Import Administration, International Trade Administration, Department of Commerce.
Notice of preliminary results of antidumping duty administrative review.
In response to a request from the respondent, Atlas Tube, Inc. (Atlas), the Department of Commerce (the Department) is conducting an administrative review of the antidumping duty order on oil country tubular goods (OCTG) from Canada. This review covers one manufacturer/exporter, Atlas, and the period June 1, 1999 through December 31, 1999. The period of review (POR) specified by the Department's opportunity to request administrative review was June 1, 1999 through May 31, 2000.
We have preliminarily determined the dumping margin for Atlas to be 6.56 percent.
March 8, 2001.
Nithya Nagarajan or Michele Mire, Office 4, Group II, AD/CVD Enforcement, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone (202) 482–5253 or (202) 482–4711 respectively.
Unless otherwise indicated, all citations to the statute are references to the provisions effective January 1, 1995, the effective date of the amendments made to the Tariff Act of 1930 (the Act) by the Uruguay Round Agreements Act (URAA). In addition, unless otherwise indicated, all citations to the Department's regulations are to the current regulations at 19 CFR part 351 (2000).
The Department published an antidumping duty order on OCTG from Canada on June 16, 1986 (51 FR 21782) and an amended order on August 19, 1986 (51 FR 29579). On June 20, 2000, the Department published an Opportunity to Request Administrative Review (65 FR 38242). On July 9, 2000, Atlas Tube, Inc. requested the Department to initiate an administrative review pursuant to section 751(a)(1) of the Act, and 19 CFR 351.213(b)(2). We initiated this administrative review on July 31, 2000 (65 FR 46687) for the period June 1, 1999, through May 31, 2000. On August 22, 2000, the Department revoked the antidumping duty order effective January 1, 2000 (65 FR 50954). Due to the revocation of the antidumping duty order, we analyzed sales of the subject merchandise for the period June 1, 1999, through December 31, 1999, rather than the entire POR specified by the Department's opportunity to request administrative review.
The Department issued its questionnaire on August 28, 2000, and received Atlas' responses to Sections A, B, C, and D (corporate structure, home market sales, U.S. sales, and cost of production/constructed value, respectively) on October 30, 2000, and supplemental responses on December 21, 2000.
The Department is conducting this administrative review in accordance with section 751(a)(1) of the Act.
The products covered by this review include shipments of OCTG from Canada. This includes American Petroleum Institute (API) specification OCTG and all other pipe with the following characteristics except entries which the Department determined through its end-use certification procedure were not used in OCTG applications: Length of at least 16 feet; outside diameter of standard sizes published in the API or proprietary specifications for OCTG with tolerances of plus
Atlas reported all United States sales of subject merchandise as export price (EP) transactions sold to unaffiliated U.S. customers prior to importation.
We calculated EP, in accordance with section 772(a) of the Act, because the merchandise was sold by the manufacturer/exporter Atlas in the exporting country to the first unaffiliated purchaser in the United States prior to importation and because evidence on the record did not otherwise warrant constructed export price (CEP) methodology. We based EP on the delivered price to unaffiliated purchasers in the United States. We adjusted the starting price by the amount Atlas reported for billing adjustments and made deductions from the starting price for discounts. We also made deductions for movement expenses in accordance with section 772(c)(2)(A) of the Act; these included foreign inland freight, U.S. inland freight, and U.S. brokerage and handling charges.
After testing (1) home market viability and (2) whether home market sales were made at below-cost prices, we calculated normal value (NV) as noted in the “Price-to-Price Comparisons” section of this notice.
In order to determine whether there is a sufficient volume of sales in the home market to serve as a viable basis for calculating NV (
Section 773(b)(2)(A)(ii) of the Act provides that there are reasonable grounds to believe or suspect that sales of the foreign like product were made at prices that are less than the cost of production (COP) of the product if we disregarded some or all of a specific exporter's sales below COP in the last completed administrative review of that exporter. In the last administrative review of this order which covered the period December 1, 1998, through May 31, 1999, we found sales below COP for Atlas which were disregarded.
In accordance with section 773(b)(3) of the Act, we calculated COP based on the sum of Atlas' cost of materials and fabrication for the foreign like product, plus an amount for home market selling, general and administrative expenses (SG&A), including interest expenses, and packing costs.
We compared the weighted-average COP figures to home market sales of the foreign like product as required under section 773(b) of the Act, in order to determine whether these sales had been made at prices below COP. In determining whether to disregard home market sales made at prices less than the COP, we examined whether (1) within an extended period of time, such sales were made in substantial quantities, and (2) such sales were made at prices which permitted the recovery of all costs within a reasonable period of time. On a product-specific basis, we compared the COP to the home market prices, less any applicable movement charges and rebates.
