Stainless Steel Wire Rods From India: Preliminary Results of the Antidumping Duty New-Shipper Review, 60808-60811 [E7-21106]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 72, Number 207 (Friday, October 26, 2007)]
[Notices]
[Pages 60808-60811]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-21106]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-533-808]


Stainless Steel Wire Rods From India: Preliminary Results of the 
Antidumping Duty New-Shipper Review

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

EFFECTIVE DATE: October 26, 2007.
SUMMARY: The Department of Commerce (the Department) is conducting a 
new-shipper review of the antidumping duty order on stainless steel 
wire rods (wire rods) from India manufactured and exported by Sunflag 
Iron & Steel Co., Ltd. (Sunflag). The period of review (POR) is 
December 1, 2005, through November 30, 2006. We preliminarily determine 
to apply adverse facts available to Sunflag's U.S. sales. We invite 
interested parties to comment on these preliminary results. Parties who 
submit argument in this proceeding are requested to submit with the 
argument (1) a statement of the issue and (2) a brief summary of the 
argument.

FOR FURTHER INFORMATION CONTACT: Catherine Cartsos or Minoo Hatten, AD/
CVD Operations, Office 5, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
1757 and (202) 482-1690, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On December 1, 1993, the Department published the antidumping duty 
order on stainless steel wire rods from India. See Antidumping Duty 
Order: Certain Stainless Steel Wire Rods from India, 58 FR 63335 
(December 1, 1993). On December 29, 2006, the Department received a 
timely request from Sunflag for new-shipper and administrative reviews 
of the antidumping duty order, under section 751(a)(2)(B) of the Tariff 
Act of 1930, as amended (the Act), and 19 CFR 351.214(c). On February 
2, 2007, we published the initiation of the administrative review. On 
March 20, 2007, the Department published a notice of initiation of a 
new-shipper review of the antidumping duty order on stainless steel 
wire rods from India with respect to Sunflag. See Stainless Steel Wire 
Rod From India: Notice of Initiation of Antidumping Duty New-Shipper 
Review, 72 FR 13088 (March 20, 2007). On September 12, 2007, we 
published our intent to rescind the administrative review with respect 
to Sunflag because we are proceeding with the new-shipper review and 
because the administrative review covers entries during the same period 
of time as the new-shipper review. See Stainless Steel Wire Rods from 
India: Preliminary Results of Antidumping Duty Administrative Review 
and Notice of Intent to Rescind Antidumping Duty Administrative Review 
in Part, 72 FR 52079 (September 12, 2007). We conducted verification of 
Sunflag's information from July 30, 2007, through August 2, 2007. On 
August 8, 2007, we extended the time limit for the preliminary results 
of the new-shipper review to October 19, 2007. See Stainless Steel Wire 
Rods From India: Extension of Time Limit for the Preliminary Results of 
the Antidumping Duty New-Shipper Review, 72 FR 44496 (August 8, 2007).

Scope of the Order

    The merchandise under review is stainless steel wire rods which are 
hot-rolled or hot-rolled annealed and/or pickled rounds, squares, 
octagons, hexagons or other shapes, in coils. Wire rods are made of 
alloy steels containing, by weight, 1.2 percent or less of carbon and 
10.5 percent or more of chromium, with or without other elements. These 
products are only manufactured by hot-rolling and are normally sold in 
coiled

[[Page 60809]]

form, and are of solid cross section. The majority of wire rods sold in 
the United States are round in cross-section shape, annealed, and 
pickled. The most common size is 5.5 millimeters in diameter.
    The wire rods subject to this order are currently classifiable 
under subheadings 7221.00.0005, 7221.00.0015, 7221.00.0030, 
7221.00.0045, and 7221.00.0075 of the Harmonized Tariff Schedule of the 
United States (HTSUS). Although the HTSUS subheadings are provided for 
convenience and customs purposes, the written description of the 
merchandise subject to the order is dispositive.

Bona Fide Analysis

    Consistent with our practice, we investigated whether the two U.S. 
transactions reported by Sunflag during the POR were bona fide sales. 
Among the factors we examined was the relationship between Sunflag and 
its reported U.S. customer. Based on our investigation, we 
preliminarily determine that Sunflag's sales were made on a bona fide 
basis. For our complete analysis, see memorandum from Catherine Cartsos 
to the File entitled ``Bona Fide Nature of Sunflag Iron & Steel Co., 
Ltd.'s Sales in the New Shipper Review for Stainless Steel Wire Rods 
from India,'' dated October 19, 2007, on file in room B-099 of the main 
Department of Commerce building.

