Circular Welded Carbon Steel Pipes and Tubes from Thailand: Preliminary Results and Rescission, in Part, of Antidumping Duty Administrative Review, 18788-18794 [2010-8420]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 75, Number 70 (Tuesday, April 13, 2010)]
[Notices]
[Pages 18788-18794]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-8420]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-549-502]


Circular Welded Carbon Steel Pipes and Tubes from Thailand: 
Preliminary Results and Rescission, in Part, of Antidumping Duty 
Administrative Review

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

[[Page 18789]]

SUMMARY: The Department of Commerce (the Department) is conducting an 
administrative review of the antidumping duty order on circular welded 
carbon steel pipes and tubes from Thailand, in response to requests 
from Allied Tube and Conduit Corporation (Allied Tube) and Wheatland 
Tube Company(Wheatland) (collectively, petitioners). This review covers 
the period March 1, 2008 through February 28, 2009. We preliminarily 
determine that U.S. sales of subject merchandise have been made by Saha 
Thai Steel Pipe (Public) Company, Ltd. (Saha Thai) below normal value 
(NV). If these preliminary results are adopted in our final results, we 
will instruct U.S. Customs and Border Protection (CBP) to assess 
antidumping duties based on the difference between the export price 
(EP) and the NV. We are also rescinding the administrative review of 
Pacific Pipe Company Limited (Pacific Pipe). We will instruct CBP to 
assess antidumping duties on entries of this merchandise produced by 
Pacific Pipe at the cash deposit rate required at the time of entry. 
Interested parties are invited to comment on these preliminary results. 
See the ``Preliminary Results of Review'' section of this notice.

EFFECTIVE DATE: April 13, 2010.

FOR FURTHER INFORMATION CONTACT: Jacqueline Arrowsmith, AD/CVD 
Operations, Office 6, Import Administration, International Trade 
Administration, Department of Commerce, 14\th\ Street and Constitution 
Avenue, NW, Washington, DC 20230; telephone: (202) 482-5255.

SUPPLEMENTARY INFORMATION:

Background

    On March 11, 1986, the Department published in the Federal Register 
an antidumping duty order on circular welded carbon steel pipes and 
tubes from Thailand. See Antidumping Duty Order: Circular Welded Carbon 
Steel Pipes and Tubes from Thailand, 51 FR 8341 (March 11, 1986). On 
March 2, 2009, the Department published a notice of opportunity to 
request an administrative review of this order covering the period 
March 1, 2008 through February 28, 2009. See Antidumping or 
Countervailing Duty Order, Finding or Suspended Investigation; 
Opportunity to Request Administrative Review, 74 FR 9077 (March 2, 
2009). On April 27, 2009, in response to timely requests by Saha Thai 
and Wheatland with respect to exports by Saha Thai during the period of 
review (POR), and to a timely request by Allied Tube with respect to 
exports by Pacific Pipe, the Department published a notice of 
initiation of this antidumping duty administrative review. See 
Initiation of Antidumping and Countervailing Duty Administrative 
Reviews and Request for Revocation in Part, 74 FR 19042 (April 27, 
2009).
    On May 5, 2009, Pacific Pipe reported that it did not have any 
shipments or sales of subject merchandise for the last five months of 
the POR, from October 1, 2008 to February 28, 2009. The Department 
subsequently completed a new shipper review for Pacific Pipe covering 
the period March 1, 2008 through September 30, 2008. See Circular 
Welded Carbon Steel Pipes and Tubes from Thailand: Final Results of 
Antidumping Duty New Shipper Review, 75 FR 4529 (January 28, 2010) (New 
Shipper Final Results).
    On June 3, 2009, we sent questionnaires to Saha Thai and Pacific 
Pipe. We received timely responses to our questionnaire from Saha Thai 
on July 13, 2009 and July 27, 2009. We sent supplemental questionnaires 
to Saha Thai on September 17, 2009 and December 9, 2009. We received 
timely responses to our supplemental questionnaires on October 6, 2009, 
October 19, 2009, January 5, 2010, and January 14, 2010.
    On November 25, 2009, we published a Federal Register notice 
extending the deadline for these preliminary results of review by 120 
days to March 31, 2010. See Circular Welded Carbon Steel Pipes and 
Tubes from Thailand: Extension of Time Limit for Preliminary Results of 
Antidumping Duty Administrative Review, 74 FR 61657 (November 25, 
2009). Subsequently the Department exercised its discretion to toll 
deadlines because of the closure of the Federal Government from 
February 5, 2010 through February 12, 2010. Thus, all deadlines in this 
segment of the proceeding were extended by seven days. See Memorandum 
to the Record from Ronald Lorentzen, DAS for Import Administration, 
regarding ``Tolling of Administrative Deadlines As a Result of the 
Government Closure During the Recent Snowstorm,'' dated February 12, 
2010. The revised deadline for the preliminary results of this review 
is April 7, 2010

