Certain Corrosion-Resistant Carbon Steel Flat Products from the Republic of Korea: Notice of Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review, 51584-51588 [E7-17756]

Download as PDF 51584 Federal Register / Vol. 72, No. 174 / Monday, September 10, 2007 / Notices Official Paul Matter; Willamette National Forest, Detroit Ranger District, HC 73 Box 320, Mill City, OR 97360; (503) 854–3366. Dated: September 4, 2007. Scott G. Fitzwilliams, Acting Forest Supervisor. [FR Doc. 07–4411 Filed 9–7–07; 8:45 am] BILLING CODE 3410–11–M DEPARTMENT OF COMMERCE International Trade Administration (A–580–816) Certain Corrosion–Resistant Carbon Steel Flat Products from the Republic of Korea: Notice of Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review Import Administration, International Trade Administration, Department of Commerce. SUMMARY: In response to requests from petitioners,1 the Department of Commerce (the Department) is conducting the thirteenth administrative review of the antidumping order on corrosion–resistant carbon steel flat products (CORE) from Korea. This review covers three manufacturers and exporters (collectively, the respondents) of the subject merchandise: Dongbu Steel Co., Ltd., (Dongbu); Hyundai HYSCO (HYSCO); and Union Steel Manufacturing Co., Ltd. (Union). The period of review (POR) is August 1, 2005, through July 31, 2006. We preliminarily determine that during the POR, Dongbu, HYSCO, and Union made sales of subject merchandise at less than normal value (NV). In addition, we are preliminary rescinding this review with respect to Pohang Iron & Steel Company, Ltd. (POSCO) and Pohang Coated Steel Co., Ltd. (POCOS) (collectively, the POSCO Group), as a result of petitioners timely withdrawal of its review request. 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 all appropriate entries of subject merchandise during the POR. EFFECTIVE DATE: September 10, 2007 FOR FURTHER INFORMATION CONTACT: Jolanta Lawska or George McMahon (Union), Preeti Tolani (Dongbu), and Victoria Cho or Christopher Hargett (HYSCO), AD/CVD Operations, Office 3, ebenthall on PRODPC61 with NOTICES AGENCY: 1 Petitioners are the United States Steel Corporation (U.S. Steel) and Mittal Steel USA ISG, Inc. (Mittal Steel USA). VerDate Aug<31>2005 15:27 Sep 07, 2007 Jkt 211001 Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482–8362, (202) 482–1167, (202) 482–0395, (202) 482–5075 and (202) 482–4161, respectively. SUPPLEMENTARY INFORMATION: Background On August 19, 1993, the Department published the antidumping order on CORE from Korea. See Antidumping Duty Orders on Certain Cold–Rolled Carbon Steel Flat Products and Certain Corrosion–Resistant Carbon Steel Flat Products from Korea, 58 FR 44159 (August 19, 1993) (Orders on Certain Steel from Korea). On August 1, 2006, we published in the Federal Register the Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity To Request Administrative Review, 71 FR 43441 (August 1, 2006). On August 31, 2006, respondents and petitioners requested a review of Dongbu, HYSCO, the POSCO Group, and Union. The Department initiated this review on September 29, 2006. See Initiation of Antidumping and Countervailing Duty Administrative Reviews, 71 FR 57465 (September 29, 2006). During the most recently completed segments of the proceeding in which Dongbu, HYSCO, the POSCO Group, and Union participated, the Department disregarded sales below the cost of production (COP) that failed the cost test.2 Therefore, pursuant to section 773(b)(2)(A)(ii) of the Tariff Act of 1930, as amended (the Act), we had reasonable grounds to believe or suspect that sales by these companies of the foreign like product under consideration for the determination of NV in this review were made at prices below the COP. We instructed Dongbu, HYSCO, the POSCO Group, and Union to respond to sections A–D of the initial questionnaire,3 which we issued on September 13, 2006. 2 Certain Corrosion-Resistant Carbon Steel Flat Products from the Republic of Korea: Notice of Preliminary Results of Antidumping Duty Administrative Review, 71 FR 53370, 53375 (September 11, 2006) (Preliminary Results of the 12th Review of CORE from Korea); Notice of Final Results of the Twelfth Administrative Review of the Antidumping Duty Order on Certain CorrosionResistant Carbon Steel Flat Products from the Republic of Korea, 72 FR 13086 (March 20, 2007) and accompanying Issues and Decisions Memorandum; and Certain Corrosion-Resistant Carbon Steel Flat Products from the Republic of Korea; Notice of Amended Final Results of the Twelfth Administrative Review, 72 FR 20815 (April 26, 2007). 3 Section A: Organization, Accounting Practices, Markets and Merchandise PO 00000 Frm 00003 Fmt 4703 Sfmt 4703 On December 28, 2006, the petitioners timely withdrew their request for an administrative review of the POSCO Group. Thus, we are preliminary rescinding the request for review of the antidumping order for the POSCO Group. On April 19, 2007, the Department published a notice extending the time period for issuing the preliminary results of the thirteenth administrative review from May 3, 2007, to August 31, 2007. See Corrosion–Resistant Carbon Steel Flat Products from Korea: Extension of Time Limits for the Preliminary Results of Antidumping Duty Administrative Review, 72 FR 19688 (April 19, 2007). Rescission of Administrative Review for the POSCO Group As provided in 19 CFR 351.213(d)(1), ‘‘[t]he Secretary will rescind an administrative review under this section, in whole or in part, if a party that requested a review withdraws the request within 90 days of the date of publication of notice of initiation of the requested review.’’ The petitioners withdrew their request for an administrative review within 90 days of the date of publication of the notice of initiation of the instant administrative review and no other party requested an administrative review of the POSCO Group. Therefore, the Department is rescinding the administrative review with respect to the POSCO Group. Dongbu On November 10, 2006, Dongbu submitted its section A response to the initial questionnaire. On November 20, 2006, Dongbu submitted its sections B– D response to the initial questionnaire. On February 9, 2007, Dongbu submitted its supplemental questionnaire responses for sections A–C. Dongbu submitted its responses to the Department’s three section D supplemental questionnaires on March 12, 2007, March 26, 2007, and April 19, 2007, respectively. Union On November 13, 2006, Union submitted its section A response to the initial questionnaire. On November 20, 2006, Union submitted its sections B–C response to the initial questionnaire. Union submitted its responses to the Department’s three section A–C supplemental questionnaires on February 2, 2007, April 16, 2007 and June 1, 2007, respectively. Section B: Comparison Market Sales Section C: Sales to the United States Section D: Cost of Production and Constructed Value E:\FR\FM\10SEN1.SGM 10SEN1 Federal Register / Vol. 72, No. 174 / Monday, September 10, 2007 / Notices HYSCO On November 3, 2006, HYSCO submitted its section A response to the Department’s initial questionnaire. On November 22, 2006, HYSCO submitted its section B–D response to the Department’s initial questionnaire. HYSCO submitted its responses to the Department’s three section A–D supplemental questionnaires on January 29, 2007, February 20, 2007, and May 24, 2007, respectively. Verification The Department conducted the sales verification of Dongbu and HYSCO, from June 18 through 29, 2007, and Union from July 23 through 27, 2007, in Seoul, South Korea. The Department conducted the cost verification of HYSCO in Seoul, South Korea, from July 31 through August 4, 2007. The Department will conduct the cost verification of Dongbu and Union in Seoul, South Korea, after these preliminary results. ebenthall on PRODPC61 with NOTICES Period of Review The POR covered by this review is August 1, 2005, through July 31, 2006. Scope of the Order This order covers flat–rolled carbon steel products, of rectangular shape, either clad, plated, or coated with corrosion–resistant metals such as zinc, aluminum, or zinc-, aluminum-, nickelor iron–based alloys, whether or not corrugated or painted, varnished or coated with plastics or other nonmetallic substances in addition to the metallic coating, in coils (whether or not in successively superimposed layers) and of a width of 0.5 inch or greater, or in straight lengths which, if of a thickness less than 4.75 millimeters, are of a width of 0.5 inch or greater and which measures at least 10 times the thickness or if of a thickness of 4.75 millimeters or more are of a width which exceeds 150 