Use of Adverse Facts Available

    Section 776(a)(2) of the Act provides that, if an interested party 
or any other person (A) withholds information that has been requested 
by the administering authority, (B) fails to provide such information 
by the deadlines for the submission of the information or in the form 
and manner requested, subject to subsections (c)(1) and (e) of section 
782, (C) significantly impedes a proceeding under this title, or (D) 
provides such information but the information cannot be verified as 
provided in section 782(i), the administering authority shall, subject 
to section 782(d), use the facts otherwise available in reaching the 
applicable determination.
    Section 782(d) of the Act provides that, if the Department 
determines that a response to a request for information does not comply 
with the request, the Department shall promptly inform the person 
submitting the response of the nature of the deficiency and shall, to 
the extent practicable, provide that person with an opportunity to 
remedy or explain the deficiency in light of the time limits 
established for the completion of the administrative review. Section 
782(e) of the Act states that the Department shall not decline to 
consider information determined to be ``deficient'' under section 
782(d) if all of the following requirements are met: (1) the 
information is submitted by the established deadline; (2) the 
information can be verified; (3) the information is not so incomplete 
that it cannot serve as a reliable basis for reaching the applicable 
determination; (4) the interested party has demonstrated that it acted 
to the best of its ability; and (5) the information can be used without 
undue difficulties.
    Moreover, section 776(b) of the Act provides that, if the 
Department finds that an interested party has failed to cooperate by 
not acting to the best of its ability to comply with a request for 
information, the Department may use an inference adverse to the 
interests of that party in selecting from among the facts otherwise 
available. In addition, the Statement of Administrative Action 
accompanying the Uruguay Round Agreements Act, H.R. Doc. 103- 316, Vol. 
1, at 870 (1994) (SAA), establishes that the Department may employ an 
adverse inference ``to ensure that the party does not obtain a more 
favorable result by failing to cooperate to the best of its ability 
than if it had cooperated fully.'' It also instructs the Department to 
consider, in employing adverse inferences, ``the extent to which a 
party may benefit from its own lack of cooperation.'' Id.
    We preliminarily determine that Sunflag's questionnaire response of 
May 11, 2007, and supplemental questionnaire responses of June 26, 
2007, and July 14, 2007, cannot serve as the basis for calculating a 
margin for Sunflag because we are unable to depend on the accuracy and 
reliability of the information in those responses. In our questionnaire 
we describe the form and manner in which the respondent should report 
its sales data. Specifically, we state,
    {f{time} or sales of merchandise that have been shipped to the 
customer and invoiced by the time this response is prepared, each 
``record'' in the computer data file should correspond to an invoice 
line item (i.e., each unique product included on the invoice). For 
sales of merchandise that have not yet been shipped and invoiced (in 
whole or in part) to the customer, a ``record'' should correspond to 
the unshipped portion of the sale. Each computer record submitted 
should contain the information requested concerning the product sold, 
the terms of the sale, the selling expenses incurred and other 
information.'' See Questionnaire, dated March 5, 2007, at B-3 and C-2.
    As discussed in detail in the October 19, 2007, Memorandum entitled 
``2005/2006 New-Shipper Review of Stainless Steel Wire Rods from India 
- Decision to Apply Adverse Facts Available and the Selection of an 
Appropriate Rate for the Preliminary Results of Review'' (AFA 
Memorandum), we found at verification that Sunflag did not report its 
sales in the home market as instructed. We found that, for its home-
market database, Sunflag reported each invoice as a single observation 
even in those instances where the invoice contained multiple sales of 
different products (i.e., multiple line items). Sunflag assigned the 
total invoice quantity and the total invoice value as the observation 
quantity and value, and it reported the product characteristics of only 
one of the line items as the product characteristics of the 
observation. Sunflag used the product description of the last item on 
the billing document (a different document from the invoice) to report 
the grade, diameter, further manufacturing, and gross unit price for 
the observation.
    Also at verification we found discrepancies with certain variables 
Sunflag reported in the home-market and U.S. databases. We have 
insufficient information on the record to correct all of the 
discrepancies related to these variables. Moreover, Sunflag did not 
report most home-market expenses (four types of discounts, inland 
freight, commissions, indirect selling expenses, and variable cost of 
manufacturing in the home market) on a per-unit basis, as we requested 
in our questionnaire but, instead, reported them based on the total 
invoice quantity. In addition, because in its home-market database 
Sunflag reported each invoice as a single aggregated observation even 
in those instances where the invoice contained multiple sales of 
different products, the information it reported in most of the expense 
fields is inaccurate. For a detailed discussion with respect to these 
deficiencies see AFA Memorandum and memorandum from Catherine Cartsos 
and Edythe Artman to File entitled ``Verification of the Sales Response 
of Sunflag Iron & Steel Co., Ltd., in the Antidumping New-Shipper 
Review of Stainless Steel Wire Rod from India,'' dated October 19, 2007 
(Verification Report). Therefore, Sunflag failed to provide information 
in the form and manner requested in the Department's original 
questionnaire. See section 776(a)(2)(B) of the Act.
    A further flaw in Sunflag's information concerns our finding at the 
verification of the discrepancy between

