[Federal Register Volume 66, Number 50 (Wednesday, March 14, 2001)]
[Notices]
[Pages 14883-14887]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-6363]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-580-815 & A-580-816]
Notice of Amended Final Results of Antidumping Duty
Administrative Reviews: Certain Cold-Rolled and Corrosion-Resistant
Carbon Steel Flat Products from Korea
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of amendment to final results of antidumping duty
administrative reviews and intent not to revoke antidumping duty order
in part.
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SUMMARY: The Department of Commerce (``Department'') is amending its
final results of reviews of the antidumping duty orders on certain
cold-rolled and corrosion-resistant carbon steel flat products from
Korea, published January 16, 2001, to reflect the correction of
ministerial errors in those final results. The period covered by these
amended final results is August 1, 1998 through July 31, 1999.
EFFECTIVE DATE: March 14, 2001.
FOR FURTHER INFORMATION CONTACT: Michael Panfeld (the POSCO Group),
Marlene Hewitt (Dongbu) and (Union), or James Doyle, Enforcement Group
III, Office 9, Import Administration, International Trade
Administration, U.S. Department of Commerce, 1401 Constitution Avenue,
NW., Washington, DC 20230, telephone 202-482-0172 (Panfeld), 202-482-
1385 (Hewitt), or 202-482-0159 (Doyle), fax 202-482-1388.
[[Page 14884]]
SUPPLEMENTARY INFORMATION:
Applicable Statute
Unless otherwise indicated, all citations to the Tariff Act of 1930
(``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's regulations are to the
regulations at 19 C.F.R. part 351 (1999).
Scope of the Reviews
The review of ``certain cold-rolled carbon steel flat products''
covers cold-rolled (cold-reduced) carbon steel flat-rolled products, of
rectangular shape, neither clad, plated nor coated with metal, whether
or not painted, varnished or coated with plastics or other nonmetallic
substances, in coils (whether or not in successively superimposed
layers) and of a width of 0.5 inch or greater, or in straight lengths
which, if of a thickness less than 4.75 millimeters, are of a width of
0.5 inch or greater and which measures at least 10 times the thickness
or if of a thickness of 4.75 millimeters or more are of a width which
exceeds 150 millimeters and measures at least twice the thickness, as
currently classifiable in the Harmonized Tariff Schedule (``HTS'')
under item numbers 7209.15.0000, 7209.16.0030, 7209.16.0060,
7209.16.0090, 7209.17.0030, 7209.17.0060, 7209.17.0090, 7209.18.1530,
7209.18.1560, 7209.18.2550, 7209.18.6000, 7209.25.0000, 7209.26.0000,
7209.27.0000, 7209.28.0000, 7209.90.0000, 7210.70.3000, 7210.90.9000,
7211.23.1500, 7211.23.2000, 7211.23.3000, 7211.23.4500, 7211.23.6030,
7211.23.6060, 7211.23.6085, 7211.29.2030, 7211.29.2090, 7211.29.4500,
7211.29.6030, 7211.29.6080, 7211.90.0000, 7212.40.1000, 7212.40.5000,
7212.50.0000, 7215.50.0015, 7215.50.0060, 7215.50.0090, 7215.90.5000,
7217.10.1000, 7217.10.2000, 7217.10.3000, 7217.10.7000, 7217.90.1000,
7217.90.5030, 7217.90.5060, 7217.90.5090. Included in this review are
flat-rolled products of nonrectangular cross-section where such cross-
section is achieved subsequent to the rolling process (i.e., products
which have been ``worked after rolling'')--for example, products which
have been beveled or rounded at the edges. Excluded from this review is
certain shadow mask steel, i.e., aluminum-killed, cold-rolled steel
coil that is open-coil annealed, has a carbon content of less than
0.002 percent, is of 0.003 to 0.012 inch in thickness, 15 to 30 inches
in width, and has an ultra flat, isotropic surface.