millimeters and measures at least twice the thickness, as currently classifiable in the Harmonized Tariff Schedule of the United States (HTSUS) under item numbers 7210.30.0030, 7210.30.0060, 7210.41.0000, 7210.49.0030, 7210.49.0090, 7210.49.0091, 7210.49.0095, 7210.61.0000, 7210.69.0000, 7210.70.6030, 7210.70.6060, 7210.70.6090, 7210.90.1000, 7210.90.6000, 7210.90.9000, 7212.20.0000, 7212.30.1030, 7212.30.1090, 7212.30.3000, 7212.30.5000, 7212.40.1000, 7212.40.5000, 7212.50.0000, 7212.60.0000, 7215.90.1000, 7215.90.3000, 7215.90.5000, 7217.20.1500, VerDate Aug<31>2005 15:27 Sep 07, 2007 Jkt 211001 7217.30.1530, 7217.30.1560, 7217.90.1000, 7217.90.5030, 7217.90.5060, and 7217.90.5090. Included in the order are flat–rolled products of non–rectangular cross– section where such cross–section is achieved subsequent to the rolling process including products which have been beveled or rounded at the edges (i.e., products which have been ‘‘worked after rolling’’). Excluded from this order are flat–rolled steel products either plated or coated with tin, lead, chromium, chromium oxides, both tin and lead (‘‘terne plate’’), or both chromium and chromium oxides (‘‘tin– free steel’’), whether or not painted, varnished or coated with plastics or other nonmetallic substances in addition to the metallic coating. Also excluded from this order are clad products in straight lengths of 0.1875 inch or more in composite thickness and of a width which exceeds 150 millimeters and measures at least twice the thickness. Also excluded from this order are certain clad stainless flat– rolled products, which are three– layered corrosion–resistant carbon steel flat–rolled products less than 4.75 millimeters in composite thickness that consist of a carbon steel flat–rolled product clad on both sides with stainless steel in a 20%–60%–20% ratio. These HTSUS item numbers are provided for convenience and customs purposes. The written descriptions remain dispositive. Product Comparisons In accordance with section 771(16) of the Act, we considered all CORE products produced by the respondents, covered by the scope of the order, and sold in the home market during the POR to be foreign like products for the purpose of determining appropriate product comparisons to CORE sold in the United States. Where there were no sales in the ordinary course of trade of identical merchandise in the home market to compare to U.S. sales, we compared U.S. sales to the next most similar foreign like product on the basis of the characteristics listed in Appendix V of the Department’s antidumping questionnaire. In making the product comparisons, we matched foreign like products based on the Appendix V physical characteristics reported by each respondent. Where sales were made in the home market on a different weight basis from the U.S. market (theoretical versus actual weight), we converted all quantities to the same weight basis, using the conversion factors supplied by the respondents, PO 00000 Frm 00004 Fmt 4703 Sfmt 4703 51585 before making our fair–value comparisons. Normal Value Comparisons To determine whether sales of CORE by the respondents to the United States were made at less than NV, we compared the Export Price (EP) or Constructed Export Price (CEP) to the NV, as described in the ‘‘Export Price/ Constructed Export Price’’ and ‘‘Normal Value’’ sections of this notice. In accordance with section 777A(d)(2) of the Act, we calculated monthly weighted–average prices for NV and compared these to individual U.S. transactions. Export Price/Constructed Export Price We calculated the price of U.S. sales based on CEP, in accordance with section 772(b) of the Act, which defines the term ‘‘constructed export price’’ as ‘‘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 subsections (c) and (d)’’ of this section. In contrast, section 772(a) of the Act defines ‘‘export price’’ as ‘‘the price at which the subject merchandise is first sold (or agreed to be sold) before the date of importation by the producer or exporter of the subject merchandise outside of the United States to an unaffiliated purchaser in the United States or to an unaffiliated purchaser for exportation to the United States, as adjusted under subsection (c)’’ of this section. In determining whether to classify U.S. sales as either EP or CEP sales, the Department must examine the totality of the circumstances surrounding the U.S. sales process, and assess where the reviewed sales or agreements of sale were made for purposes of section 772(b) of the Act. In the instant case, the record establishes that the sales were made in the United States after importation. Dongbu’s, HYSCO’s, and Union’s affiliates in the United States (1) took title to the subject merchandise and (2) invoiced and received payment from the unaffiliated U.S. customers for their sales of the subject merchandise to those U.S. customers. Thus, the Department has determined that these U.S. sales should be classified as CEP transactions under section 772(b) of the Act. For Dongbu, HYSCO, and Union, we calculated CEP based on packed prices to unaffiliated customers in the United E:\FR\FM\10SEN1.SGM 10SEN1 51586 Federal Register / Vol. 72, No. 174 / Monday, September 10, 2007 / Notices ebenthall on PRODPC61 with NOTICES States. Where appropriate, we made deductions from the starting price for foreign inland freight, foreign inland insurance, foreign brokerage and handling, international freight, marine insurance, U.S. warehousing expenses, U.S. wharfage, U.S. inland freight, U.S. brokerage and handling, loading expenses, other U.S. transportation expenses, U.S. customs duties, commissions, credit expenses, letter of credit expenses, warranty expenses, other direct selling expenses, inventory carrying costs incurred in the United States, and other indirect selling expenses in the country of manufacture and the United States associated with economic activity in the United States. Pursuant to section 772(d)(3) of the Act, we made an adjustment for CEP profit. Where appropriate, we added interest revenue to the gross unit price. Consistent with the Department’s normal practice, for Union we added the reported duty drawback to the gross unit price. We did so in accordance with the Department’s long–standing test, which requires that: (1) the import duty and rebate be directly linked to, and dependent upon, one another; and (2) the company claiming the adjustment demonstrate that there were sufficient imports of imported raw materials to account for the duty drawback received on the exports of the manufactured product. HYSCO’s Sales of Subject Merchandise that were Further Manufactured and Sold as Non–Subject Merchandise in the United States In its Section A questionnaire response and on September 27, 2006, HYSCO requested that the Department exclude certain POR sales of subject merchandise imported by its wholly owned U.S. subsidiary, HYSCO America Company (HAC), that were further manufactured after importation and sold as non–subject merchandise in the United States, citing ‘‘the extreme difficulty in calculating CEP for these sales through HAC.’’ The Department issued several supplemental questionnaires to HYSCO regarding these HAC CEP sales. Section 772(e) of the Act provides that when the value added in the United States by an affiliated party is likely to exceed substantially the value of the subject merchandise, the Department shall use one of the following prices to determine CEP if there is a sufficient quantity of sales to provide a reasonable basis of comparison and the use of such sales is appropriate: (1) The price of identical subject merchandise sold by the exporter or producer to an unaffiliated person; or (2) The price of VerDate Aug<31>2005 15:27 Sep 07, 2007 Jkt 211001 other subject merchandise sold by the exporter or producer to an unaffiliated person. Our analysis showed that the value added by the affiliated party to the subject merchandise after importation in the United States was significantly greater than the 65 percent threshold we use in determining whether the value added in the United States by an affiliated party substantially exceeds the value of the subject merchandise. See 19 CFR 351.402 (c)(2). We then considered whether there were sales of identical subject merchandise or other subject merchandise sold in sufficient quantities by the exporter or producer to an unaffiliated person that could provide a reasonable basis of comparison. In addition to the sales to HAC that were further manufactured, HYSCO also had CEP sales of similar, but not identical, subject merchandise to unaffiliated customers in the United States in back–to-back transactions through another