Scope of the Order

    The products covered by this antidumping order are certain welded 
carbon steel pipes and tubes from Thailand. The subject merchandise has 
an outside diameter of 0.375 inches or more, but not exceeding 16 
inches. These products, which are commonly referred to in the industry 
as ``standard pipe'' or ``structural tubing'' are hereinafter 
designated as ``pipes and tubes.'' The merchandise is classifiable 
under the Harmonized Tariff Schedule of the United States (HTSUS) item 
numbers 7306.30.1000, 7306.30.5025, 7306.30.5032, 7306.30.5040, 
7306.30.5055, 7306.30.5085 and 7306.30.5090. Although the HTSUS 
subheadings are provided for the convenience and purposes of CBP, our 
written description of the scope is dispositive.

Partial Rescission of Review

    Section 351.213(d)(3) of the Department's regulations stipulates 
that the Secretary may rescind an administrative review of a producer 
if there were no entries, exports, or sales of the subject merchandise 
by that producer during the period covered by the review. Pacific Pipe, 
in a letter dated May 5, 2009, reported that it did not make any 
shipments or sales of subject merchandise for the last five months of 
the POR, from October 1, 2008 to February 28, 2009. The one shipment 
that Pacific Pipe did make during the first seven months of the POR, 
March 1, 2008 through September 30, 2008, was concurrently under review 
in a new shipper review. See New Shipper Review Final Results, 75 FR at 
4529-4530 (January 28, 2010). Allied Tube responded to Pacific Pipe's 
letter on May 8, 2009, by arguing that the Department's regulations and 
recent practice permit the rescission of the new shipper review and 
continuance of the administrative review. Allied Tube argued that the 
Department should follow its practice in Cut-to-Length Carbon Steel 
Plate from the People's Republic of China: Notice of Rescission of 
Antidumping Duty New Shipper Review, 74 FR 15930 (April 8, 2009), where 
the Department rescinded the new shipper review and continued the 
administrative review. On September 4, 2009, the Department issued a 
``No Shipment Inquiry'' to CBP and confirmed that there were no 
shipments or entries of circular welded carbon steel pipes and tubes 
from Thailand exported by Pacific Pipe from October 1, 2008 through 
February 28, 2009.
    Record evidence establishes that there were no entries of subject 
merchandise produced by Pacific Pipe from October 1, 2008 through 
February 29, 2009, the final five months of this POR. Further, the sale 
and entry made by Pacific Pipe during the period from March 1, 2008 
through September 30, 2008 was the subject of a new shipper review. See 
New Shipper Review Final Results, 75 FR at 4529-4530 (January 28, 
2010). Therefore, the Department is rescinding the administrative 
review with respect to Pacific Pipe pursuant to 19 CFR

[[Page 18790]]

351.213(d)(3). The Department will issue appropriate assessment 
instructions to CBP within 15 days of publication of this notice.

Analysis

Date of Sale

    Saha Thai reported contract date as the date of sale for U.S. 
sales. The Department considers invoice date to be the presumptive date 
of sale. See section 351.401(i)) of the Department's regulations. For 
purposes of this review, we examined whether invoice date or another 
date better represents the date on which the final material terms of 
sale were established. The Department examined sales documentation, 
including contracts and invoices, provided by Saha Thai for its U.S. 
sales and has preliminarily found that the material terms of sale are 
set on the contract date. Where there was a change in material terms 
for four sales subsequent to the original contract, Saha Thai issued an 
amended contract and the amended contract date was reported as date of 
sale.
    We preliminarily determine that contract date (or amended contract 
date) is the appropriate date of sale for U.S. sales in this 
administrative review because it better represents the date upon which 
the final material terms of sale were established. This is consistent 
with the most recently completed administrative reviews of this order. 
See Circular Welded Carbon Steel Pipes and Tubes from Thailand: Final 
Results of Antidumping Duty Administrative Review, 73 FR 61019 (October 
15, 2008) (2006-2007 AR Final Results); see Circular Welded Carbon 
Steel Pipes and Tubes from Thailand: Final Results of Antidumping Duty 
Administrative Review, 71 FR 54266 (September 14, 2006) (2004-2005 AR 
Final Results).
    In the home market, the date of invoice is when the material terms 
of sale are established. Therefore, we are using the invoice date as 
the date of sale for home market sales.