The review of ``certain corrosion-resistant carbon steel flat
products'' covers flat-rolled carbon steel products, of rectangular
shape, either clad, plated, or coated with corrosion-resistant metals
such as zinc, aluminum, or
zinc-, aluminum-, nickel- or iron-based alloys, whether or not
corrugated or painted, varnished or coated with plastics or other
nonmetallic substances in addition to the metallic coating, in coils
(whether or not in successively superimposed layers) and of a width of
0.5 inch or greater, or in straight lengths which, if of a thickness
less than 4.75 millimeters, are of a width of 0.5 inch or greater and
which measures at least 10 times the thickness or if of a thickness of
4.75 millimeters or more are of a width which exceeds 150 millimeters
and measures at least twice the thickness, as currently classifiable in
the HTS under item numbers 7210.30.0030, 7210.30.0060, 7210.41.0000,
7210.49.0030, 7210.49.0090, 7210.61.0000, 7210.69.0000, 7210.70.6030,
7210.70.6060, 7210.70.6090, 7210.90.1000, 7210.90.6000, 7210.90.9000,
7212.20.0000, 7212.30.1030, 7212.30.1090, 7212.30.3000, 7212.30.5000,
7212.40.1000, 7212.40.5000, 7212.50.0000, 7212.60.0000, 7215.90.1000,
7215.90.3000, 7215.90.5000, 7217.20.1500, 7217.30.1530, 7217.30.1560,
7217.90.1000, 7217.90.5030, 7217.90.5060, 7217.90.5090. Included in
this review are flat-rolled products of nonrectangular cross-section
where such cross-section is achieved subsequent to the rolling process
(i.e., products which have been ``worked after rolling'')--for example,
products which have been beveled or rounded at the edges. Excluded from
this review are flat-rolled steel products either plated or coated with
tin, lead, chromium, chromium oxides, both tin and lead (``terne
plate''), or both chromium and chromium oxides (``tin-free steel''),
whether or not painted, varnished or coated with plastics or other
nonmetallic substances in addition to the metallic coating. Also
excluded from this review are clad products in straight lengths of
0.1875 inch or more in composite thickness and of a width which exceeds
150 millimeters and measures at least twice the thickness. Also
excluded from this review are certain clad stainless flat-rolled
products, which are three-layered corrosion-resistant carbon steel
flat-rolled products less than 4.75 millimeters in composite thickness
that consist of a carbon steel flat-rolled product clad on both sides
with stainless steel in a 20%-60%-20% ratio.
These HTS item numbers are provided for convenience and U.S.
Customs purposes. The written descriptions remain dispositive.
Amendment of Final Results
On January 16, 2001, the Department published the final results of
its administrative reviews of the antidumping duty orders on certain
cold-rolled and corrosion-resistant carbon steel flat products from
Korea, for the period August 1, 1998 through July 31, 1999. See Certain
Cold-rolled and Corrosion-Resistant Carbon Steel Flat Products from
Korea: Final Results of Antidumping Duty Administrative Reviews, 66 FR
3540 (hereinafter ``Final Results''). The reviews covered shipments of
subject merchandise by Dongbu Steel Co., Ltd. (``Dongbu''), Union Steel
Manufacturing Co., Ltd. (``Union''), and Pohang Iron and Steel Co.,
Ltd. (``POSCO''). (POSCO and the companies collapsed with POSCO (Pohang
Coated Steel Co., Ltd. (POCOS'') and Pohang Steel Industries Co., Ltd.
(``PSI''), are collectively referred to as ``the POSCO Group.'')
On January 22, 2001, Union submitted clerical error allegations
with respect to its margin calculations, and Petitioners submitted
clerical error allegations with respect to POSCO's margin calculations.
On January 23, 2001, POSCO submitted clerical error allegations with
respect to its margin calculations. On January 29, 2001, Petitioners
and POSCO submitted comments on each other's respective allegations.
The allegations and comments were filed in a timely fashion.
Union
Comment 1: Union alleges that the Department committed a clerical
error, when, in implementing the fungibility principle adopted in the
Final Results, it failed to employ a methodology which eliminates the
double-counting of imputed credit expenses. Union proposes to the
Department a methodology that it says is correct and consistent with
the Department's statements in the Final Results. Union argues that the
first step in the Department's calculation of the U.S. Indirect Selling
Expense (``ISEs'') interest factor should be to identify the amount of
actual interest expense allocated to Cold-Rolled (``CR'') and
Corrosion-Resistant (``CORE'') as shown in Union's calculations. Only
after identifying the amount of interest
[[Page 14885]]
expense allocated can the Department perform an ``apples-to-apples''
calculation and deduct the amount of imputed credit expenses calculated
for CR and CORE to determine if there is any basis to ``add any
remainder to the pool of ISEs.'' Union claims that with its proposed
methodology, the Department would find that Union's ISE for CR and CORE
consist solely of non-financial ISEs.