HYSCO affiliate in the United States, Hyundai HYSCO USA (‘‘HHU’’). Decisions as to the appropriate methodology for determining CEP for sales involving further manufacturing generally must be made on a case–bycase basis. In this instance, the quantity of sales of identical or other subject merchandise to an unaffiliated person is relatively small. However, another reasonable method for determining CEP for the HAC CEP sales is not evident. In this case, the value added after importation is very large and the further manufacturing very complex. Therefore, similar to our practice in other cases, see, e.g., Certain Hot–Rolled Carbon Steel Flat Products from the Netherlands; Final Results of Antidumping Duty Administrative Reviews, 72 FR 28676 (May 22, 2007), we relied on HYSCO’s other sales of similar merchandise to unaffiliated parties in the United States as the basis for calculating CEP on HYSCO’s sales through HAC. Although we have relied on a relatively small quantity of sales, as under the circumstances here this is the most reasonable methodology, we will continue to assess whether such quantities provide an adequate basis for our dumping analysis in other cases. Therefore, in this and future reviews we will reexamine the appropriate methodology to use when presented with similar circumstances. Normal Value Based on a comparison of the aggregate quantity of home market and U.S. sales, we determined that the quantity of the foreign like product sold in the exporting country was sufficient PO 00000 Frm 00005 Fmt 4703 Sfmt 4703 to permit a proper comparison with the sales of the subject merchandise to the United States, pursuant to section 773(a) of the Act. Therefore, in accordance with section 773(a)(1)(B)(i) of the Act, we 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 and in the ordinary course of trade. Where appropriate, we deducted rebates, discounts, inland freight (offset, where applicable, by freight revenue), inland insurance, and packing. Additionally, we made adjustments to NV, where appropriate, for credit expenses, warranty expenses, post–sale warehousing, and differences in weight basis. We also made adjustments, where appropriate, for home market indirect selling expenses and inventory carrying costs to offset U.S. commissions. We also increased NV by U.S. packing costs in accordance with section 773(a)(6)(A) of the Act. We made adjustments to NV for differences in cost attributable to differences in physical characteristics of the merchandise, pursuant to section 773(a)(6)(C)(ii) of the Act. For purposes of calculating NV, section 771(16) of the Act defines ‘‘foreign like product’’ as merchandise which is either (1) identical or (2) similar to the merchandise sold in the United States. When there are no identical products sold in the home market, the products which are most similar to the product sold in the United States are identified. For the non– identical or most similar products which are identified based on the Department’s product matching criteria, an adjustment is made to the home market sales price to account for the actual physical differences between the products sold in the United States and the home market or third country market. See 19 CFR 351.411 and section 773(a)(6)(C)(ii) of the Act. Level of Trade In accordance with section 773(a)(1)(B) of the Act, we determined NV based on sales in the comparison market at the same level of trade (LOT) as the CEP sales, to the extent practicable. When there were no sales at the same LOT, we compared U.S. sales to comparison market sales at a different LOT. Pursuant to 19 CFR 351.412, to determine whether CEP sales and NV sales were at different LOTs, we examine stages in the marketing process and selling functions along the chain of distribution between the producer and the unaffiliated (or arm’s–length) customers. If the comparison market E:\FR\FM\10SEN1.SGM 10SEN1 Federal Register / Vol. 72, No. 174 / Monday, September 10, 2007 / Notices sales are at a different LOT and the differences affect price comparability, as manifested in a pattern of consistent price differences between sales at different LOTs in the country in which NV is determined, we will make an LOT adjustment under section 773(a)(7)(A) of the Act. For CEP sales, if the NV LOT is at a more advanced stage of distribution than the CEP LOT and the data available do not provide an appropriate basis to determine an LOT adjustment, we will grant a CEP offset, as provided in section 773(a)(7)(B) of the Act. See Notice of Final Determination of Sales at Less Than Fair Value: Certain Cut–to-Length Carbon Steel Plate from South Africa, 62 FR 61731, 61732–33 (November 19, 1997). We did not make an LOT adjustment under 19 CFR 351.412(e) because, as there was only one home market LOT for each respondent, we were unable to identify a pattern of consistent price differences attributable to differences in LOTs (see 19 CFR 351.412(d)). Under 19 CFR 351.412(f), we are preliminarily granting a CEP offset for Dongbu, HYSCO, and Union because the NV for each company is at a more advanced LOT than the LOT for their U.S. CEP sales. For a detailed description of our LOT methodology and a summary of company–specific LOT findings for these preliminary results, see the August 31, 2007, Calculation Memorandum for Dongbu Steel Co., Ltd.; Calculation Memorandum for Hyundai HYSCO; and Calculation Memorandum for Union Steel Manufacturing Co., Ltd., of which the public versions are on file in the Central Records Unit (CRU), Import Administration, Washington, DC, HCHB Building, Room B–099. In accordance with section 773(b)(3) of the Act, we calculated COP based on the sum of the respondents’ cost of materials and fabrication for the foreign like product, plus amounts for general and administrative (G&A) expenses and interest expenses. We relied on the COP information provided by Dongbu in its questionnaire responses, except for the following instances where the information was not appropriately quantified or valued: 1. We adjusted Dongbu’s reported cost of manufacturing (COM) to appropriately value the claimed scrap offset. 2. We revised the reported G&A expense ratio to exclude certain items of exchange gains and losses. In addition, we adjusted the denominator used to calculate the G&A expense ratio for the adjustment made above. For further discussion of these adjustments, see the Memorandum to Neal Halper entitled, Cost of Production and Constructed Value Adjustments for the Preliminary Results—Dongbu Steel Co., Ltd., dated August 30, 2007. ebenthall on PRODPC61 with NOTICES Cost of Production B. Test of Home–Market Prices In determining whether to disregard home market sales made at prices below the COP, as required under sections 773(b)(1)(A) and (B) of the Act, we compared the weighted–average COP figures to home market sales of the foreign like product and we examined whether (1) within an extended period of time, such sales were made in substantial quantities, and (2) such sales were made at prices which permitted the recovery of all costs within a reasonable period of time. On a product–specific basis, we compared the COP to the home market prices (not including VAT), less any applicable movement charges, discounts, and rebates. A. Calculation of COP We are investigating COP for Dongbu, HYSCO, and Union because during the most recently completed segments of the proceeding in which Dongbu, HYSCO, and Union participated, the Department found and disregarded sales that failed the cost test. We calculated a company–specific COP for Dongbu, HYSCO, and Union based on the sum of each respondent’s cost of materials and fabrication for the foreign like product, plus amounts for home–market selling expenses, selling, general and administrative expenses (SG&A), and packing costs in accordance with section 773(b)(3) of the Act. We relied on Dongbu’s, HYSCO’s, and Union’s information as submitted. C. Results of COP Test Pursuant to section 773(b)(1) of the Act, we may disregard below–COP sales in the determination of NV if these sales have been made within an extended period of time in substantial quantities and were not at prices which permit recovery of all costs within a reasonable period of time. Where 20 percent or more of a respondent’s sales of a given product during the POR were at prices less than the COP for at least six months of the POR, we determined that sales of that model were made in ‘‘substantial quantities’’ within an extended period of time, in accordance with sections 773(b)(2)(B) and (C) of the Act. Where prices of a respondent’s sales of a given product were below the per–unit COP at VerDate Aug<31>2005 15:27 Sep 07, 2007 Jkt 211001 PO 00000 Frm 00006 Fmt 4703 Sfmt 4703 51587 the time of sale and below the weighted–average per–unit costs for the POR, we determined that sales were not at prices which would permit recovery of all costs within a reasonable period of time, in accordance with section 773(b)(2)(D) of the Act. In such cases, we disregarded the below–cost sales in accordance with section 773(b)(1) of the Act. Pursuant to section 773(b)(2)(C) of the Act, where less than 20 percent of a respondent’s sales of a given product were at prices less than the COP, we did not disregard any below–cost sales of that product because we determined that the below–cost sales were not made in ‘‘substantial quantities.’’ We tested and identified below–cost home market sales for Dongbu, HYSCO, and Union. We disregarded individual below–cost sales of a given product and used the remaining sales as the basis for determining NV, in accordance with section 773(b)(1) of the Act. See the August 31, 2007, Calculation Memorandum for Dongbu Steel Co., Ltd.; Calculation Memorandum for Hyundai HYSCO; and Calculation Memorandum for Union Steel Manufacturing Co., Ltd. Arm’s–Length Sales Dongbu and HYSCO also reported that they made sales in the home market to affiliated parties. The Department calculates NV based on a sale to an affiliated party only if it is satisfied that the price to the affiliated party is comparable to the price at which sales are made to parties not affiliated with the producer or exporter, i.e., sales at arm’s length. See 19 CFR 351.403(c). To test whether these sales were made at arm’s length, we compared the starting prices of sales to affiliated and unaffiliated customers net of all movement charges, direct selling expenses, discounts and packing. In accordance with the Department’s current 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 considered the sales to be at arm’s– length prices. See Notice of Preliminary Results and Partial Rescission of Antidumping Duty Administrative: Ninth Administrative Review of the Antidumping Duty Order on Certain Pasta from Italy, 71 FR 45017, 45020 (August 8, 2006); 19 CFR 351.403(c). Conversely, where we found sales to the affiliated party that did not pass the arm’s–length test, all sales to that affiliated party have been excluded from the NV calculation. E:\FR\FM\10SEN1.SGM 10SEN1 51588 Federal Register / Vol. 72, No. 174 / Monday, September 10, 2007 / Notices ebenthall on PRODPC61 with NOTICES See Antidumping Proceedings: Affiliated Party Sales in the Ordinary Course of Trade, 67 69186, 69187 (November 15, 2002). Assessment Rate Upon completion of this administrative review, the Department shall determine, and CBP shall assess, antidumping duties on all appropriate Currency Conversion entries, in accordance with 19 CFR For purposes of these preliminary 351.212. The Department intends to results, we made currency conversions issue assessment instructions to CBP 15 in accordance with section 773A(a) of days after the date of publication of the final results of this review. The the Act, based on the official exchange Department clarified its ‘‘automatic rates published by the Federal Reserve assessment’’ regulation on May 6, 2003. Bank. See Antidumping and Countervailing Preliminary Results of the Review Duty Proceedings: Assessment of Antidumping Duties, 68 FR 23954 (May As a result of this review, we 6, 2003) (Assessment Policy Notice). preliminarily find that the following This clarification will apply to entries of weighted–average dumping margins subject merchandise during the POR exist: produced by companies included in Weighted–Average these final results of review for which Producer/Manufacturer the reviewed companies did not know Margin that the merchandise they sold to the Dongbu ......................... 4.96 % intermediary (e.g., a reseller, trading HYSCO ......................... 0.51 % company, or exporter) was destined for Union ............................ 4.35 % the United States. In such instances, we will instruct CBP to liquidate unreviewed entries at the ‘‘All Others’’ The Department will disclose calculations performed within five days rate if there is no rate for the intermediary involved in the of the date of publication of this notice transaction. See Assessment Policy to the parties of this proceeding in Notice for a full discussion of this accordance with 19 CFR 351.224(b). Interested parties may submit case briefs clarification. and/or written comments no later than Cash Deposit Requirements 30 days after the date of publication of To calculate the cash deposit rate for these preliminary results of review. See 19 CFR 351.309(c)(ii). Rebuttal briefs are each producer and/or exporter included limited to issues raised in such briefs or in this administrative review, we divided the total dumping margins for comments and may be filed no later each company by the total net value for than five days after the time limit for that company’s sales during the review filing the case briefs or comments. See period. 19 CFR 351.309(d). Parties submitting The following deposit rates will be arguments in this proceeding are effective upon publication of the final requested to submit with the argument: results of this administrative review for 1) a statement of the issue, 2) a brief all shipments of CORE for Korea summary of the argument, and 3) a table entered, or withdrawn from warehouse, of authorities. Case and rebuttal briefs for consumption on or after the and comments must be served on publication date, as provided by section interested parties in accordance with 19 751(a)(2)(C) of the Act: (1) The cash CFR 351.303(f). Further, parties deposit rates for the companies listed submitting written comments are above will be the rates established in the requested to provide the Department final results of this review, except if the with an additional copy of the public rate is less than 0.5 percent and, version of any such comments on a therefore, de minimis, the cash deposit diskette. will be zero; (2) for previously reviewed An interested party may request a or investigated companies not listed hearing within 30 days of publication of above, the cash deposit rate will these preliminary results. See 19 CFR continue to be the company–specific 351.310(c). Any hearing, if requested, rate published for the most recent final ordinarily will be held two days after results in which that manufacturer or the due date of the rebuttal briefs. The exporter participated; (3) if the exporter Department will issue the final results is not a firm covered in these reviews, of this administrative review, which a prior review, or the original less–thanwill include the results of its analysis of fair–value (LTFV) investigation, but the issues raised in any such comments, or manufacturer is, the cash deposit rate at a hearing, if requested, within 120 will be the rate established for the most days of publication of these preliminary recent final results for the manufacturer results. of the merchandise; and (4) if neither VerDate Aug<31>2005 16:56 Sep 07, 2007 Jkt 211001 PO 00000 Frm 00007 Fmt 4703 Sfmt 4703 the exporter nor the manufacturer is a firm covered in these or any previous review conducted by the Department, the cash deposit rate will be 17.70 percent, the ‘‘All Others’’ rate established in the LTFV. See Orders on Certain Steel from Korea. These cash deposit requirements, when imposed, shall remain in effect until further notice. 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. These preliminary results of review are issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Act. Dated: August 31, 2007. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E7–17756 Filed 9–7–07; 8:45 am] BILLING CODE 3510–DS–S DEPARTMENT OF COMMERCE International Trade Administration A–570–886 Polyethylene Retail Carrier Bags from the People’s Republic of China: Preliminary Results of Antidumping Duty Administrative Review and Partial Rescission of Review Import Administration, International Trade Administration, Department of Commerce. SUMMARY: In response to a request from the Polyethylene Retail Carrier Bag Committee,1 which represents domestic producers of polyethylene retail carrier bags, and individual requests from certain manufacturers/exporters of subject merchandise located in the People’s Republic of China (‘‘PRC’’), the Department of Commerce (‘‘the Department’’) is conducting an administrative review of the antidumping duty order on polyethylene retail carrier bags (‘‘PRCBs’’) from the PRC. The AGENCY: 1 Consisting of Hilex Poly Company, LLC and the Superbag Corporation (collectively, ‘‘the petitioners’’). E:\FR\FM\10SEN1.SGM 10SEN1

