Magnesium Metal from the Russian Federation: Preliminary Results of Antidumping Duty Administrative Review, 25740-25745 [E7-8688]

Download as PDF 25740 Federal Register / Vol. 72, No. 87 / Monday, May 7, 2007 / Notices Paperwork Clearance Officer, (202) 482– 0266, Department of Commerce, Room 6625, 14th & Constitution Avenue, NW., Washington, DC 20230. E-mail: dHynek@doc.gov. Written comments and recommendations for the proposed information collection should be sent within 30 days of the publication of this notice to David Rostker, OMB Desk Officer, via the Internet David_Rostker@omb.eop.gov or Fax (202) 395–7285. Dated: May 1, 2007. Gwellnar Banks, Management Analyst, Office of the Chief Information Officer. [FR Doc. E7–8632 Filed 5–4–07; 8:45 am] BILLING CODE 3510–FP–P DEPARTMENT OF COMMERCE Census Bureau Generic Clearance for Customer Satisfaction Research ACTION: Proposed collection; comment request. SUMMARY: The Department of Commerce, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995, Public Law 104–13 (44 U.S.C. 3506(c)(2)(A)). DATES: Written comments must be submitted on or before July 6, 2007. ADDRESSES: Direct all written comments to Diana Hynek, Departmental Paperwork Clearance Officer, Department of Commerce, Room 6625, 14th and Constitution Avenue, NW., Washington, DC 20230 (or via the Internet at dHynek@doc.gov). FOR FURTHER INFORMATION CONTACT: Requests for additional information or copies of the information collection instrument(s) and instructions should be directed to Joanne C. Dickinson, 301– 763–4094, U.S. Census Bureau, HQ– 8H187, Washington, DC 20233–0800 (or via the Internet at joanne.dickinson@census.gov). pwalker on PROD1PC71 with NOTICES SUPPLEMENTARY INFORMATION: I. Abstract The Census Bureau is requesting an extension of the generic clearance to conduct customer satisfaction research which may be in the form of mailed or electronic questionnaires and/or focus VerDate Aug<31>2005 18:36 May 04, 2007 Jkt 211001 groups, telephone interviews, or personal interviews. The Census Bureau has ranked a customer-focused environment as one of its most important strategic planning objectives. The Census Bureau routinely needs to collect and analyze customer feedback about its products and services to better align them to its customers’ needs and preferences. Several programs, products, and distribution channels have been designed/ redesigned based on feedback from its various customer satisfaction research efforts. Each research design is reviewed for content, utility, and user-friendliness by a variety of appropriate staff (including research design and subject-matter specialists). The concept and design are tested by internal staff and a select sample of respondents to confirm its appropriateness, user-friendliness, and to estimate burden (including hours and cost) of the proposed collection of information. Collection techniques are discussed and included in the research concept design discussion to define the most time-, cost-efficient and accurate collection media. The clearance operates in the following manner: a block of hours is reserved at the beginning of each year, and the particular activities that will be conducted under the clearance are not specified in advance. The Census Bureau provides information to the Office of Management and Budget (OMB) about the specific activities on a flow basis throughout the year. OMB is notified of each activity in a letter that gives specific details about the activity, rather than by means of individual clearance packages. At the end of each year, a report is submitted to OMB that summarizes the number of hours used as well as the nature and results of the activities completed under the clearance. Some modifications of the clearance from previous years are planned. The number of burden hours will increase to 7,500 due to the anticipation of additional activities due to the 2010 Census. II. Method of Collection This research may be in the form of mailed or electronic questionnaires and/ or focus groups, telephone interviews, or personal interviews. III. Data OMB Number: 0607–0760. Form Number: Various. Type of Review: Regular submission. Affected Public: Individuals or households, State or local governments, farms, business or other for-profit PO 00000 Frm 00005 Fmt 4703 Sfmt 4703 organizations, federal agencies or employees, and not-for-profit institutions. Estimated Number of Respondents: 90,000. Estimated Time Per Response: 5 minutes. Estimated Total Annual Burden Hours: 7,500. Estimated Total Annual Cost: There is no cost to respondents, except for their time to answer the questions. Respondent’s Obligation: Voluntary. Legal Authority: Executive Order 12862. IV. Request for Comments Comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency’s estimate of the burden (including hours and cost) of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval of this information collection; they also will become a matter of public record. Dated: May 1, 2007. Gwellnar Banks, Management Analyst, Office of the Chief Information Officer. [FR Doc. E7–8627 Filed 5–4–07; 8:45 am] BILLING CODE 3510–07–P DEPARTMENT OF COMMERCE International Trade Administration [A–821–819] Magnesium Metal from the Russian Federation: Preliminary Results of Antidumping Duty Administrative Review Import Administration, International Trade Administration, Department of Commerce. SUMMARY: In response to timely requests, the Department of Commerce (the Department) is conducting an administrative review of the antidumping duty order on magnesium metal from the Russian Federation for the period of review (POR) October 4, 2004 through March 31, 2006. The AGENCY: E:\FR\FM\07MYN1.SGM 07MYN1 Federal Register / Vol. 72, No. 87 / Monday, May 7, 2007 / Notices pwalker on PROD1PC71 with NOTICES review covers two respondents, PSC VSMPO–AVISMA Corporation (formerly known as JSC AVISMA Titianium–Magnesium Works, see ‘‘Successor–In-Interest’’ section below) and its affiliated U.S. reseller VSMPO– Tirus, U.S. Inc. (collectively Avisma), and Solikamsk Magnesium Works (SMW). The Department preliminarily determines that Avisma and SMW made sales to the United States at less than normal value (NV). If these preliminary results are adopted in the final results of this administrative review, we will instruct U.S. Customs and Border Protection (CBP) to assess antidumping duties on entries of Avisma’s and SMW’s merchandise during the POR. The preliminary results are listed below in the section titled ‘‘Preliminary Results of Review.’’ EFFECTIVE DATE: May 7, 2007. FOR FURTHER INFORMATION CONTACT: Gene Calvert or Jun Jack Zhao, AD/CVD Operations, Office 6, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482–3586 or (202) 482– 1396, respectively. SUPPLEMENTARY INFORMATION: Background The Department of Commerce (the Department) published the antidumping duty order on magnesium metal from the Russian Federation on April 15, 2005. See Notice of Antidumping Duty Order: Magnesium Metal from the Russian Federation, 70 FR 19930 (April 15, 2005) (Antidumping Duty Order). On April 3, 2006, the Department published in the Federal Register a notice of ‘‘Opportunity to Request Administrative Review’’ of the antidumping duty order on magnesium metal from the Russian Federation. See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 71 FR 16549 (April 3, 2006). On April 4, 2006 and April 6, 2006, respectively, Avisma and SMW, Russian producers of the subject merchandise, requested that the Department conduct an administrative review. On April 28, 2006, U.S. Magnesium Corporation LLC, petitioner, also requested that the Department conduct an administrative review of Avisma and SMW. On May 31, 2006, the Department published the notice of initiation of the administrative review of the antidumping duty order on magnesium metal from the Russian Federation, for the period October 4, VerDate Aug<31>2005 18:36 May 04, 2007 Jkt 211001 2004, through March 31, 2006.1 See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 71 FR 30864 (May 31, 2006). On June 2, 2006, the Department issued sections A through E of the questionnaire to SMW.2 SMW submitted its section A response on July 10, 2006, and submitted its sections B through D response on July 24, 2006. The Department issued a section A through D supplemental questionnaire on September 15, 2006, and SMW responded on October 19, 2006. On December 1, 2006, the Department issued a second section D supplemental questionnaire to SMW; SMW responded on December 29, 2006. Finally, on January 24, 2007, the Department issued a second section A through C supplemental questionnaire to SMW, and SMW responded on February 12, 2007. On June 2, 2006, the Department issued sections A through D of the questionnaire to Avisma. Avisma submitted its section A questionnaire response on July 10, 2006, and submitted its responses to sections B through D on July 25, 2006. The Department issued a sections A through D supplemental questionnaire on September 15, 2006, and Avisma responded on October 18, 2006. On November 30, 2006, the Department issued a second section D supplemental questionnaire to Avisma; Avisma responded on December 29, 2006. On January 24, 2007, the Department issued a second sections A through C supplemental questionnaire to Avisma, and Avisma responded on February 14, 2007. Finally, on March 29, 2007, the Department issued a third section D supplemental questionnaire, and Avisma responded on April 12, 2007. On December 13, 2006, the Department extended the deadline for the preliminary results of this 1 The first administrative review covers approximately an 18-month period from the date of suspension of liquidation (generally the date the preliminary determination in the investigation was published) to the end of the month immediately preceding the anniversary month in which the review was requested. See 19 CFR 351.213(e)(1)(ii). 