Export Price

    In accordance with section 772(a) of the Tariff Act of 1930, as 
amended (the Act), export price is the price at which the subject 
merchandise is first sold (or agreed to be sold) by the producer or 
exporter of subject merchandise outside of the United States to an 
unaffiliated purchaser prior to the date of importation. We classified 
all of Saha Thai's sales to its U.S. customers as EP sales because, as 
in previous administrative reviews of this order, we found that Saha 
Thai is not affiliated with its distributors, which are the first 
purchasers in the United States. See, e.g., 2006-2007 AR Final Results 
and 2004-2005 AR Final Results.
    In accordance with section 772(c)(2) of the Act, we made deductions 
from the gross unit price for foreign inland freight, foreign brokerage 
and handling, foreign inland insurance, foreign warehousing, ocean 
freight, lighterage charges, U.S. brokerage and handling charges, and 
U.S. duties.
    Section 772(c)(1)(B) of the Act states that EP should be increased 
by the amount of any import duties ``imposed by the country of 
exportation which have been rebated, or which have not been collected 
by reason, of the exportation of the subject merchandise to the United 
States. . . .'' Saha Thai claimed an adjustment to EP for the duties 
exempted on its imports of inputs (hot-rolled steel coil and zinc) into 
a bonded warehouse. In determining whether an adjustment should be made 
to EP for this exemption, we look for a reasonable link between the 
duties imposed and those rebated or exempted. We do not require that 
the imported input be traced directly from importation through 
exportation. We do require, however, that the company meet our ``two-
pronged'' test in order for this addition to be made to EP. The first 
element is that the import duty and its rebate or exemption be directly 
linked to, and dependent upon, one another; the second element is that 
the company must demonstrate that there were sufficient imports of the 
imported material to account for the duty drawback or exemption granted 
for the export of the manufactured product. See, e.g., 2006-2007 AR 
Final Results; see also Mittal Steel USA Inc. v. United States, 31 CIT 
1395, 1412-1413 (2007); and Rajinder Pipes Ltd. v. United States, 70 F. 
Supp. 2d 1350, 1358 (Ct. Intl. Trade, 1999).
    Saha Thai has provided information that demonstrates that it meets 
both prongs of our ``two-pronged'' test. Therefore, for these 
preliminary results, we are making an upward adjustment to export price 
for these duty exemptions. See ``Analysis Memorandum of Saha Thai Steel 
Pipe (Public) Company, Ltd. for the Preliminary Results of the 
Antidumping Duty Administrative Review of Circular Welded Carbon Steel 
Pipes and Tubes from Thailand for the Period 03/01/2008 through 02/28/
2009, dated concurrently with this notice, (Preliminary Analysis 
Memorandum); see also 2006-2007 AR Final Results.