Petitioners state this clerical error allegation argues the merit
of an alternative methodology for calculating Union's imputed credit
expenses, and that Union concedes that its argument is methodological,
not ministerial. Petitioners conclude that as the alleged error is not
ministerial, but methodological, Union's allegation with respect to the
Department's methodology must be rejected.
Department's position: After reviewing both parties' comments, we
have determined that the above mentioned points raised by Union do not
meet the definition of ministerial error under section 751(h) of the
Act and 19 CFR 351.224(f). The Department's decision of whether to
calculate imputed credit expenses for all merchandise when correcting
for double counting is not a mistake of ``addition or subtraction or
other arithmetic function'' or ``other similar types of unintentional
error'' within the meaning of 19 CFR 351.224(f). Instead, this
allegation suggests a distinct methodology for correcting this double-
counting. See Final Results, 66 FR at 3541 and accompanying Issues and
Decision Memo at Comment 1.
Comment 2: Union argues that the Department erred in its
calculation of Union's U.S. indirect selling expense (``ISE'') factor.
Specifically, the Department failed to eliminate the double-counting of
actual interest expenses and imputed credit expenses in its calculation
by first subtracting imputed credit from net interest expenses and then
adding imputed credit back to net interest expenses rather then adding
the indirect selling expenses to the remaining interest expenses.
Petitioners agreed with Union that the Department made a clerical
error in its calculations of Union's U.S. ISEs. The Department
erroneously both subtracted from and added U.S. imputed credit expenses
to the financial expense component of DKA's indirect selling expenses
and thus failed to account for any double-counting of credit.
Petitioners stated that in order to correct this error, the Department
should correct its definitions of ``interest factor'' and ``ISE
Factor'' such that non-financial ISEs are included in the ISEs
calculations. Non-financial ISEs are presently omitted from the
Department's calculations.
Department's Position: We reviewed the allegation and response and
we agree with Union and Petitioners that there is an unintentional
error in our calculation of Union's U.S. ISE Factor. Specifically, when
the Department attempted to eliminate the double counting of imputed
credit expenses in its calculation, it did not intend to both add and
subtract U.S. imputed credit expense in the calculation. See Final
Results, 66 FR at 3541 and accompanying Issues and Decision Memo at
Comment 1. Accordingly, we recalculated the interest factor by
deducting the imputed credit expense from the interest factor. We then
recalculated the U.S. indirect selling expenses by using the corrected
interest factor. We have corrected both our ISE calculations and the
implementing programming language. See, the Memorandum from Marlene
Hewitt to Edward Yang, dated February 16, 2001.
Comment 3: Union alleges that the Department erred by applying its
VAT correction factor to local sales when calculating home market
credit expenses. Specifically, Union argues that the Department should
not have applied the VAT correction factor to local sales because the
credit expense for local sales was calculated on a shipment by shipment
basis. Instead, Union points out that it is the Department's practice
to only apply the VAT correction factor to home market credit expenses
reported using the receivables turnover methodology.
Petitioners stated that they agree with Union that the Department
made a clerical error by applying its VAT correction factor for home
market credit expenses to Union's local sales.
Department's Position: We agree with Union and Petitioners that the
Department inadvertently applied its correction factor for calculating
home market credit expenses to local sales. We have corrected the
program to distinguish between local sales and home market sales that
reported credit expense using the receivables-turnover method and
applied the home credit expense only to home market sales that were
reported using the receivables-turnover method. See, the Memorandum
from Marlene Hewitt to Edward Yang, dated February 16, 2001.
POSCO
Comment 1: POSCO alleges that the Department committed a clerical
error when, in implementing the fungibility principle adopted in the
Final Results, (66 FR at 3541), it failed to allocate the U.S.
affiliate's interest expenses to all activities (sales and investment)
of the U.S. affiliate. Specifically, POSCO argues that the Department
allocated the total interest expenses to the total sales, whereas the
affiliate also has significant investment activities i.e. a joint
venture. POSCO concludes that the Department should recalculate
interest expense also considering the investment activities of
affiliates.