Pursuant to section 773(b)(2)(C), where less than 20 percent of respondent's sales of a given product were at prices less than the COP, we did not disregard any below-cost sales of that product because we determined that the below-cost sales were not made in “substantial quantities.” Where 20 percent or more of respondent's sales of a given product during the POR were at prices less than the COP, we determined such sales to be made in “substantial quantities” within an extended period of time in accordance with section 773(b)(1)(A) of the Act. In the instant case, we compared Atlas' home market prices to weighted-average COPs for the POR, and therefore determined that below-cost sales were not made at prices which would permit recovery of all costs within a reasonable period of time, in accordance with section 773(b)(1)(B) of the Act. Therefore, we disregarded such below-cost sales.
In accordance with section 773(a)(1)(B) of the 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 CEP transaction. The NV LOT 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 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.
To determine whether NV sales are at a different LOT than the 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. 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 home market sales at the LOT of the export transaction, we make a LOT adjustment under section 773(a)(7)(A) of the Act.
Atlas reported one customer category and one channel of distribution (i.e., sales to unaffiliated distributors) for its home market sales. For its EP sales, Atlas also reported one customer category and one channel of distribution (
In determining whether separate LOTs actually existed in the home market and U.S. market, we examined whether Atlas' sales involved different marketing stages (or their equivalent) based on the channel of distribution, customer categories and selling functions. Atlas reported that its selling functions for home market sales are arranging for freight, warehousing, and warranty service; however, we noted that Atlas did not report any warehouse or warranty expenses for home market sales during the POR. After reviewing the record evidence for this current review, we agree with Atlas that its home market sales comprise a single LOT.
In analyzing Atlas' selling activities for its EP sales, we noted that the sales generally involved the same selling functions associated with the home market LOT described above. Atlas reported that these selling activities included arranging for freight, warehousing, and warranty services; however, Atlas reported that it did not incur any warehouse or warranty expenses for U.S. market sales during the POR. Based upon the record evidence for this current review, we have determined that there is one LOT for all EP sales and that it is the same LOT as in the home market. Therefore, because we find that the U.S. sales and home market sales are at the same LOT, we determine that a LOT adjustment under section 773(a)(7)(A) is not warranted.
We calculated NV based on delivered prices to unaffiliated customers. The NV price was reported on a Goods and Services Tax-exclusive basis. We adjusted the starting price by the amount Atlas reported for billing adjustments. We made deductions from the starting price for rebates, inland freight, and inland freight insurance. We made adjustments for differences in merchandise in accordance with section 773(a)(6)(C)(ii) of the Act. We made further adjustments, under section 773(a)(6)(C)(iii) of the Act, for
Pursuant to section 773A(a) of the Act, we made currency conversions into U.S. dollars based on the exchange rates in effect on the dates of the U.S. sales as certified by the Federal Reserve Bank.
As a result of this review, we preliminarily determine that a 6.56 percent dumping margin exists for Atlas for the period June 1, 1999 through December 31, 1999.
The Department will disclose the calculations we performed within five days of the date of publication of this notice to the parties of this proceeding in accordance with 19 CFR 351.224(b). An interested party may request a hearing within thirty days of publication of these preliminary results.
Upon completion of this administrative review, the Department shall determine, and the U.S. Customs Service (Customs) shall assess, antidumping duties on all appropriate entries. There was only one importer during the POR for merchandise sold by Atlas. We have calculated an importer-specific duty assessment rate based on the ratio of the total amount of antidumping duties calculated for the examined sales to the total entered value of examined sales. Atlas reported entered value by subtracting discounts, freight, and brokerage and handling costs from the reported U.S. price. Where the importer-specific rate is above
Pursuant to section 751(d)(2) of the Act, on August 22, 2000, the Department revoked the antidumping duty order on OCTG from Canada, effective January 1, 2000 (65 FR 50954). Therefore, we instructed Customs to liquidate all entries of subject merchandise made on or after January 1, 2000, without regard to antidumping duties. Therefore, we will not issue cash deposit instructions to Customs based on the results of this review.
This notice also serves as a preliminary 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 double antidumping duties.
This administrative review and notice are in accordance with sections 751(a)(1) and 777(i)(1). Effective January 20, 2001, Bernard T. Carreau is fulfilling the duties of Assistant Secretary for Import Administration.