2 Pursuant to section 733(d) of the Act and the expiration of so called ≥provisional measures,≥ the Department instructed CBP to discontinue the suspension of liquidation on all shipments entered, or withdrawn from warehouse for consumption on or after April 2, 2005, and to release any securities and refund any cash deposits on such entries. The Department instructed CBP to once again begin suspending liquidation and collecting securities or cash deposits effective April 15, 2005, the date the antidumping duty order on Russian magnesium metal was published in the Federal Register (70 FR 19930). Thus, there are no entries currently suspended or subject to assessment of antidumping duties during this 14-day period of the POR. PO 00000 Frm 00006 Fmt 4703 Sfmt 4703 25741 antidumping duty administrative review from December 31, 2006 to April 30, 2007. See Notice of Extension of Time Limit for Preliminary Results of Antidumping Duty Administrative Review: Magnesium Metal From the Russian Federation, 71 FR 74897 (December 13, 2006). Period of Review This review covers the period October 4, 2004 through March 31, 2006. Scope of the Order The merchandise covered by this order is magnesium metal (also referred to as magnesium), which includes primary and secondary pure and alloy magnesium metal, regardless of chemistry, raw material source, form, shape, or size. Magnesium is a metal or alloy containing by weight primarily the element magnesium. Primary magnesium is produced by decomposing raw materials into magnesium metal. Secondary magnesium is produced by recycling magnesium–based scrap into magnesium metal. The magnesium covered by this order includes blends of primary and secondary magnesium. The subject merchandise includes the following pure and alloy magnesium metal products made from primary and/ or secondary magnesium, including, without limitation, magnesium cast into ingots, slabs, rounds, billets, and other shapes, and magnesium ground, chipped, crushed, or machined into raspings, granules, turnings, chips, powder, briquettes, and other shapes: (1) Products that contain at least 99.95 percent magnesium, by weight (generally referred to as ‘‘ultra–pure’’ magnesium); (2) products that contain less than 99.95 percent but not less than 99.8 percent magnesium, by weight (generally referred to as ‘‘pure’’ magnesium); and (3) chemical combinations of magnesium and other material(s) in which the magnesium content is 50 percent or greater, but less that 99.8 percent, by weight, whether or not conforming to an ‘‘ASTM Specification for Magnesium Alloy’’. The scope of this order excludes: (1) magnesium that is in liquid or molten form; and (2) mixtures containing 90 percent or less magnesium in granular or powder form by weight and one or more of certain non–magnesium granular materials to make magnesium– based reagent mixtures, including lime, calcium metal, calcium silicon, calcium carbide, calcium carbonate, carbon, slag coagulants, fluorspar, nephaline syenite, feldspar, alumina (Al203), calcium aluminate, soda ash, hydrocarbons, graphite, coke, silicon, rare earth E:\FR\FM\07MYN1.SGM 07MYN1 25742 Federal Register / Vol. 72, No. 87 / Monday, May 7, 2007 / Notices metals/mischmetal, cryolite, silica/fly ash, magnesium oxide, periclase, ferroalloys, dolomite lime, and colemanite.3 The merchandise subject to this order is currently classifiable under items 8104.11.00, 8104.19.00, 8104.30.00, and 8104.90.00 of the Harmonized Tariff Schedule of the United States (HTSUS). Although the HTSUS item numbers are provided for convenience and customs purposes, the written description of the merchandise covered by this order is dispositive. On November 9, 2006, in response to U.S. Magnesium’s request for scope rulings, the Department issued final scope rulings in which we determined that the processing of pure magnesium ingots, imported from Russia by Timminco, a Canadian company, into pure magnesium extrusion billets constitutes substantial transformation. Therefore, such alloy magnesium extrusion billets produced and exported by Timminco are a product of Canada, and thus not included within the scope of the order. See November 9, 2006 Memorandum for Stephen J. Claeys, Deputy Assistant Secretary for Import Administration, from Barbara E. Tillman, Director, Office 6, and Wendy Frankel, Director, Office 8, China/NME Group, AD/CVD Operations: Pure Magnesium from the People’s Republic of China (A–570–832), Magnesium Metal from the People’s Republic of China (A–570–896), and Magnesium Metal from Russia (A–821–819): Final Ruling in the Scope Inquiry on Russian and Chinese Magnesium Processed in Canada. pwalker on PROD1PC71 with NOTICES Succesor–In-Interest On July 1, 2005, JSC Avisma Titanium–Magnesium Works (ATMW), a respondent in the investigation, merged with VSMPO, a controlling shareholder in ATMW since 1998, forming PSC VSMPO–AVISMA (referred to throughout this notice as ‘‘Avisma’’), the respondent in this review. Because entries have been made under the name of the new company during the POR, the Department must make a 3 This second exclusion for magnesium-based reagent mixtures is based on the exclusion for reagent mixtures in the 2000-2001 investigations of magnesium from China, Israel, and Russia. See Notice of Final Determination of Sales at Less Than Fair Value: Pure Magnesium in Granular Form From the People’s Republic of China, 66 FR 49345 (September 27, 2001); Notice of Final Determination of Sales at Less Than Fair Value: Pure Magnesium From Israel, 66 FR 49349 (September 27, 2001); Notice of Final Determination of Sales at Not Less Than Fair Value: Pure Magnesium From the Russian Federation, 66 FR 49347 (September 27, 2001). These mixtures are not magnesium alloys, because they are not chemically combined in liquid form and cast into the same ingot. VerDate Aug<31>2005 18:36 May 04, 2007 Jkt 211001 successorship determination in order to apply the appropriate and necessary company–specific cash deposit rates. In determining whether Avisma is the successor to ATMW for purposes of applying the antidumping duty law, the Department examines a number of factors including, but not limited to, changes in: (1) Management, (2) production facilities, (3) suppliers, and (4) customer base. See, e.g., Brass Sheet and Strip from Canada; Final Results of Antidumping Duty Administrative Review, 57 FR 20460 (May 13, 1992) (Brass from Canada); Steel Wire Strand for Prestressed Concrete from Japan: Final Results of Changed Circumstances Antidumping Duty Administrative Review, 55 FR 28796 (July 13, 1990); and Industrial Phosphoric Acid From Israel; Final Results of Antidumping Duty Changed Circumstances Review, 59 FR 6944 (February 14, 1994). While examining these factors alone will not necessarily provide a dispositive indication of succession, the Department will generally consider one company to have succeeded another if that company’s operations are essentially inclusive of the predecessor’s operations. See Brass from Canada. Thus, if the evidence demonstrates, with respect to the production and sale of the subject merchandise, that the new company is essentially the same business operation as the former company, the Department will assign the new company the cash deposit rate of its predecessor. The evidence on the record, particularly Avisma’s response to our questionnaire specifically addressing its claimed successorship (Appendix III of the October 19, 2006 supplemental questionnaire response), demonstrates that, with respect to the production and sale of the subject merchandise, Avisma is the successor to ATMW. Specifically, the evidence shows that Avisma uses the same magnesium production facilities (id. at 16), and the same customers and suppliers (except for VSMPO, which previously was both a customer and a supplier), as ATMW had (id. at 16–17). We reviewed Avisma’s organizational structure before and after