Normal Value

A. Cost Averaging Methodology

    The Department's normal practice is to calculate an annual 
weighted-average cost for the POR. See, e.g., Certain Pasta from Italy: 
Final Results of Antidumping Duty Administrative Review, 65 FR 77852 
(December 13, 2000), and accompanying Issues and Decision Memorandum at 
Comment 18; and Notice of Final Results of Antidumping Duty 
Administrative Review of Carbon and Certain Alloy Steel Wire Rod from 
Canada, 71 FR 3822 (January 24, 2006), and accompanying Issues and 
Decision Memorandum at Comment 5 (explaining the Department's practice 
of computing a single weighted-average cost for the entire period). 
However, the Department recognizes that possible distortions may result 
if our normal annual average cost method is used during a period of 
significant cost changes. In determining whether to deviate from our 
normal methodology of calculating an annual weighted average cost, the 
Department evaluates the case-specific record evidence using two 
primary factors: (1) the change in the cost of manufacturing (COM) 
recognized by the respondent during the POR must be deemed significant; 
and (2) the record evidence must indicate that sales during the shorter 
averaging periods could be reasonably linked with the cost of 
production (COP) or constructed value (CV) during the same shorter 
averaging periods. See, e.g., Stainless Steel Sheet and Strip in Coils 
from Mexico; Final Results of Antidumping Duty Administrative Review 75 
FR 6631 (February 10, 2010) (SSSS from Mexico); see also Stainless 
Steel Plate in Coils From Belgium: Final Results of Antidumping Duty 
Administrative Review, 73 FR 75398 (December 11, 2008) and accompanying 
Issues and Decision Memorandum at Comment 4 (SSPC from Belgium).
1. Significance of Cost Changes
    In prior cases, the Department established 25 percent as the 
threshold (between the high and low quarter COM) for determining that 
the changes in COM are significant enough to warrant a departure from 
our standard annual costing approach. See SSPC from Belgium at Comment 
4. In the instant case, record evidence shows that Saha Thai 
experienced significant changes (i.e., changes that exceeded 25 
percent) between the high and low quarterly COM during the POR and that 
the change in COM is primarily attributable to the price volatility for 
hot-rolled coil, a major input consumed in the production of the carbon 
steel pipes and

[[Page 18791]]

tubes and used to produce the merchandise under consideration. See 
``Cost of Production and Constructed Value Calculation Adjustments for 
the Preliminary Results-Saha Thai Steel Pipe (Public) Company, Ltd.,'' 
dated concurrently with this notice (Preliminary Cost Calculation 
Memorandum). We found that hot-rolled coil prices changed significantly 
throughout the POR and consequently directly affected the cost of the 
material inputs consumed by Saha Thai. See Preliminary Cost Calculation 
Memo. Specifically, the record data shows that the percentage 
difference between the high and the low quarterly COM clearly exceeded 
the 25 percent threshold for four of five control numbers (CONNUMs) 
sold in the home market and all five CONNUMs sold in the United States 
during the POR. See Preliminary Cost Calculation Memo. As a result, we 
have determined for the preliminary results that the changes in Saha 
Thai's COM for hot-rolled coil are significant enough to warrant a 
departure from our standard cost approach, as these significant cost 
changes create distortions in the Department's sales-below-cost test, 
as well as in the overall margin calculation.
2. Linkage between Cost and Sales Information
    Consistent with past precedent, if the Department finds changes in 
costs to be significant in a given period of review, the Department 
subsequently evaluates whether there is evidence of linkage between the 
cost changes and the sales prices during the POR. The Department's 
definition of linkage does not require direct traceability between 
specific sales and their specific production costs, but rather relies 
on whether there are elements that would indicate a reasonable 
correlation between the underlying costs and the final sales prices 
levied by the company. See, SSPC from Belgium at Comment 4. These 
correlative elements may be measured and defined in a number of ways 
depending on the associated industry and the overall production and 
sales processes. The Department acknowledges that being able to 
reasonably link sales prices and costs during a shorter cost period is 
important in deciding whether to depart from our annual average cost 
methodology. We believe that requiring too strict a standard for 
linkage, however, would unreasonably preclude this remedy for 
commodity-type products where there is no pricing mechanism in place 
and it may be very difficult to precisely link production costs to 
specific sales. We requested that Saha Thai provide comparisons for its 
top five home market and its top five US CONNUMs over the twelve months 
of the POR. Saha Thai provided this information in its October 6, 2009 
and January 14, 2010 responses. To determine whether a reasonable 
correlation existed between the sales prices and their underlying costs 
during the POR, we compared weighted-average quarterly prices to the 
corresponding quarterly COM for the five highest-volume home market 
CONNUMs. After reviewing this information and determining that the 
sales and costs generally trend in the same direction, we preliminarily 
determine that there is linkage between Saha Thai's cost changes and 
sales prices during the POR. See Preliminary Cost Calculation Memo. 
See, e.g., SSSS from Mexico; see also SSPC from Belgium.
    Because we have found significant cost changes in COM as well as 
reasonable linkage between costs and sales prices, we have 
preliminarily determined that a quarterly costing approach would lead 
to more appropriate comparisons in our antidumping duty calculation for 
Saha Thai.

