Tapered Roller Bearings and Parts Thereof, Finished and Unfinished, From the People's Republic of China; Final Results of 1998-1999 Administrative Review, Partial Rescission of Review, and Determination Not To Revoke Order in Part

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of final results of 1998-1999 (twelfth) administrative review, partial rescission of the review, and determination not to revoke the order in part.

SUMMARY:

We have determined that sales of tapered roller bearings and parts thereof, finished and unfinished, from the People's Republic of China, were made below normal value during the period June 1, 1998, through May 31, 1999. Based on our review of comments received and a reexamination of surrogate value data, we have made certain changes in the margin calculation of 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.

China National Machinery Import & Export Corporation, Wafangdian Bearing Group Corp. Import & Export Company, Wanxiang Group Corporation, and Zhejiang Machinery Import & Export Corp. have requested revocation of the antidumping duty order in part. Based on record evidence, we find that none of these companies qualify for revocation. Accordingly, we are not revoking the order with respect to the subject merchandise produced and exported by these four companies.

EFFECTIVE DATE:

January 10, 2001.

FOR FURTHER INFORMATION CONTACT:

Greg Campbell or Jarrod Goldfedder, Group 1, Office I, Antidumping/Countervailing Duty Enforcement, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone (202) 482-2239 or (202) 482-0189, respectively.

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) regulations are to 19 CFR part 351 (2000).

Background

On July 7, 2000, the Department published the Preliminary Results. The period of review (POR) is June 1, 1998, through May 31, 1999. This review covers the following exporters (referred to collectively as the respondents): Wafangdian Bearing Group Corp. Import & Export Company (Wafangdian), Zhejiang Machinery Import & Export Corp. (ZMC), Wanxiang Group Corporation (Wanxiang), China National Machinery Import & Export Corporation (CMC), Liaoning MEC Group Co. Ltd. (Liaoning), Luoyang Bearing Corp. (Group) (Luoyang), Premier Bearing & Equipment Ltd. (Premier), Tianshui Hailin Import and Export Corporation/Hailin Bearing Factory (Hailin), Weihai Machinery Holding (Group) Co., Ltd. (Weihai), Zhejiang Changshan Changhe Bearing Corp. (“ZCCBC”), and Zhuzhou Torch Spark Plug Co., Ltd. (Torch).

We invited parties to comment on our preliminary results of review. By August 17, 2000, we received case briefs from the Timken Company (petitioner), as well as from CMC, Liaoning, Wanxiang, Hailin, Weihai, Premier, ZMC, Luoyang, Wafangdian and Torch. By August 21, 2000, each of these parties (with the exception of Torch) also submitted rebuttal briefs. At the request of certain interested parties, we held a public hearing on August 31, 2000.

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

Scope of Review

Merchandise covered by this review includes tapered roller bearings (TRBs) and parts thereof, finished and unfinished, from the PRC; flange, take up cartridge, and hanger units incorporating tapered roller bearings; and tapered roller housings (except pillow blocks) incorporating tapered rollers, with or without spindles, whether or not for automotive use. This merchandise is currently classifiable under the Harmonized Tariff Schedule of the United States (“HTSUS”) item numbers 8482.20.00, 8482.91.00.50, 8482.99.30, 8483.20.40, 8483.20.80, 8483.30.80, 8483.90.20, 8483.90.30, 8483.90.80, 8708.99.80.15, and 8708.99.80.80. Although the HTSUS item numbers are provided for convenience and customs purposes, the written description of the scope of the order and this review is dispositive.

Rescission of Review in Part

As stated in the Preliminary Results, ZCCBC reported no shipments of subject merchandise to the United States during the POR other than those shipments already examined by the Department as part of ZCCBC's new shipper review. Entry data provided by the Customs Service confirms that there were no POR entries from ZCCBC of TRBs other than those examined under the new shipper review. Therefore, consistent with the Department's regulations and practice, we are rescinding this review with respect to ZCCBC.

As stated in the Preliminary Results, Torch shipped TRBs to an affiliated Canadian party during the POR. According to Torch, the TRBs were originally intended for shipment to Canada. However, they entered the United States and, according to Torch, were erroneously categorized as consumption entries. Torch has provided documentation demonstrating that the merchandise has not been sold to an unaffiliated party in the United States.

