Magnesium Metal from the Russian Federation: Preliminary Results of Antidumping Duty Administrative Review, 24541-24547 [E8-9889]
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Federal Register / Vol. 73, No. 87 / Monday, May 5, 2008 / Notices
previously reviewed or investigated
companies not participating in these
reviews, 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 these reviews or the original
less–than-fair–value (LTFV)
investigation, but the manufacturer is,
the cash deposit rate will be the rate
established for the most recent period
for the manufacturer of the
merchandise; and 4) the cash deposit
rate for all other manufacturers or
exporters will continue to be 16.06
percent, the all–others rate established
in the LTFV investigation. These
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.
We are issuing and publishing the
results of this administrative review in
accordance with sections 751(a)(1) and
777(i)(1) of the Act.
Dated: April 29, 2008.
David M. Spooner,
Assistant Secretary for Import
Administration.
[FR Doc. E8–9887 Filed 5–2–08; 8:45 am]
BILLING CODE 3510–DS–S
DEPARTMENT OF COMMERCE
International Trade Administration
(A–821–819)
Magnesium Metal from the Russian
Federation: Preliminary Results of
Antidumping Duty Administrative
Review
Import Administration,
International Trade Administration,
Department of Commerce.
SUMMARY: In response to timely
requests, the Department of Commerce
(the Department) is conducting an
administrative review of the
antidumping duty order on magnesium
metal from the Russian Federation for
the period of review (POR) April 1,
2006, through March 31, 2007. The
review covers two respondents, PSC
VSMPO–AVISMA Corporation
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AGENCY:
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(AVISMA) and Solikamsk Magnesium
Works (SMW).
The Department preliminarily
determines that AVISMA and SMW
made sales to the United States at less
than normal value. If these preliminary
results are adopted in the final results
of this administrative review, we will
instruct U.S. Customs and Border
Protection (CBP) to assess antidumping
duties on entries of AVISMA’s and
SMW’s merchandise during the POR.
The preliminary results are listed below
in the section titled ‘‘Preliminary
Results of Review.’’
EFFECTIVE DATE: May 5, 2008.
FOR FURTHER INFORMATION CONTACT:
Dmitry Vladimirov 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) 482–0665 or (202) 482–
1690, respectively.
SUPPLEMENTARY INFORMATION:
Background
The Department published the
antidumping duty order on magnesium
metal from the Russian Federation on
April 15, 2005. See Notice of
Antidumping Duty Order: Magnesium
Metal from the Russian Federation, 70
FR 19930 (April 15, 2005) (Antidumping
Duty Order). On April 2, 2007, the
Department published in the Federal
Register a notice of opportunity to
request an administrative review of the
antidumping duty order on magnesium
metal from the Russian Federation. See
Antidumping or Countervailing Duty
Order, Finding, or Suspended
Investigation; Opportunity to Request
Administrative Review, 72 FR 15650
(April 2, 2007). On April 30, 2007,
AVISMA, a Russian Federation
producer of the subject merchandise,
requested that the Department conduct
an administrative review. On April 30,
2007, U.S. Magnesium Corporation LLC,
the petitioner in this proceeding, also
requested that the Department conduct
an administrative review with respect to
AVISMA and SMW, another Russian
Federation producer of the subject
merchandise. On May 30, 2007, the
Department published a notice of
initiation of an administrative review of
the antidumping duty order on
magnesium metal from the Russian
Federation for the period April 1, 2006,
through March 31, 2007. See Initiation
of Antidumping and Countervailing
Duty Administrative Reviews and
Request for Revocation in Part, 72 FR
29968 (May 30, 2007).
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On December 18, 2007, the
Department extended the deadline for
the preliminary results of this
antidumping duty administrative review
from December 31, 2007, to April 29,
2008. See Notice of Extension of Time
Limit for Preliminary Results of
Antidumping Duty Administrative
Review: Magnesium Metal From the
Russian Federation, 72 FR 71620
(December 18, 2007).
Scope of the Order
The merchandise covered by the order
is magnesium metal (also referred to as
magnesium), which includes primary
and secondary pure and alloy
magnesium metal, regardless of
chemistry, raw material source, form,
shape, or size. Magnesium is a metal or
alloy containing by weight primarily the
element magnesium. Primary
magnesium is produced by
decomposing raw materials into
magnesium metal. Secondary
magnesium is produced by recycling
magnesium–based scrap into
magnesium metal. The magnesium
covered by the order includes blends of
primary and secondary magnesium.
The subject merchandise includes the
following pure and alloy magnesium
metal products made from primary and/
or secondary magnesium, including,
without limitation, magnesium cast into
ingots, slabs, rounds, billets, and other
shapes, and magnesium ground,
chipped, crushed, or machined into
raspings, granules, turnings, chips,
powder, briquettes, and other shapes:
(1) products that contain at least 99.95
percent magnesium, by weight
(generally referred to as ‘‘ultra–pure’’
magnesium); (2) products that contain
less than 99.95 percent but not less than
99.8 percent magnesium, by weight
(generally referred to as ‘‘pure’’
magnesium); and (3) chemical
combinations of magnesium and other
material(s) in which the magnesium
content is 50 percent or greater, but less
that 99.8 percent, by weight, whether or
not conforming to an ‘‘ASTM
Specification for Magnesium Alloy’’.
The scope of the order excludes: (1)
magnesium that is in liquid or molten
form; and (2) mixtures containing 90
percent or less magnesium in granular
or powder form by weight and one or
more of certain non–magnesium
granular materials to make magnesium–
based reagent mixtures, including lime,
calcium metal, calcium silicon, calcium
carbide, calcium carbonate, carbon, slag
coagulants, fluorspar, nephaline syenite,
feldspar, alumina (Al203), calcium
aluminate, soda ash, hydrocarbons,
graphite, coke, silicon, rare earth
metals/mischmetal, cryolite, silica/fly
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A. Use of Facts Available
Section 776(a)(2) of the Tariff Act of
1930, as amended (the Act), provides
that, if an interested party withholds
information requested by the
administering authority, fails to provide
such information by the deadlines for
submission of the information and in
the form or manner requested, subject to
subsections (c)(1) and (e) of section 782,
significantly impedes a proceeding
under this title, or provides such
information but the information cannot
be verified as provided in section 782(i),
the administering authority shall use,
subject to section 782(d) of the Act, facts
otherwise available in reaching the
applicable determination. Section
782(d) of the Act provides that, if the
administering authority determines that
a response to a request for information
does not comply with the request, the
administering authority shall promptly
inform the responding party and
provide an opportunity to remedy the
deficient submission. Section 782(e) of
the Act states further that the
Department shall not decline to
consider submitted information 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; (5) the
information can be used without undue
difficulties.
On July 11, 2007, SMW notified the
Department that it would not participate
in this administrative review. As such,
SMW failed to respond to our
questionnaire, thereby withholding,
among other things, home–market and
U.S. sales information necessary for
reaching the applicable results. Such
information is imperative to calculate an
antidumping margin for the preliminary
results of the review. Because SMW
failed to provide the information
requested and thus significantly
impeded the proceeding, we find that
we must base its margin on facts
otherwise available pursuant to sections
776(a)(2)(A), (B), and (C) of the Act.
Further, sections 782(d) and (e) of the
Act are inapplicable because SMW
decided not to provide the Department
with any information.
1 This second exclusion for magnesium-based
reagent mixtures is based on the exclusion for
reagent mixtures in the 2000-2001 investigations of
magnesium from China, Israel, and Russia. See
Notice of Final Determination of Sales at Less Than
Fair Value: Pure Magnesium in Granular Form
From the People’s Republic of China, 66 FR 49345
(September 27, 2001); Notice of Final Determination
of Sales at Less Than Fair Value: Pure Magnesium
From Israel, 66 FR 49349 (September 27, 2001);
Notice of Final Determination of Sales at Not Less
Than Fair Value: Pure Magnesium From the
Russian Federation, 66 FR 49347 (September 27,
2001). These mixtures are not magnesium alloys,
because they are not chemically combined in liquid
form and cast into the same ingot.
B. Application of Adverse Inferences for
Facts Available
In applying the facts otherwise
available, section 776(b) of the Act
provides that, if the administering
authority 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 from the
administering authority, in reaching the
applicable determination under this title
the administering authority may use an
inference adverse to the interests of that
ash, magnesium oxide, periclase,
ferroalloys, dolomite lime, and
colemanite.1
The merchandise subject to the order
is currently classifiable under items
8104.11.00, 8104.19.00, 8104.30.00, and
8104.90.00 of the Harmonized Tariff
Schedule of the United States (HTSUS).
Although the HTSUS item numbers are
provided for convenience and customs
purposes, the written description of the
merchandise covered by the order is
dispositive.
On November 9, 2006, in response to
U.S. Magnesium Corporation LLC’s
request for scope rulings, the
Department issued final scope rulings in
which it determined that the processing
of pure magnesium ingots imported
from Russia by Timminco, a Canadian
company, into pure magnesium
extrusion billets constitutes substantial
transformation. Therefore, such alloy
magnesium extrusion billets produced
and exported by Timminco are a
product of Canada and thus are not
within the scope of the order. See
November 9, 2006, Memorandum for
Stephen J. Claeys, Deputy Assistant
Secretary for Import Administration,
from Barbara E. Tillman, Director, Office
6, and Wendy Frankel, Director, Office
8, China/NME Group, AD/CVD
Operations: Pure Magnesium from the
People’s Republic of China (A–570–
832), Magnesium Metal from the
People’s Republic of China (A–570–
896), and Magnesium Metal from Russia
(A–821–819): Final Ruling in the Scope
Inquiry on Russian and Chinese
Magnesium Processed in Canada.
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Use of Facts Otherwise Available
For the reasons discussed below, we
determine that the use of adverse facts
available (AFA) is appropriate for the
preliminary results of this review with
respect to SMW.
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party in selecting from among the facts
otherwise available.
Adverse inferences are appropriate
‘‘to ensure that the party does not obtain
a more favorable result by failing to
cooperate than if it had cooperated
fully.’’ See Statement of Administrative
Action accompanying the Uruguay
Round Agreements Act, H.R. Doc. No.