the merger and confirmed that there were only minimal changes. See id. at Exhibit SA–6. Therefore, we preliminary find that Avisma is the successor to ATMW for purposes of this proceeding, and for the application of the antidumping law. Analysis Home Market Viability In order to determine whether there was a sufficient volume of sales in the PO 00000 Frm 00007 Fmt 4703 Sfmt 4703 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 during the POR to the volume of U.S. sales of subject merchandise during the POR. See section 773(a)(1) of the Tariff Act of 1930, as amended (the Act). Based on this comparison, we determined for both Avisma and SMW that the quantity of sales in the home market exceeded five percent of their sales of magnesium to the United States. See 19 CFR 351.404(b). Product Comparisons In accordance with section 771(16)(A) of the Act, we considered all products produced by respondents that are covered by the description in the ‘‘Scope of the Order’’ section, above, and that were sold in the home market during the POR, to be foreign like products for purposes of determining appropriate product comparisons to U.S. sales. In accordance with sections 771(16)(B) and (C) of the Act, 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 determined by the Department in the investigation to be the most appropriate for purposes of product matching. Date of Sale It is the Department’s practice to use invoice date as the date of sale. However, 19 CFR 351.401(i) states that the Secretary may use a date other than the invoice date if the Secretary is satisfied that the material terms of the sale were established on some other date. See Allied Tube and Conduit Corp. v. United States, 127 F. Supp. 2d 207, 217–219 (CIT 2000). Both Avisma and SMW reported invoice date as the date of sale for all sales in both markets, consistent with our conclusions in the investigation regarding both spot sales and sales made according to short- and long–term agreements. 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 Issues and Decision Memorandum at Comment 14. After analyzing the responses of both parties and the sample sales documents provided, we preliminarily determine that invoice date is the appropriate date of sale for all sales under review. E:\FR\FM\07MYN1.SGM 07MYN1 pwalker on PROD1PC71 with NOTICES Federal Register / Vol. 72, No. 87 / Monday, May 7, 2007 / Notices Export Price and Constructed Export Price In its questionnaire responses, Avisma identified all of its sales to the United States as constructed export price (CEP) sales, except one, which it identified as an export price (EP) sale. With the exception of that one EP sale, all of Avisma’s sales are properly classified as CEP sales because they were made for the account of Avisma, by Avisma’s U.S. affiliate, VSMPO– Tirus, U.S., Inc. (Tirus US), to unaffiliated purchasers in the United States. U.S. sales to the first unaffiliated party were made in the United States, by the U.S. affiliate, thus satisfying the Department’s requirements for treating sales as CEP sales. See section 772(b) of the Act. Avisma and Tirus US are affiliated through common control. See section 771(33)(F) of the Act. In accordance with section 772(c)(2) of the Act, for Avisma’s CEP sales and the single EP sale we made deductions from price for movement expenses and discounts, where appropriate. More specifically, after reviewing the terms of delivery for Avisma’s sales to the United States, we deducted early payment discounts, Russian inland freight from plant to port, freight insurance, Russian brokerage, handling, and port charges, international freight and marine insurance, U.S. customs duties, U.S. brokerage, handling, and port charges, and U.S. warehousing and inland freight. Section 772(d)(1) of the Act provides for additional adjustments to calculate CEP. Accordingly, we deducted direct selling expenses and indirect selling expenses related to commercial activity in the United States. Pursuant to section 772(d)(3) of the Act, we made an adjustment for CEP profit. See Analysis Memorandum for Magnesium Metal from the Russian Federation: PSC VSMPO–AVISMA Corporation (April 30, 2007) (Avisma Analysis Memorandum). SMW identified all of its U.S. sales as CEP sales in its questionnaire responses. During the POR, all sales of SMW’s subject merchandise to the United States were made through its U.S. affiliates, Solimin and Cometals. As in the investigation, we find that Cometals is affiliated with SMW by virtue of an agency agreement, in which Cometals acts as a North American distributor of pure and alloy magnesium products. See section 771(33)(G) of the Act; see also Notice of Final Determination of Sales at Less Than Fair Value: Engineered Process Gas Turbo– Compressor Systems, Whether Assembled or Unassembled, and VerDate Aug<31>2005 18:36 May 04, 2007 Jkt 211001 Whether Complete or Incomplete, from Japan, 62 FR 24394, 24403 (May 5, 1997). We also find that Solimin is affiliated with SMW under section 771(33)(F) of the Act because it is wholly owned and controlled by SMW. All of SMW’s sales are properly classified as CEP sales because they were made for the account of SMW, by SMW’s U.S. affiliates, Solimin and Cometals, to unaffiliated purchasers in the United States. U.S. sales to the first unaffiliated party were made in the United States, by the U.S. affiliates, thus satisfying the Department’s requirements for characterizing sales as CEP sales, pursuant to section 772(b) of the Act. In accordance with section 772(c)(2) of the Act, for SMW’s CEP sales, we made deductions from U.S. price for movement expenses and billing adjustments, where appropriate. More specifically, after reviewing the terms of delivery for SMW’s CEP sales to the United States, we deducted Russian inland freight from plant to port, Russian brokerage, handling, and port charges, international freight and insurance, U.S. brokerage, handling, and port charges, U.S. warehousing, U.S. customs duties, and U.S. inland freight. In accordance with section 772(d)(1) of the Act, we deducted direct selling expenses and indirect selling expenses related to commercial activity in the United States. Pursuant to section 772(d)(3) of the Act, we made an adjustment for CEP profit. See Analysis Memorandum for Magnesium Metal from the Russian Federation: Solikamsk Magnesium Works (April 30, 2007) (SMW Analysis Memorandum). Normal Value 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 sale. See ‘‘Level of Trade’’ section below. Where appropriate, we determined NV for Avisma and SMW based on home market prices. We did not deduct home market movement expenses, pursuant to section 773(a)(6)(A) of the Act, as both respondents billed their customers separately for these expenses. For SMW, we deducted billing adjustments. As in the U.S. market, Avisma did not have billing adjustments, and neither company had discounts or rebates in the home market. For home market sales compared to Avisma’s EP sale, we made PO 00000 Frm 00008 Fmt 4703 Sfmt 4703 25743 circumstances of sale (COS) adjustments for Avisma’s transactions reflecting differences between direct selling expenses (credit expense) incurred on domestic (home market) and U.S. sales, in accordance with section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410. For home market sales compared to CEP sales, we only deducted domestic direct selling expenses from home market price, as U.S. direct selling expenses were deducted from U.S. price, as noted above. We also made adjustments for any differences in packing between domestic and U.S. sales, pursuant to section 773(a)(6)(B)(ii) of the Act, and any differences between the variable costs of the U.S. product and the matching home market product (the ‘‘DIFMER’’ adjustment), pursuant to section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. Section 773(a)(4) of the Act provides that, where NV cannot be based on comparison–market sales, NV may be based on constructed value (CV). Accordingly, for sales of magnesium for which we could not determine the NV based on comparison–market sales, either because there were no useable sales of a comparable product or all sales of the comparable products failed the sales–below-cost test, we based NV on CV. See ‘‘Cost of Production Analysis’’ section below. Section 773(e) of the Act provides that CV shall be based on the sum of the cost of materials and fabrication for the imported merchandise, plus amounts for selling, general, and administrative expenses (SG&A), interest expense, profit, and U.S. packing costs. We calculated the cost of materials and fabrication based on the methodology described in the ‘‘Cost of Production Analysis’’ section below. We based SG&A, interest expense, and profit on the actual amounts incurred and realized by Avisma and SMW in connection with the production and sale of the foreign like product in the ordinary course of