As noted in the Preliminary Results, in situations where an affiliated importer enters merchandise during a review period, but does not sell that merchandise during the POR, our normal practice is to liquidate the entries based on other sales of the merchandise made by the affiliated importer during the POR. In this case, however, the company indicated that it did not intend to sell this merchandise in the United States. Thus, we stated our intent to liquidate Torch's merchandise in question without regard to any dumping liability if certain requirements were met. In a June 29, 1999, memorandum, “Review of Zhuzhou Torch Spark Plug Company, Ltd.,” we specified the proof required before we could reach a final determination of whether to liquidate the merchandise in question without regard to dumping liability. The importer, Undercar Canada, Inc., submitted the requisite information in letters dated May 15, September 8, and October 17, 2000.

We, therefore, find that Torch did not sell the merchandise in the United States and, thus, there is no basis to calculate a dumping margin for this merchandise. Accordingly, we are rescinding this review with respect to Torch, and will instruct the Customs Service to liquidate the merchandise in question without regard to any dumping liability.

Determination Not To Revoke Order, in Part

The Department “may revoke, in whole or in part” an antidumping duty order upon completion of a review under section 751 of the Act. While Congress has not specified the procedures that the Department must follow in revoking an order, the Department has developed a procedure for revocation that is described in 19 CFR 351.222. This regulation requires, inter alia, that a company requesting revocation must submit the following: (1) A certification that the company has sold the subject merchandise at not less than normal value (“NV”) in the current review period and that the company will not sell at less than NV in the future; (2) a certification that the company sold the subject merchandise in each of the three years forming the basis of the request in commercial quantities; and (3) an agreement to reinstatement of the order if the Department concludes that the company, subsequent to the revocation, sold subject merchandise at less than NV. See 19 CFR 351.222(e)(1). Upon receipt of such a request, the Department may revoke an order, in part, if it concludes that (1) the company in question has sold subject merchandise at not less than NV for a period of at least three consecutive years; (2) it is not likely that the company will in the future sell the subject merchandise at less than NV; and (3) the company has agreed to its immediate reinstatement in the order if the Department concludes that the company, subsequent to the revocation, sold subject merchandise at less than NV. See 19 CFR 351.222(b)(2).

As noted in the Preliminary Results, pursuant to 19 CFR 351.222(e)(1), CMC, Wafangdian, Wanxiang, and ZMC requested revocation of the antidumping duty order, in part, based on an absence of dumping for at least three consecutive years. As noted below in the “Suspension of Liquidation” section, CMC, Wafangdian, and ZMC were found to have made sales below normal value in the instant review. As such, we find that CMC, Wafangdian, and ZMC do not qualify for revocation.

Wanxiang sold the subject merchandise at not less than normal value for a period of at least three consecutive years. We must determine, as a threshold matter, in accordance with 19 CFR 351.222(e)(1)(ii), whether the company requesting revocation sold the subject merchandise in commercial quantities in each of the three years forming the basis of the request. After consideration of the various comments that were submitted in response to the Preliminary Results, we determine that Wanxiang did not sell the subject merchandise in the United States in commercial quantities in each of the three years cited by Wanxiang to support its request for revocation. See “Analysis of Comments Received, Comment 21,” below. Therefore, we find that Wanxiang does not qualify for revocation of the order on TRBs under 19 CFR 351.222(e)(1)(ii).

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties to this administrative review are addressed in the “Issues and Decision Memorandum” (Decision Memo) from Richard W. Moreland, Deputy Assistant Secretary, Import Administration, to Troy H. Cribb, Assistant Secretary for Import Administration, dated January 3, 2001, 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/frn/summary/list.htm. The paper copy and electronic version of the Decision Memo are identical in content.

Changes Since the Preliminary Results

Based on our review of comments received and a reexamination of surrogate value data, we have made certain changes to the calculations for the final results. These changes are discussed in the following Comments in the Decision Memo or in the referenced final calculation memoranda for particular companies:

All Companies

Use of Market Economy Steel Values—Comments 1 through 3

Valuation of Certain Steel Inputs—Comments 4, 5, 6, and 13

Valuation of Ocean Freight—Comment 11

Valuation of Pallets and Wooden Cases—Comment 10

For changes in the valuation of overhead, SG&A, and profit see comments 8 and 9 of the Decision Memo. In addition to those changes noted in the Decision Memo, we have also revised the calculation of all company-specific overhead costs by adding back into the direct costs (to which the surrogate overhead rate is applied) the value of scrap.

Wafangdian

We applied the Sigma cap to the inland freight expenses of Wafangdian's suppliers. See Comment 14 of the Decision Memo. We increased skilled and unskilled labor hours to account for downtime. See Comment 29 of the Decision Memo. We accounted for post-sale price adjustments relating to previous sales of defective merchandise. See Comment 27 of the Decision Memo. Finally, we used a different surrogate to value plastic bags. See Final Factors of Production Memorandum dated January 3, 2001.