103–316, vol.1 (1994) at 870 (SAA).
Further, ‘‘affirmative evidence of bad
faith on the part of a respondent is not
required before the Department may
make an adverse inference.’’ See
Antidumping Duties; Countervailing
Duties, 62 FR 27296, 27340 (May 19,
1997). Because SMW has not provided
any information in response to our
questionnaire and has notified us that it
would not participate in this review, we
find that SMW has not acted to the best
of its ability in providing us with
relevant information which is under its
control. This constitutes a failure on the
part of SMW to cooperate to the best of
its ability to comply with a request for
information by the Department within
the meaning of section 776(b) of the Act.
Based on the above, the Department has
preliminarily determined that, in
selecting from among the facts
otherwise available, an adverse
inference is warranted. See, e.g., Notice
of Final Determination of Sales at Less
than Fair Value: Circular Seamless
Stainless Steel Hollow Products from
Japan, 65 FR 42985, 42986 (July 12,
2000) (the Department applied total
AFA where the respondent failed to
respond to the antidumping
questionnaire).
C. Selection and Corroboration of
Information Used as Facts Available
Section 776(b) of the Act provides
that the Department may use as AFA
information derived from the petition,
the final determination in the
investigation, any previous review, or
any other information placed on the
record. When selecting an AFA rate
from among the possible sources of
information, the Department’s practice
has been to ensure that the margin is
sufficiently adverse to induce
respondents to provide the Department
with complete and accurate information
in a timely manner. See, e.g., Certain
Steel Concrete Reinforcing Bars from
Turkey; Final Results and Rescission of
Antidumping Duty Administrative
Review in Part, 71 FR 65082, 65084
(November 7, 2006). In selecting an
appropriate AFA rate for SMW, the
Department considered the following
rates from the proceeding: 1) the rates
alleged in the petition which range from
54.40 to 68.94 and 86.54 to 101.24
percent (when taking into account
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adjustments for electricity; see Notice of
Initiation of Antidumping Duty
Investigations: Magnesium Metal From
the People’s Republic of China and the
Russian Federation, 69 FR 15293
(March 25, 2004)); 2) the rates we
calculated for the final determination of
the investigation which ranged from
18.65 to 21.71 percent (see Antidumping
Duty Order); and 3) the rates we
calculated in the first administrative
review (the most recently completed
review), 0.41 and 3.77 percent (see
Magnesium Metal from the Russian
Federation: Final Results of
Antidumping Duty Administrative
Review, 72 FR 51791 (September 11,
2007)).
Section 776(c) of the Act provides that
the Department shall corroborate, to the
extent practicable, secondary
information used for facts available by
reviewing independent sources
reasonably at its disposal. With respect
to the rates alleged in the petition,
information from prior segments of the
proceeding constitutes secondary
information. See SAA at 870 and Final
Results of Antidumping Duty
Administrative Reviews, Rescission of
Administrative Reviews in Part, and
Determination to Revoke Order in Part:
Antifriction Bearings and Parts Thereof
From France, Germany, Italy, Japan,
Singapore, and the United Kingdom, 69
FR 55574, 55577 (September 15, 2004)
(AFBs 14). The word ‘‘corroborate’’
means that the Department will satisfy
itself that the secondary information to
be used has probative value. Id.; see also
Tapered Roller Bearings and Parts
Thereof, Finished and Unfinished, from
Japan, and Tapered Roller Bearings
Four Inches or Less in Outside
Diameter, and Components Thereof,
from Japan: Preliminary Results of
Antidumping Duty Administrative
Reviews and Partial Termination of
Administrative Reviews, 61 FR 57391,
57392 (November 6, 1996). To
corroborate secondary information, the
Department will examine, to the extent
practicable, the reliability and relevance
of the information used.
Because SMW did not submit
information we requested in this review
we do not have such information to
consider in determining whether the
petition rates are relevant to SMW. To
determine whether the petition rates are
reliable and relevant in this
administrative review, we compared the
transaction–specific margins of
AVISMA for the POR to the petition
rates and found that the petition rates
were not relevant for use in this
administrative review and, therefore, do
not have probative value for use as AFA.
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In addition, we find that the
weighted–average rates we calculated
for respondents in the previous, as well
as in the instant review, are not
sufficiently high as to effectuate the
purpose of the facts–available rule (i.e.,
we do not find that any of these rates
are high enough to encourage
participation in future segments of this
proceeding in accordance with section
776(b) of the Act). Therefore, as facts
available with an adverse inference, we
have selected the rate of 21.71 percent
for SMW, the weighted–average margin
the Department calculated for JSC
AVISMA Magnesium–Titanium Works
(a predecessor to PSC VSMPO–AVISMA
Corporation) in the original
investigation (see Antidumping Duty
Order); it is the highest rate the
Department has calculated in any
segment of the proceeding. We consider
the 21.71 percent rate to be sufficiently
high so as to encourage participation in
future segments of this proceeding.
With respect to corroboration of other
rates from the proceeding, unlike other
types of information such as input costs
or selling expenses, there are no
independent sources for calculated
dumping margins. The only source for
margins is administrative
determinations. Thus, with respect to an
administrative review, if the Department
chooses as facts available a calculated
dumping margin from a prior segment of
the proceeding, there is no practical
manner to test the margin’s reliability
further and the Department considers
the rate reliable. See AFBs 14 at 55577.
With respect to the relevance aspect
of corroboration the Department will
consider information reasonably at its
disposal as to whether there are
circumstances that would render a
margin not relevant. Where
circumstances indicate that the selected
margin is not appropriate as AFA, the
Department will disregard the margin
and determine an appropriate margin.
See Fresh Cut Flowers from Mexico;
Final Results of Antidumping Duty
Administrative Review, 61 FR 6812,
6814 (February 22, 1996), where the
Department disregarded the highest
dumping margin as best information
available because the margin was based
on another company’s uncharacteristic
business expense resulting in an
unusually high margin.
We examined individual transactions
made by AVISMA in the current review
and the margins on those transactions in
order to determine whether the rate of
21.71 percent was probative. We found
a number of sales with dumping
margins above the rate of 21.71 percent.
Further, to support our corroboration,
because SMW did not provide us with
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any information in this review, we
examined individual transactions made
by SMW during the immediately
preceding (2005–06) administrative
review period and the margins we
determined for that review on those
transactions in order to determine
whether the rate of 21.71 percent was
probative. See Preliminary Results of
Antidumping Duty Administrative
Review: Stainless Steel Wire Rod from
the Republic of Korea, 72 FR 32074,
32076 (June 11, 2007) (unchanged in
Final Results of Antidumping Duty
Administrative Review: Stainless Steel
Wire Rod from the Republic of Korea, 72
FR 46035 (August 16, 2007)). We found
a number of sales by SMW during the
2005–06 period with dumping margins
above the rate of 21.71 percent. Thus,
the AFA rate is relevant as applied to
SMW for this review because it falls
within the range of AVISMA’s
transaction–specific margins in the
current review period and SMW’s own
transaction–specific margins in the prior
review period. See Ta Chen Stainless
Steel Pipe, Inc. vs. United States, 298
F.3d 1330, 1340 (CAFC 2002) (‘‘Because
Commerce selected a dumping margin
within the range of Ta Chen’s actual
sales data, we cannot conclude that
Commerce overreached reality’.’’) We
have detailed the corroboration of the
AFA rate in the memorandum from the
analyst to Laurie Parkhill entitled ‘‘The
Use of Facts Available and
Corroboration of Secondary Information
for Solikamsk Magnesium Works in the
2006/2007 Administrative Review of the
Antidumping Duty Order on
Magnesium Metal from the Russian
Federation,’’ dated April 29, 2008.
Therefore, we find this rate to be both
reliable and relevant. As such, the
Department finds this rate to be
corroborated to the extent practicable
consistent with section 776(c) of Act.
Date of Sale
AVISMA reported invoice date as the
date of sale for all sales in both markets,
consistent with our conclusions in
earlier segments of the proceeding
regarding both spot sales and sales made
according to short and long–term
agreements. See Magnesium Metal from
the Russian Federation: Notice of Final
Determination of Sales at Less Than
Fair Value, 70 FR 9041 (February 24,
2005), and accompanying Issues and
Decision Memorandum at Comment 14.
After analyzing AVISMA’s response and
the sample sales documents it provided,
we preliminarily determine that invoice
date is the appropriate date of sale for
all U.S. and home–market sales subject
to analysis in this review.
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Constructed Export Price
AVISMA identified all of its sales to
the United States as constructed export–
price (CEP) sales because the U.S. sales
were made for the account of AVISMA
by AVISMA’s U.S. affiliate, VSMPO–
Tirus, U.S., Inc. (Tirus US), to
unaffiliated purchasers in the United
States. AVISMA and Tirus US are
affiliated because Tirus US is a wholly
owned subsidiary of AVISMA. See
section 771(33)(E) of the Act. U.S. sales
to the first unaffiliated party were made
in the United States by the U.S. affiliate,
thus satisfying the legal requirements
for CEP sales. See section 772(b) of the
Act.
We calculated CEP based on the
packed, C.I.F price to unaffiliated
purchasers in the United States. In
accordance with section 772(c)(2) of the
Act, for AVISMA’s CEP sales we made
deductions from price for movement
expenses and discounts, where
appropriate. More specifically, we
deducted early–payment discounts,
expenses for Russian railway freight
from plant to port, freight insurance,
Russian brokerage, handling, and port
charges, international freight and
marine insurance, U.S. customs duties,
U.S. brokerage, handling, and port
charges, U.S. warehousing, and U.S.
inland freight.
In accordance with section 772(d)(1)
of the Act we deducted direct selling
expenses and indirect selling expenses
related to commercial activity in the
United States. See also SAA at 823–824.
Pursuant to sections 772(d)(3) and 772(f)
of the Act, we made an adjustment for
CEP profit allocated to expenses
deducted under section 772(d)(1) of the
Act. In accordance with section 772(f) of
the Act, we computed profit based on
the total revenues realized on sales in
both the U.S. and home markets, less all
expenses associated with those sales.