trade for consumption in the comparison market, in accordance with section 773(e)(2)(A) of the Act. For Avisma’s EP sale, we made adjustments to CV for differences in COS in accordance with sections 773(a)(6)(C)(iii) and 773(a)(8) of the Act and 19 CFR 351.410. For CV compared to CEP sales, we only deducted domestic direct selling expenses from home market price, as U.S. direct selling expenses were deducted from U.S. price, as noted above. E:\FR\FM\07MYN1.SGM 07MYN1 25744 Federal Register / Vol. 72, No. 87 / Monday, May 7, 2007 / Notices Cost of Production Analysis In accordance with section 773(b)(3) of the Act, we calculated a weighted– average COP based on the sum of the cost of materials and fabrication for the foreign like product, plus amounts for the home market SG&A expenses, interest expense, and packing expenses. We relied on the COP data submitted by Avisma and SMW in their cost questionnaire responses, with the following changes. We relied upon Avisma’s December 29, 2006 cost database, which incorporated the company’s revised depreciation expense based on the revaluation of its fixed assets. We revised the reported general and administrative (G&A) and financial expense ratios to reflect the company’s fiscal year, rather than the 18 months of the POR. Additionally, we included certain auxiliary services in the G&A expense ratio. See Memorandum to Neal M. Halper, Director, Office of Accounting, through Michael P. Martin, Lead Accountant, from Heidi Schriefer, Senior Accountant, Cost of Production and Constructed Value Calculation Adjustments for the Preliminary Results for Magnesium Metal from the Russian Federation - PSC VSMPO–AVISMA Corporation, dated concurrently with this notice. For SMW, we did not make any adjustments to the cost of production. pwalker on PROD1PC71 with NOTICES 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). See 19 CFR 351.403(c). To test whether the sales to affiliates were made at arm’s–length prices, the Department compares the unit prices of sales to affiliated and unaffiliated customers net of all movement charges, direct selling expenses, discounts and rebates, and packing. See id. 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 19 CFR 351.403(c); Antidumping Proceedings: Affiliated Party Sales in the Ordinary Course of Trade, 67 FR 69186 (November 15, 2002). Where the affiliated party transactions do not pass the arm’s–length test, all sales to that VerDate Aug<31>2005 18:36 May 04, 2007 Jkt 211001 affiliated party are excluded from the NV calculation. When the aggregate volume of the sales to these affiliates that do not pass the arm’s–length test is more than 5 percent of total home market sales, we request downstream sales. See 19 CFR 351.403(d). As such, SMW provided downstream sales information for sales to its affiliate, Solikamsk Desulphurizer Works (SZD). For Avisma, all of its sales to affiliates that failed the arm’s length test were consumed by the affiliates and incorporated into merchandise that is outside of the scope of the order. Thus, there were no downstream sales to report. 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 sale. 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.; 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),4 including selling functions,5 class of customer (customer 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 prices), we consider the starting prices before any adjustments. With respect to CEP sales, Micron Technology, Inc. v. United States, 243 F.3d 1301, 1315 (Fed. Cir. 2001), requires the Department 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. 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 sale, the Department may compare the U.S. sale to sales at a different LOT in the comparison market. However, in this PO 00000 Frm 00009 Fmt 4703 Sfmt 4703 case, the Department preliminarily determines that only one LOT existed in both markets for each respondent, consistent with what the parties reported and with our determination in the investigation. (SMW reported two LOTs in the home market, but one LOT consisted exclusively of sales to an affiliate. These sales were disregarded after failing the arm’s length test. The Department determines that the downstream sales reported by SMW are at the same level of trade as the rest of the home market because the functions being performed by the affiliate, SZD, are essentially the same as those performed by SMW.) For further details on the LOT analysis, see Avisma Analysis Memorandum and SMW Analysis Memorandum. Currency Conversion For purposes of the preliminary results, in accordance with section 773A of the Act, we made currency 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: Manufacturer/Exporter PSC VSMPO–AVISMA Corporation ............... Solikamsk Magnesium Works ........................ Margin 2.34 % 3.77 % Cash Deposit Requirements If these 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 Avisma will be that established in the final results of this review; 2) the cash deposit rate for SMW will be that established in the final results of this review; 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 a firm covered in this E:\FR\FM\07MYN1.SGM 07MYN1 Federal Register / Vol. 72, No. 87 / Monday, May 7, 2007 / Notices pwalker on PROD1PC71 with NOTICES review, 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 21.01 percent. See Antidumping Duty Order. These cash deposit requirements, when imposed, shall remain in effect until further notice. 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. In accordance with 19 CFR 351.212(b)(1), we will calculate importer–specific ad valorem 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 of the respective importers made during the POR if these preliminary results are adopted in the final results of review. The Department intends to issue appropriate assessment instructions directly to CBP 15 days after the date of publication of the final results of this review. The Department clarified its ‘‘automatic assessment’’ regulation on May 6, 2003. See Antidumping and Countervailing Duty Proceedings: 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 the final results of review 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 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 VerDate Aug<31>2005 19:24 May 04, 2007 Jkt 211001 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 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)(2) 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. The preliminary results of this administrative review and this notice are issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Act. Dated: April 30, 2007. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E7–8688 Filed 5–4–07; 8:45 am] BILLING CODE 3510–DS–S PO 00000 Frm 00010 Fmt 4703 Sfmt 4703 25745 DEPARTMENT OF COMMERCE International Trade Administration [A–580–825] Oil Country Tubular Goods, Other than Drill Pipe, from Korea: Extension of Time Limit for Preliminary Results of Antidumping Duty Administrative Review Import Administration, International Trade Administration, Department of Commerce. EFFECTIVE DATE: May 7, 2007. FOR FURTHER INFORMATION CONTACT: Scott Lindsay or Dara Iserson, AD/CVD Operations, Office 6, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington DC 20230; telephone: (202) 482–0780 or (202) 482– 4052, respectively. SUPPLEMENTARY INFORMATION: AGENCY: Background On August 31, 2006, the Department of Commerce (the Department) received timely requests for an administrative review of the antidumping duty order on oil country tubular goods, other than drill pipe (OCTG) from Korea, with respect to SeAH Steel Corporation, Husteel Co., Ltd, and Nexteel Co., Ltd. On September 29, 2006, the Department published a notice of initiation of this administrative review for the period of August 1, 2005 through July 31, 2006. See Notice of Initiation of Antidumping and Countervailing Duty Administrative Reviews, 71 FR 57465 (September 29, 2006). Extension of Time Limit for Preliminary Results Pursuant to section 751(a)(3)(A) of the Tariff Act of 1930, as amended (the Act), the Department shall issue preliminary results in an administrative review of an antidumping duty order within 245 days after the last day of the anniversary month of the date of publication of the order. The Act further provides, however, that the Department may extend that 245-day period to 365 days if it is not practicable to complete the review within the foregoing time period. The Department finds that it is not practicable to complete the preliminary results by the current deadline of May 3, 2007 because this is Nexteel Co., Ltd.’s first appearance under this antidumping duty order and additional time is needed to analyze this company’s information. We have also requested additional information from the respondents and we will need more E:\FR\FM\07MYN1.SGM 07MYN1