Premier

We have applied partial facts available to fill certain data gaps in Premier's reporting of foreign inland freight. As partial facts available, we have used the average of the unit expenses across those sales for which such expenses were reported. See Comment 33 of the Decision Memo.

We have deducted Premier's reported constructed export price (CEP) credit expenses from U.S. price. For those CEP sales where Premier reported a negative expense, we added the absolute value of that amount to U.S. price. See Comment 34 of the Decision Memo.

Liaoning

We have used the corrected database submitted along with Liaoning's March 20, 2000 supplemental response. See Comment 36 of the Decision Memo.

ZMC

We are using surrogate steel values for ZMC instead of market economy steel values as we did in the Preliminary Results. See Memorandum to the Case File; Calculations for Final Results for Premier (January 3, 2001).

Wehai

We are using surrogate steel values for Weihai instead of market economy steel values as we did in the Preliminary Results. See Comment 38 of the Decision Memo.

Wanxiang

Based on verification findings, we made certain revisions to the calculation of SG&A labor.

Final Results of Review

We determine that the following dumping margins exist for the period June 1, 1998, through May 31, 1999:

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 Requirements

The following cash deposit requirements will be effective upon publication of the final results of this administrative review for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided for by section 751(a)(1) of the Act: (1) For the PRC companies named above, the cash deposit rates will be the rates for these firms established in the final results of this review, except that, for exporters with de minimis rates (i.e., less than 0.5 percent) no deposit will be required; (2) for previously-reviewed PRC and non-PRC exporters with separate rates, the cash deposit rate will be the company-specific rate established for the most recent period during which they were reviewed; (3) for all other PRC exporters, the rate will be the PRC country-wide rate, which is 33.12 percent; and (4) for all other non-PRC exporters of subject merchandise from the PRC, the cash deposit rate will be the rate applicable to the PRC supplier of that exporter. These deposit requirements, when imposed, shall remain in effect until publication of the final results of the next administrative review.

Notification to Importers

This notice also 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 section 751(a)(1) and 771(i) of the Act.

Appendix

List of Comments and Issues in the Decision Memorandum

Comment 1: Market Economy Steel Values

Comment 2: Insignificant Imports from Market Economy Sources

Comment 3: Weight-Averaging Market Economy with Surrogate Steel Values

Comment 4: Cage Surrogate Steel Values

Comment 5: Roller Surrogate Steel Values

Comment 6: Excluding Certain Data from Surrogate Source Data

Comment 7: Labor Costs

Comment 8: Surrogate Calculations for Overhead, SG&A and Profit

Comment 9: Inclusion of Traded Goods in Overhead, SG&A and Profit

Comment 10: Surrogate Values for Pallets and Wooden Cases

Comment 11: Ocean Freight Expenses

Comment 12: Adjusting Surrogate Export Values for Duties

Comment 13: Adding Ocean Freight and Insurance to FOB Export Values

Comment 14: Sigma Cap and PRC Freight Expenses

Comment 15: Exchange Rates

Comment 16: Separate Rates Analysis of Suppliers

Comment 17: U.S. Credit Expenses for EP Sales

Comment 18: The Department Should Grant Revocations

Comment 19: Limiting Revocation to Certain Trading Companies

Comment 20: Limiting Revocation to Particular Models

Comment 21: Revocation with Respect to Wanxiang

Comment 22: CMC's Market Economy Steel Values

Comment 23: Accounting for CMC's Rejects

Comment 24: CMC's Negative Inventory Carrying Costs

Comment 25: Applying Adverse Facts Available to ZMC

Comment 26: Wanxiang's Surrogate Steel Values

Comment 27: Wafangdian's Price Adjustments

Comment 28: Wafangdian's Normal Value for Non-Specification Parts

Comment 29: Double-Counting of Wafangdian's Labor Inputs

Comment 30: Application of the PRC-wide Rate to Premier

Comment 31: Application of Total Adverse Facts Available to Premier

Comment 32: Department's Choice of FOP Data for Each of Premier's Inputs

Comment 33: Premier's Foreign Inland Freight

Comment 34: Deducting Premier's U.S. Credit Expenses in CEP Sales Situations

Comment 35: Adjusting Luoyang's Normal Value for U.S. Credit Expenses for EP Sales

Comment 36: Use of Liaoning's Correct Database

Comment 37: Adjusting Liaoning's normal value for U.S. Credit Expenses for EP Sales

Comment 38: Surrogate Steel Valuation for Weihai

Comment 39: Torch's Affiliated Sales and Transshipped TRBs