[[Page 60810]]

the reported value of sales for the window period and the value of 
sales in the general ledger for the same period; the general-ledger 
figure was higher than the value Sunflag reported as its total home-
market sales. Company officials attributed part of the difference in 
the two values to returns but, while part of the difference was indeed 
due to reporting sales net of returns, the remainder of the difference 
was due to sales of foreign like product that Sunflag should have 
reported but did not. By not reporting all of its sales of foreign like 
product, Sunflag withheld information that the Department requested in 
its questionnaire and two supplemental questionnaires. In addition, the 
Department officials observed while conducting verification that 
Sunflag maintained detailed records containing all the information 
necessary to provide a complete and accurate questionnaire response. 
See section 776(a)(2)(A) of the Act.
    In addition to finding that Sunflag misreported and neglected to 
report home-market sales, Sunflag provided additional information that 
could not be verified. During the verification the Department officials 
found that Sunflag's reported sales data contained pervasive errors and 
much of the data remained substantially unverified due to Sunflag's 
lack of preparedness. Even though Sunflag officials received our 
Verification Agenda, which outlined in detail the steps we would follow 
at verification, more than a week in advance of the verification, they 
were not well prepared. Therefore, we experienced constant and serious 
delays while at verification. Because of these delays, it was 
impossible to verify all of the information we had identified as 
subject to our examination in the Verification Agenda. See section 
776(a)(2)(D) of the Act.
    Sunflag significantly impeded the new-shipper review by not 
providing accurate and necessary information contained in its records. 
See section 776(a)(2)(C) of the Act. Also, the Department can decline 
to consider information Sunflag submitted because, as demonstrated 
above, sections 782(e)(2) and (3) of the Act are not met. Accordingly, 
pursuant to sections 776(a)(2) of the Act, the use of total facts 
available for Sunflag is justified.
    Section 776(b) of the Act provides that, if the Department finds 
that an interested party has failed to cooperate by not acting to the 
best of its ability to comply with a request for information, the 
Department may use an inference adverse to the interests of that party 
in selecting from among the facts otherwise available. See, e.g., 
Notice of Preliminary Determination of Sales at Less Than Fair Value, 
Postponement of Final Determination, and Affirmative Preliminary 
Determination of Critical Circumstance in Part: Prestressed Concrete 
Steel Wire Strand From Mexico, 68 FR 42378 (July 17, 2003), unchanged 
in the final determination (see Notice of Final Determination of Sales 
at Less Than Fair Value and Negative Final Determination of Critical 
Circumstances: Prestressed Concrete Steel Wire Strand from Mexico, 68 
FR 68350 (December 8, 2003)).
    Sunflag had the documents necessary to report complete and correct 
information in the necessary and requested manner and format. Because 
it did not do so, we find that Sunflag did not act to the best of its 
ability in reporting necessary and accurate information and presenting 
its data in the requested manner that would enable us to calculate a 
margin. Therefore, we find it appropriate to use an inference that is 
adverse to Sunflag's interest in selecting from among the facts 
otherwise available. By doing so, we ensure that Sunflag will not 
obtain a more favorable rate by failing to cooperate.
    Section 776(b) of the Act states that an adverse inference may 
include reliance on information derived from the petition. See also 19 
CFR 351.308(c). We have preliminarily assigned Sunflag, as facts 
otherwise available with an adverse inference, the petition margin rate 
of 48.80 percent. While this is the highest margin in the history of 
the proceeding, it is also the all-others rate and, therefore, the rate 
currently applicable to entries of merchandise from Sunflag. Any rate 
lower than 48.80 percent would give Sunflag a more favorable rate 
despite its failure to cooperate to the best of its ability.
    Section 776(c) of the Act requires that the Department corroborate, 
to the extent practicable, secondary information from independent 
sources that are reasonably at its disposal. Secondary information is 
defined as ``information derived from the petition that gave rise to 
the investigation or review, the final determination concerning the 
subject merchandise, or any previous review under section 751 
concerning the subject merchandise.'' See SAA at 870. The SAA clarifies 
that ``corroborate'' means that the Department will satisfy itself that 
the secondary information to be used has probative value. See SAA at 
870. The Department will examine, to the extent practicable, the 
reliability and relevance of the information. The SAA emphasizes, 
however, that the Department need not prove that the selected facts 
available are the best alternative information. See SAA at 869. The SAA 
also states that independent sources used to corroborate such evidence 
may include, for example, published price lists, official import 
statistics and customs data, and information obtained from interested 
parties during the particular investigation. See SAA at 870. See also19 
CFR 351.308(d).
    With respect to the reliability aspect of the corroboration, we 
will consider information reasonably at our disposal to determine 
whether a margin continues to be reliable and whether there are 
circumstances that would render data used as facts available 
unreliable. The 48.80 percent all-others rate from the investigation is 
the average of the rates applied to each original respondent in the 
investigation. In the investigation, the Department applied the highest 
rate among the margins in the petition to each respondent based upon a 
determination by the Department to use the best information available. 
See Final Determination of Sales at Less Than Fair Value: Certain 
Stainless Steel Wire Rods from India, 58 FR 54110, 54111 (October 20, 
1993). The U.S. price in the petition, which resulted in the 48.80 
percent rate, was based on a quote to a U.S. customer which was 
obtained through market research. See Memorandum from the analyst to 
the file dated October 19, 2007, entitled ``Transfer to Current Record 
of Petition for the Imposition of Antidumping Duties Dated December 29, 
1993.''
    The normal value the petitioner used in the petition was based on 
an actual home-market price quote from an Indian producer of stainless 
steel wire rods. The price quote for normal value in the petition was 
contemporaneous with the U.S. price quote in the petition as the basis 
for export price.
    We determined that, because the home-market and U.S. price 
quotation reflected commercial practices of the particular industry 
during the period of investigation, the information was relevant to 
mandatory respondents which refused to participate in the 
investigation. No information has been presented in the current review 
that calls into question the reliability of this information nor has 
this rate been judicially invalidated. Further, the 48.80 percent rate 
was most recently corroborated and applied as an adverse facts-
available rate to a respondent in the 2001-2002 review of this order. 
See Stainless Steel Wire Rods from India: Preliminary Results and 
Partial Rescission of Antidumping Duty Administrative Review, 68 
FR70765,

