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Certain Forged Stainless Steel Flanges from India: Preliminary Results of New Shipper Review

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Import Administration, International Trade Administration, Department of Commerce.


Notice of preliminary results of new shipper review: certain forged stainless steel flanges from India.


The Department of Commerce (the Department) is conducting a new shipper review of the antidumping duty order on certain forged stainless steel flanges from India in response to a request by an Indian exporter of subject merchandise, Snowdrop Trading PVT LTD (Snowdrop). As indicated in the Department's initiation of this review (65 FR 17485), the review covers sales of the subject merchandise to the United States during the period of review (POR), February 1, 1999 through February 29, 2000.

We have preliminarily determined that Snowdrop made sales below normal value (NV). If these preliminary results are adopted in our final results, we will instruct the U.S. Customs Service not to assess antidumping duties on entries subject to this review.

Interested parties are invited to comment on these preliminary results, and are requested to submit with the argument: (1) A statement of the issue; and (2) a brief summary of the argument.


January 31, 2001.

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Thomas Killiam or Robert James, Office 8, AD/CVD Enforcement Group III, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230, telephone: (202) 482-5222 or (202) 482-0649, respectively.

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Applicable Statute and Regulations

Unless otherwise indicated, all citations to the Tariff Act of 1930, as amended (the Tariff Act), are references to the provisions effective January 1, 1995, the effective date of the amendments made to the Tariff Act by the Uruguay Round Agreements Act. In addition, unless otherwise indicated, all references to the Department's regulations are to 19 CFR part 351 (1999).


The Department published an antidumping duty order on certain forged stainless steel flanges from India on February 9, 1994 (59 FR 5994). Having received a timely request for a new shipper review from Snowdrop, the Department initiated this review on March 28, 2000 (65 FR 17485 (April 3, 2000)), in accordance with section 751(a)(2)(B) of the Tariff Act and section 351.214(b) of the Department's regulations. Snowdrop provided responses to the Department's questionnaires on April 24, 2000 (Section A), May 15, 2000 (Sections B and C), and August 28, 2000 (supplemental). The Department's analysis of Snowdrop's data is presented in a Memorandum from Thomas Killiam to the file, dated January 19, 2001 (Analysis Memorandum).

Scope of Review

The products under review are certain forged stainless steel flanges both Start Printed Page 8381finished and not-finished, generally manufactured to specification ASTM A-182, and made in alloys such as 304, 304L, 316, and 316L. The scope includes five general types of flanges. They are weld neck, used for butt-weld line connections, threaded, used for threaded line connections, slip-on and lap joint, used with stub-ends/butt-weld line connections, socket weld, used to fit pipe into a machined recession, and blind, used to seal off a line. The sizes of the flanges within the scope range generally from one to six inches; however, all sizes of the above-described merchandise are included in the scope. Specifically excluded from the scope of this order are cast stainless steel flanges. Cast stainless steel flanges generally are manufactured to specification ASTM A-351. The flanges subject to this order are currently classifiable under subheadings 7307.21.1000 and 7307.21.5000 of the Harmonized Tariff Schedule of the United States (HTS). Although the HTS subheadings are provided for convenience and customs purposes, the written description of the scope of this order remains dispositive.


On November 28, 2000, the Department visited Snowdrop's headquarters in Bandra West, Mumbai, India, and conducted a verification of its questionnaire responses. Our findings are discussed in a January 19, 2001 memorandum from Thomas Killiam to the file, subject “Sales Verification of Snowdrop Trading PVT. LTD.—Stainless Steel Flanges from India.”

Home Market Viability

In its April 24, 2000 submission, Snowdrop indicated that it had made no sales of certain forged stainless steel flanges (flanges) in the home market during the POR, and submitted sales to Canada as the comparison, or third country, market. In order to determine whether there is a sufficient volume of sales in the comparison market to serve as a viable basis for calculating normal value (NV), we compared Snowdrop's volume (by weight) of third country market sales of the foreign like product to the volume (by weight) of U.S. sales of the subject merchandise, in accordance with section 773(a)(1)(C) of the Tariff Act. Because Snowdrop's aggregate volume of Canadian sales of the foreign like product was greater than five percent of its aggregate volume of U.S. sales for the subject merchandise, we determined that the Canadian market was viable for Snowdrop. The record of this review does not indicate that there was another viable third country market, so we used the Canadian market sales as a basis for NV.

Product Comparisons

Because Snowdrop made a contemporaneous sale to the Canadian market of merchandise that we matched to the merchandise which Snowdrop sold in the U.S. market, and there were no differences in the reported variable cost of manufacturing (based on Snowdrop's reported cost of acquisition), it was not necessary to make any adjustments for physical differences in the merchandise as called for by section 773(a)(6)(C)(ii) of the Tariff Act.

Normal Value Comparisons

To determine whether Snowdrop's sales of flanges to the United States were made at less than NV, we compared export price (EP) to the NV, as described in the “U.S. Price” and “Normal Value” sections of the notice, below. Because there were only single instances of sales of particular models in the comparison market, it was not appropriate to calculate weighted average NVs; instead, we compared the EP of the U.S. sale to the NV of the most similar merchandise sold in the third country contemporaneously.