Agencies

[Federal Register Volume 72, Number 174 (Monday, September 10, 2007)]
[Notices]
[Pages 51584-51588]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-17756]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

International Trade Administration

(A-580-816)


Certain Corrosion-Resistant Carbon Steel Flat Products from the 
Republic of Korea: Notice of Preliminary Results and Partial Rescission 
of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: In response to requests from petitioners,\1\ the Department of 
Commerce (the Department) is conducting the thirteenth administrative 
review of the antidumping order on corrosion-resistant carbon steel 
flat products (CORE) from Korea. This review covers three manufacturers 
and exporters (collectively, the respondents) of the subject 
merchandise: Dongbu Steel Co., Ltd., (Dongbu); Hyundai HYSCO (HYSCO); 
and Union Steel Manufacturing Co., Ltd. (Union). The period of review 
(POR) is August 1, 2005, through July 31, 2006. We preliminarily 
determine that during the POR, Dongbu, HYSCO, and Union made sales of 
subject merchandise at less than normal value (NV). In addition, we are 
preliminary rescinding this review with respect to Pohang Iron & Steel 
Company, Ltd. (POSCO) and Pohang Coated Steel Co., Ltd. (POCOS) 
(collectively, the POSCO Group), as a result of petitioners timely 
withdrawal of its review request. 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 all appropriate entries of subject merchandise during the 
POR.
---------------------------------------------------------------------------

    \1\ Petitioners are the United States Steel Corporation (U.S. 
Steel) and Mittal Steel USA ISG, Inc. (Mittal Steel USA).

---------------------------------------------------------------------------
EFFECTIVE DATE: September 10, 2007

FOR FURTHER INFORMATION CONTACT: Jolanta Lawska or George McMahon 
(Union), Preeti Tolani (Dongbu), and Victoria Cho or Christopher 
Hargett (HYSCO), AD/CVD Operations, Office 3, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, NW, Washington, DC 20230; telephone: 
(202) 482-8362, (202) 482-1167, (202) 482-0395, (202) 482-5075 and 
(202) 482-4161, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On August 19, 1993, the Department published the antidumping order 
on CORE from Korea. See Antidumping Duty Orders on Certain Cold-Rolled 
Carbon Steel Flat Products and Certain Corrosion-Resistant Carbon Steel 
Flat Products from Korea, 58 FR 44159 (August 19, 1993) (Orders on 
Certain Steel from Korea). On August 1, 2006, we published in the 
Federal Register the Antidumping or Countervailing Duty Order, Finding, 
or Suspended Investigation; Opportunity To Request Administrative 
Review, 71 FR 43441 (August 1, 2006). On August 31, 2006, respondents 
and petitioners requested a review of Dongbu, HYSCO, the POSCO Group, 
and Union. The Department initiated this review on September 29, 2006. 
See Initiation of Antidumping and Countervailing Duty Administrative 
Reviews, 71 FR 57465 (September 29, 2006).
    During the most recently completed segments of the proceeding in 
which Dongbu, HYSCO, the POSCO Group, and Union participated, the 
Department disregarded sales below the cost of production (COP) that 
failed the cost test.\2\ Therefore, pursuant to section 
773(b)(2)(A)(ii) of the Tariff Act of 1930, as amended (the Act), we 
had reasonable grounds to believe or suspect that sales by these 
companies of the foreign like product under consideration for the 
determination of NV in this review were made at prices below the COP. 
We instructed Dongbu, HYSCO, the POSCO Group, and Union to respond to 
sections A-D of the initial questionnaire,\3\ which we issued on 
September 13, 2006.
---------------------------------------------------------------------------

    \2\ Certain Corrosion-Resistant Carbon Steel Flat Products from 
the Republic of Korea: Notice of Preliminary Results of Antidumping 
Duty Administrative Review, 71 FR 53370, 53375 (September 11, 2006) 
(Preliminary Results of the 12th Review of CORE from Korea); Notice 
of Final Results of the Twelfth Administrative Review of the 
Antidumping Duty Order on Certain Corrosion-Resistant Carbon Steel 
Flat Products from the Republic of Korea, 72 FR 13086 (March 20, 
2007) and accompanying Issues and Decisions Memorandum; and Certain 
Corrosion-Resistant Carbon Steel Flat Products from the Republic of 
Korea; Notice of Amended Final Results of the Twelfth Administrative 
Review, 72 FR 20815 (April 26, 2007).
    \3\ Section A: Organization, Accounting Practices, Markets and 
Merchandise
    Section B: Comparison Market Sales
    Section C: Sales to the United States
    Section D: Cost of Production and Constructed Value
---------------------------------------------------------------------------

    On December 28, 2006, the petitioners timely withdrew their request 
for an administrative review of the POSCO Group. Thus, we are 
preliminary rescinding the request for review of the antidumping order 
for the POSCO Group.
    On April 19, 2007, the Department published a notice extending the 
time period for issuing the preliminary results of the thirteenth 
administrative review from May 3, 2007, to August 31, 2007. See 
Corrosion-Resistant Carbon Steel Flat Products from Korea: Extension of 
Time Limits for the Preliminary Results of Antidumping Duty 
Administrative Review, 72 FR 19688 (April 19, 2007).

Rescission of Administrative Review for the POSCO Group

    As provided in 19 CFR 351.213(d)(1), ``[t]he Secretary will rescind 
an administrative review under this section, in whole or in part, if a 
party that requested a review withdraws the request within 90 days of 
the date of publication of notice of initiation of the requested 
review.'' The petitioners withdrew their request for an administrative 
review within 90 days of the date of publication of the notice of 
initiation of the instant administrative review and no other party 
requested an administrative review of the POSCO Group. Therefore, the 
Department is rescinding the administrative review with respect to the 
POSCO Group.

Dongbu

    On November 10, 2006, Dongbu submitted its section A response to 
the initial questionnaire. On November 20, 2006, Dongbu submitted its 
sections B-D response to the initial questionnaire. On February 9, 
2007, Dongbu submitted its supplemental questionnaire responses for 
sections A-C. Dongbu submitted its responses to the Department's three 
section D supplemental questionnaires on March 12, 2007, March 26, 
2007, and April 19, 2007, respectively.

Union

    On November 13, 2006, Union submitted its section A response to the 
initial questionnaire. On November 20, 2006, Union submitted its 
sections B-C response to the initial questionnaire. Union submitted its 
responses to the Department's three section A-C supplemental 
questionnaires on February 2, 2007, April 16, 2007 and June 1, 2007, 
respectively.

[[Page 51585]]

HYSCO

    On November 3, 2006, HYSCO submitted its section A response to the 
Department's initial questionnaire. On November 22, 2006, HYSCO 
submitted its section B-D response to the Department's initial 
questionnaire. HYSCO submitted its responses to the Department's three 
section A-D supplemental questionnaires on January 29, 2007, February 
20, 2007, and May 24, 2007, respectively.