Agencies

[Federal Register Volume 72, Number 87 (Monday, May 7, 2007)]
[Notices]
[Pages 25740-25745]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-8688]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-821-819]


Magnesium Metal from the Russian Federation: Preliminary Results 
of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: In response to timely requests, the Department of Commerce 
(the Department) is conducting an administrative review of the 
antidumping duty order on magnesium metal from the Russian Federation 
for the period of review (POR) October 4, 2004 through March 31, 2006. 
The

[[Page 25741]]

review covers two respondents, PSC VSMPO-AVISMA Corporation (formerly 
known as JSC AVISMA Titianium-Magnesium Works, see ``Successor-In-
Interest'' section below) and its affiliated U.S. reseller VSMPO-Tirus, 
U.S. Inc. (collectively Avisma), and Solikamsk Magnesium Works (SMW).
    The Department preliminarily determines that Avisma and SMW made 
sales to the United States at less than normal value (NV). If these 
preliminary results are adopted in the final results of this 
administrative review, we will instruct U.S. Customs and Border 
Protection (CBP) to assess antidumping duties on entries of Avisma's 
and SMW's merchandise during the POR. The preliminary results are 
listed below in the section titled ``Preliminary Results of Review.''

EFFECTIVE DATE:  May 7, 2007.

FOR FURTHER INFORMATION CONTACT: Gene Calvert or Jun Jack Zhao, AD/CVD 
Operations, Office 6, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
3586 or (202) 482-1396, respectively.

SUPPLEMENTARY INFORMATION:

Background

    The Department of Commerce (the Department) published the 
antidumping duty order on magnesium metal from the Russian Federation 
on April 15, 2005. See Notice of Antidumping Duty Order: Magnesium 
Metal from the Russian Federation, 70 FR 19930 (April 15, 2005) 
(Antidumping Duty Order). On April 3, 2006, the Department published in 
the Federal Register a notice of ``Opportunity to Request 
Administrative Review'' of the antidumping duty order on magnesium 
metal from the Russian Federation. See Antidumping or Countervailing 
Duty Order, Finding, or Suspended Investigation; Opportunity to Request 
Administrative Review, 71 FR 16549 (April 3, 2006). On April 4, 2006 
and April 6, 2006, respectively, Avisma and SMW, Russian producers of 
the subject merchandise, requested that the Department conduct an 
administrative review. On April 28, 2006, U.S. Magnesium Corporation 
LLC, petitioner, also requested that the Department conduct an 
administrative review of Avisma and SMW. On May 31, 2006, the 
Department published the notice of initiation of the administrative 
review of the antidumping duty order on magnesium metal from the 
Russian Federation, for the period October 4, 2004, through March 31, 
2006.\1\ See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews and Request for Revocation in Part, 71 FR 30864 
(May 31, 2006).
---------------------------------------------------------------------------

    \1\ The first administrative review covers approximately an 18-
month period from the date of suspension of liquidation (generally 
the date the preliminary determination in the investigation was 
published) to the end of the month immediately preceding the 
anniversary month in which the review was requested. See 19 CFR 
351.213(e)(1)(ii).
---------------------------------------------------------------------------

    On June 2, 2006, the Department issued sections A through E of the 
questionnaire to SMW.\2\ SMW submitted its section A response on July 
10, 2006, and submitted its sections B through D response on July 24, 
2006. The Department issued a section A through D supplemental 
questionnaire on September 15, 2006, and SMW responded on October 19, 
2006. On December 1, 2006, the Department issued a second section D 
supplemental questionnaire to SMW; SMW responded on December 29, 2006. 
Finally, on January 24, 2007, the Department issued a second section A 
through C supplemental questionnaire to SMW, and SMW responded on 
February 12, 2007.
---------------------------------------------------------------------------