We then allocated profit to expenses
incurred with respect to U.S. economic
activity based on the ratio of total U.S.
expenses to total expenses for both the
U.S. and home markets. See the
memorandum to the file entitled
‘‘Administrative Review of the
Antidumping Duty Order on
Magnesium Metal from the Russian
Federation - Preliminary Results
Analysis Memorandum for PSC
VSMPO–AVISMA Corporation’’ (April
29, 2008) (AVISMA Analysis
Memorandum).
Normal Value
Based on a comparison of the
aggregate quantity of home–market and
U.S. sales and absent any information
that a particular market situation in the
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exporting country did not permit a
proper comparison, we determined that
the quantity of foreign like product sold
by AVISMA 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.
AVISMA’s quantity of sales in its home
market was greater than five percent of
its sales to the U.S. market. Therefore,
in accordance with section
773(a)(1)(B)(i) of the Act, we considered
basing normal value on the prices at
which the foreign like product was first
sold for consumption in the exporting
country in the usual commercial
quantities and in the ordinary course of
trade and, to the extent practicable, at
the same level of trade as the CEP sales.
In accordance with section 771(16)(A)
of the Act, we considered all products
produced by AVISMA that are covered
by the description in the ‘‘Scope of the
Order’’ section, above, and that were
sold in the home market during the POR
to be foreign like products for purposes
of determining appropriate product
comparisons to U.S. sales. In accordance
with sections 771(16)(B) and (C) of the
Act, where there were no sales of
identical merchandise in the home
market to compare to U.S. sales, we
considered comparing U.S. sales to the
most similar foreign like product on the
basis of the product characteristics we
determined to be the most appropriate
for purposes of product matching.
Cost–of-Production Analysis
We disregarded below–cost sales in
accordance with section 773(b) of the
Act in the last completed review with
respect to AVISMA. See Magnesium
Metal from the Russian Federation:
Preliminary Results of Antidumping
Duty Administrative Review, 72 FR
25740, 25743 (May 7, 2007) (unchanged
in Magnesium Metal from the Russian
Federation: Final Results of
Antidumping Duty Administrative
Review, 72 FR 51791 (September 11,
2007)). Therefore, we have reasonable
grounds to believe or suspect that sales
of the foreign like product under
consideration for the determination of
normal value in this review may have
been made at prices below the cost of
production (COP) as provided by
section 773(b)(2)(A)(ii) of the Act.
Therefore, pursuant to section 773(b)(1)
of the Act, we conducted a COP
investigation of sales by AVISMA in the
home market.
In accordance with section 773(b)(3)
of the Act, we calculated a weighted–
average COP based on the sum of the
cost of materials and fabrication for the
foreign like product, plus amounts for
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home–market selling, G&A expenses,
interest expense, and packing expenses.
In the original investigation and in the
first administrative review, AVISMA’s
cost–reporting methodology was based
on its normal books and records which
treated magnesium metal as the main
product and chlorine gas as a by–
product of the manufacturing process.
On January 1, 2007, during the current
POR, AVISMA changed its normal
books and records to treat magnesium as
the by–product of its titanium
operations (chlorine is consumed in
titanium production). Raw magnesium
and chlorine gas are produced jointly
during the third major processing step,
the electrolysis stage (i.e., the split–off
point), during which both products
become identifiable physically. In its
cost responses, AVISMA claims that its
acquisition by VSMPO, a titanium
producer, has shifted its operational
focus to the production of titanium
sponge. Accordingly, it contends, the
company determined that the
production of chlorine gas, which is a
significant and a critical input in the
production of titanium sponge, is the
main goal of production while
magnesium production is now treated as
a secondary product. As such, AVISMA
claims, it has reduced its magnesium
production to the minimum levels
needed to support the titanium- sponge
production based on its new operational
focus. AVISMA claims that the
reduction in magnesium production is
apparent through its reduction or
cessation of its practice of burning off
excess chlorine gas.
In its original cost response AVISMA
included only the costs from the
further–processing steps (i.e., only the
costs incurred after the split–off point
and none of the joint costs of the
electrolysis and prior stages) in its COP
database.
In its supplemental cost responses
AVISMA provided alternative cost
calculations in which it treated raw
magnesium and chlorine gas as co–
products. Under this approach,
AVISMA calculated the value of
chlorine at the split–off point by starting
with sale prices of titanium sponge and
then deducting the post–split-off
titanium–processing costs; AVISMA
calculated the value of raw magnesium
at the split–off point using the starting
sale prices of magnesium metal and
then deducted the post–split-off costs of
the magnesium–metal processing.
AVISMA then allocated the joint costs
under the net–realizable-value (NRV)
methodology.
We requested that AVISMA provide
another set of cost calculations based on
a co–product methodology which relies
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on the sales or market values of the joint
products, i.e., magnesium and chlorine
gas (for the one-year period prior to the
original period of investigation) instead
of the sales values of the downstream
products (i.e., titanium sponge).
AVISMA provided the requested cost
data based on a co–product
methodology of allocating joint costs in
which it determined the value of
chlorine gas (with certain adjustments)
at the split–off point using the current
market prices of liquid chlorine and the
value of raw magnesium at the split–off
point using the sales prices for
magnesium products for the period
predating the period of original
investigation. AVISMA allocated joint
costs based on the relationship between
the NRV of raw magnesium and the
NRV of chlorine gas.
We analyzed the data on the record to
determine whether to judge the joint
products appropriately as co–products
or byproducts. In doing so, we
conservatively considered the lowest
per–metric-ton value of chlorine gas
during the POR; for raw magnesium we
considered the average per–metric-ton
value for the period prior to the period
of investigation (i.e., prior to a period in
which dumping was alleged). We
evaluated the significance of each
product at the split–off point and found
that chlorine gas represented a
significant percentage of the total value
of all products at the split–off point.
Consequently, based on our review of
the combination of factors (the takeover
of AVISMA by VSMPO, the cessation of
the burning off of excess chlorine gas,
and our examination of the relative
values of the joint products in question),
we have preliminarily determined that
it is appropriate to treat chlorine gas and
raw magnesium as co–products for
purposes of allocating the common costs
of these joint products for the entire
cost- reporting period.
We have relied on AVISMA’s cost
database based on the co–product
methodology of allocating joint costs for
the preliminary results. We made
certain adjustments to AVISMA’s cost
data - we revised the value of chlorine
gas to reflect the company’s purchases
of liquid chlorine less freight costs and
further–processing costs2 and we
increased the total pool of joint costs to
be allocated to the co–products to
include the costs associated with the
2 AVISMA added the cost of evaporating liquid
chlorine to the sales value of liquid chlorine in
order to arrive at the estimated value of chlorine
gas. In the absence of a cost value associated with
liquefying chlorine gas, as a proxy, we subtracted
the evaporation costs from the sales value of liquid
chlorine to estimate the NRV of chlorine gas at the
split-off point.
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15:16 May 02, 2008
Jkt 214001
disposal of excess chlorine gas.3 For
more details, see Memorandum to Neal
M. Halper, Director, Office of
Accounting, through Michael P. Martin,
Lead Accountant, from Heidi K.
Schriefer, Senior Accountant, entitled
‘‘Cost of Production and Constructed
Value Calculation Adjustments for the
Preliminary Results - PSC VSMPO–
AVISMA Corporation and VSMPO Tirus US Inc,’’ dated April 29, 2008.
After calculating the COP and in
accordance with section 773(b)(1) of the
Act, we tested whether home–market
sales of the foreign like product were
made at prices below the COP within an
extended period of time in substantial
quantities and whether such prices
permitted the recovery of all costs
within a reasonable period of time. We
compared model–specific COPs to the
reported home–market prices less any
applicable movement charges,
discounts, and rebates. Pursuant to
section 773(b)(2)(C) of the Act, when
less than 20 percent of a respondent’s
sales of a given product were at prices
less than the COP, we do not disregard
any below–cost sales of that product
because the below–cost sales were not
made in substantial quantities within an
extended period of time. When 20
percent or more of a respondent’s sales
of a given product were at prices less
than the COP, we disregard the below–
cost sales because they were made in
substantial quantities within an
extended period of time pursuant to
sections 773(b)(2)(B) and (C) of the Act
and because, based on comparisons of
prices to weighted–average COPs for the
period of review, such sales were at
prices which would not permit recovery
of all costs within a reasonable period
of time in accordance with section
773(b)(2)(D) of the Act. Based on this
test, we disregarded all of AVISMA’s
home–market sales of magnesium metal
because all such sales failed the cost
test. See AVISMA Analysis
Memorandum.
Constructed Value
Section 773(a)(4) of the Act provides
that, where normal value cannot be
based on comparison–market sales,
normal value may be based on
constructed value. Accordingly, because
all home–market sales of magnesium
metal failed the sales–below-cost test,
we based normal value on constructed
value.
Section 773(e) of the Act provides that
constructed value shall be based on the
sum of the cost of materials and
3 AVISMA burned off excess chlorine gas for part
of the POR. By November 2006, AVISMA was no
longer producing excess chlorine gas.
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fabrication for the imported
merchandise, plus amounts for selling,
general and administrative expenses
(G&A), interest expense, profit, and U.S.
packing costs. We calculated the cost of
materials and fabrication based on the
methodology described in the ‘‘Cost- of–
Production Analysis’’ section above.
Because we disregarded all home–
market sales as below–cost sales there
are no sales made in the ordinary course
of trade that we can use to calculate
selling expenses and profit for
constructed value pursuant to section
773(e)(2)(A) of the Act for AVISMA. In
cases where actual data are not available
to use in the calculation of selling
expenses and profit, section
773(e)(2)(B)(i) of the Act provides the
alternative of calculating such expenses
using ‘‘actual amounts incurred and
realized by the specific exporter or
producer in connection with the
production and sale of merchandise that
is in the same general category of
products as the subject merchandise.’’
This option is not available to us for
these preliminary results because the
record information, such as the financial
information AVISMA submitted in this
review, is not sufficiently detailed to
permit a calculation of selling expenses
and profit specific to subject
merchandise or specific to a category of
products in the same category as the
subject merchandise.