B. Home Market Viability

    In accordance with section 773(a)(1) of the Act, to determine 
whether there was sufficient volume of sales in the home market to 
serve as a viable basis for calculating NV, we compared Saha Thai's 
volume of home market sales of foreign like product to the volume of 
U.S. sales of subject merchandise. Pursuant to section 773(a)(1) of the 
Act and section 351.404(b) of the Department's regulations, because the 
volume of Saha Thai's home market sales of foreign like product was 
greater than five percent of the volume of U.S. sales of the subject 
merchandise during the POR, we determine that the home market is 
viable. Therefore, we used home market sales as the basis for NV in 
accordance with section 773(a)(1).

C. Affiliated Party Transactions and Arm's-Length Test

    The Department's practice with respect to the use of home market 
sales to affiliated parties for NV is to determine whether such sales 
are at arm's-length prices. To examine whether home market sales were 
made at arm's length, we compared the starting price of sales to 
affiliated customers to the starting price of sales to unaffiliated 
customers, net of all movement charges, direct selling expenses, 
discounts and packing. We made this comparison on a quarterly basis 
consistent with our preliminary decision to use a quarterly costing 
approach. Where the price to the affiliated party was, on average, 
within a range of 98 to 102 percent of the same or comparable 
merchandise to the unaffiliated parties, we determined that the sales 
made to the affiliated parties were at arm's length. See Antidumping 
Proceedings: Affiliated Party Sales in the Ordinary Course of Trade, 67 
FR 69186 (November 15, 2002). In accordance with the Department's 
practice, in our margin analysis, we included only those sales to 
affiliated parties that were made at arm's length. Where the affiliated 
party transactions did not pass the arm's-length test, these sales were 
excluded from the NV calculation.
    For each affiliated reseller, we requested Saha Thai to report the 
first sale to an unaffiliated customer. When the sale to the affiliated 
reseller did not pass the arm's-length test and was therefore excluded 
from the normal value calculation, we included the sale by the 
affiliated reseller to the first unaffiliated customer in our margin 
analysis.

D. COP Analysis

    We found that Saha Thai made sales below the COP in the most 
recently completed segment of this proceeding in which Saha Thai was 
examined, and such sales were disregarded. Thus, in accordance with 
section 773(b)(2)(A)(ii) of the Act, there are reasonable grounds to 
believe or suspect that Saha Thai made sales of the subject merchandise 
in its comparison market at prices below the COP in the current review 
period. Pursuant to section 773(b)(1) of the Act, we initiated a COP 
investigation of sales by Saha Thai. For our complete analysis, see 
Preliminary Cost Calculation Memo.
1. Calculation of Cost of Production
    In accordance with section 773(b)(3) of the Act, we calculated Saha 
Thai's COP based on the sum of its costs of materials and conversion 
for foreign like product, plus an amount for home market SG&A expenses, 
interest expenses and packing costs.  See the ``Test of Comparison 
Market Sales Prices'' section below for the treatment of comparison 
market selling expenses. We relied on home market sales and COP 
information provided by Saha Thai in its questionnaire responses, 
except where noted below:
    a. We have adjusted Saha Thai's cost of carbon steel hot-rolled 
coils obtained from an affiliated supplier to reflect the higher of 
transfer or market price in accordance with section 773(f)(2) of the

[[Page 18792]]

Act (transactions disregarded). Because we have determined that 
quarterly average costs are appropriate for the COP analysis, we have 
applied the transactions disregarded analysis and calculated the 
related adjustments on a quarterly basis.
    b. We revised Saha Thai's general and administrative (G&A) expenses 
to reflect a rate calculated on non-consolidated producer-specific 
financial statements, rather than the consolidated financial 
statements.
    c. We adjusted the cost of goods sold denominators used in the G&A 
and financial expense rates to reflect transactions disregarded 
adjustments and to include the cost of services.
    d. We revised Saha Thai's reported duty exemptions on hot-rolled 
coil and zinc inputs to apply the adjustments as a ratio of the 
exempted duty amounts to total purchases of the respective input.
    For more detail on these adjustments, refer to Preliminary Cost 
Calculation Memorandum.