    \2\ Pursuant to section 733(d) of the Act and the expiration of 
so called provisional measures, the Department 
instructed CBP to discontinue the suspension of liquidation on all 
shipments entered, or withdrawn from warehouse for consumption on or 
after April 2, 2005, and to release any securities and refund any 
cash deposits on such entries. The Department instructed CBP to once 
again begin suspending liquidation and collecting securities or cash 
deposits effective April 15, 2005, the date the antidumping duty 
order on Russian magnesium metal was published in the Federal 
Register (70 FR 19930). Thus, there are no entries currently 
suspended or subject to assessment of antidumping duties during this 
14-day period of the POR.
---------------------------------------------------------------------------

    On June 2, 2006, the Department issued sections A through D of the 
questionnaire to Avisma. Avisma submitted its section A questionnaire 
response on July 10, 2006, and submitted its responses to sections B 
through D on July 25, 2006. The Department issued a sections A through 
D supplemental questionnaire on September 15, 2006, and Avisma 
responded on October 18, 2006. On November 30, 2006, the Department 
issued a second section D supplemental questionnaire to Avisma; Avisma 
responded on December 29, 2006. On January 24, 2007, the Department 
issued a second sections A through C supplemental questionnaire to 
Avisma, and Avisma responded on February 14, 2007. Finally, on March 
29, 2007, the Department issued a third section D supplemental 
questionnaire, and Avisma responded on April 12, 2007.
    On December 13, 2006, the Department extended the deadline for the 
preliminary results of this antidumping duty administrative review from 
December 31, 2006 to April 30, 2007. See Notice of Extension of Time 
Limit for Preliminary Results of Antidumping Duty Administrative 
Review: Magnesium Metal From the Russian Federation, 71 FR 74897 
(December 13, 2006).

Period of Review

    This review covers the period October 4, 2004 through March 31, 
2006.

Scope of the Order

    The merchandise covered by this order is magnesium metal (also 
referred to as magnesium), which includes primary and secondary pure 
and alloy magnesium metal, regardless of chemistry, raw material 
source, form, shape, or size. Magnesium is a metal or alloy containing 
by weight primarily the element magnesium. Primary magnesium is 
produced by decomposing raw materials into magnesium metal. Secondary 
magnesium is produced by recycling magnesium-based scrap into magnesium 
metal. The magnesium covered by this order includes blends of primary 
and secondary magnesium.
    The subject merchandise includes the following pure and alloy 
magnesium metal products made from primary and/or secondary magnesium, 
including, without limitation, magnesium cast into ingots, slabs, 
rounds, billets, and other shapes, and magnesium ground, chipped, 
crushed, or machined into raspings, granules, turnings, chips, powder, 
briquettes, and other shapes: (1) Products that contain at least 99.95 
percent magnesium, by weight (generally referred to as ``ultra-pure'' 
magnesium); (2) products that contain less than 99.95 percent but not 
less than 99.8 percent magnesium, by weight (generally referred to as 
``pure'' magnesium); and (3) chemical combinations of magnesium and 
other material(s) in which the magnesium content is 50 percent or 
greater, but less that 99.8 percent, by weight, whether or not 
conforming to an ``ASTM Specification for Magnesium Alloy''.
    The scope of this order excludes: (1) magnesium that is in liquid 
or molten form; and (2) mixtures containing 90 percent or less 
magnesium in granular or powder form by weight and one or more of 
certain non-magnesium granular materials to make magnesium-based 
reagent mixtures, including lime, calcium metal, calcium silicon, 
calcium carbide, calcium carbonate, carbon, slag coagulants, fluorspar, 
nephaline syenite, feldspar, alumina (Al203), calcium aluminate, soda 
ash, hydrocarbons, graphite, coke, silicon, rare earth

[[Page 25742]]

metals/mischmetal, cryolite, silica/fly ash, magnesium oxide, 
periclase, ferroalloys, dolomite lime, and colemanite.\3\
---------------------------------------------------------------------------

    \3\ This second exclusion for magnesium-based reagent mixtures 
is based on the exclusion for reagent mixtures in the 2000-2001 
investigations of magnesium from China, Israel, and Russia. See 
Notice of Final Determination of Sales at Less Than Fair Value: Pure 
Magnesium in Granular Form From the People's Republic of China, 66 
FR 49345 (September 27, 2001); Notice of Final Determination of 
Sales at Less Than Fair Value: Pure Magnesium From Israel, 66 FR 
49349 (September 27, 2001); Notice of Final Determination of Sales 
at Not Less Than Fair Value: Pure Magnesium From the Russian 
Federation, 66 FR 49347 (September 27, 2001). These mixtures are not 
magnesium alloys, because they are not chemically combined in liquid 
form and cast into the same ingot.
---------------------------------------------------------------------------

    The merchandise subject to this order is currently classifiable 
under items 8104.11.00, 8104.19.00, 8104.30.00, and 8104.90.00 of the 
Harmonized Tariff Schedule of the United States (HTSUS). Although the 
HTSUS item numbers are provided for convenience and customs purposes, 
the written description of the merchandise covered by this order is 
dispositive.
    On November 9, 2006, in response to U.S. Magnesium's request for 
scope rulings, the Department issued final scope rulings in which we 
determined that the processing of pure magnesium ingots, imported from 
Russia by Timminco, a Canadian company, into pure magnesium extrusion 
billets constitutes substantial transformation. Therefore, such alloy 
magnesium extrusion billets produced and exported by Timminco are a 
product of Canada, and thus not included within the scope of the order. 
See November 9, 2006 Memorandum for Stephen J. Claeys, Deputy Assistant 
Secretary for Import Administration, from Barbara E. Tillman, Director, 
Office 6, and Wendy Frankel, Director, Office 8, China/NME Group, AD/
CVD Operations: Pure Magnesium from the People's Republic of China (A-
570-832), Magnesium Metal from the People's Republic of China (A-570-
896), and Magnesium Metal from Russia (A-821-819): Final Ruling in the 
Scope Inquiry on Russian and Chinese Magnesium Processed in Canada.

Succesor-In-Interest

    On July 1, 2005, JSC Avisma Titanium-Magnesium Works (ATMW), a 
respondent in the investigation, merged with VSMPO, a controlling 
shareholder in ATMW since 1998, forming PSC VSMPO-AVISMA (referred to 
throughout this notice as ``Avisma''), the respondent in this review. 
Because entries have been made under the name of the new company during 
the POR, the Department must make a successorship determination in 
order to apply the appropriate and necessary company-specific cash 
deposit rates.
    In determining whether Avisma is the successor to ATMW for purposes 
of applying the antidumping duty law, the Department examines a number 
of factors including, but not limited to, changes in: (1) Management, 
(2) production facilities, (3) suppliers, and (4) customer base. See, 
e.g., Brass Sheet and Strip from Canada; Final Results of Antidumping 
Duty Administrative Review, 57 FR 20460 (May 13, 1992) (Brass from 
Canada); Steel Wire Strand for Prestressed Concrete from Japan: Final 
Results of Changed Circumstances Antidumping Duty Administrative 
Review, 55 FR 28796 (July 13, 1990); and Industrial Phosphoric Acid 
From Israel; Final Results of Antidumping Duty Changed Circumstances 
Review, 59 FR 6944 (February 14, 1994). While examining these factors 
alone will not necessarily provide a dispositive indication of 
succession, the Department will generally consider one company to have 
succeeded another if that company's operations are essentially 
inclusive of the predecessor's operations. See Brass from Canada. Thus, 
if the evidence demonstrates, with respect to the production and sale 
of the subject merchandise, that the new company is essentially the 
same business operation as the former company, the Department will 
assign the new company the cash deposit rate of its predecessor.
    The evidence on the record, particularly Avisma's response to our 
questionnaire specifically addressing its claimed successorship 
(Appendix III of the October 19, 2006 supplemental questionnaire 
response), demonstrates that, with respect to the production and sale 
of the subject merchandise, Avisma is the successor to ATMW. 
Specifically, the evidence shows that Avisma uses the same magnesium 
production facilities (id. at 16), and the same customers and suppliers 
(except for VSMPO, which previously was both a customer and a 
supplier), as ATMW had (id. at 16-17). We reviewed Avisma's 
organizational structure before and after the merger and confirmed that 
there were only minimal changes. See id. at Exhibit SA-6. Therefore, we 
preliminary find that Avisma is the successor to ATMW for purposes of 
this proceeding, and for the application of the antidumping law.