[[Page 60811]]

70771 (December 19, 2003), unchanged in Stainless Steel Wire Rods from 
India: Final Results and Partial Rescission of Antidumping Duty 
Administrative Review, 69 FR29923 (May 26, 2004). Accordingly, we 
preliminarily determine that the rate we used in the investigation, 
which we corroborated in the 2001-2002 review of this order and in this 
review, is a reliable rate.
    To assess the relevance of the petition margin for purposes of this 
review, in accordance with section 776(c) of the Act we examined the 
key elements of the calculations of export price and normal value upon 
which the petitioners based their margins for the petition, to the 
extent practicable. See Certain Cut-to-Length Carbon Steel Plate from 
Mexico: Final Results of Antidumping Duty Administrative Review, 64 FR 
76, 84 (January 4, 1999).
    In the current new-shipper review we were able to corroborate the 
U.S. price in the petition, which was used as the basis of the 48.80 
percent rate, by comparing this price to information from a respondent 
in the concurrent administrative review covering the same POR, Mukand 
Limited (Mukand). Mukand's reported U.S. price is significantly lower 
than the U.S. price in the petition, thus corroborating the petition 
U.S. price. See Memorandum from the analyst to the file entitled, 
``Placement of Mukand's Home-Market and U.S. Data on the Record,'' 
dated October 19, 2007 (Mukand Data Memo).
    In the current new-shipper review, in order to corroborate normal 
value, we looked again at information from Mukand's response for the 
concurrent administrative review covering the same POR. We find that 
the home-market prices in Mukand's March 15, 2007, questionnaire 
response are similar to, and in many instances much higher than, the 
price provided as normal value in the 1992 petition, which contributed 
to the all-others rate of 48.80 percent. See Mukand Data Memo.
    For these reasons, the Department considers the normal value to be 
corroborated. Furthermore, because the 48.80 percent rate is also the 
all-others rate for this order, Sunflag's shipments have entered the 
United States at this rate such that the 48.80 percent rate is relevant 
to the current POR.
    Finally, this is a new-shipper review; hence, as the first review 
of Sunflag, there are no probative alternatives specific to the 
company. Accordingly, by using information that was applied in the 
less-than-fair-value investigation (LTFV), corroborated in the 2001-
2002 review of this order, and preliminarily determined to be relevant 
to Sunflag in this review, we have corroborated the adverse facts-
available rate ``to the extent practicable.'' See section 776(c) of the 
Act, 19 CFR 351.308(d).

