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Notice

Circular Welded Non-Alloy Steel Pipe from the Republic of Korea; Final Results of Antidumping Administrative Review

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AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of final results of antidumping duty administrative review of circular welded non-alloy steel pipe from the Republic of Korea.

SUMMARY:

The Department of Commerce has conducted an administrative review of the antidumping duty order on circular welded non-alloy steel pipe from the Republic of Korea. This review covers imports of subject merchandise from three producers/exporters. We have determined that sales have been made below normal value during the review period of November 1, 1998, through October 31, 1999.

Based on our review of comments received, we have made certain changes in the margin calculation for all of the reviewed companies. Consequently, the final results differ from the preliminary results. The final weighted-average dumping margins for these firms are listed below in the section entitled “Final Results of the Review.” Based on these final results of review, we will instruct the Customs Service to assess antidumping duties based on the difference between the export price and normal value on all appropriate entries.

EFFECTIVE DATE:

April 11, 2001.

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FOR FURTHER INFORMATION CONTACT:

Gregory Campbell or Suresh Maniam, Import Administration, International Trade Administration, U.S. Department of Commerce, Washington, DC 20230; telephone: (202) 482-2239 or 482-0176, respectively.

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SUPPLEMENTARY INFORMATION:

The Applicable Statute

Unless otherwise indicated, all citations to the Tariff Act of 1930, as amended (the “Act”), are references to the provisions effective January 1, 1995, the effective date of the amendments made to the Act by the Uruguay Round Agreements Act (“URAA”). In addition, unless otherwise indicated, all citations to the Department of Commerce's (“Department's”) regulations are to 19 CFR Part 351 (2000).

Background

The period of review (“POR”) is November 1, 1998, through October 31, 1999. This review covers the following exporters (referred to collectively as “the respondents”): Hyundai Pipe Co., Ltd. (“HDP”),[1] SeAH Steel Corporation (“SeAH”) and Shinho Steel Co., Ltd. (“Shinho”).

On December 6, 2000, the Department published Circular Welded Non-Alloy Steel Pipe from the Republic of Korea; Preliminary Results and Rescission in Part of Antidumping Administrative Review, 65 FR 73218 (December 6, 2000) (“Preliminary Results”), and invited parties to comment on our Preliminary Results. The domestic interested parties, Allied Tube and Conduit Corp. and Wheatland Tube Co., and the respondents submitted case briefs on January 19, 2001, and rebuttal briefs on January 26, 2001. At the request of certain interested parties, we held a public hearing on March 1, 2001.

The Department has conducted this administrative review in accordance with section 751 of the Act.

Scope of Review

The merchandise subject to this review is circular welded non-alloy steel pipe and tube, of circular cross-section, not more than 406.4mm (16 inches) in outside diameter, regardless of wall thickness, surface finish (black, galvanized, or painted), or end finish (plain end, beveled end, threaded, or threaded and coupled). These pipes and tubes are generally known as standard pipes and tubes, and are intended for the low-pressure conveyance of water, steam, natural gas, air, and other liquids and gases in plumbing and heating systems, air-conditioning units, automatic sprinkler systems, and other related uses. Standard pipe may also be used for light load-bearing applications, such as for fence tubing, and as structural pipe tubing used for framing and as support members for reconstruction or load-bearing purposes in the construction, shipbuilding, trucking, farm equipment, and other related industries. Unfinished conduit pipe is also included in this order.

All carbon-steel pipes and tubes within the physical description outlined above are included within the scope of this review except line pipe, oil-country tubular goods, boiler tubing, mechanical tubing, pipe and tube hollows for redraws, finished scaffolding, and finished conduit. In accordance with the Department's Final Negative Determination of Scope Inquiry on Certain Circular Welded Non-Alloy Steel Pipe and Tube from Brazil, the Republic of Korea, Mexico, and Venezuela (61 FR 11608, March 21, 1996), pipe certified to the API 5L line-pipe specification and pipe certified to both the API 5L line-pipe specifications and the less-stringent ASTM A-53 standard-pipe specifications, which falls within the physical parameters as outlined above, and entered as line pipe of a kind used for oil and gas pipelines is outside of the scope of the antidumping duty order.

Imports of these products are currently classifiable under the following Harmonized Tariff Schedule of the United States (HTSUS) subheadings: 7306.30.10.00, 7306.30.50.25, 7306.30.50.32, 7306.30.50.40, 7306.30.50.55, 7306.30.50.85, and 7306.30.50.90. Although the HTSUS subheadings are provided for convenience and customs, the written description of the scope of this proceeding is dispositive.

Product Comparisons

We compared the products sold by the respondents in the comparison market to sales that entered the United States during the POR using the methodology described in the Preliminary Results, with the following exception:

At the Preliminary Results, we included specification as a matching criterion for determining similar products for Shinho and SeAH. Consistent with our methodology in prior reviews, and in light of the lack of evidence that specification captures important differences in physical characteristics not reflected in other matching criteria, we have revised Shinho's and SeAH's margin calculations by removing specification as one of the matching criteria for similar matches. We note that HDP's Start Printed Page 18748preliminary margin calculation did not include specification as a criterion in determining similar matches and, therefore, we have made no changes to HDP's program in this regard. See Comment 1 of the accompanying Memorandum to Bernard T. Carreau, from Richard W. Moreland, “Issues and Decision Memo” (April 5, 2001) (“Decision Memo”).