Analysis

Home Market Viability

    In order to determine whether there was 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 during the POR to the volume of U.S. sales of 
subject merchandise during the POR. See section 773(a)(1) of the Tariff 
Act of 1930, as amended (the Act). Based on this comparison, we 
determined for both Avisma and SMW that the quantity of sales in the 
home market exceeded five percent of their sales of magnesium to the 
United States. See 19 CFR 351.404(b).

Product Comparisons

    In accordance with section 771(16)(A) of the Act, we considered all 
products produced by respondents that are covered by the description in 
the ``Scope of the Order'' section, above, and that were sold in the 
home market during the POR, to be foreign like products for purposes of 
determining appropriate product comparisons to U.S. sales. In 
accordance with sections 771(16)(B) and (C) of the Act, 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 determined by the 
Department in the investigation to be the most appropriate for purposes 
of product matching.

Date of Sale

    It is the Department's practice to use invoice date as the date of 
sale. However, 19 CFR 351.401(i) states that the Secretary may use a 
date other than the invoice date if the Secretary is satisfied that the 
material terms of the sale were established on some other date. See 
Allied Tube and Conduit Corp. v. United States, 127 F. Supp. 2d 207, 
217-219 (CIT 2000).
    Both Avisma and SMW reported invoice date as the date of sale for 
all sales in both markets, consistent with our conclusions in the 
investigation regarding both spot sales and sales made according to 
short- and long-term agreements. 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 Issues and 
Decision Memorandum at Comment 14. After analyzing the responses of 
both parties and the sample sales documents provided, we preliminarily 
determine that invoice date is the appropriate date of sale for all 
sales under review.

[[Page 25743]]

Export Price and Constructed Export Price

    In its questionnaire responses, Avisma identified all of its sales 
to the United States as constructed export price (CEP) sales, except 
one, which it identified as an export price (EP) sale. With the 
exception of that one EP sale, all of Avisma's sales are properly 
classified as CEP sales because they were made for the account of 
Avisma, by Avisma's U.S. affiliate, VSMPO-Tirus, U.S., Inc. (Tirus US), 
to unaffiliated purchasers in the United States. U.S. sales to the 
first unaffiliated party were made in the United States, by the U.S. 
affiliate, thus satisfying the Department's requirements for treating 
sales as CEP sales. See section 772(b) of the Act. Avisma and Tirus US 
are affiliated through common control. See section 771(33)(F) of the 
Act.
    In accordance with section 772(c)(2) of the Act, for Avisma's CEP 
sales and the single EP sale we made deductions from price for movement 
expenses and discounts, where appropriate. More specifically, after 
reviewing the terms of delivery for Avisma's sales to the United 
States, we deducted early payment discounts, Russian inland freight 
from plant to port, freight insurance, Russian brokerage, handling, and 
port charges, international freight and marine insurance, U.S. customs 
duties, U.S. brokerage, handling, and port charges, and U.S. 
warehousing and inland freight.
    Section 772(d)(1) of the Act provides for additional adjustments to 
calculate CEP. Accordingly, we deducted direct selling expenses and 
indirect selling expenses related to commercial activity in the United 
States. Pursuant to section 772(d)(3) of the Act, we made an adjustment 
for CEP profit. See Analysis Memorandum for Magnesium Metal from the 
Russian Federation: PSC VSMPO-AVISMA Corporation (April 30, 2007) 
(Avisma Analysis Memorandum).
    SMW identified all of its U.S. sales as CEP sales in its 
questionnaire responses. During the POR, all sales of SMW's subject 
merchandise to the United States were made through its U.S. affiliates, 
Solimin and Cometals. As in the investigation, we find that Cometals is 
affiliated with SMW by virtue of an agency agreement, in which Cometals 
acts as a North American distributor of pure and alloy magnesium 
products. See section 771(33)(G) of the Act; see also Notice of Final 
Determination of Sales at Less Than Fair Value: Engineered Process Gas 
Turbo-Compressor Systems, Whether Assembled or Unassembled, and Whether 
Complete or Incomplete, from Japan, 62 FR 24394, 24403 (May 5, 1997). 
We also find that Solimin is affiliated with SMW under section 
771(33)(F) of the Act because it is wholly owned and controlled by SMW. 
All of SMW's sales are properly classified as CEP sales because they 
were made for the account of SMW, by SMW's U.S. affiliates, Solimin and 
Cometals, to unaffiliated purchasers in the United States. U.S. sales 
to the first unaffiliated party were made in the United States, by the 
U.S. affiliates, thus satisfying the Department's requirements for 
characterizing sales as CEP sales, pursuant to section 772(b) of the 
Act.
    In accordance with section 772(c)(2) of the Act, for SMW's CEP 
sales, we made deductions from U.S. price for movement expenses and 
billing adjustments, where appropriate. More specifically, after 
reviewing the terms of delivery for SMW's CEP sales to the United 
States, we deducted Russian inland freight from plant to port, Russian 
brokerage, handling, and port charges, international freight and 
insurance, U.S. brokerage, handling, and port charges, U.S. 
warehousing, U.S. customs duties, and U.S. inland freight.
    In accordance with section 772(d)(1) of the Act, we deducted direct 
selling expenses and indirect selling expenses related to commercial 
activity in the United States. Pursuant to section 772(d)(3) of the 
Act, we made an adjustment for CEP profit. See Analysis Memorandum for 
Magnesium Metal from the Russian Federation: Solikamsk Magnesium Works 
(April 30, 2007) (SMW Analysis Memorandum).