Preliminary Results of Review

    As a result of this review, we preliminarily determine that a 
dumping margin of 48.80 percent for Sunflag exists for the period 
December 1, 2005, through November 30, 2006.

Public Comment

    We will disclose the documents resulting from our analysis to 
parties in this review within five days of the date of publication of 
this notice. Any interested party may request a hearing within 30 days 
of the publication of this notice in the Federal Register. If a hearing 
is requested, the Department will notify interested parties of the 
hearing schedule.
    Interested parties are invited to comment on the preliminary 
results of this review. The Department will consider case briefs filed 
by interested parties within 30 days after the date of publication of 
this notice in the Federal Register. Interested parties may file 
rebuttal briefs, limited to issues raised in the case briefs. The 
Department will consider rebuttal briefs filed not later than five days 
after the time limit for filing case briefs. Parties who submit 
arguments are requested to submit with each argument a statement of the 
issue, a brief summary of the argument, and a table of authorities 
cited. Further, we request that parties submitting written comments 
provide the Department with a diskette containing an electronic copy of 
the public version of such comments.
    We intend to issue the final results of this new-shipper review, 
including the results of our analysis of issues raised in the written 
comments, within 90 days after the date on which the preliminary 
results are issued.

Assessment Rates

    The Department shall determine, and U.S. Customs and Border 
Protection (CBP) shall assess, antidumping duties on all appropriate 
entries. Because we are relying on total adverse facts available to 
establish Sunflag's dumping margin, we preliminarily determine to 
instruct CBP to apply a dumping margin of 48.80 percent to all entries 
of subject merchandise during the POR that were produced or exported by 
Sunflag. The Department will issue instructions to CBP 15 days after 
the publication of the final results of review.

Cash-Deposit Requirements

    The following cash-deposit requirements will be effective for all 
shipments of the subject merchandise entered, or withdrawn from 
warehouse, for consumption on or after the publication date of the 
final results of this new-shipper review, as provided by section 
751(a)(1) of the Act: (1) the cash-deposit rate for Sunflag will be the 
rate established in the final results of this new-shipper review; (2) 
for previously investigated or reviewed companies not listed above, the 
cash-deposit rate will continue to be the company-specific rate 
published for the most recent period; (3) if the exporter is not a firm 
covered in this review, a prior review, or the LTFV investigation but 
the manufacturer is, the cash-deposit rate will be the rate established 
for the most recent period for the manufacturer of the subject 
merchandise; and (4) the cash-deposit rate for all other manufacturers 
or exporters will continue to be the ``all others'' rate of 48.80 
percent, which is the ``all others'' rate established in the LTFV 
investigation. See Final Determination of Sales at Less Than Fair 
Value: Certain Stainless Steel Wire Rods from India, 58 FR 54110, 54111 
(October 20, 1993). These cash-deposit rates, when imposed, shall 
remain in effect until further notice.

Notification to Importers

    This notice also 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 duites occurred and the subsequent 
assessment of double antidumping duties.
    We are issuing and publishing this notice in accordance with 
sections 751(a)(2)(B) and 777(i)(1) of the Act and 19 CFR 351.214.

    Dated: October 19, 2007.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E7-21106 Filed 10-25-07; 8:45 am]
BILLING CODE 3510-DS-S