Stainless Steel Sheet and Strip in Coils From Germany: Notice of Court Decision and Suspension of Liquidation

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of Court Decision and Suspension of Liquidation.

EFFECTIVE DATE:

November 15, 2001.

SUMMARY:

On October 19, 2001, the Court of International Trade (the Court) affirmed the redetermination made by the Department of Commerce (the Department) pursuant to the Court's remand of the final determination of sales at less than fair value of stainless steel sheet and strip in coils (stainless sheet) from Germany. See Krupp Thyssen Nirosta GmbH and Krupp Hoesch Steel Products, Inc. v. United States, Court No. 99-08-0050, Slip Op. 01-123 (CIT October 19, 2001). In the redetermination the Department (i) used neutral facts available for the purpose of calculating U.S. Reseller's margin rate and any other calculation predicated on U.S. Reseller's cost and sales data ; and, (ii) calculated facts available for the reseller in a way that enabled the facts available rate and the sales prices to which it is applied to be adjusted to be net of movement and selling expenses. The results of the remand redetermination are shown below. Consistent with the decision of the U.S. Court of Appeals for the Federal Circuit in Timken Co. v. United States, 893 F.2d 337 (Fed. Cir. 1990) (Timken), the Department will continue to order the suspension of liquidation of the subject merchandise until there is a “conclusive” decision in this case.

FOR FURTHER INFORMATION CONTACT:

Patricia Tran or Robert James at (202) 482-1121, or (202) 482-0649, respectively, Antidumping and Countervailing Duty Enforcement Group III, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

Background

On July 27, 1999, the Department published in the Federal Register a notice of amended final determination of sales at less than fair value and antidumping duty order on stainless steel sheet and strip in coils from Germany. See Notice of Amended Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order; Stainless Steel Sheet and Strip in Coils From Germany, 64 FR 40557 (July 27, 1999) (Amended Final Determination).

Following publication of the amended final determination, KTN and Krupp Hoesch Steel Products, Inc. (KHSP) filed a lawsuit with the Court challenging certain aspects of the Department's findings in the antidumping investigation of stainless steel sheet and strip in coils from Germany.

On July 31, 2000, the Court remanded eight issues from the Amended Final Determination, ordering the Department i) to explain why its choice of adverse facts available for the German resellers was “rationally related to KTN's sales and indicative of its customary selling practices,” and why these facts available were not unduly harsh or punitive; ii) to explain which data fields in the U.S. Reseller's U.S. cost database were verified or verifiable; iii) to explain whether, and to what extent, errors in the U.S. Reseller's cost response tainted its attendant sales database; iv) to adduce substantial evidence that KTN had the ability to check the U.S. Reseller's database for errors prior to verification; v) to point to additional evidence, aside from computer programming errors, for assigning adverse facts available to the U.S. Reseller; vi) to explain why the Department's allocation methodology for the U.S. Reseller's sales of unknown origin was not unduly harsh or punitive; vii) to explain its refusal to deduct movement and selling expenses from the U.S. Reseller's gross unit price prior to applying adverse facts available; and viii) to exclude the U.S. Reseller's sales of non-subject merchandise (i.e., cut-to-length sheet and strip) from the margin calculation. See Krupp Thyssen Nirosta GmbH and Krupp Hoesch Steel Products, Inc. v. United States, Court No. 99-08-0050, Slip Op. 00-89 (CIT 2000) (Krupp I).

Furthermore, with respect to points (ii) and (iii), the Court ordered the Department to use the U.S. Reseller's data if it found the information was verified or verifiable, “subject to filling any gaps, as noted in the [C]ourt's opinion, with facts available.” Krupp I at 19. The Court further held, with respect to points (iv) and (v), that if the Department could not produce evidence of KTN's ability to check its data prior to verification, and evidence of errors aside from computer programming errors, the Department could not use an adverse inference in selecting among the facts otherwise available. Id.

On October 30, 2000 the Department issued its Results of Redetermination Pursuant to Court Remand Stainless Steel Sheet and Strip in Coils from Germany (Remand Determination I) addressing the concerns of the Court stated above.

On July 9, 2001 the Court issued a second order remanding the Department's Remand Determination I. In Krupp Thyssen Nirosta GmbH and Krupp Hoesch Steel Products, Inc. v. United States, Court No. 99-08-0050, Slip Op. 01-84 (CIT 2001) (Krupp II), the Court sustained (i) the use of adverse facts for German Resellers' downstream sales; (ii) the Department's rejection of U.S. Reseller's entire database; and (iii) the adverse facts the Department selected with respect to the allocation of sales of unidentified origin. The Court directed the Department (i) to use neutral facts available for the purpose of calculating U.S. Reseller's margin rate and any other calculation predicated on U.S. Reseller's cost and sales data; and, (ii) to calculate facts available for the reseller in a way that enables the facts available rate and the sales prices to which it is applied to be adjusted to be net of movement and selling expenses.

On September 7, 2001 the Department issued its Draft Results of Redetermination to the plaintiffs and defendant-intervenors to comment. In the Draft Results of Redetermination, the Department, for purposes of the remand, used neutral facts available to calculate U.S. Reseller's margin rate and any other calculation predicated on U.S. Reseller's cost and sales data, and calculated facts available for the reseller in a way that enabled the facts available rate and the sales prices to which it is applied to be adjusted for movement and selling expenses. Neither party submitted comments on the Department's Draft Results of Redetermination. Pursuant to Krupp II the Department filed its redetermination on remand on September 14, 2001. The Department's Results of Redetermination were identical to the Draft Results of Redetermination.

On October 19, 2001, the Court affirmed the Department's remand determination. See Krupp Thyssen Nirosta GmbH and Krupp Hoesch Steel Products, Inc. v. United States, Court No. 99-08-0050, Slip Op. 01-123 (CIT October 19, 2001). As a result of the remand determination, the final dumping margins are as follows:

Suspension of Liquidation

The U.S. Court of Appeals for the Federal Circuit in Timken held that the Department must publish notice of a decision of the Court or the Federal Circuit which is not in harmony with the Department's determination. Publication of this notice fulfills this obligation. The Federal Circuit also held that the Department must suspend liquidation of the subject merchandise until there is a “final and conclusive” decision on the case. Therefore, pursuant to Timken, the Department must continue to suspend liquidation of the subject merchandise pending the expiration of the period to appeal the Court's October 19, 2001 decision, or if that decision is appealed, pending a final decision by the Federal Circuit. However, because entries of the subject merchandise continue to be suspended pursuant to the antidumping duty order in effect (the Department is conducting administrative reviews for the 1999-2000 and 2000-2001 periods), the Department need not send additional instructions to the Customs Service to suspend liquidation. Further, consistent with Timken, the Department will order the Customs Service to change the relevant cash deposit rates in the event that the Court's ruling is not appealed or the Federal Circuit issues a final decision affirming the Court's ruling.