Furthermore, with respect to HDP, for the final results we have re-coded the end-finish matching criterion. See Comment 8 of the accompanying Decision Memorandum.

Fair Value Comparisons

To determine whether sales of standard pipe from the ROK were made in the United States at less than fair value, we compared the export price (“EP”) or constructed export price (“CEP”) to normal value (“NV”), as described in the “Export Price and Constructed Export Price” and “Normal Value” sections below. Our calculations followed the methodologies described in the Preliminary Results with the following exception:

For the final results we have expanded our window for potential contemporaneous home market sales to include all home market sales that were made within the period three months prior to the sale date of the earliest reported U.S. sale through two months subsequent to the sale date of the last reported U.S. sale. See Comment 3 of the accompanying Decision Memorandum.

Export Price and Constructed Export Price

For sales to the United States, we used, as appropriate, EP or CEP in accordance with sections 772(a) and 772(b) of the Act determined by the methodology described in the Preliminary Results, with the following exception: we reviewed sales of merchandise entered during the POR rather than POR sales. See Comment 2 of the Decision Memorandum.

Normal Value

A. Selection of Comparison Markets

HDP and SeAH reported sales in the home market of “overrun” merchandise (i.e., sales of pipe that exceeded the amount ordered by customers due to overproduction). HDP and SeAH claimed that we should disregard “overrun” sales in the home market because these sales are outside the ordinary course of trade. Based on our analysis of these sales, we found overrun sales to be outside the ordinary course of trade. See Comment 5 of the accompanying Decision Memorandum.

B. Arm's-Length Test

Since the Preliminary Results, the Department revised the arm's-length test for sales to SeAH's affiliate, Haiduk Steel Industrial Co., Ltd. Specifically, we collapsed nine distinct customer codes into one customer code for purposes of the arm's-length test. We consider these nine customer codes to represent a single customer, HSI, for purposes of the arm's-length test. We have made the appropriate changes in the margin calculations for SeAH. See Comment 12 of the accompanying Decision Memorandum.

Additionally, we stated in the Preliminary Results that we intended to perform an arm's-length test for HDP's home market sales. This test was inadvertently omitted from the calculation program. For the final results we have corrected the calculation program accordingly.

C. Cost of Production Analysis

We used the same methodology in performing the COP analysis as in the Preliminary Results with the following exceptions:

We have added packing expenses to the reported COM for SeAH and Shinho, and recalculated G & A and interest expenses. See Comment 4 of the accompanying Decision Memorandum.

We disallowed certain non-production-related income offsets to Shinho's G & A costs. Moreover, because we disallowed these income items, we also excluded the corresponding expenses. See Comment 11 of the accompanying Decision Memorandum.

D. Level of Trade (LOT)

Section 773(a)(1)(B)(i) of the Act states that, to the extent practicable, the Department will calculate NV based on sales at the same LOT as the EP or CEP. When the Department is unable to find sales of the foreign like product in the comparison market at the same LOT as the EP or CEP, the Department may compare the U.S. sale to sales at a different LOT in the comparison market.

Sales are made at different levels of trade if they are made at different marketing stages (or their equivalent). 19 CFR 412(c)(2). Substantial differences in selling activities are a necessary, but not sufficient, condition for determining that there is a difference in the stages of marketing. Id.; see also Notice of Final Determination of Sales at Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate From South Africa, 62 FR 61731, 61732 (November 19, 1997). Pursuant to section 773(a)(1)(B)(i) of the Act, in identifying levels of trade for EP and home market sales, we consider the selling functions reflected in the starting prices before any adjustments. For CEP sales, we consider only the selling activities reflected in the price after the deduction of expenses and profit under section 772(d) of the Act. See Micron Technology, Inc. v. United States, Court Nos. 00-1058, -1060 (Fed. Cir. March 7, 2001). We expect that, if claimed levels of trade are the same, the functions and activities of the seller should be similar. Conversely, if a party claims that levels of trade are different for different groups of sales, the functions and activities of the seller should be dissimilar.

When CEP sales have been made in the United States, section 773(a)(7)(B) of the Act and 19 CFR 351.412(f) allow for a CEP offset under two conditions: (1) NV is established at a LOT that is at a more advanced stage of distribution than the LOT of the CEP; and (2) the data available do not permit a determination that there is a pattern of consistent price differences between sales at different LOTs in the comparison market.

We obtained information from each respondent regarding the marketing stages involved in making the reported home market and U.S. sales, including a description of the selling activities performed by the respondents for each channel of distribution. For a detailed description of our LOT methodology and a summary of company-specific LOT findings for these final results, see Memorandum to Susan Kuhbach, “Final LOT Memorandum for SeAH Steel Corp. and Shinho Steel Co., Ltd.” (April 5, 2001).