E. Cost Test

    In accordance with section 773(b) of the Act, we compared the 
quarterly COP to the home market sales price (less any applicable 
movement charges and discounts) by quarter, of the foreign like product 
on a product-specific basis in order to determine whether home market 
sales had been made at prices below COP.
    In determining whether to disregard sales below COP, we examined, 
in accordance with sections 773(b)(1)(A) and whether such sales were 
made in substantial quantities, and whether such sales were made at 
prices which permitted the recovery of all costs within a reasonable 
period of time in the normal course of trade. As noted in section 
773(b)(1)(D) of the Act, prices are considered to provide for recovery 
of costs if such prices are above the weighted average per-unit COP for 
the period of investigation or review. In the instant case, we have 
relied on a quarterly costing approach. Similar to that used by the 
Department in cases of high-inflation (see, e.g., Notice of Final 
Determination of Sales at Less Than Fair Value: Certain Cut-to-Length 
Carbon-Quality Steel Plate Products from Indonesia, 64 FR 73164 
(December 29, 1999) at Comment (1), this methodology restates the 
quarterly material costs on a year-end equivalent basis, calculates an 
annual weighted-average cost for the POR and then restates it to each 
respective quarter. We find that this quarterly costing method meets 
the requirements of section 773(b)(2)(D) of the Act.
    Where less than 20 percent of the respondent's home market sales of 
a given model were at prices below the COP, we did not disregard any 
below-cost sales of that model because we determined that the below-
cost sales were not made within an extended period of time and in 
``substantial quantities.'' Where 20 percent or more of the 
respondent's home market sales of a given model were at prices less 
than the COP, we disregarded the below-cost sales because: (1) they 
were made within an extended period of time in ``substantial 
quantities,'' in accordance with sections 773(b)(2)(B) and (C) of the 
Act; and (2) based on our comparison of prices to the indexed weighted-
average COPs for the POR, they were at prices which would not permit 
the recovery of all costs within a reasonable period of time, in 
accordance with section 773(b)(2)(D) of the Act.
    Our cost test for Saha Thai revealed that, for home market sales of 
certain models, less than 20 percent of the sales of those models were 
at prices below the COP. Therefore, we retained all such sales in our 
analysis and used them as the basis for determining NV. Our cost test 
also indicated that for home market sales of other models, more than 20 
percent were sold at prices below the COP within an extended period of 
time and were at prices which would not permit the recovery of all 
costs within a reasonable period of time. Thus, in accordance with 
section 773(b)(1) of the Act, we excluded these below-cost sales from 
our analysis and used the remaining above-cost sales as the basis for 
determining NV.

F. Home Market Price

    To calculate Saha Thai's home market net price, we deducted 
discounts and movement expenses, which included inland freight and 
warehousing where appropriate. Pursuant to section 773(a)(6)(C)(iii) of 
the Act and section 351.410(c) of the Department's regulations, we made 
a circumstance of sale adjustment for home market and U.S. credit 
expenses, as well as U.S. bank charges. In addition, pursuant to 
section 773(a)(6)(A) of the Act, we deducted home market packing costs 
and added U.S. packing costs. In addition, where applicable, we made 
adjustments for differences in costs attributable to physical 
characteristics pursuant to section 773(a)(6)(C)(ii) of the Act and 
section 351.410 of the Department's regulations.

Level of Trade

    Pursuant to section 773(a)(1)(B)(i) of the Act, to the extent 
practicable, NV is normally the price in the home market that is at the 
same level of trade (LOT) as the EP. The NV LOT is that of the 
starting-price sale in the comparison market, or when NV is based on 
CV, that of the sales from which we derive SG&A and profit. For EP, the 
U.S. LOT is the level of the starting-price sale, which is usually from 
exporter to importer. To determine whether NV sales are at a different 
LOT than EP sales, we examine stages in the marketing and selling 
functions along the chain of distribution between the producer and 
unaffiliated customer. If the comparison market sales are at a 
different LOT, and the difference affects the price comparability, as 
manifested in a pattern of consistent price differences between sales 
at different levels of trade in the country in which NV is determined, 
we make an LOT adjustment under section 773(a)(7)(A) of the Act and 
under section 351.410(c) of the Department's regulations. See, e.g., 
Notice of Final Determination of Sales at Less Than Fair Value: Certain 
Cut-to-Length Carbon Steel Plate from South Africa, 62 FR 61731 
(November 19, 1997).
    For the U.S. market, Saha Thai reported only one LOT for its EP 
sales. For its home market sales, Saha Thai reported that its sales to 
unaffiliated customers were at the same level of trade as its U.S. 
sales. However, Saha Thai reported that, if the Department used the 
downstream sales of any of its affiliated resellers, these sales were 
made at a distinct level of trade, and Saha Thai's home market would 
consist of two levels of trade.
    For Saha Thai's sales made through affiliated resellers, we 
consider the relevant functions to be the selling functions of both the 
producer and the reseller (i.e., the cumulative selling functions along 
the chain of distribution) for purposes of comparing the selling 
activities related to each affiliate's sale with those related to the 
producer's sale to its unaffiliated customers. If the reseller performs 
selling functions that add substantial selling activity in making the 
sale, we may find that sales by the reseller are made at a different 
LOT than the sales made by the producer.
    Saha Thai provided information about the marketing and selling 
functions performed by the affiliated resellers for its sales to 
unaffiliated customers. This information is sufficient to conduct an 
analysis of whether Saha Thai's sales in the home market were made at 
more than one LOT. For those affiliated resellers whose sales did not 
pass the arm's length test, we have analyzed the information that Saha 
Thai provided regarding the marketing and selling