Another alternative at section
773(e)(2)(B)(ii) of the Act suggests
calculating the amounts in question
using ‘‘the weighted average of the
actual amounts incurred and realized by
exporters or producers that are subject
to the investigation or review (other
than the exporter or producer described
in clause (i)) ‘‘ This alternative is not
applicable in this review because
AVISMA is the single cooperating
respondent in this review and there are
no other participating exporters/
producers in this review.
Another statutory alternative of
calculating the amounts in question
provided at section 773(e)(2)(B)(iii) of
the Act suggests ‘‘any other reasonable
method ‘‘ Therefore, pursuant to section
773(e)(2)(B)(iii) of the Act, we have
calculated an estimate of direct and
indirect selling expenses and profit for
AVISMA in this review using the selling
expenses and profit we calculated for
AVISMA in the 2005–06 administrative
review. See AVISMA Analysis
Memorandum.
When appropriate, we made
adjustments to constructed value in
accordance with section 773(a)(8) of the
Act, 19 CFR 351.410, and 19 CFR
351.412 for circumstance–of-sale
differences and level–of-trade
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differences. We made circumstance–ofsale adjustments by deducting home–
market direct selling expenses from
constructed value. Because we
calculated constructed value at a level
of trade different from the CEP level
trade, we made a CEP–offset adjustment
in accordance with sections 773(a)(7)(B)
and 773(a)(8) of the Act. See ‘‘Level of
Trade’’ section below.
Level Of Trade
In the U.S. market, AVISMA made
CEP sales. In the case of CEP sales, we
identified the level of trade based on the
price after the deduction of expenses
and profit under section 772(d) of the
Act. Although the starting price for CEP
sales was based on sales made by the
affiliated reseller to unaffiliated
customers through two channels of
distribution, sales to end–users and
distributors, AVISMA reported similar
selling activities associated with all
sales to the affiliated reseller (i.e., at the
CEP level of trade).
AVISMA reported one channel of
distribution in the home market, sales to
end–users. We found that this channel
of distribution constitutes a single level
of trade in the home market. When
normal value is based on constructed
value, the level of trade is that of the
sales from which we derive selling,
G&A, and profit figures.
To determine whether home–market
sales were made at a different level of
trade than U.S. sales, we examined
stages in the marketing process and
selling functions along the chain of
distribution between the producer and
the unaffiliated customer. We found that
there were significant differences
between the selling activities associated
with the CEP level of trade and those
associated with the home–market level
of trade and, thus, we found the CEP
level of trade to be different from the
home–market level of trade. Further, we
found the CEP level of trade to be at a
less advanced stage of distribution than
the home–market level of trade.
Because AVISMA reported no home–
market levels of trade that were
equivalent to the CEP level of trade and
because we determined that the CEP
level of trade was at a less advanced
stage than the home–market level of
trade, we were unable to determine a
level–of-trade adjustment based on the
respondent’s home–market sales of the
foreign like product. Furthermore, we
have no other information that provides
an appropriate basis for determining a
level–of-trade adjustment. For
AVISMA’s CEP sales, we made a CEP–
offset adjustment in accordance with
sections 773(a)(7)(B) and 773(a)(8) of the
Act. The CEP–offset adjustment to
VerDate Aug<31>2005
15:16 May 02, 2008
Jkt 214001
constructed value was subject to the
offset cap, calculated as the sum of
home–market indirect selling expenses
up to the amount of U.S. indirect selling
expenses deducted from CEP (or, if
there were no home–market
commissions, the sum of U.S. indirect
selling expenses and U.S. commissions).
For a description of our level–of-trade
analysis for these preliminary results,
see AVISMA Analysis Memorandum.
results of this administrative review,
including the results of its analysis of
issues raised in any case brief, rebuttal
brief, or hearing no later than 120 days
after publication of these preliminary
results.
Assessment Rates
The Department shall determine, and
U.S. Customs and Border Protection
(CBP) shall assess, antidumping duties
on all appropriate entries. In accordance
Currency Conversion
with 19 CFR 351.212(b)(1), we have
calculated an importer–specific
For purposes of the preliminary
assessment rate for AVISMA reflecting
results and in accordance with section
these preliminary results of review. We
773A of the Act, we made currency
divided the total dumping margins for
conversions based on the official
the reviewed sales by the total entered
exchange rates in effect on the dates of
the U.S. sales as certified by the Federal value of those reviewed sales for the
importer. We will instruct CBP to assess
Reserve Bank of New York. See also 19
the importer–specific rate uniformly on
CFR 351.415.
all entries of subject merchandise made
Preliminary Results of Review
by the relevant importer during the
POR. See 19 CFR 351.212(b). The
As a result of this review, we
Department will issue instructions to
preliminarily find that the following
CBP 15 days after the publication of the
weighted–average
dumping margins exist:
final results of review.
The Department clarified its
Manufacturer/Exporter
Margin (percent)
‘‘automatic assessment’’ regulation on
May 6, 2003. See Antidumping and
PSC VSMPO–AVISMA
Countervailing Duty Proceedings:
Corporation ...............
17.68
Assessment of Antidumping Duties, 68
Solikamsk Magnesium
FR 23954 (May 6, 2003) (Assessment of
Works ........................
21.71
Antidumping Duties). This clarification
will apply to entries of subject
Disclosure and Public Comment
merchandise during the POR produced
Pursuant to 19 CFR 351.224(b), the
by AVISMA for which AVISMA did not
Department will disclose to any party to know its merchandise was destined for
the proceeding the calculations
the United States. In such instances, we
performed in connection with these
will instruct CBP to liquidate
preliminary results within five days
unreviewed entries of AVISMA–
after the date of publication of this
produced merchandise at the all–others
notice. Pursuant to 19 CFR 351.309,
rate if there is no rate for the
interested parties may submit written
intermediate company(ies) involved in
comments in response to these
the transaction. For a full discussion of
preliminary results. Case briefs are due
this clarification, see Assessment of
within 30 days after the date of
Antidumping Duties.
publication of this notice. Rebuttal
Because we are relying on total AFA
briefs, limited to arguments raised in
to establish SMW’s dumping margin, we
case briefs, may be submitted no later
preliminarily determine to instruct CBP
than five days after the time limit for
to apply a dumping margin of 21.71
filing case briefs. Parties who submit
percent to all entries of subject
arguments in this proceeding are
merchandise during the POR that were
requested to submit with the argument
produced and/or exported by SMW.
a statement of the issues, a brief
summary of the argument, and a table of Cash–Deposit Requirements
If these preliminary results are
authorities. Case and rebuttal briefs
adopted in the final results of review,
must be served on interested parties in
the following deposit requirements will
accordance with 19 CFR 351.303(f).
Also, pursuant to 19 CFR 351.310(c),
be effective upon completion of the final
within 30 days of the date of publication results of this administrative review for
of this notice, interested parties may
all shipments of the subject
request a public hearing on arguments
merchandise entered, or withdrawn
to be raised in the case and rebuttal
from warehouse, for consumption on or
briefs. If requested, the hearing will be
after the publication of the final results
held two days after the date for
of this administrative review, as
submission of rebuttal briefs. Parties
provided in section 751(a)(1) of the Act:
will be notified of the time and location. 1) the cash–deposit rate for the reviewed
The Department will publish the final
firms will be those established in the
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final results of this review; 2) for
previously reviewed or investigated
companies not covered in this review,
the cash–deposit rate will continue to be
the company–specific rate published for
the most recent period; 3) if the exporter
is not a firm covered in this review, a
prior review, or the less–than-fair–value
(LTFV) investigation but the
manufacturer is, the cash–deposit rate
will be the rate established for the most
recent period for the manufacturer of
the subject merchandise; and 4) if
neither the exporter nor the
manufacturer is a firm covered in this or
any previous segment of the proceeding,
the cash–deposit rate will continue to be
the all–others rate established in the
LTFV investigation, which is 21.01
percent. See Antidumping Duty Order.
These cash–deposit requirements, when
imposed, shall remain in effect until
further notice.
Notification to Importers
This notice serves as a preliminary
reminder to importers of their
responsibility under
19 CFR 351.402(f)(2) to file a
certificate regarding the reimbursement
of antidumping duties prior to
liquidation of the relevant entries
during this review period. Failure to
comply with this requirement could
result in the Secretary’s presumption
that reimbursement of antidumping
duties occurred and the subsequent
assessment of double antidumping
duties.
The preliminary results of this
administrative review and this notice
are issued and
published in accordance with sections
751(a)(1) and 777(i)(1) of the Act.
Dated: April 29, 2008.
David M. Spooner,
Assistant Secretary for Import
Administration.
[FR Doc. E8–9889 Filed 5–2–08; 8:45 am]
BILLING CODE 3510–DS–S
DEPARTMENT OF COMMERCE
International Trade Administration
(A–520–803)
rfrederick on PROD1PC67 with NOTICES
Polyethylene Terephthalate Film,
Sheet, and Strip from the United Arab
Emirates: Preliminary Determination of
Sales at Less Than Fair Value and
Postponement of Final Determination
Import Administration,
International Trade Administration,
Department of Commerce.
SUMMARY: The U.S. Department of
Commerce (the Department)
preliminarily determines that
AGENCY:
VerDate Aug<31>2005
16:13 May 02, 2008
Jkt 214001
Polyethylene Terephthalate Film, Sheet,
and Strip (PET Film) from the United
Arab Emirates (UAE) is being, or is
likely to be, sold in the United States at
less than fair value (LTFV), as provided
in section 733 of the Tariff Act of 1930,
as amended (the Act). The estimated
margins of sales at LTFV are listed in
the ‘‘Preliminary Determination’’
section of this notice. Interested parties
are invited to comment on this
preliminary determination. Pursuant to
a request from an interested party, we
are postponing our final determination
to not later than 135 days after
publication of the preliminary
determination.
EFFECTIVE DATE: May 5, 2008.
FOR FURTHER INFORMATION CONTACT:
Douglas Kirby or Myrna Lobo, AD/CVD
Operations, Office 6, Import
Administration, International Trade
Administration, U.S. Department of
Commerce, 14th Street and Constitution
Avenue, NW, Washington, DC 20230;
telephone: (202) 482–3782 or (202) 482–
2371, respectively.
