Notice of Amended Final Results of Antidumping Duty Administrative Review: Stainless Steel Butt-Weld Pipe Fittings from Taiwan

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

EFFECTIVE DATE:

January 30, 2003.

FOR FURTHER INFORMATION CONTACT:

Lilit Astvatsatrian, AD/CVD Enforcement Group III, Office IX, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-6412.

SUPPLEMENTARY INFORMATION:

Scope of the Review

The merchandise subject to this administrative review is certain stainless steel butt-weld pipe fittings (“SSBWPF”) whether finished or unfinished, under 14 inches inside diameter. Certain SSBWPF are used to connect pipe sections in piping systems where conditions require welded connections. The subject merchandise is used where one or more of the following conditions is a factor in designing the piping system: (1) Corrosion of the piping system will occur if material other than stainless steel is used; (2) contamination of the material in the system by the system itself must be prevented; (3) high temperatures are present; (4) extreme low temperatures are present; and (5) high pressures are contained within the system.

Pipe fittings come in a variety of shapes, with the following five shapes the most basic: “elbows”, “tees”, “reducers”, “stub-ends“, and “caps.” The edges of finished pipe fittings are beveled. Threaded, grooved, and bolted fittings are excluded from this review. The pipe fittings subject to this review are classifiable under subheading 7307.23.00 of the Harmonized Tariff Schedule of the United States (“HTSUS”).

Although the HTSUS subheading is provided for convenience and customs purposes, our written description of the scope of the review is dispositive. Pipe fittings manufactured to American Society of Testing and Materials specification A774 are included in the scope of this order.

On April 12, 2001, during this administrative review, the Department received a scope ruling request, in accordance with 19 CFR 351.225(c), from Allegheny Bradford Corporation d/b/a Top Line Process Equipment Company ("Top Line"), for a scope ruling on whether the stainless steel butt-weld tube fittings it plans to import are covered by the antidumping duty order on stainless steel butt-weld pipe fittings from Taiwan. On November 15, 2001, the Department issued its preliminary scope ruling. See Memorandum from Edward C. Yang, Director, Enforcement, Group III, Office 9, to Joseph A. Spetrini, Deputy Assistant Secretary for Import Administration, Group III: Preliminary Scope Ruling on the Antidumping Duty Order on Stainless Steel Butt-Weld Pipe Fittings: Allegheny Bradford Corporation d/b/a Top Line Process Equipment (“Preliminary Scope Ruling”), dated November 15, 2001, which is on file at the U.S. Department of Commerce, in the Central Records Unit, in room B-099. We gave interested parties an opportunity to comment on our Preliminary Scope Ruling. Top Line and petitioners filed briefs on November 21, 2001. On November 26, 2001, Top Line and petitioners filed rebuttal briefs. On December 10, 2001, the Department issued its final scope ruling that Top Line's stainless steel butt-weld tube fittings are within the scope of the Order. See Memorandum from Edward C. Yang, Director, Enforcement, Group III, Office 9, to Joseph A. Spetrini, Deputy Assistant Secretary for Import Administration, Group III: Final Scope Ruling on the Antidumping Duty Order on Stainless Steel Butt-Weld Pipe Fittings: Allegheny Bradford Corporation d/b/a Top Line Process Equipment, dated December 10, 2001, which is also on file at the U.S. Department of Commerce, in the Central Records Unit, in room B-099.

Amendment of the Final Results

On December 17, 2002, the Department of Commerce (“the Department”) issued its final results for stainless steel butt-weld pipe fittings from Taiwan for the June 1, 2000 through May 31, 2001, period of review. See Notice of Final Results and Final Rescission in Part of Antidumping Duty Administrative Review: Stainless Steel Sheet and Strip in Coils From France: Stainless Steel Butt-Weld Pipe Fittings From Taiwan (“Final Results”), 67 FR 78417 (December 24, 2002).

In accordance with 19 C.F.R. §:351.224(c), on December 20, 2002, the petitioners in this administrative review requested that the Department extend the deadline to file ministerial errors regarding the Final Results from December 20, 2002 to December 27, 2002. On December 20, 2002, the Department extended the deadline to file any ministerial error allegations on the Final Results from December 20, 2002 to December 27, 2002. Subsequently, on December 27, 2002, the petitioners timely filed an allegation pursuant to 19 CFR §351.224(c) that the Department made six ministerial errors in the Final Results. Ta Chen Stainless Steel Pipe Co., (“Ta Chen”), the only respondent covered by the review, did not submit any ministerial error allegations or rebuttal comments in reply to petitioners' ministerial error allegations.

Allegation 1: Improper Revision to General and Administrative Expense (“G&A”) Ratio

The petitioners state that in the final results the Department erred in the method of applying the revised general and administrative expenses (“G&A”) to the total cost of manufacture when adding certain bonus payments to the reported G&A. According to the petitioners, the Department erroneously applied the revised G&A ratio to the reported G&A, instead of applying the revised G&A to the reported total cost of manufacture. The petitioners note that the same error of not applying the revised G&A to the total cost of manufacture was also made in the Margin Calculation Program.

Department's Position: We agree with the petitioners and have revised both the Model Match and Margin Calculation programs to apply the revised G&A correctly. See Analysis Memo.

Allegation 2: Improper Use of Fiscal Year for U.S. Indirect Selling Expense Calculation

The petitioners argue that in the final results the Department erroneously did not rely on 2001 financial statements of Ta Chen International (“TCI”) for the calculation of the U.S. indirect selling expense. The petitioners further argue that the Department has erred in its decision by finding that TCI had not been given the opportunity to adjust its 2001 financial data because record evidence shows that the relevant adjusted information was in fact on the record. Thus, the petitioners state that the Department should revise its final results by using TCI's adjusted 2001 indirect selling expense percentage of the gross unit price.