Petitioners argue that the asserted ``ministerial error'' raised by
POSCO is not the type of unintentional error listed in section 735(e)
of the Act or 19 CFR 351.224(f) of the regulations. POSCO does not
point to any incorrect operations of addition, subtraction, or any
other arithmetic function. Instead, the issue POSCO raises deals with
what methodology best allocates POSAM's U.S. interest expenses to
subject merchandise. According to Petitioners, the Department's
decision, which correctly assigned the financial indirect selling
expenses of POSAM to the sales revenues that are absorbing those costs
is not an unintentional ministerial error, but is instead an
intentional methodological decision which the Department took after
weighing POSCO's extensive briefing on this topic.
Department's Position: After reviewing POSCO's and Petitioners
comments, we have determined that the above mentioned points raised by
POSCO do not meet the definition of ministerial error under section
751(h) of the Act and 19 CFR 351.224(f). The Department's decision of
whether to allocate interest expense to the activities of the joint
venture is not a mistake of ``addition or subtraction or other
arithmetic function'' or ``other similar types of unintentional error''
within the meaning of 19 CFR 351.224(f). Instead, this allegation
suggests a distinct methodology for including interest expenses
incurred by U.S. affiliates in the pool of U.S. ISEs. For a full
discussion of the Department's methodological choice see the Final
Results 66 FR at 3541 and its accompanying Issues and Decision
Memorandum at Comment 1.
Comment 2: POSCO alleges that the Department committed a clerical
error by failing to correct for double-counting of imputed credit
expenses and inventory financing expenses. Specifically, when the
Department adjusted interest expenses to avoid double-counting, it
subtracted only those imputed credit expenses associated with subject
merchandise and failed to subtract imputed credit expenses associated
with non-subject
[[Page 14886]]
merchandise. In addition, POSCO argues that under the fungibility
principle that the Department adopted for its Final Result, (66 FR at
3541 and accompanying Issues and Decision Memorandum at Comment 1), all
debt and equity finance all assets. Thus, the interest expense is by
definition attributable, in part, to financing U.S. inventories.
However, the Department's calculations erroneously failed to eliminate
this portion of expense from the total interest expense.
Petitioners argue that the Department's decision not to deduct
imputed credit expenses for non-subject merchandise was an intentional
methodological decision, not a ministerial error. POSCO points to no
arithmetic error or clerical error to support a ministerial error
allegation. Instead, Petitioners assert that the issue POSCO raises
deals with what methodology best accounts for imputed credit expenses
on non-subject merchandise in U.S. interest expenses in order to avoid
double-counting. POSCO's argument that the Department must deduct
imputed credit expenses on non-subject merchandise from U.S. interest
expense in order to avoid double-counting is wrong. According to
Petitioners, the Department's margin calculations do not deduct imputed
or actual credit expenses related to non-subject merchandise from U.S.
price as suggested by POSCO. The Department should refuse to consider
POSCO's second alleged ``ministerial error'' claim.
Department's Position: After reviewing POSCO's comments, we have
determined that the above mentioned points raised by POSCO do not meet
the definition of ministerial error in section 751(h) of the Act and 19
CFR 351.224(f). The Department's decision that no portion of U.S.
interest expenses should be segregated and attributed to non-subject
merchandise sales is not a mistake of ``addition or subtraction or
other arithmetic function'' or ``other similar types of unintentional
error'' within the meaning of 19 CFR 351.224(f). See Final Results, 66
FR at 3541 and accompanying Issues and Decision Memo at Comment 1.
Comment 3: Petitioners allege that the Department committed a
clerical error when it attempted to offset total interest with interest
income in the U.S. ISE calculations. Specifically, Petitioners argue
that the Department used the total interest income as an offset,
whereas it should have limited the offset to short-term interest
income, as it is the Department's longstanding policy to allow an
offset only for interest income that is short-term in nature.
POSCO argues that the Department correctly and appropriately relied
on net interest expense as the starting point for calculating the
interest expense component of POSCO's U.S. indirect selling expense. As
indicated in the Decision Memorandum, the Department's calculation of
U.S. indirect selling expenses includes all ``money'', i.e. interest
expense and interest income, of the U.S. affiliate. The Department's
calculations thus correctly execute the Department's intent to include
total interest expense and total interest income in the calculation of
U.S. ISEs. Petitioners allegation of a clerical error should be
rejected by the Department.