SUPPLEMENTARY INFORMATION:
Background
This investigation was initiated on
October 18, 2007. See Polyethylene
Terephthalate Film, Sheet, and Strip
(PET Film) from Brazil, the People’s
Republic of China, Thailand, and the
United Arab Emirates: Initiation of
Antidumping Duty Investigations
(Notice of Initiation), 72 FR 60801
(October 26, 2007). On November 13,
2007, the United States International
Trade Commission (ITC) preliminarily
determined that, pursuant to section
733(a) of the Act, there is a reasonable
indication that an industry in the
United States is materially injured by
reason of imports of PET Film from
Brazil, China, Thailand, and the United
Arab Emirates. See Investigation Nos.
731–TA–1131–1134 (Preliminary):
Polyethylene Terephthalate Film, Sheet,
and Strip from Brazil, China, Thailand,
and the United Arab Emirates, 72 FR
67756 (November 13, 2007) (ITC
Preliminary Determination). The
domestic interested parties are DuPont
Teijin Films, Mitsubishi Polyester Film
of America, Inc., SKC, Inc. and Toray
Plastics (America), Inc. (collectively, the
petitioners). The respondent for this
investigation is Flex Middle East FZE
(Flex FZE).
On November 27, 2007, the
Department issued its sections A
through E questionnaires to Flex FZE.
On December 19, 2007, Flex FZE
submitted its section A response. On
January 18, 2008, Flex FZE submitted its
sections B and C responses. On January
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24547
23, 2008, the petitioners made a timely
request pursuant to section 733(c)(1) of
the Act and 19 CFR 351.205(e) for a
postponement of the preliminary
determinations with respect to Brazil,
the People’s Republic of China,
Thailand, and the United Arab Emirates.
See Polyethylene Terephthalate Film,
Sheet, and Strip from Brazil, the
People’s Republic of China, Thailand,
and the United Arab Emirates:
Postponement of Preliminary
Determinations of Antidumping Duty
Investigations, 73 FR 7710 (February 11,
2008).
On February 6, 2008, the petitioners
submitted a timely allegation that home
market sales were being made at prices
below the cost of production and
requested that the Department initiate a
sales–below-cost investigation of Flex
FZE pursuant to 19 CFR
351.301(d)(2)(B). On February 8, 2008,
the Department issued its first
supplemental questionnaire to Flex
FZE. On February 27, 2008, Flex FZE
submitted its response to the first
supplemental questionnaire. On
February 29, 2008, the Department
issued a second supplemental
questionnaire to Flex FZE. On February
29, 2008, the Department initiated a
sales–below-cost–investigation of Flex
FZE and requested that Flex FZE
respond to the section D questionnaire.
See Memorandum to Barbara E.
Tillman, Director, AD/CVD Operations,
Office 6, from the Team, Petitioners’
Allegation of Sales Below the Cost of
Production for Flex Middle East FZE
(Flex FZE) (Cost Allegation
Memorandum) (February 29, 2008), on
file in the Central Record Unit, room
1117 of the main Department of
Commerce building (CRU). On March
12, 2008, Flex FZE submitted its
response to the second supplemental
questionnaire. On March 14, 2008, Flex
FZE submitted its response to the
section D questionnaire.
On March 21, 2008, the petitioners
submitted an allegation pursuant to 19
CFR 351.301(d)(5) that certain U.S. sales
by Flex FZE were targeted for dumping.
On March 27, 2008, the Department
issued a supplemental questionnaire for
sections A through D to Flex FZE. On
March 31, 2008, Flex FZE submitted
comments regarding the petitioners’
targeted dumping allegation. On April 1,
2008, the Department issued a letter to
Flex FZE to clarify the March 27, 2008,
supplemental questionnaire. On April 8,
2008, Flex FZE submitted its response
to the sections A through D
supplemental questionnaire. On April
11, 2008, the Department issued
questions to the petitioners regarding its
targeted dumping allegation. On April
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Agencies
[Federal Register Volume 73, Number 87 (Monday, May 5, 2008)]
[Notices]
[Pages 24541-24547]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-9889]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
International Trade Administration
(A-821-819)
Magnesium Metal from the Russian Federation: Preliminary Results
of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: In response to timely requests, the Department of Commerce
(the Department) is conducting an administrative review of the
antidumping duty order on magnesium metal from the Russian Federation
for the period of review (POR) April 1, 2006, through March 31, 2007.
The review covers two respondents, PSC VSMPO-AVISMA Corporation
(AVISMA) and Solikamsk Magnesium Works (SMW).
The Department preliminarily determines that AVISMA and SMW made
sales to the United States at less than normal value. If these
preliminary results are adopted in the final results of this
administrative review, we will instruct U.S. Customs and Border
Protection (CBP) to assess antidumping duties on entries of AVISMA's
and SMW's merchandise during the POR. The preliminary results are
listed below in the section titled ``Preliminary Results of Review.''
EFFECTIVE DATE: May 5, 2008.
FOR FURTHER INFORMATION CONTACT: Dmitry Vladimirov 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-
0665 or (202) 482-1690, respectively.
SUPPLEMENTARY INFORMATION:
Background
The Department published the antidumping duty order on magnesium
metal from the Russian Federation on April 15, 2005. See Notice of
Antidumping Duty Order: Magnesium Metal from the Russian Federation, 70
FR 19930 (April 15, 2005) (Antidumping Duty Order). On April 2, 2007,
the Department published in the Federal Register a notice of
opportunity to request an administrative review of the antidumping duty
order on magnesium metal from the Russian Federation. See Antidumping
or Countervailing Duty Order, Finding, or Suspended Investigation;
Opportunity to Request Administrative Review, 72 FR 15650 (April 2,
2007). On April 30, 2007, AVISMA, a Russian Federation producer of the
subject merchandise, requested that the Department conduct an
administrative review. On April 30, 2007, U.S. Magnesium Corporation
LLC, the petitioner in this proceeding, also requested that the
Department conduct an administrative review with respect to AVISMA and
SMW, another Russian Federation producer of the subject merchandise. On
May 30, 2007, the Department published a notice of initiation of an
administrative review of the antidumping duty order on magnesium metal
from the Russian Federation for the period April 1, 2006, through March
31, 2007. See Initiation of Antidumping and Countervailing Duty
Administrative Reviews and Request for Revocation in Part, 72 FR 29968
(May 30, 2007).
On December 18, 2007, the Department extended the deadline for the
preliminary results of this antidumping duty administrative review from
December 31, 2007, to April 29, 2008. See Notice of Extension of Time
Limit for Preliminary Results of Antidumping Duty Administrative
Review: Magnesium Metal From the Russian Federation, 72 FR 71620
(December 18, 2007).
Scope of the Order
The merchandise covered by the order is magnesium metal (also
referred to as magnesium), which includes primary and secondary pure
and alloy magnesium metal, regardless of chemistry, raw material
source, form, shape, or size. Magnesium is a metal or alloy containing
by weight primarily the element magnesium. Primary magnesium is
produced by decomposing raw materials into magnesium metal. Secondary
magnesium is produced by recycling magnesium-based scrap into magnesium
metal. The magnesium covered by the order includes blends of primary
and secondary magnesium.
The subject merchandise includes the following pure and alloy
magnesium metal products made from primary and/or secondary magnesium,
including, without limitation, magnesium cast into ingots, slabs,
rounds, billets, and other shapes, and magnesium ground, chipped,
crushed, or machined into raspings, granules, turnings, chips, powder,
briquettes, and other shapes: (1) products that contain at least 99.95
percent magnesium, by weight (generally referred to as ``ultra-pure''
magnesium); (2) products that contain less than 99.95 percent but not
less than 99.8 percent magnesium, by weight (generally referred to as
``pure'' magnesium); and (3) chemical combinations of magnesium and
other material(s) in which the magnesium content is 50 percent or
greater, but less that 99.8 percent, by weight, whether or not
conforming to an ``ASTM Specification for Magnesium Alloy''.
The scope of the order excludes: (1) magnesium that is in liquid or
molten form; and (2) mixtures containing 90 percent or less magnesium
in granular or powder form by weight and one or more of certain non-
magnesium granular materials to make magnesium-based reagent mixtures,
including lime, calcium metal, calcium silicon, calcium carbide,
calcium carbonate, carbon, slag coagulants, fluorspar, nephaline
syenite, feldspar, alumina (Al203), calcium aluminate, soda ash,
hydrocarbons, graphite, coke, silicon, rare earth metals/mischmetal,
cryolite, silica/fly
[[Page 24542]]
ash, magnesium oxide, periclase, ferroalloys, dolomite lime, and
colemanite.\1\
---------------------------------------------------------------------------
\1\ This second exclusion for magnesium-based reagent mixtures
is based on the exclusion for reagent mixtures in the 2000-2001
investigations of magnesium from China, Israel, and Russia. See
Notice of Final Determination of Sales at Less Than Fair Value: Pure
Magnesium in Granular Form From the People's Republic of China, 66
FR 49345 (September 27, 2001); Notice of Final Determination of
Sales at Less Than Fair Value: Pure Magnesium From Israel, 66 FR
49349 (September 27, 2001); Notice of Final Determination of Sales
at Not Less Than Fair Value: Pure Magnesium From the Russian
Federation, 66 FR 49347 (September 27, 2001). These mixtures are not
magnesium alloys, because they are not chemically combined in liquid
form and cast into the same ingot.
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The merchandise subject to the order is currently classifiable
under items 8104.11.00, 8104.19.00, 8104.30.00, and 8104.90.00 of the
Harmonized Tariff Schedule of the United States (HTSUS). Although the
HTSUS item numbers are provided for convenience and customs purposes,
the written description of the merchandise covered by the order is
dispositive.
On November 9, 2006, in response to U.S. Magnesium Corporation
LLC's request for scope rulings, the Department issued final scope
rulings in which it determined that the processing of pure magnesium
ingots imported from Russia by Timminco, a Canadian company, into pure
magnesium extrusion billets constitutes substantial transformation.