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties to this administrative review are addressed in the Decision Memo, which is hereby adopted by this notice. A list of the issues which parties have raised and to which we have responded, all of which are in the Decision Memo, is attached to this notice as an appendix. Parties can find a complete discussion of all issues raised in this review and the corresponding recommendations in this public memorandum, which is on file in the Central Records Unit, room B-099 of the main Department building. In addition, a complete version of the Decision Memo can be accessed directly on the Web at http://ia.ita.doc.gov. The paper copy and electronic version of the Decision Memo are identical in content.

Final Results of Review

We determine that the following dumping margins exist for the period Start Printed Page 18749November 1, 1998, through October 31, 1999:

Manufacturer/ExporterMargin (percent)
Shinho2.89
SeAH0.96
HDP2.83

Assessment Rates

Pursuant to 19 CFR 351.212(b), the Department calculates an assessment rate for each importer of the subject merchandise. Because certain importer-specific assessment rates calculated in these final results are above de minimis (i.e., at or above 0.5 percent), the Department will issue appraisement instructions directly to the Customs Service to assess antidumping duties on appropriate entries by applying the assessment rate to the entered value of the merchandise. For assessment purposes, we calculate importer-specific assessment rates for the subject merchandise by aggregating the dumping duties due for all U.S. sales to each importer and dividing the amount by the total entered value of the sales to that importer.

Cash Deposit Rates

To calculate the cash-deposit rate for each producer and/or exporter included in this administrative review, we divided the total dumping margins for each company by the total net value for that company's sales.

The following deposit requirements will be required on all shipments of standard pipe from Korea entered, or withdrawn from warehouse, for consumption, effective on or after the publication date of the final results of this administrative review, as provided by section 751(a)(1) of the Act: (1) The cash deposit rate for the reviewed companies will be the rates indicated above, except if the rate is less than 0.5 percent and, therefore, de minimis, the cash deposit will be zero; (2) for merchandise exported by manufacturers or exporters not covered in this review but covered in the original less-than-fair-value investigation or a previous review, the cash deposit will continue to be the most recent rate published in the final determination or final results for which the manufacturer or exporter received an individual rate; (3) if the exporter is not a firm covered in this review, the previous 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 reviews, the cash deposit rate will be 4.80 percent, the “all others” rate established in the less-than-fair-value investigation. See Notice of Antidumping Orders: Certain Circular Welded Non-Alloy Steel Pipe from Brazil, the Republic of Korea (Korea), Mexico, and Venezuela, and Amendment to Final Determination of Sales at Less Than Fair Value: Certain Circular Welded Non-Alloy Steel Pipe from Korea, 57 FR 49453 (November 2, 1992).

These cash deposit requirements, when imposed, shall remain in effect until publication of the final results of the next administrative review.

Notification to Importers

This notice serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f) 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 doubled antidumping duties.

Notification Regarding APOs

This notice also serves as a reminder to parties subject to administrative protective orders (“APOs”) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305, which continues to govern business proprietary information in this segment of the proceeding. Timely written notification of the return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a violation which is subject to sanction.

We are issuing and publishing this determination and notice in accordance with sections 751(a)(1) and 777(i) of the Act.

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Dated: April 5, 2001.

Timothy J. Hauser,

Acting Under Secretary for International Trade.

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Appendix—List of Comments and Issues in the Decision Memorandum

A. General Issues

Comment 1: Inclusion of Specification in Matching Criteria

Comment 2: Exclusion of Certain Sales Entered During POR

Comment 3: Exclusion of Certain Sales in Contemporaneous Window

Comment 4: G & A and Interest Ratios

B. HDP Specific Issues

Comment 5: HDP's Overrun Sales

Comment 6: Application of the Arm's-length Test to HDP's Home Market Sales

Comment 7: Calculation of HDP's Interest Expense Ratio

Comment 8: Product Matching Codes for End Finish

Comment 9: Separate Analysis of Products Produced by HDP and Those Further Manufactured by HDP

C. SeAH & Shinho Specific Issues

Comment 10: Bad Debt Expenses

Comment 11: Non-Operating Related Income Offsetting G & A Expenses

Comment 12: Arm's-Length Test Should be Rerun for Certain of SeAH's Sales

Comment 13: CEP Offset for Shinho and SeAH

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Footnotes

1.  In a letter dated January 5, 2001, HDP informed the Department that its corporate name would change to Hyundai Steel Company effective February 1, 2001. On February 27, 2001, the Department initiated a changed circumstances review to determine whether entries naming “Hyundai Hysco” as manufacturer or exporter should receive the cash deposit rate currently applied to HDP. Certain Circular Welded Non-Alloy Steel Pipe from the Republic of Korea; Initiation of Changed Circumstances Antidumping Duty Administrative Review, 66 FR 12460 (February 27, 2001). Pending a final determination in that changed circumstances review, we will continue to refer to the respondent in the instant review as HDP.

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[FR Doc. 01-8934 Filed 4-10-01; 8:45 am]

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