Verification

    The Department conducted the sales verification of Dongbu and 
HYSCO, from June 18 through 29, 2007, and Union from July 23 through 
27, 2007, in Seoul, South Korea. The Department conducted the cost 
verification of HYSCO in Seoul, South Korea, from July 31 through 
August 4, 2007. The Department will conduct the cost verification of 
Dongbu and Union in Seoul, South Korea, after these preliminary 
results.

Period of Review

    The POR covered by this review is August 1, 2005, through July 31, 
2006.

Scope of the Order

    This order covers flat-rolled carbon steel products, of rectangular 
shape, either clad, plated, or coated with corrosion-resistant metals 
such as zinc, aluminum, or zinc-, aluminum-, nickel- or iron-based 
alloys, whether or not corrugated or painted, varnished or coated with 
plastics or other nonmetallic substances in addition to the metallic 
coating, in coils (whether or not in successively superimposed layers) 
and of a width of 0.5 inch or greater, or in straight lengths which, if 
of a thickness less than 4.75 millimeters, are of a width of 0.5 inch 
or greater and which measures at least 10 times the thickness or if of 
a thickness of 4.75 millimeters or more are of a width which exceeds 
150 millimeters and measures at least twice the thickness, as currently 
classifiable in the Harmonized Tariff Schedule of the United States 
(HTSUS) under item numbers 7210.30.0030, 7210.30.0060, 7210.41.0000, 
7210.49.0030, 7210.49.0090, 7210.49.0091, 7210.49.0095, 7210.61.0000, 
7210.69.0000, 7210.70.6030, 7210.70.6060, 7210.70.6090, 7210.90.1000, 
7210.90.6000, 7210.90.9000, 7212.20.0000, 7212.30.1030, 7212.30.1090, 
7212.30.3000, 7212.30.5000, 7212.40.1000, 7212.40.5000, 7212.50.0000, 
7212.60.0000, 7215.90.1000, 7215.90.3000, 7215.90.5000, 7217.20.1500, 
7217.30.1530, 7217.30.1560, 7217.90.1000, 7217.90.5030, 7217.90.5060, 
and 7217.90.5090. Included in the order are flat-rolled products of 
non-rectangular cross-section where such cross-section is achieved 
subsequent to the rolling process including products which have been 
beveled or rounded at the edges (i.e., products which have been 
``worked after rolling''). Excluded from this order are flat-rolled 
steel products either plated or coated with tin, lead, chromium, 
chromium oxides, both tin and lead (``terne plate''), or both chromium 
and chromium oxides (``tin-free steel''), whether or not painted, 
varnished or coated with plastics or other nonmetallic substances in 
addition to the metallic coating. Also excluded from this order are 
clad products in straight lengths of 0.1875 inch or more in composite 
thickness and of a width which exceeds 150 millimeters and measures at 
least twice the thickness. Also excluded from this order are certain 
clad stainless flat-rolled products, which are three-layered corrosion-
resistant carbon steel flat-rolled products less than 4.75 millimeters 
in composite thickness that consist of a carbon steel flat-rolled 
product clad on both sides with stainless steel in a 20%-60%-20% ratio.
    These HTSUS item numbers are provided for convenience and customs 
purposes. The written descriptions remain dispositive.

Product Comparisons

    In accordance with section 771(16) of the Act, we considered all 
CORE products produced by the respondents, covered by the scope of the 
order, and sold in the home market during the POR to be foreign like 
products for the purpose of determining appropriate product comparisons 
to CORE sold in the United States.
    Where there were no sales in the ordinary course of trade of 
identical merchandise in the home market to compare to U.S. sales, we 
compared U.S. sales to the next most similar foreign like product on 
the basis of the characteristics listed in Appendix V of the 
Department's antidumping questionnaire. In making the product 
comparisons, we matched foreign like products based on the Appendix V 
physical characteristics reported by each respondent. Where sales were 
made in the home market on a different weight basis from the U.S. 
market (theoretical versus actual weight), we converted all quantities 
to the same weight basis, using the conversion factors supplied by the 
respondents, before making our fair-value comparisons.

Normal Value Comparisons

    To determine whether sales of CORE by the respondents to the United 
States were made at less than NV, we compared the Export Price (EP) or 
Constructed Export Price (CEP) to the NV, as described in the ``Export 
Price/Constructed Export Price'' and ``Normal Value'' sections of this 
notice. In accordance with section 777A(d)(2) of the Act, we calculated 
monthly weighted-average prices for NV and compared these to individual 
U.S. transactions.

Export Price/Constructed Export Price

    We calculated the price of U.S. sales based on CEP, in accordance 
with section 772(b) of the Act, which defines the term ``constructed 
export price'' as ``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 subsections (c) and (d)'' of this section. In 
contrast, section 772(a) of the Act defines ``export price'' as ``the 
price at which the subject merchandise is first sold (or agreed to be 
sold) before the date of importation by the producer or exporter of the 
subject merchandise outside of the United States to an unaffiliated 
purchaser in the United States or to an unaffiliated purchaser for 
exportation to the United States, as adjusted under subsection (c)'' of 
this section.
    In determining whether to classify U.S. sales as either EP or CEP 
sales, the Department must examine the totality of the circumstances 
surrounding the U.S. sales process, and assess where the reviewed sales 
or agreements of sale were made for purposes of section 772(b) of the 
Act. In the instant case, the record establishes that the sales were 
made in the United States after importation. Dongbu's, HYSCO's, and 
Union's affiliates in the United States (1) took title to the subject 
merchandise and (2) invoiced and received payment from the unaffiliated 
U.S. customers for their sales of the subject merchandise to those U.S. 
customers. Thus, the Department has determined that these U.S. sales 
should be classified as CEP transactions under section 772(b) of the 
Act.
    For Dongbu, HYSCO, and Union, we calculated CEP based on packed 
prices to unaffiliated customers in the United

[[Page 51586]]

States. Where appropriate, we made deductions from the starting price 
for foreign inland freight, foreign inland insurance, foreign brokerage 
and handling, international freight, marine insurance, U.S. warehousing 
expenses, U.S. wharfage, U.S. inland freight, U.S. brokerage and 
handling, loading expenses, other U.S. transportation expenses, U.S. 
customs duties, commissions, credit expenses, letter of credit 
expenses, warranty expenses, other direct selling expenses, inventory 
carrying costs incurred in the United States, and other indirect 
selling expenses in the country of manufacture and the United States 
associated with economic activity in the United States. Pursuant to 
section 772(d)(3) of the Act, we made an adjustment for CEP profit. 
Where appropriate, we added interest revenue to the gross unit price.
    Consistent with the Department's normal practice, for Union we 
added the reported duty drawback to the gross unit price. We did so in 
accordance with the Department's long-standing test, which requires 
that: (1) the import duty and rebate be directly linked to, and 
dependent upon, one another; and (2) the company claiming the 
adjustment demonstrate that there were sufficient imports of imported 
raw materials to account for the duty drawback received on the exports 
of the manufactured product.