Therefore, such alloy magnesium extrusion billets produced and exported
by Timminco are a product of Canada and thus are not within the scope
of the order. See November 9, 2006, Memorandum for Stephen J. Claeys,
Deputy Assistant Secretary for Import Administration, from Barbara E.
Tillman, Director, Office 6, and Wendy Frankel, Director, Office 8,
China/NME Group, AD/CVD Operations: Pure Magnesium from the People's
Republic of China (A-570-832), Magnesium Metal from the People's
Republic of China (A-570-896), and Magnesium Metal from Russia (A-821-
819): Final Ruling in the Scope Inquiry on Russian and Chinese
Magnesium Processed in Canada.
Use of Facts Otherwise Available
For the reasons discussed below, we determine that the use of
adverse facts available (AFA) is appropriate for the preliminary
results of this review with respect to SMW.
A. Use of Facts Available
Section 776(a)(2) of the Tariff Act of 1930, as amended (the Act),
provides that, if an interested party withholds information requested
by the administering authority, fails to provide such information by
the deadlines for submission of the information and in the form or
manner requested, subject to subsections (c)(1) and (e) of section 782,
significantly impedes a proceeding under this title, or provides such
information but the information cannot be verified as provided in
section 782(i), the administering authority shall use, subject to
section 782(d) of the Act, facts otherwise available in reaching the
applicable determination. Section 782(d) of the Act provides that, if
the administering authority determines that a response to a request for
information does not comply with the request, the administering
authority shall promptly inform the responding party and provide an
opportunity to remedy the deficient submission. Section 782(e) of the
Act states further that the Department shall not decline to consider
submitted information 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; (5) the information can be used without
undue difficulties.
On July 11, 2007, SMW notified the Department that it would not
participate in this administrative review. As such, SMW failed to
respond to our questionnaire, thereby withholding, among other things,
home-market and U.S. sales information necessary for reaching the
applicable results. Such information is imperative to calculate an
antidumping margin for the preliminary results of the review. Because
SMW failed to provide the information requested and thus significantly
impeded the proceeding, we find that we must base its margin on facts
otherwise available pursuant to sections 776(a)(2)(A), (B), and (C) of
the Act. Further, sections 782(d) and (e) of the Act are inapplicable
because SMW decided not to provide the Department with any information.
B. Application of Adverse Inferences for Facts Available
In applying the facts otherwise available, section 776(b) of the
Act provides that, if the administering authority 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 from the
administering authority, in reaching the applicable determination under
this title the administering authority may use an inference adverse to
the interests of that party in selecting from among the facts otherwise
available.
Adverse inferences are appropriate ``to ensure that the party does
not obtain a more favorable result by failing to cooperate than if it
had cooperated fully.'' See Statement of Administrative Action
accompanying the Uruguay Round Agreements Act, H.R. Doc. No. 103-316,
vol.1 (1994) at 870 (SAA). Further, ``affirmative evidence of bad faith
on the part of a respondent is not required before the Department may
make an adverse inference.'' See Antidumping Duties; Countervailing
Duties, 62 FR 27296, 27340 (May 19, 1997). Because SMW has not provided
any information in response to our questionnaire and has notified us
that it would not participate in this review, we find that SMW has not
acted to the best of its ability in providing us with relevant
information which is under its control. This constitutes a failure on
the part of SMW to cooperate to the best of its ability to comply with
a request for information by the Department within the meaning of
section 776(b) of the Act. Based on the above, the Department has
preliminarily determined that, in selecting from among the facts
otherwise available, an adverse inference is warranted. See, e.g.,
Notice of Final Determination of Sales at Less than Fair Value:
Circular Seamless Stainless Steel Hollow Products from Japan, 65 FR
42985, 42986 (July 12, 2000) (the Department applied total AFA where
the respondent failed to respond to the antidumping questionnaire).
C. Selection and Corroboration of Information Used as Facts Available
Section 776(b) of the Act provides that the Department may use as
AFA information derived from the petition, the final determination in
the investigation, any previous review, or any other information placed
on the record. When selecting an AFA rate from among the possible
sources of information, the Department's practice has been to ensure
that the margin is sufficiently adverse to induce respondents to
provide the Department with complete and accurate information in a
timely manner. See, e.g., Certain Steel Concrete Reinforcing Bars from
Turkey; Final Results and Rescission of Antidumping Duty Administrative
Review in Part, 71 FR 65082, 65084 (November 7, 2006). In selecting an
appropriate AFA rate for SMW, the Department considered the following
rates from the proceeding: 1) the rates alleged in the petition which
range from 54.40 to 68.94 and 86.54 to 101.24 percent (when taking into
account
[[Page 24543]]
adjustments for electricity; see Notice of Initiation of Antidumping
Duty Investigations: Magnesium Metal From the People's Republic of
China and the Russian Federation, 69 FR 15293 (March 25, 2004)); 2) the
rates we calculated for the final determination of the investigation
which ranged from 18.65 to 21.71 percent (see Antidumping Duty Order);
and 3) the rates we calculated in the first administrative review (the
most recently completed review), 0.41 and 3.77 percent (see Magnesium
Metal from the Russian Federation: Final Results of Antidumping Duty
Administrative Review, 72 FR 51791 (September 11, 2007)).
Section 776(c) of the Act provides that the Department shall
corroborate, to the extent practicable, secondary information used for
facts available by reviewing independent sources reasonably at its
disposal. With respect to the rates alleged in the petition,
information from prior segments of the proceeding constitutes secondary
information. See SAA at 870 and Final Results of Antidumping Duty
Administrative Reviews, Rescission of Administrative Reviews in Part,
and Determination to Revoke Order in Part: Antifriction Bearings and
Parts Thereof From France, Germany, Italy, Japan, Singapore, and the
United Kingdom, 69 FR 55574, 55577 (September 15, 2004) (AFBs 14). The
word ``corroborate'' means that the Department will satisfy itself that
the secondary information to be used has probative value. Id.; see also
Tapered Roller Bearings and Parts Thereof, Finished and Unfinished,
from Japan, and Tapered Roller Bearings Four Inches or Less in Outside
Diameter, and Components Thereof, from Japan: Preliminary Results of
Antidumping Duty Administrative Reviews and Partial Termination of
Administrative Reviews, 61 FR 57391, 57392 (November 6, 1996). To
corroborate secondary information, the Department will examine, to the
extent practicable, the reliability and relevance of the information
used.
Because SMW did not submit information we requested in this review
we do not have such information to consider in determining whether the
petition rates are relevant to SMW. To determine whether the petition
rates are reliable and relevant in this administrative review, we
compared the transaction-specific margins of AVISMA for the POR to the
petition rates and found that the petition rates were not relevant for
use in this administrative review and, therefore, do not have probative
value for use as AFA.
In addition, we find that the weighted-average rates we calculated
for respondents in the previous, as well as in the instant review, are
not sufficiently high as to effectuate the purpose of the facts-
available rule (i.e., we do not find that any of these rates are high
enough to encourage participation in future segments of this proceeding
in accordance with section 776(b) of the Act). Therefore, as facts
available with an adverse inference, we have selected the rate of 21.71
percent for SMW, the weighted-average margin the Department calculated
for JSC AVISMA Magnesium-Titanium Works (a predecessor to PSC VSMPO-
AVISMA Corporation) in the original investigation (see Antidumping Duty
Order); it is the highest rate the Department has calculated in any
segment of the proceeding. We consider the 21.71 percent rate to be
sufficiently high so as to encourage participation in future segments
of this proceeding.
With respect to corroboration of other rates from the proceeding,
unlike other types of information such as input costs or selling
expenses, there are no independent sources for calculated dumping
margins. The only source for margins is administrative determinations.
Thus, with respect to an administrative review, if the Department
chooses as facts available a calculated dumping margin from a prior
segment of the proceeding, there is no practical manner to test the
margin's reliability further and the Department considers the rate
reliable. See AFBs 14 at 55577.
With respect to the relevance aspect of corroboration the
Department will consider information reasonably at its disposal as to
whether there are circumstances that would render a margin not
relevant. Where circumstances indicate that the selected margin is not
appropriate as AFA, the Department will disregard the margin and
determine an appropriate margin. See Fresh Cut Flowers from Mexico;
Final Results of Antidumping Duty Administrative Review, 61 FR 6812,
6814 (February 22, 1996), where the Department disregarded the highest
dumping margin as best information available because the margin was
based on another company's uncharacteristic business expense resulting
in an unusually high margin.
We examined individual transactions made by AVISMA in the current
review and the margins on those transactions in order to determine
whether the rate of 21.71 percent was probative. We found a number of
sales with dumping margins above the rate of 21.71 percent. Further, to
support our corroboration, because SMW did not provide us with any
information in this review, we examined individual transactions made by
SMW during the immediately preceding (2005-06) administrative review
period and the margins we determined for that review on those
transactions in order to determine whether the rate of 21.71 percent
was probative. See Preliminary Results of Antidumping Duty
Administrative Review: Stainless Steel Wire Rod from the Republic of
Korea, 72 FR 32074, 32076 (June 11, 2007) (unchanged in Final Results
of Antidumping Duty Administrative Review: Stainless Steel Wire Rod
from the Republic of Korea, 72 FR 46035 (August 16, 2007)). We found a
number of sales by SMW during the 2005-06 period with dumping margins
above the rate of 21.71 percent. Thus, the AFA rate is relevant as
applied to SMW for this review because it falls within the range of
AVISMA's transaction-specific margins in the current review period and
SMW's own transaction-specific margins in the prior review period. See
Ta Chen Stainless Steel Pipe, Inc. vs. United States, 298 F.3d 1330,
1340 (CAFC 2002) (``Because Commerce selected a dumping margin within
the range of Ta Chen's actual sales data, we cannot conclude that
Commerce overreached reality'.'') We have detailed the corroboration of
the AFA rate in the memorandum from the analyst to Laurie Parkhill
entitled ``The Use of Facts Available and Corroboration of Secondary
Information for Solikamsk Magnesium Works in the 2006/2007
Administrative Review of the Antidumping Duty Order on Magnesium Metal
from the Russian Federation,'' dated April 29, 2008. Therefore, we find
this rate to be both reliable and relevant. As such, the Department
finds this rate to be corroborated to the extent practicable consistent
with section 776(c) of Act.