Department's Position: After reviewing Petitioners' and POSCO's
comments, we have determined that the above mentioned points raised by
Petitioners do not meet the definition of ministerial error under
section 751(h) of the Act and 19 CFR 351.224(f). Our treatment of the
interest income, used to offset the interest expense included in
POSCO's U.S. indirect selling expenses, is not a mistake of ``addition
or subtraction or other arithmetic function'' or ``other similar types
of unintentional error'' within the meaning of 19 CFR 351.224(f).
Comment 4: Petitioners argue that the Department erred in making an
adjustment to home market credit expenses in the corrosion-resistant
margin calculations. Specifically, the adjusting factor was mis-typed
at one point in the program.
Department's Position: We agree with Petitioners that the
Department created a ministerial error in making this adjustment to
home market credit in the corrosion-resistant margin program. The
adjusting factor was incorrect. The Department has corrected the
program accordingly.
Comment 5: Petitioners argue that the Department erred in creating
two additional U.S. tolerance weights used in the cold-rolled margin
program by naming them ``CRTOLERM'' rather than ``CRTOLERS.''
Department's Position: We agree with Petitioners. The Department
intended to name the tolerance weights ``CRTOLERS''. We have corrected
the program accordingly.
Amended Final Results of the Reviews
Amended Final Results of the Reviews
------------------------------------------------------------------------
Weighted-
Producer/manufacturer/exporter average
margin
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Certain Cold-Rolled Carbon Steel Flat Products
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*Dongbu.................................................... 1.35
The POSCO Group............................................ 0.73
Union...................................................... 1.94
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Certain Corrosion-Resistant Carbon Steel Flat Products
------------------------------------------------------------------------
*Dongbu.................................................... 0.13
The POSCO Group............................................ 2.24
Union...................................................... 0.29
------------------------------------------------------------------------
*Not affected by these Amended Final Results.
The Department shall determine, and the U.S. Customs Service
(``Customs'') shall assess, antidumping duties on all appropriate
entries. In accordance with 19 CFR 351.212(b), we have calculated
exporter/importer-specific assessment rates. With respect to both
export price and constructed export price sales, we divided the total
dumping margins for the reviewed sales by the total entered value of
those reviewed sales for each importer. We will direct Customs to
assess the resulting percentage margins against the entered Customs
values for the subject merchandise on each of that importer's entries
under the relevant order during the review period.
Cash Deposit Requirements
The following deposit requirements will be effective upon
publication of this notice of amended final results of administrative
reviews for all shipments of cold-rolled and corrosion-resistant carbon
steel flat products from Korea entered, or withdrawn from warehouse,
for consumption on or after the date of publication, as provided by
section 751(a)(1) of the Act: (1) The cash deposit rates for the
reviewed companies will be the rates shown above except that, for firms
whose weighted-average margins are less than 0.5 percent and therefore
de minimis, the Department shall require no deposit of estimated
antidumping duties; (2) for previously reviewed or investigated
companies not listed above, 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 original less than fair value (``LTFV'') investigation, but the
manufacturer is, the cash deposit rate will be the rate
[[Page 14887]]
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 14.44 percent (for certain cold-rolled
carbon steel flat products) or 17.70 percent (for certain corrosion-
resistant carbon steel flat products). These rates are the ``all
others'' rates from the LTFV investigations. See Antidumping Duty
Orders on Certain Cold-Rolled Carbon Steel Flat Products and Certain
Corrosion-Resistant Carbon Steel Flat Products from Korea, 58 FR 44159
(August 19, 1993).
These deposit requirements shall remain in effect until publication
of the final results of the next administrative review.
This notice also serves as a final 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 doubled antidumping duties.
This notice also serves as the only reminder to parties subject to
administrative protective orders (``APO'') of their responsibility
concerning the return or destruction of proprietary 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. Effective
January 20, 2001, Bernard T. Carreau is fulfilling the duties of
Assistant Secretary of Import Administration.
Dated: March 6, 2001.
Bernard T. Carreau,
Deputy Assistant Secretary, Import Administration.
[FR Doc. 01-6363 Filed 3-13-01; 8:45 am]
BILLING CODE 3510-DS-P