HYSCO's Sales of Subject Merchandise that were Further Manufactured and 
Sold as Non-Subject Merchandise in the United States

    In its Section A questionnaire response and on September 27, 2006, 
HYSCO requested that the Department exclude certain POR sales of 
subject merchandise imported by its wholly owned U.S. subsidiary, HYSCO 
America Company (HAC), that were further manufactured after importation 
and sold as non-subject merchandise in the United States, citing ``the 
extreme difficulty in calculating CEP for these sales through HAC.'' 
The Department issued several supplemental questionnaires to HYSCO 
regarding these HAC CEP sales.
    Section 772(e) of the Act provides that when the value added in the 
United States by an affiliated party is likely to exceed substantially 
the value of the subject merchandise, the Department shall use one of 
the following prices to determine CEP if there is a sufficient quantity 
of sales to provide a reasonable basis of comparison and the use of 
such sales is appropriate: (1) The price of identical subject 
merchandise sold by the exporter or producer to an unaffiliated person; 
or (2) The price of other subject merchandise sold by the exporter or 
producer to an unaffiliated person.
    Our analysis showed that the value added by the affiliated party to 
the subject merchandise after importation in the United States was 
significantly greater than the 65 percent threshold we use in 
determining whether the value added in the United States by an 
affiliated party substantially exceeds the value of the subject 
merchandise. See 19 CFR 351.402 (c)(2). We then considered whether 
there were sales of identical subject merchandise or other subject 
merchandise sold in sufficient quantities by the exporter or producer 
to an unaffiliated person that could provide a reasonable basis of 
comparison. In addition to the sales to HAC that were further 
manufactured, HYSCO also had CEP sales of similar, but not identical, 
subject merchandise to unaffiliated customers in the United States in 
back-to-back transactions through another HYSCO affiliate in the United 
States, Hyundai HYSCO USA (``HHU'').
    Decisions as to the appropriate methodology for determining CEP for 
sales involving further manufacturing generally must be made on a case-
by-case basis. In this instance, the quantity of sales of identical or 
other subject merchandise to an unaffiliated person is relatively 
small. However, another reasonable method for determining CEP for the 
HAC CEP sales is not evident. In this case, the value added after 
importation is very large and the further manufacturing very complex. 
Therefore, similar to our practice in other cases, see, e.g., Certain 
Hot-Rolled Carbon Steel Flat Products from the Netherlands; Final 
Results of Antidumping Duty Administrative Reviews, 72 FR 28676 (May 
22, 2007), we relied on HYSCO's other sales of similar merchandise to 
unaffiliated parties in the United States as the basis for calculating 
CEP on HYSCO's sales through HAC. Although we have relied on a 
relatively small quantity of sales, as under the circumstances here 
this is the most reasonable methodology, we will continue to assess 
whether such quantities provide an adequate basis for our dumping 
analysis in other cases. Therefore, in this and future reviews we will 
reexamine the appropriate methodology to use when presented with 
similar circumstances.

Normal Value

    Based on a comparison of the aggregate quantity of home market and 
U.S. sales, we determined that the quantity of the foreign like product 
sold in the exporting country was sufficient to permit a proper 
comparison with the sales of the subject merchandise to the United 
States, pursuant to section 773(a) of the Act. Therefore, in accordance 
with section 773(a)(1)(B)(i) of the Act, we 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 and in the ordinary 
course of trade.
    Where appropriate, we deducted rebates, discounts, inland freight 
(offset, where applicable, by freight revenue), inland insurance, and 
packing. Additionally, we made adjustments to NV, where appropriate, 
for credit expenses, warranty expenses, post-sale warehousing, and 
differences in weight basis. We also made adjustments, where 
appropriate, for home market indirect selling expenses and inventory 
carrying costs to offset U.S. commissions.
    We also increased NV by U.S. packing costs in accordance with 
section 773(a)(6)(A) of the Act. We made adjustments to NV for 
differences in cost attributable to differences in physical 
characteristics of the merchandise, pursuant to section 
773(a)(6)(C)(ii) of the Act.
    For purposes of calculating NV, section 771(16) of the Act defines 
``foreign like product'' as merchandise which is either (1) identical 
or (2) similar to the merchandise sold in the United States. When there 
are no identical products sold in the home market, the products which 
are most similar to the product sold in the United States are 
identified. For the non-identical or most similar products which are 
identified based on the Department's product matching criteria, an 
adjustment is made to the home market sales price to account for the 
actual physical differences between the products sold in the United 
States and the home market or third country market. See 19 CFR 351.411 
and section 773(a)(6)(C)(ii) of the Act.

Level of Trade

    In accordance with section 773(a)(1)(B) of the Act, we determined 
NV based on sales in the comparison market at the same level of trade 
(LOT) as the CEP sales, to the extent practicable. When there were no 
sales at the same LOT, we compared U.S. sales to comparison market 
sales at a different LOT.
    Pursuant to 19 CFR 351.412, to determine whether CEP sales and NV 
sales were at different LOTs, we examine stages in the marketing 
process and selling functions along the chain of distribution between 
the producer and the unaffiliated (or arm's-length) customers. If the 
comparison market

[[Page 51587]]

sales are at a different LOT and the differences affect price 
comparability, as manifested in a pattern of consistent price 
differences between sales at different LOTs in the country in which NV 
is determined, we will make an LOT adjustment under section 
773(a)(7)(A) of the Act. For CEP sales, if the NV LOT is at a more 
advanced stage of distribution than the CEP LOT and the data available 
do not provide an appropriate basis to determine an LOT adjustment, we 
will grant a CEP offset, as provided in section 773(a)(7)(B) of the 
Act. See Notice of Final Determination of Sales at Less Than Fair 
Value: Certain Cut-to-Length Carbon Steel Plate from South Africa, 62 
FR 61731, 61732-33 (November 19, 1997).
    We did not make an LOT adjustment under 19 CFR 351.412(e) because, 
as there was only one home market LOT for each respondent, we were 
unable to identify a pattern of consistent price differences 
attributable to differences in LOTs (see 19 CFR 351.412(d)). Under 19 
CFR 351.412(f), we are preliminarily granting a CEP offset for Dongbu, 
HYSCO, and Union because the NV for each company is at a more advanced 
LOT than the LOT for their U.S. CEP sales.
    For a detailed description of our LOT methodology and a summary of 
company-specific LOT findings for these preliminary results, see the 
August 31, 2007, Calculation Memorandum for Dongbu Steel Co., Ltd.; 
Calculation Memorandum for Hyundai HYSCO; and Calculation Memorandum 
for Union Steel Manufacturing Co., Ltd., of which the public versions 
are on file in the Central Records Unit (CRU), Import Administration, 
Washington, DC, HCHB Building, Room B-099.