Date of Sale
AVISMA reported invoice date as the date of sale for all sales in
both markets, consistent with our conclusions in earlier segments of
the proceeding regarding both spot sales and sales made according to
short and long-term agreements. See Magnesium Metal from the Russian
Federation: Notice of Final Determination of Sales at Less Than Fair
Value, 70 FR 9041 (February 24, 2005), and accompanying Issues and
Decision Memorandum at Comment 14. After analyzing AVISMA's response
and the sample sales documents it provided, we preliminarily determine
that invoice date is the appropriate date of sale for all U.S. and
home-market sales subject to analysis in this review.
[[Page 24544]]
Constructed Export Price
AVISMA identified all of its sales to the United States as
constructed export-price (CEP) sales because the U.S. sales were made
for the account of AVISMA by AVISMA's U.S. affiliate, VSMPO-Tirus,
U.S., Inc. (Tirus US), to unaffiliated purchasers in the United States.
AVISMA and Tirus US are affiliated because Tirus US is a wholly owned
subsidiary of AVISMA. See section 771(33)(E) of the Act. U.S. sales to
the first unaffiliated party were made in the United States by the U.S.
affiliate, thus satisfying the legal requirements for CEP sales. See
section 772(b) of the Act.
We calculated CEP based on the packed, C.I.F price to unaffiliated
purchasers in the United States. In accordance with section 772(c)(2)
of the Act, for AVISMA's CEP sales we made deductions from price for
movement expenses and discounts, where appropriate. More specifically,
we deducted early-payment discounts, expenses for Russian railway
freight from plant to port, freight insurance, Russian brokerage,
handling, and port charges, international freight and marine insurance,
U.S. customs duties, U.S. brokerage, handling, and port charges, U.S.
warehousing, and U.S. inland freight.
In accordance with section 772(d)(1) of the Act we deducted direct
selling expenses and indirect selling expenses related to commercial
activity in the United States. See also SAA at 823-824. Pursuant to
sections 772(d)(3) and 772(f) of the Act, we made an adjustment for CEP
profit allocated to expenses deducted under section 772(d)(1) of the
Act. In accordance with section 772(f) of the Act, we computed profit
based on the total revenues realized on sales in both the U.S. and home
markets, less all expenses associated with those sales. We then
allocated profit to expenses incurred with respect to U.S. economic
activity based on the ratio of total U.S. expenses to total expenses
for both the U.S. and home markets. See the memorandum to the file
entitled ``Administrative Review of the Antidumping Duty Order on
Magnesium Metal from the Russian Federation - Preliminary Results
Analysis Memorandum for PSC VSMPO-AVISMA Corporation'' (April 29, 2008)
(AVISMA Analysis Memorandum).
Normal Value
Based on a comparison of the aggregate quantity of home-market and
U.S. sales and absent any information that a particular market
situation in the exporting country did not permit a proper comparison,
we determined that the quantity of foreign like product sold by AVISMA
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. AVISMA's quantity of sales in
its home market was greater than five percent of its sales to the U.S.
market. Therefore, in accordance with section 773(a)(1)(B)(i) of the
Act, we considered basing normal value on the prices at which the
foreign like product was first sold for consumption in the exporting
country in the usual commercial quantities and in the ordinary course
of trade and, to the extent practicable, at the same level of trade as
the CEP sales.
In accordance with section 771(16)(A) of the Act, we considered all
products produced by AVISMA that are covered by the description in the
``Scope of the Order'' section, above, and that were sold in the home
market during the POR to be foreign like products for purposes of
determining appropriate product comparisons to U.S. sales. In
accordance with sections 771(16)(B) and (C) of the Act, where there
were no sales of identical merchandise in the home market to compare to
U.S. sales, we considered comparing U.S. sales to the most similar
foreign like product on the basis of the product characteristics we
determined to be the most appropriate for purposes of product matching.
Cost-of-Production Analysis
We disregarded below-cost sales in accordance with section 773(b)
of the Act in the last completed review with respect to AVISMA. See
Magnesium Metal from the Russian Federation: Preliminary Results of
Antidumping Duty Administrative Review, 72 FR 25740, 25743 (May 7,
2007) (unchanged in Magnesium Metal from the Russian Federation: Final
Results of Antidumping Duty Administrative Review, 72 FR 51791
(September 11, 2007)). Therefore, we have reasonable grounds to believe
or suspect that sales of the foreign like product under consideration
for the determination of normal value in this review may have been made
at prices below the cost of production (COP) as provided by section
773(b)(2)(A)(ii) of the Act. Therefore, pursuant to section 773(b)(1)
of the Act, we conducted a COP investigation of sales by AVISMA in the
home market.
In accordance with section 773(b)(3) of the Act, we calculated a
weighted-average COP based on the sum of the cost of materials and
fabrication for the foreign like product, plus amounts for home-market
selling, G&A expenses, interest expense, and packing expenses.
In the original investigation and in the first administrative
review, AVISMA's cost-reporting methodology was based on its normal
books and records which treated magnesium metal as the main product and
chlorine gas as a by-product of the manufacturing process. On January
1, 2007, during the current POR, AVISMA changed its normal books and
records to treat magnesium as the by-product of its titanium operations
(chlorine is consumed in titanium production). Raw magnesium and
chlorine gas are produced jointly during the third major processing
step, the electrolysis stage (i.e., the split-off point), during which
both products become identifiable physically. In its cost responses,
AVISMA claims that its acquisition by VSMPO, a titanium producer, has
shifted its operational focus to the production of titanium sponge.
Accordingly, it contends, the company determined that the production of
chlorine gas, which is a significant and a critical input in the
production of titanium sponge, is the main goal of production while
magnesium production is now treated as a secondary product. As such,
AVISMA claims, it has reduced its magnesium production to the minimum
levels needed to support the titanium- sponge production based on its
new operational focus. AVISMA claims that the reduction in magnesium
production is apparent through its reduction or cessation of its
practice of burning off excess chlorine gas.
In its original cost response AVISMA included only the costs from
the further-processing steps (i.e., only the costs incurred after the
split-off point and none of the joint costs of the electrolysis and
prior stages) in its COP database.
In its supplemental cost responses AVISMA provided alternative cost
calculations in which it treated raw magnesium and chlorine gas as co-
products. Under this approach, AVISMA calculated the value of chlorine
at the split-off point by starting with sale prices of titanium sponge
and then deducting the post-split-off titanium-processing costs; AVISMA
calculated the value of raw magnesium at the split-off point using the
starting sale prices of magnesium metal and then deducted the post-
split-off costs of the magnesium-metal processing. AVISMA then
allocated the joint costs under the net-realizable-value (NRV)
methodology.
We requested that AVISMA provide another set of cost calculations
based on a co-product methodology which relies
[[Page 24545]]
on the sales or market values of the joint products, i.e., magnesium
and chlorine gas (for the one-year period prior to the original period
of investigation) instead of the sales values of the downstream
products (i.e., titanium sponge). AVISMA provided the requested cost
data based on a co-product methodology of allocating joint costs in
which it determined the value of chlorine gas (with certain
adjustments) at the split-off point using the current market prices of
liquid chlorine and the value of raw magnesium at the split-off point
using the sales prices for magnesium products for the period predating
the period of original investigation. AVISMA allocated joint costs
based on the relationship between the NRV of raw magnesium and the NRV
of chlorine gas.
We analyzed the data on the record to determine whether to judge
the joint products appropriately as co-products or byproducts. In doing
so, we conservatively considered the lowest per-metric-ton value of
chlorine gas during the POR; for raw magnesium we considered the
average per-metric-ton value for the period prior to the period of
investigation (i.e., prior to a period in which dumping was alleged).
We evaluated the significance of each product at the split-off point
and found that chlorine gas represented a significant percentage of the
total value of all products at the split-off point. Consequently, based
on our review of the combination of factors (the takeover of AVISMA by
VSMPO, the cessation of the burning off of excess chlorine gas, and our
examination of the relative values of the joint products in question),
we have preliminarily determined that it is appropriate to treat
chlorine gas and raw magnesium as co-products for purposes of
allocating the common costs of these joint products for the entire
cost- reporting period.
We have relied on AVISMA's cost database based on the co-product
methodology of allocating joint costs for the preliminary results. We
made certain adjustments to AVISMA's cost data - we revised the value
of chlorine gas to reflect the company's purchases of liquid chlorine
less freight costs and further-processing costs\2\ and we increased the
total pool of joint costs to be allocated to the co-products to include
the costs associated with the disposal of excess chlorine gas.\3\ For
more details, see Memorandum to Neal M. Halper, Director, Office of
Accounting, through Michael P. Martin, Lead Accountant, from Heidi K.
Schriefer, Senior Accountant, entitled ``Cost of Production and
Constructed Value Calculation Adjustments for the Preliminary Results -
PSC VSMPO-AVISMA Corporation and VSMPO - Tirus US Inc,'' dated April
29, 2008.
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\2\ AVISMA added the cost of evaporating liquid chlorine to the
sales value of liquid chlorine in order to arrive at the estimated
value of chlorine gas. In the absence of a cost value associated
with liquefying chlorine gas, as a proxy, we subtracted the
evaporation costs from the sales value of liquid chlorine to
estimate the NRV of chlorine gas at the split-off point.
\3\ AVISMA burned off excess chlorine gas for part of the POR.
By November 2006, AVISMA was no longer producing excess chlorine
gas.