Normal Value

    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 sale. See ``Level of Trade'' 
section below.
    Where appropriate, we determined NV for Avisma and SMW based on 
home market prices. We did not deduct home market movement expenses, 
pursuant to section 773(a)(6)(A) of the Act, as both respondents billed 
their customers separately for these expenses. For SMW, we deducted 
billing adjustments. As in the U.S. market, Avisma did not have billing 
adjustments, and neither company had discounts or rebates in the home 
market. For home market sales compared to Avisma's EP sale, we made 
circumstances of sale (COS) adjustments for Avisma's transactions 
reflecting differences between direct selling expenses (credit expense) 
incurred on domestic (home market) and U.S. sales, in accordance with 
section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410. For home 
market sales compared to CEP sales, we only deducted domestic direct 
selling expenses from home market price, as U.S. direct selling 
expenses were deducted from U.S. price, as noted above. We also made 
adjustments for any differences in packing between domestic and U.S. 
sales, pursuant to section 773(a)(6)(B)(ii) of the Act, and any 
differences between the variable costs of the U.S. product and the 
matching home market product (the ``DIFMER'' adjustment), pursuant to 
section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411.
    Section 773(a)(4) of the Act provides that, where NV cannot be 
based on comparison-market sales, NV may be based on constructed value 
(CV). Accordingly, for sales of magnesium for which we could not 
determine the NV based on comparison-market sales, either because there 
were no useable sales of a comparable product or all sales of the 
comparable products failed the sales-below-cost test, we based NV on 
CV. See ``Cost of Production Analysis'' section below.
    Section 773(e) of the Act provides that CV shall be based on the 
sum of the cost of materials and fabrication for the imported 
merchandise, plus amounts for selling, general, and administrative 
expenses (SG&A), interest expense, profit, and U.S. packing costs. We 
calculated the cost of materials and fabrication based on the 
methodology described in the ``Cost of Production Analysis'' section 
below. We based SG&A, interest expense, and profit on the actual 
amounts incurred and realized by Avisma and SMW in connection with the 
production and sale of the foreign like product in the ordinary course 
of trade for consumption in the comparison market, in accordance with 
section 773(e)(2)(A) of the Act.
    For Avisma's EP sale, we made adjustments to CV for differences in 
COS in accordance with sections 773(a)(6)(C)(iii) and 773(a)(8) of the 
Act and 19 CFR 351.410. For CV compared to CEP sales, we only deducted 
domestic direct selling expenses from home market price, as U.S. direct 
selling expenses were deducted from U.S. price, as noted above.

[[Page 25744]]

Cost of Production Analysis

    In accordance with section 773(b)(3) of the Act, we calculated a 
weighted-average COP based on the sum of the cost of materials and 
fabrication for the foreign like product, plus amounts for the home 
market SG&A expenses, interest expense, and packing expenses. We relied 
on the COP data submitted by Avisma and SMW in their cost questionnaire 
responses, with the following changes.
    We relied upon Avisma's December 29, 2006 cost database, which 
incorporated the company's revised depreciation expense based on the 
revaluation of its fixed assets. We revised the reported general and 
administrative (G&A) and financial expense ratios to reflect the 
company's fiscal year, rather than the 18 months of the POR. 
Additionally, we included certain auxiliary services in the G&A expense 
ratio. See Memorandum to Neal M. Halper, Director, Office of 
Accounting, through Michael P. Martin, Lead Accountant, from Heidi 
Schriefer, Senior Accountant, Cost of Production and Constructed Value 
Calculation Adjustments for the Preliminary Results for Magnesium Metal 
from the Russian Federation - PSC VSMPO-AVISMA Corporation, dated 
concurrently with this notice. For SMW, we did not make any adjustments 
to the cost of production.

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). See 19 CFR 351.403(c). To test 
whether the sales to affiliates were made at arm's-length prices, the 
Department compares the unit prices of sales to affiliated and 
unaffiliated customers net of all movement charges, direct selling 
expenses, discounts and rebates, and packing. See id. 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 19 CFR 351.403(c); Antidumping 
Proceedings: Affiliated Party Sales in the Ordinary Course of Trade, 67 
FR 69186 (November 15, 2002). Where the affiliated party transactions 
do not pass the arm's-length test, all sales to that affiliated party 
are excluded from the NV calculation. When the aggregate volume of the 
sales to these affiliates that do not pass the arm's-length test is 
more than 5 percent of total home market sales, we request downstream 
sales. See 19 CFR 351.403(d). As such, SMW provided downstream sales 
information for sales to its affiliate, Solikamsk Desulphurizer Works 
(SZD). For Avisma, all of its sales to affiliates that failed the arm's 
length test were consumed by the affiliates and incorporated into 
merchandise that is outside of the scope of the order. Thus, there were 
no downstream sales to report.

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 sale. 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.; 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),\4\ including selling 
functions,\5\ class of customer (customer 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 prices), we consider the starting 
prices before any adjustments. With respect to CEP sales, Micron 
Technology, Inc. v. United States, 243 F.3d 1301, 1315 (Fed. Cir. 
2001), requires the Department 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.
    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 sale, the Department may compare the U.S. sale to sales at a 
different LOT in the comparison market. However, in this case, the 
Department preliminarily determines that only one LOT existed in both 
markets for each respondent, consistent with what the parties reported 
and with our determination in the investigation. (SMW reported two LOTs 
in the home market, but one LOT consisted exclusively of sales to an 
affiliate. These sales were disregarded after failing the arm's length 
test. The Department determines that the downstream sales reported by 
SMW are at the same level of trade as the rest of the home market 
because the functions being performed by the affiliate, SZD, are 
essentially the same as those performed by SMW.) For further details on 
the LOT analysis, see Avisma Analysis Memorandum and SMW Analysis 
Memorandum.

Currency Conversion

    For purposes of the preliminary results, in accordance with section 
773A of the Act, we made currency 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:

------------------------------------------------------------------------
                Manufacturer/Exporter                       Margin
------------------------------------------------------------------------
PSC VSMPO-AVISMA Corporation........................              2.34 %
Solikamsk Magnesium Works...........................              3.77 %
------------------------------------------------------------------------

Cash Deposit Requirements

    If these 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 Avisma will be that 
established in the final results of this review; 2) the cash deposit 
rate for SMW will be that established in the final results of this 
review; 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 a 
firm covered in this

[[Page 25745]]

review, 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 21.01 percent. See Antidumping Duty 
Order. These cash deposit requirements, when imposed, shall remain in 
effect until further notice.

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. In accordance with 19 CFR 
351.212(b)(1), we will calculate importer-specific ad valorem 
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 of the respective importers made during the 
POR if these preliminary results are adopted in the final results of 
review. The Department intends to issue appropriate assessment 
instructions directly to CBP 15 days after the date of publication of 
the final results of this review.
    The Department clarified its ``automatic assessment'' regulation on 
May 6, 2003. See Antidumping and Countervailing Duty Proceedings: 
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 the final results of review 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 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 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)(2) 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.
    The preliminary results of this administrative review and this 
notice are issued and published in accordance with sections 751(a)(1) 
and 777(i)(1) of the Act.

    Dated: April 30, 2007.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E7-8688 Filed 5-4-07; 8:45 am]
BILLING CODE 3510-DS-S