Department's Position: With regard to this allegation, we disagree that a change to the calculation would represent a ministerial error correction. At the outset, we note that petitioners are correct that this information is on the record. However, we note that reliance on that erroneous observation is only one of the two bases of our decision in the final results. The second basis of the Department's decision was that TCI's year 2000 data overlaps a longer portion of the POR than the year 2001 data. This fact is unchallenged by the petitioners. Therefore, petitioners' request that the Department overturn its decision to use the year 2000 TCI data is not ministerial in nature, but rather involves a methodological change. A ministerial error is defined under 19 CFR 351.224(f) as “an error in addition, subtraction, or other arithmetic function, clerical error resulting from inaccurate copying, duplication, or the like, and any other similar type of unintentional error which the Secretary considers ministerial.” Accordingly, we have not made the requested change.

Allegation 3: Improper Use of Short-term Borrowing Rate for U.S. Credit Expense Calculation

The petitioners argue that in the final results, the Department incorrectly based the U.S. credit expenses for certain “indent” sales on Ta Chen Taiwan's short-term borrowing rate, instead of its U.S. subsidiary TCI's short-term borrowing rate. The petitioners conclude the Department should revise U.S. credit expenses based TCI's short-term interest rate as opposed to that of Ta Chen.

Department's Position: We agree with the petitioners that the Department inadvertently used Ta Chen's short-term borrowing rate for calculation of imputed credit expense for the U.S. sales at issue, instead of correctly using TCI's short-term borrowing rate. We have corrected this error. See Analysis Memo.

Allegation 4: Improper Application of Average Margin to Unreported Sales

Petitioners note that in the preliminary results, the Department decided to impose partial facts available on two sets of Ta Chen's U.S. sales and assigned Ta Chen's average positive margin to those sales. The petitioners further note that in the final results, the Department changed from using the average positive margin to the average margin on the basis that use of the average positive margin was implicitly an unintended adverse margin. However, petitioners argue that using the average margin produces an incorrect result. See, Memorandum For The File from Lilit Astvatsatrian through James Doyle, dated January 20, 2003, for identification of the precise nature of the alleged incorrect result. Moreover, petitioners assert that the average positive margin is not adverse as the highest dumping margin calculated would have been the proper adverse facts available margin. As a result of these considerations, petitioners conclude that the Department should apply the average positive margin to the two sets of Ta Chen's U.S. sales at issue.

Department's Position: We disagree with petitioners' assertion that the use of the average margin represents a ministerial error and accordingly will not adjust the final results. The final results computer program correctly calculated and applied the average margin to these sales, which was precisely the Department's intent as expressed in the final results. While the petitioners may disagree with the use of the calculated average margin, such disagreement regarding the figure does not represent identification of a ministerial error as described in 19 CFR 351.224(f).

Allegation 5: Omission of Negative Data Test in the Model Match Program

The petitioners maintain that in its Margin Calculation Program, the Department conducted a “negative data test” to find and remove a negative reported price or quantity from the calculation. Petitioners also note that the Department did not conduct a similar negative data test in the Model Match Program. Petitioners conclude that conducting the test in one program and not the other results in the incorrect use of different databases between the two programs.

Department's Position: We disagree with petitioners. As an initial matter, we note that petitioners did not comment on this standard Department calculation practice after the preliminary results, which was the correct time to raise this methodological consideration. Finally, as this is a methodological issue, it cannot be understood to be a ministerial error.

Allegation 6: Improper Admission of CEP Offset

Petitioners allege that the Department, in granting Ta Chen a CEP offset, failed: (1) to analyze the proper levels of trade for determining whether a CEP offset should be granted, and (2) to confirm the type and extent of the selling expenses offered by Ta Chen to the U.S. and home markets in the submitted record. Petitioners argue that after a proper analysis, the Department should find that the U.S. level of trade is at a higher level (or at a minimum, an equal level) of trade than home market sales and deny Ta Chen's request for a CEP offset and then correct the final results accordingly.

Department's Position: We disagree with the petitioners. Rather than requesting the Department to correct an unintentional error such as these listed at 19 CFR 351.224 (f), the petitioners are requesting the Department to review its analysis and subsequently reverse its decision at the final results. Accordingly, we cannot agree this represents a ministerial error.

We are amending the Final Results to reflect the correction of the above-cited two ministerial errors. All changes made to the model match and margin program can be found in the analysis memorandum. See Memorandum to the File from Lilit Astvatsatrian, Case Analyst to James C. Doyle, Program Manager, Final Analysis for Ta Chen Stainless Steel Pipe Co. for the Amended Final Results of the Administrative Review of Stainless Steel Butt-Weld Pipe Fittings from Taiwan for the period June 1, 2000 through May 31, 2001, dated January 20, 2003.

The revised weighted-average dumping margin is as follows:

The Department will determine, and the Customs Service shall assess, antidumping duties on all appropriate entries. In accordance with 19 CFR 351.212(b), we have calculated importer-specific assessment rates. With respect to the 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 any resulting non-de minimis percentage margins against the entered Customs values for the subject merchandise on each of that importer's entries during the review period. We will issue appropriate assessment instructions directly to the Customs Service within 15 days of publication of these amended final results of review.

We will also direct the Customs Service to collect cash deposits of estimated antidumping duties on all appropriate entries in accordance with the procedures discussed in the Final Results and at the rates amended by this determination. The amended deposit requirements are effective for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the date of publication of this notice and shall remain until publication of the final results of the next administrative review.

We are issuing and publishing this determination and notice in accordance with sections 751(a)(1) and 777(i) of the Act and CFR 351.210(c).