from the CEP starting price prior to performing its LOT 
analysis. As such, for CEP sales, the U.S. LOT is based on the starting 
price of the sales, as adjusted under section 772(d) of the Act.
    To determine whether NV sales are at a different LOT than the CEP 
sales, we examine stages in the marketing process and selling functions 
along the chain of distribution between the producer and the customer. 
If the comparison market sales are at different levels of trade, and 
the difference in levels of trade affects price comparability, as 
manifested in a pattern of consistent price differences, we make an LOT 
adjustment under section 773(a)(7)(A) of the Act. For CEP sales, if the 
NV level is more remote from the factory than the CEP level and there 
is no basis for determining whether the difference in the levels 
between NV and CEP affects price comparability, we adjust NV under 
section 773(A)(7)(B) of the Act (the CEP offset provision). See e.g., 
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'').
    Sales are made at different LOTs if they are made at different 
marketing stages (or their equivalent). See 19 CFR 351.412(c)(2). 
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. 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 
channel of distribution),\3\ including selling functions,\4\ class of 
customer (customer category), and the level of selling expenses for 
each type of sale.
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    \3\ 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.
    \4\ 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.
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    Pursuant to section 773(a)(1)(B)(I) of the Act, in identifying 
levels of trade for CEP and comparison market sales (i.e., NV based on 
either home market or third country prices), we consider the starting 
prices before any adjustments. Consistent with Micron Technology, 243 
F.3d at 1315, the Department will adjust the U.S. LOT, pursuant to 
section 772(d) of the Act, prior to performing the LOT analysis, as 
articulated by 19 CFR 351.412.
    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 
CEP sales, the Department may compare the U.S. sale to sales at a 
different LOT in the comparison market. In comparing CEP sales to sales 
at a different LOT in the comparison market, where available data make 
it practicable, we make an LOT adjustment under section 773(a)(7)(A) of 
the Act.
    In determining whether separate LOTs exist, we obtained information 
from SeAH regarding the marketing stages for the reported U.S. and 
comparison market sales, including a description of the selling 
activities performed for each channel of distribution. Generally, if 
the reported LOTs are the same, the functions and activities of the 
seller at each level should be similar. Conversely, if a party reports 
that LOTs are different for different groups of sales, the selling 
functions and activities of the seller for each group should be 
dissimilar.
    In the current review, SeAH reported one channel of distribution in 
the Canadian comparison market. All sales to the Canadian market were 
made between PPA and the unaffiliated customer and shipped directly to 
the customer from Korea. The selling functions performed by SeAH and 
PPA for the Canadian market were identical for each customer. As such, 
we preliminarily find that all of SeAH's sales in the Canadian market 
were made at one LOT.
    SeAH reported one channel of distribution for its sales to the 
United States. We examined the selling functions performed by SeAH and 
PPA for the U.S. sales and found that all sales of the subject 
merchandise were inventoried and most were further manufactured by PPA 
in the United States before being sold to the unaffiliated customer. 
The selling functions performed by SeAH and PPA in the U.S. market were 
identical for each customer. Therefore, we preliminarily find that SeAH 
made its U.S. sales at one LOT. SeAH claimed

[[Page 51801]]

that once adjustments for PPA's activities for U.S. sales are made, 
pursuant to section 772(d) of the Act, the LOT in the U.S. market is 
less advanced than the Canadian LOT.
    To determine whether NV is at a different LOT than the U.S. 
transactions, the Department compared SeAH's selling activities for the 
Canadian market with those for the U.S. market. We grouped SeAH's 
selling activities for the Canadian market and U.S. market into the 
following categories: selling and marketing, technical service, 
freight, and inventory. See SeAH's Section A questionnaire response at 
Exhibit A-15. In accordance with Micron Technology, we removed the 
selling activities set forth in section 772(d) of the Act from the U.S. 
LOT prior to performing the LOT analysis. See SeAH's Preliminary 
Analysis Memo. After removing the appropriate selling activities, we 
compared the U.S. LOT to the Canadian LOT. Based on our analysis, we 
find that the U.S. sales are at a less advanced LOT than the Canadian 
sales. See SeAH's Preliminary Analysis Memo.
    Therefore, because the sales in Canada are being made at a more 
advanced LOT than the sales to the United States, an LOT adjustment is 
appropriate for the Canadian sales in this review. However, as SeAH 
sold only through one channel of distribution to Canada, there is not 
sufficient data to evaluate whether an LOT adjustment is warranted. 
Therefore, we made a CEP offset adjustment in accordance with section 
773(a)(7)(B) of the Act and 19 CFR 351.412(f). This offset is equal to 
the amount of indirect selling expenses and inventory carrying costs 
incurred in the comparison market up to but not exceeding the sum of 
indirect selling expenses and inventory carrying costs from the U.S. 
price in accordance with section 772(d)(1)(D) of the Act.