[[Page 18793]]

functions for both Saha Thai and the affiliated resellers. We examined 
the information reported by Saha Thai and its affiliated resellers with 
respect to the selling and marketing functions, the freight functions, 
technical services/warranties functions, and inventory management 
functions of Saha Thai and its resellers. We examined the selling 
functions and the level of intensity at which Saha Thai performs those 
selling functions, as described in the narrative response and Exhibit 9 
of Saha Thai's July 13, 2009 questionnaire response and Exhibit 8 of 
Saha Thai's October 19, 2009 supplemental questionnaire response. 
Information about the specific selling functions we examined, the 
intensity at which Saha Thai and its affiliated resellers performed 
them, and our analysis is business proprietary, and is detailed in the 
``Level of Trade'' section in the Preliminary Analysis Memorandum.
    Based on the facts and our analysis, we have concluded that Saha 
Thai's home market sales were made at two distinct levels of trade: 
sales directly from Saha Thai to its unaffiliated customers and sales 
from Saha Thai through its affiliated resellers to unaffiliated 
customers. See ``Level of Trade'' section in the Preliminary Analysis 
Memorandum; see also 2006-2007 AR Final Results.
    Saha Thai reported that its U.S. sales are made at only one level 
of trade, to unaffiliated resellers in the United States. For the U.S. 
market, we also examined the information reported by Saha Thai with 
respect to the selling and marketing functions, the freight functions, 
technical services/warranties functions, and inventory management 
functions performed by Saha Thai for sales to its unaffiliated 
resellers. We examined the selling functions and the level of intensity 
at which Saha Thai performs these selling functions as described in its 
narrative response and Exhibit 9 of Saha Thai's July 13, 2009 Section 
questionnaire response and Exhibit 8 of Saha Thai's October 19, 2009 
supplemental questionnaire response. Information about the specific 
selling functions we examined, the intensity at which Saha Thai 
performs those selling functions for its U.S. sales (to unaffiliated 
resellers) and our analyses is business proprietary, and is detailed in 
the ``Level of Trade'' section in the Preliminary Analysis Memorandum.
    Based on the facts and our analyses, we preliminarily determine 
that all U.S. sales are made at one LOT. Furthermore, we find that the 
U.S. sales are at the same LOT as Saha Thai's home market sales to 
unaffiliated customers. For our complete analysis, see ``Level of 
Trade'' section in the Preliminary Analysis Memorandum; see also 2006-
2007 AR Final Results.
    While we have preliminarily determined that there are two distinct 
levels of trade in the home market (LOT 1 and LOT 2) and that the LOT 
in the U.S. market matches LOT 1 in the home market, we must consider 
whether an LOT adjustment is warranted for those U.S. sales for which 
there is not a match in the home market at LOT 1. In accordance with 
section 773(a)(7)(A)(ii) of the Act, such an adjustment is warranted 
when the difference in LOT is demonstrated to affect price 
comparability, based on a pattern of consistent price differences, on 
both a CONNUM and a quantity basis, between sales at different levels 
of trade in the home market (the basis for NV). However, our decision 
to apply the quarterly cost methodology and to perform quarterly price-
to-price comparisons, raises a novel issue with respect to the LOT 
analysis of pattern of price differences and any possible LOT 
adjustment based on that analysis. Therefore, we request parties 
comment on whether the application of the quarterly cost methodology 
necessarily requires an evaluation on a quarterly basis of the pattern 
of price differences and how any such differences should be analyzed 
for purposes of determining whether there is a pattern of price 
differences. In addition, we invite parties to comment on whether, if a 
pattern of price differences is found to exist, any LOT adjustment 
should be done on a yearly basis or on a quarterly basis. These 
comments should be submitted no later than ten days from the date of 
publication of this notice in the Federal Register.