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After calculating the COP and in accordance with section 773(b)(1)
of the Act, we tested whether home-market sales of the foreign like
product were made at prices below the COP within an extended period of
time in substantial quantities and whether such prices permitted the
recovery of all costs within a reasonable period of time. We compared
model-specific COPs to the reported home-market prices less any
applicable movement charges, discounts, and rebates. Pursuant to
section 773(b)(2)(C) of the Act, when less than 20 percent of a
respondent's sales of a given product were at prices less than the COP,
we do not disregard any below-cost sales of that product because the
below-cost sales were not made in substantial quantities within an
extended period of time. When 20 percent or more of a respondent's
sales of a given product were at prices less than the COP, we disregard
the below-cost sales because they were made in substantial quantities
within an extended period of time pursuant to sections 773(b)(2)(B) and
(C) of the Act and because, based on comparisons of prices to weighted-
average COPs for the period of review, such sales were at prices which
would not permit recovery of all costs within a reasonable period of
time in accordance with section 773(b)(2)(D) of the Act. Based on this
test, we disregarded all of AVISMA's home-market sales of magnesium
metal because all such sales failed the cost test. See AVISMA Analysis
Memorandum.
Constructed Value
Section 773(a)(4) of the Act provides that, where normal value
cannot be based on comparison-market sales, normal value may be based
on constructed value. Accordingly, because all home-market sales of
magnesium metal failed the sales-below-cost test, we based normal value
on constructed value.
Section 773(e) of the Act provides that constructed value shall be
based on the sum of the cost of materials and fabrication for the
imported merchandise, plus amounts for selling, general and
administrative expenses (G&A), interest expense, profit, and U.S.
packing costs. We calculated the cost of materials and fabrication
based on the methodology described in the ``Cost- of-Production
Analysis'' section above.
Because we disregarded all home-market sales as below-cost sales
there are no sales made in the ordinary course of trade that we can use
to calculate selling expenses and profit for constructed value pursuant
to section 773(e)(2)(A) of the Act for AVISMA. In cases where actual
data are not available to use in the calculation of selling expenses
and profit, section 773(e)(2)(B)(i) of the Act provides the alternative
of calculating such expenses using ``actual amounts incurred and
realized by the specific exporter or producer in connection with the
production and sale of merchandise that is in the same general category
of products as the subject merchandise.'' This option is not available
to us for these preliminary results because the record information,
such as the financial information AVISMA submitted in this review, is
not sufficiently detailed to permit a calculation of selling expenses
and profit specific to subject merchandise or specific to a category of
products in the same category as the subject merchandise.
Another alternative at section 773(e)(2)(B)(ii) of the Act suggests
calculating the amounts in question using ``the weighted average of the
actual amounts incurred and realized by exporters or producers that are
subject to the investigation or review (other than the exporter or
producer described in clause (i)) `` This alternative is not applicable
in this review because AVISMA is the single cooperating respondent in
this review and there are no other participating exporters/producers in
this review.
Another statutory alternative of calculating the amounts in
question provided at section 773(e)(2)(B)(iii) of the Act suggests
``any other reasonable method `` Therefore, pursuant to section
773(e)(2)(B)(iii) of the Act, we have calculated an estimate of direct
and indirect selling expenses and profit for AVISMA in this review
using the selling expenses and profit we calculated for AVISMA in the
2005-06 administrative review. See AVISMA Analysis Memorandum.
When appropriate, we made adjustments to constructed value in
accordance with section 773(a)(8) of the Act, 19 CFR 351.410, and 19
CFR 351.412 for circumstance-of-sale differences and level-of-trade
[[Page 24546]]
differences. We made circumstance-of-sale adjustments by deducting
home-market direct selling expenses from constructed value. Because we
calculated constructed value at a level of trade different from the CEP
level trade, we made a CEP-offset adjustment in accordance with
sections 773(a)(7)(B) and 773(a)(8) of the Act. See ``Level of Trade''
section below.
Level Of Trade
In the U.S. market, AVISMA made CEP sales. In the case of CEP
sales, we identified the level of trade based on the price after the
deduction of expenses and profit under section 772(d) of the Act.
Although the starting price for CEP sales was based on sales made by
the affiliated reseller to unaffiliated customers through two channels
of distribution, sales to end-users and distributors, AVISMA reported
similar selling activities associated with all sales to the affiliated
reseller (i.e., at the CEP level of trade).
AVISMA reported one channel of distribution in the home market,
sales to end-users. We found that this channel of distribution
constitutes a single level of trade in the home market. When normal
value is based on constructed value, the level of trade is that of the
sales from which we derive selling, G&A, and profit figures.
To determine whether home-market sales were made at a different
level of trade than U.S. sales, we examined stages in the marketing
process and selling functions along the chain of distribution between
the producer and the unaffiliated customer. We found that there were
significant differences between the selling activities associated with
the CEP level of trade and those associated with the home-market level
of trade and, thus, we found the CEP level of trade to be different
from the home-market level of trade. Further, we found the CEP level of
trade to be at a less advanced stage of distribution than the home-
market level of trade.
Because AVISMA reported no home-market levels of trade that were
equivalent to the CEP level of trade and because we determined that the
CEP level of trade was at a less advanced stage than the home-market
level of trade, we were unable to determine a level-of-trade adjustment
based on the respondent's home-market sales of the foreign like
product. Furthermore, we have no other information that provides an
appropriate basis for determining a level-of-trade adjustment. For
AVISMA's CEP sales, we made a CEP-offset adjustment in accordance with
sections 773(a)(7)(B) and 773(a)(8) of the Act. The CEP-offset
adjustment to constructed value was subject to the offset cap,
calculated as the sum of home-market indirect selling expenses up to
the amount of U.S. indirect selling expenses deducted from CEP (or, if
there were no home-market commissions, the sum of U.S. indirect selling
expenses and U.S. commissions). For a description of our level-of-trade
analysis for these preliminary results, see AVISMA Analysis Memorandum.
Currency Conversion
For purposes of the preliminary results and in accordance with
section 773A of the Act, we made currency conversions based on the
official exchange rates in effect on the dates of the U.S. sales as
certified by the Federal Reserve Bank of New York. See also 19 CFR
351.415.
Preliminary Results of Review
As a result of this review, we preliminarily find that the
following weighted-average
dumping margins exist:
------------------------------------------------------------------------
Manufacturer/Exporter Margin (percent)
------------------------------------------------------------------------
PSC VSMPO-AVISMA Corporation........................ 17.68
Solikamsk Magnesium Works........................... 21.71
------------------------------------------------------------------------
Disclosure and Public Comment
Pursuant to 19 CFR 351.224(b), the Department will disclose to any
party to the proceeding the calculations performed in connection with
these preliminary results within five days after the date of
publication of this notice. Pursuant to 19 CFR 351.309, interested
parties may submit written comments in response to these preliminary
results. Case briefs are due within 30 days after the date of
publication of this notice. Rebuttal briefs, limited to arguments
raised in case briefs, may be submitted no later than five days after
the time limit for filing case briefs. Parties who submit arguments in
this proceeding are requested to submit with the argument a statement
of the issues, a brief summary of the argument, and a table of
authorities. Case and rebuttal briefs must be served on interested
parties in accordance with 19 CFR 351.303(f).
Also, pursuant to 19 CFR 351.310(c), within 30 days of the date of
publication of this notice, interested parties may request a public
hearing on arguments to be raised in the case and rebuttal briefs. If
requested, the hearing will be held two days after the date for
submission of rebuttal briefs. Parties will be notified of the time and
location. The Department will publish the final results of this
administrative review, including the results of its analysis of issues
raised in any case brief, rebuttal brief, or hearing no later than 120
days after publication of these preliminary results.
Assessment Rates
The Department shall determine, and U.S. Customs and Border
Protection (CBP) shall assess, antidumping duties on all appropriate
entries. In accordance with 19 CFR 351.212(b)(1), we have calculated an
importer-specific assessment rate for AVISMA reflecting these
preliminary results of review. We divided the total dumping margins for
the reviewed sales by the total entered value of those reviewed sales
for the importer. We will instruct CBP to assess the importer-specific
rate uniformly on all entries of subject merchandise made by the
relevant importer during the POR. See 19 CFR 351.212(b). The Department
will issue instructions to CBP 15 days after the publication of the
final results of 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
of Antidumping Duties). This clarification will apply to entries of
subject merchandise during the POR produced by AVISMA for which AVISMA
did not know its merchandise was destined for the United States. In
such instances, we will instruct CBP to liquidate unreviewed entries of
AVISMA-produced merchandise at the all-others rate if there is no rate
for the intermediate company(ies) involved in the transaction. For a
full discussion of this clarification, see Assessment of Antidumping
Duties.
Because we are relying on total AFA to establish SMW's dumping
margin, we preliminarily determine to instruct CBP to apply a dumping
margin of 21.71 percent to all entries of subject merchandise during
the POR that were produced and/or exported by SMW.
Cash-Deposit Requirements
If these preliminary results are adopted in the final results of
review, the following deposit requirements will be effective upon
completion of the final results of this administrative review for all
shipments of the subject merchandise entered, or withdrawn from
warehouse, for consumption on or after the publication of the final
results of this administrative review, as provided in section 751(a)(1)
of the Act: 1) the cash-deposit rate for the reviewed firms will be
those established in the
[[Page 24547]]
final results of this review; 2) for previously reviewed or
investigated companies not covered in this review, the cash-deposit
rate will continue to be the company-specific rate published for the
most recent period; 3) if the exporter is not a firm covered in this
review, a prior review, or the less-than-fair-value (LTFV)
investigation but the manufacturer is, the cash-deposit rate will be
the rate established for the most recent period for the manufacturer of
the subject merchandise; and 4) if neither the exporter nor the
manufacturer is a firm covered in this or any previous segment of the
proceeding, the cash-deposit rate will continue to be the all-others
rate established in the LTFV investigation, which is 21.01 percent. See
Antidumping Duty Order. These cash-deposit requirements, when imposed,
shall remain in effect until further notice.
Notification to Importers
This notice serves as a preliminary reminder to importers of their
responsibility under
19 CFR 351.402(f)(2) to file a certificate regarding the
reimbursement of antidumping duties prior to liquidation of the
relevant entries during this review period. Failure to comply with this
requirement could result in the Secretary's presumption that
reimbursement of antidumping duties occurred and the subsequent
assessment of double antidumping duties.
The preliminary results of this administrative review and this
notice are issued and
published in accordance with sections 751(a)(1) and 777(i)(1) of
the Act.
Dated: April 29, 2008.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E8-9889 Filed 5-2-08; 8:45 am]
BILLING CODE 3510-DS-S