Cost of Production

A. Calculation of COP
    We are investigating COP for Dongbu, HYSCO, and Union because 
during the most recently completed segments of the proceeding in which 
Dongbu, HYSCO, and Union participated, the Department found and 
disregarded sales that failed the cost test. We calculated a company-
specific COP for Dongbu, HYSCO, and Union based on the sum of each 
respondent's cost of materials and fabrication for the foreign like 
product, plus amounts for home-market selling expenses, selling, 
general and administrative expenses (SG&A), and packing costs in 
accordance with section 773(b)(3) of the Act. We relied on Dongbu's, 
HYSCO's, and Union's information as submitted.
    In accordance with section 773(b)(3) of the Act, we calculated COP 
based on the sum of the respondents' cost of materials and fabrication 
for the foreign like product, plus amounts for general and 
administrative (G&A) expenses and interest expenses. We relied on the 
COP information provided by Dongbu in its questionnaire responses, 
except for the following instances where the information was not 
appropriately quantified or valued:
    1. We adjusted Dongbu's reported cost of manufacturing (COM) to 
appropriately value the claimed scrap offset.
    2. We revised the reported G&A expense ratio to exclude certain 
items of exchange gains and losses. In addition, we adjusted the 
denominator used to calculate the G&A expense ratio for the adjustment 
made above.
    For further discussion of these adjustments, see the Memorandum to 
Neal Halper entitled, Cost of Production and Constructed Value 
Adjustments for the Preliminary Results--Dongbu Steel Co., Ltd., dated 
August 30, 2007.
B. Test of Home-Market Prices
    In determining whether to disregard home market sales made at 
prices below the COP, as required under sections 773(b)(1)(A) and (B) 
of the Act, we compared the weighted-average COP figures to home market 
sales of the foreign like product and we examined whether (1) within an 
extended period of time, such sales were made in substantial 
quantities, and (2) such sales were made at prices which permitted the 
recovery of all costs within a reasonable period of time. On a product-
specific basis, we compared the COP to the home market prices (not 
including VAT), less any applicable movement charges, discounts, and 
rebates.
C. Results of COP Test
    Pursuant to section 773(b)(1) of the Act, we may disregard below-
COP sales in the determination of NV if these sales have been made 
within an extended period of time in substantial quantities and were 
not at prices which permit recovery of all costs within a reasonable 
period of time. Where 20 percent or more of a respondent's sales of a 
given product during the POR were at prices less than the COP for at 
least six months of the POR, we determined that sales of that model 
were made in ``substantial quantities'' within an extended period of 
time, in accordance with sections 773(b)(2)(B) and (C) of the Act. 
Where prices of a respondent's sales of a given product were below the 
per-unit COP at the time of sale and below the weighted-average per-
unit costs for the POR, we determined that sales were not at prices 
which would permit recovery of all costs within a reasonable period of 
time, in accordance with section 773(b)(2)(D) of the Act. In such 
cases, we disregarded the below-cost sales in accordance with section 
773(b)(1) of the Act.
    Pursuant to section 773(b)(2)(C) of the Act, where less than 20 
percent of a respondent's sales of a given product were at prices less 
than the COP, we did not disregard any below-cost sales of that product 
because we determined that the below-cost sales were not made in 
``substantial quantities.''
    We tested and identified below-cost home market sales for Dongbu, 
HYSCO, and Union. We disregarded individual below-cost sales of a given 
product and used the remaining sales as the basis for determining NV, 
in accordance with section 773(b)(1) of the Act. See the August 31, 
2007, Calculation Memorandum for Dongbu Steel Co., Ltd.; Calculation 
Memorandum for Hyundai HYSCO; and Calculation Memorandum for Union 
Steel Manufacturing Co., Ltd.

Arm's-Length Sales

    Dongbu and HYSCO also reported that they made sales in the home 
market to affiliated parties. The Department calculates NV based on a 
sale to an affiliated party only if it is satisfied that the price to 
the affiliated party is comparable to the price at which sales are made 
to parties not affiliated with the producer or exporter, i.e., sales at 
arm's length. See 19 CFR 351.403(c).
    To test whether these sales were made at arm's length, we compared 
the starting prices of sales to affiliated and unaffiliated customers 
net of all movement charges, direct selling expenses, discounts and 
packing. In accordance with the Department's current 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 considered the sales to be at arm's-length prices. See Notice 
of Preliminary Results and Partial Rescission of Antidumping Duty 
Administrative: Ninth Administrative Review of the Antidumping Duty 
Order on Certain Pasta from Italy, 71 FR 45017, 45020 (August 8, 2006);
    19 CFR 351.403(c). Conversely, where we found sales to the 
affiliated party that did not pass the arm's-length test, all sales to 
that affiliated party have been excluded from the NV calculation.

[[Page 51588]]

See Antidumping Proceedings: Affiliated Party Sales in the Ordinary 
Course of Trade, 67 69186, 69187 (November 15, 2002).

Currency Conversion

    For purposes of these preliminary results, we made currency 
conversions in accordance with section 773A(a) of the Act, based on the 
official exchange rates published by the Federal Reserve Bank.

Preliminary Results of the Review

    As a result of this review, we preliminarily find that the 
following weighted-average dumping margins exist:

------------------------------------------------------------------------
                                                       Weighted-Average
                Producer/Manufacturer                       Margin
------------------------------------------------------------------------
Dongbu..............................................              4.96 %
HYSCO...............................................              0.51 %
Union...............................................              4.35 %
------------------------------------------------------------------------

    The Department will disclose calculations performed within five 
days of the date of publication of this notice to the parties of this 
proceeding in accordance with 19 CFR 351.224(b). Interested parties may 
submit case briefs and/or written comments no later than 30 days after 
the date of publication of these preliminary results of review. See 19 
CFR 351.309(c)(ii). Rebuttal briefs are limited to issues raised in 
such briefs or comments and may be filed no later than five days after 
the time limit for filing the case briefs or comments. See 19 CFR 
351.309(d). Parties submitting arguments in this proceeding are 
requested to submit with the argument: 1) a statement of the issue, 2) 
a brief summary of the argument, and 3) a table of authorities. Case 
and rebuttal briefs and comments must be served on interested parties 
in accordance with 19 CFR 351.303(f). Further, parties submitting 
written comments are requested to provide the Department with an 
additional copy of the public version of any such comments on a 
diskette.
    An interested party may request a hearing within 30 days of 
publication of these preliminary results. See 19 CFR 351.310(c). Any 
hearing, if requested, ordinarily will be held two days after the due 
date of the rebuttal briefs. The Department will issue the final 
results of this administrative review, which will include the results 
of its analysis of issues raised in any such comments, or at a hearing, 
if requested, within 120 days of publication of these preliminary 
results.

Assessment Rate

    Upon completion of this administrative review, the Department shall 
determine, and CBP shall assess, antidumping duties on all appropriate 
entries, in accordance with 19 CFR 351.212. The Department intends to 
issue assessment instructions 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 POR produced by companies included in these 
final results of review for which the reviewed companies did not know 
that the merchandise they 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.

Cash Deposit Requirements

    To calculate the cash deposit rate for each producer and/or 
exporter included in this administrative review, we divided the total 
dumping margins for each company by the total net value for that 
company's sales during the review period.
    The following deposit rates will be effective upon publication of 
the final results of this administrative review for all shipments of 
CORE for Korea entered, or withdrawn from warehouse, for consumption on 
or after the publication date, as provided by section 751(a)(2)(C) of 
the Act: (1) The cash deposit rates for the companies listed above will 
be the rates established in the final results of this review, except if 
the rate is less than 0.5 percent and, therefore, de minimis, the cash 
deposit will be zero; (2) for previously reviewed or investigated 
companies not listed above, the cash deposit rate will continue to be 
the company-specific rate published for the most recent final results 
in which that manufacturer or exporter participated; (3) if the 
exporter is not a firm covered in these reviews, 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 final results for the manufacturer of the merchandise; 
and (4) if neither the exporter nor the manufacturer is a firm covered 
in these or any previous review conducted by the Department, the cash 
deposit rate will be 17.70 percent, the ``All Others'' rate established 
in the LTFV. See Orders on Certain Steel from Korea. These cash deposit 
requirements, when imposed, shall remain in effect until further 
notice.

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.
    These preliminary results of review are issued and published in 
accordance with sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: August 31, 2007.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E7-17756 Filed 9-7-07; 8:45 am]
BILLING CODE 3510-DS-S