Currency Conversion

    We made currency conversions pursuant to section 351.415 of the 
Department's regulations based on rates certified by the Federal 
Reserve.

Preliminary Results of Review

------------------------------------------------------------------------
                                                                Margin
                    Manufacturer/Exporter                      (percent)
------------------------------------------------------------------------
Saha Thai Steel Pipe (Public) Company, Ltd..................        4.35
------------------------------------------------------------------------

Assessment

    The Department shall determine, and CBP shall assess, antidumping 
duties on all appropriate entries in accordance with section 351.212 of 
the Department's regulations. The Department intends to issue 
assessment instructions for Saha Thai directly to CBP 15 days after the 
date of publication of the final results of this administrative review.
    The Department clarified its ``automatic assessment'' regulation on 
May 6, 2003 (68 FR 23954). This clarification will apply to entries of 
subject merchandise during the POR produced by companies included in 
these final results of review for which the reviewed companies did not 
know their merchandise was destined for the United States. In such 
instances, we will instruct CBP to liquidate unreviewed entries at the 
all-others rate if there is no rate for any intermediate company 
involved in the transaction. For a full discussion of this 
clarification, Antidumping and Countervailing Duty Proceedings: 
Assessment of Antidumping Duties, 68 FR 239254 (May 6, 2003).

Cash Deposit Requirements

    The following cash deposit rates will be effective with respect to 
all shipments of subject merchandise entered, or withdrawn from 
warehouse for consumption, on or after the publication date of the 
final results, as provided for by section 751(a)(1) of the Act: (1) for 
Saha Thai, the cash deposit rate will be the rate established in the 
final results of this review; (2) for previously reviewed or 
investigated companies not listed above, the cash deposit rate will be 
the company-specific rate established for the most recent period; (3) 
if the exporter is not a firm covered in this review, a prior review, 
or the LTFV investigation, but the manufacturer is, the cash deposit 
rate will be the rate established for the most recent period for the 
manufacturer of the subject merchandise; and (4) if neither the 
exporter nor the manufacturer of the subject merchandise is a firm 
covered by this review, a prior review, or the LTFV investigation, the 
cash deposit rate shall be the ``all other'' rate established in the 
LTFV investigated, which is 15.67 percent. These deposit rates, when 
imposed, shall remain in effect until publication of the final results 
of the next administrative review.

Public Comment

    Pursuant to section 351.224(b) of the Department's regulations, the 
Department will disclose to parties to the proceeding any calculations 
performed in connection with these preliminary results within five days 
after the date of publication of this notice. Pursuant to section 
351.309 of the Department's regulations, interested parties may submit 
written comments in response to those preliminary results.

[[Page 18794]]

Unless extended by the Department, case briefs are to be submitted 
within 30 days after the date of publication of this notice, and 
rebuttal briefs, limited to arguments raised in case briefs, are to be 
submitted no later than five days after the time limit for filing case 
briefs. Parties who submit arguments in this proceeding are requested 
to submit with the argument: (1) statement of the issues; and (2) a 
brief summary of the argument. Case and rebuttal briefs must be served 
on interested parties in accordance with section 351.303(f) of the 
Department's regulations.
    Also, pursuant to section 351.310(c) of the Department's 
regulations, within 30 days of the date of publication of this notice, 
interested parties may request a public hearing on arguments raised in 
the case and rebuttal briefs. Unless the Secretary specifies otherwise, 
the hearing, if requested, will be held two days after the date for 
submission of rebuttal briefs. Parties will be notified of the time and 
location.
    The Department will publish the final results of the administrative 
review, including the results of its analysis of issues raised in any 
case or rebuttal brief, no later than 120 days after publication of the 
preliminary results, unless extended. See section 351.213(h) of the 
Department's regulations.

Notification to Importers

    This notice serves as a preliminary reminder to importers of their 
responsibility under section 351.402(f) of the Department's regulations 
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.
    This administrative review and notice are issued and published in 
accordance with sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: April 7, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 2010-8420 Filed 4-12-10; 8:45 am]
BILLING CODE 3510-DS-S