Level of Trade

In accordance with section 773(a)(1)(B) of the Tariff Act, to the extent practicable, we determine NV based on sales in the comparison market at the same level of trade (LOT) as the EP or constructed EP (CEP) transaction. The LOT in the comparison market is that of the starting-price sales in the comparison market or, when NV is based on constructed value (CV), that of the sales from which we derive selling, general and administrative (SG&A) expenses and profit. With respect to U.S. price for EP transactions, the LOT is also the level of the starting-price sale, which is usually from the exporter to the importer. For CEP, the LOT is the level of the constructed sale from the exporter to the importer.

To determine whether NV sales are at a different LOT than EP or CEP, we examine stages in the marketing process and selling functions along the chain of distribution between the producer and the unaffiliated customer. If the comparison-market sales are at a different LOT and the difference affects price comparability, as manifested in a pattern of consistent price differences between the sales on which NV is based and third country market sales at the LOT of the export transaction, we make a LOT adjustment under section 773(a)(7)(A) of the Tariff Act. See Notice of Final Determination of Sales at Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate from South Africa, 62 FR 61731 (November 19, 1997).

Snowdrop reported one customer category and one channel of distribution (i.e., sales to unaffiliated distributors) for its third country market sales. Snowdrop reported EP sales in the U.S. market. For EP sales, Snowdrop also reported one customer category and one channel of distribution (i.e., direct sales to importer distributors). Snowdrop stated in its response that its EP sales were made at the same LOT as third country market sales to unaffiliated importer distributors, and did not request a LOT adjustment. We have determined that there is one LOT for all EP sales and that it is the same LOT as that in the third country market. Accordingly, because we find the U.S. sales and third country market sales to be at the same LOT, no LOT adjustment under section 773(a)(7)(A) is warranted.

United States Price

Snowdrop reported as EP transactions sales of subject merchandise to unaffiliated U.S. customers prior to importation. We calculated EP in accordance with section 772(a) of the Tariff Act, because CEP methodology was not indicated by other facts on the record. We based EP on the price to the unaffiliated foreign purchaser. We made deductions from the starting price for movement expenses, in accordance with section 772(c)(2)(A) of the Tariff Act. See the Analysis Memorandum.

We have asked Snowdrop to clarify several remaining uncertainties in regards to the U.S. transaction. We may incorporate additional information in the final results.

Normal Value

We calculated NV based on C&F prices to unaffiliated customers, and made adjustments under section 773(a)(6)(C)(iii) of the Tariff Act for differences in circumstances of sale for imputed credit expenses. We deducted movement expenses and bank charges from NV, in accordance with sections 773(a)(6)(A) and (B) of the Tariff Act. Snowdrop reported that it incurred no packing costs per se, because packing costs were included in the prices which Snowdrop's suppliers' charged it. We added U.S. credit expense and deducted third country credit expense. See the Analysis Memorandum.

Currency Conversion

Pursuant to section 773A(a) of the Tariff Act, we made currency conversions into U.S. dollars based on the exchange rates in effect on the dates Start Printed Page 8382of the U.S. sales as certified by the Federal Reserve Bank of New York.

Preliminary Results

As a result of this review, we preliminarily determine that for the period February 1, 1999 through February 29, 2000, the weighted-average dumping margin for Snowdrop is 24.79 percent.

In accordance with section 351.224(b) of our regulations, we will disclose to the relevant parties the calculations performed for these preliminary results. An interested party may request a hearing within thirty days of publication of this notice. See 19 CFR 351.310(c). Any hearing, if requested, will be held 37 days after the date of publication of this notice, or the first working day thereafter. Interested parties may submit case briefs within 30 days of publication of this notice. Rebuttal briefs, which must be limited to issues raised in the case briefs, may be filed no later than 35 days after the date of publication of this notice. In accordance with 351.214(i)(1) of our regulations, the Department will issue the final results of this new shipper review, which will include the results of its analysis of issues raised in the briefs, within 90 days of issuance of these preliminary results, unless the time limit is extended.

Upon completion of this new shipper review, the Department shall determine, and the Customs Service shall assess, antidumping duties on all appropriate entries. The Department will issue appraisement instructions directly to Customs. Snowdrop did not report entered value; we will calculate Snowdrop's duty assessment rate based on the ratio of the total amount of antidumping duties calculated for the examined sales, calculated as the difference between NV and EP, to the total quantity of examined sales. The rate will be assessed uniformly on all entries made during the POR. The Department will issue appraisement instructions directly to Customs.

Furthermore, the following deposit requirements will be effective upon completion of the final results of this new shipper review for all shipments of flanges from India entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of this new shipper review, as provided by section 751(a)(1) of the Tariff Act: (1) The cash deposit rate for Snowdrop will be the rate established in the final results of this new shipper review; (2) for merchandise exported by manufacturers or exporters not covered in this review but covered in the original less-than-fair-value (LTFV) investigation or a previous 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, or the original 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) if neither the exporter nor the manufacturer is a firm covered in this or any previous review, the cash deposit rate will be 162.14 percent, the “all-others” rate established in the less-than-fair-value investigation.

These deposit requirements, when imposed, shall remain in effect until publication of the final results of the next administrative or new shipper review for a subsequent review period.

This notice also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.

This new shipper review and notice are in accordance with sections 751(a)(1) and 777(i)(1) of the Tariff Act.

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Dated: January 22, 2001.

Bernard T. Carreau,

Acting Assistant Secretary for Import Administration.

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[FR Doc. 01-2681 Filed 1-30-01; 8:45 am]