Currency Conversions

    We made currency conversions in accordance with section 773A of the 
Act based on the 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:

------------------------------------------------------------------------
                  Manufacturer/Exporter                       Margin
------------------------------------------------------------------------
SeAH Steel Corporation..................................    0.58[percnt]
HuSteel Co., Ltd........................................    0.85[percnt]
------------------------------------------------------------------------

Cash Deposit Requirements

    If these preliminary results are adopted in the final results of 
this review, the following cash deposit requirements will be effective 
upon completion of the final results of this administrative review for 
all shipments of subject merchandise entered, or withdrawn from 
warehouse, for consumption on or after the publication of the final 
results of this administrative review, as provided by section 751(a)(1) 
of the Act: 1) the cash deposit rate for the reviewed company will be 
the rate established in the final results of this review, except if the 
rate is less than 0.50 percent (de minimis within the meaning of 19 CFR 
351.106(c)(1)), the cash deposit will be zero; 2) for previously 
reviewed companies not listed above, the cash deposit rate will 
continue to be the company-specific rate published for the most recent 
period; 3) if the exporter is not a firm covered in this review, a 
prior review, or the original 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 merchandise; and 4) the cash deposit rate for all other 
manufacturers or exporters will continue to be the ``all others'' rate 
established in the LFTV investigation, which is of 12.17 percent. See 
Final Determination of Sales at Less Than Fair Value: Oil Country 
Tubular Goods from Korea, 60 FR 33561 (June 28, 1995). These cash 
deposit requirements, when imposed, shall remain in effect until 
publication of the final results of the next administrative review. See 
section 751(a)(2)(C) of the Act.

Duty Assessment

    Upon publication of the final results of this review, the 
Department shall determine and CBP shall assess antidumping duties on 
all appropriate entries. Pursuant to 19 CFR 351.212(b)(1), the 
Department calculates an assessment rate for each importer of the 
subject merchandise for each respondent. HuSteel and SeAH each made all 
their sales to the United States through an affiliated importer. 
HuSteel and SeAH have reported entered values for all of their 
respective sales of subject merchandise to the United States during the 
POR. We have compared the entered values reported by HuSteel and SeAH 
with the entered values that they reported to CBP on their customs 
entries and preliminarily find that HuSteel's and SeAH's reported 
entered values are reliable. See HuSteel's Preliminary Analysis Memo 
and SeAH's Preliminary Analysis Memo. Therefore, in accordance with 19 
CFR 351.212(b)(1), we will calculate importer-specific duty assessment 
rates on the basis of the ratio of the total amount of antidumping 
duties calculated for the examined sales and the total entered value of 
the examined sales. These rates will be assessed uniformly on all 
entries the respective importers made during the POR if these 
preliminary results are adopted in the final results of review. The 
Department will issue appropriate assessment instructions directly to 
CBP within 15 days of the final results of this review.
    The Department clarified its ``automatic assessment'' regulation on 
May 6, 2003. See Notice of Policy Concerning Assessment of Antidumping 
Duties, 68 FR 23954 (May 6, 2003) (Assessment-Policy Notice). This 
clarification will apply to entries of subject merchandise during the 
period of review produced by companies included in these final results 
of reviews for which the reviewed companies did not know that the 
merchandise it sold to the intermediary (e.g., a reseller, trading 
company, or exporter) 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 intermediary involved in 
the transaction. See the Assessment-Policy Notice for a full discussion 
of this clarification.

Public Comment

    Pursuant to 19 CFR 351.224(b), 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 19 CFR 351.309, interested 
parties may submit written comments in response to these preliminary 
results. Unless extended by the Department, case briefs are to be 
submitted within 30 days after the date of publication of this notice. 
Rebuttal briefs, limited to arguments raised in case briefs, may be 
submitted no later than five 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 issues; (2) a brief 
summary of the argument; and (3) a table of authorities. Case and 
rebuttal briefs must be served on interested parties in accordance with 
19 CFR 351.303(f).
    Also, pursuant to 19 CFR 351.310(c), within 30 days of the date of 
publication of this notice, interested parties may request a public 
hearing on arguments

[[Page 51802]]

to be raised in the case and rebuttal briefs. Unless the Secretary 
specifies otherwise, the hearing, if requested, will be held two days 
after the date for submission of rebuttal briefs. Parties will be 
notified of the time and location. The Department will publish the 
final results of this administrative review, including the results of 
its analysis of issues raised in any case brief, rebuttal brief, or 
hearing no later than 120 days after publication of these preliminary 
results, unless extended. See 19 CFR 351.213(h).

Notification to Importers

    This notice serves as a preliminary reminder to importers of their 
responsibility under 19 CFR 351.402(f) to file a certificate regarding 
the reimbursement of antidumping duties prior to liquidation of the 
relevant entries during this review period. Failure to comply with this 
requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    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 24, 2006.
Stephen J. Claeys,
Acting Assistant Secretary for Import Administration.
[FR Doc. 06-7348 Filed 8-30-06; 8:45 am]
BILLING CODE 3510-DS-S