Titanium Sponge From Russia; Final Results of Antidumping Duty Administrative Review

Background

On August 31, 1994, Titanium Metals Corporation (TIMET) a U.S. producer of titanium sponge, AVISMA a Russian producer of titanium sponge, Interlink Metals and Chemicals, Inc., (Interlink) an unrelated third country reseller of titanium sponge, and RMI Titanium Company (RMI), a U.S. importer of titanium sponge, requested an administrative review of AVISMA's sales of subject merchandise. The Department initiated the review on September 16, 1994 (59 FR 47609), covering the period August 1, 1993, through July 31, 1994. On September 26, 1995, the Department published the preliminary results of review (60 FR 49576). The Department has now completed this review in accordance with section 751 of the Tariff Act of 1930, as amended (the Act). Unless otherwise indicated, all citations to the statute and to the Department's regulations are in reference to the provisions as they existed on December 31, 1994.

Scope of the Review

The merchandise covered by this review is titanium sponge from Russia. Titanium sponge is chiefly used for aerospace vehicles, specifically, in the construction of compressor blades and wheels, stator blades, rotors, and other parts in aircraft gas turbine engines. Imports of titanium sponge are currently classifiable under the harmonized tariff schedule (HTS) subheading 8108.10.50.10. The HTS subheading is provided for convenience and U.S. Customs purposes; our written description of the scope of this finding is dispositive. This review covers one manufacturer, AVISMA, and the period August 1, 1993 through July 31, 1994.

Analysis of Comments Received

We gave interested parties an opportunity to comment on the preliminary results. We received comments from the respondent and the petitioner. At the request of AVISMA, Interlink, and RMI, we held a public hearing on December 7, 1995.

Comment 1

AVISMA argues that it had sufficient knowledge at the time of sale that at least a portion of its sales were destined for resale in the United States. AVISMA argues that there is sufficient and detailed evidence on the record in the form of affidavits and letters of correspondence to support its contention that while it did not know the final destination of each of its sales at the time of sale, it did know that a substantial portion of its sales to Interlink, an international trader, were destined for the United States. Citing to Certain Stainless Steel Sheet and Strip Products From the Federal Republic of Germany; Final Determination of Sales at Less Than Fair Value, 48 FR 20459 (May 6, 1983) (Stainless Steel), AVISMA states that the Department has based the United States price on the purchase price when a foreign producer selling through a trading company knows that part of the merchandise was destined for the United States at the time of purchase. AVISMA contends that its inability to identify particular shipments that were resold in the United States is irrelevant and unnecessary to the Department's final determination. AVISMA argues that the Department's requirement, as described in Television Receivers, Monochrome and Color, From Japan; Final Results of Antidumping Duty Administrative Review, 58 FR 11211 (February 24, 1993), that there be knowledge of the destination of specific shipments is wrong. AVISMA states that general knowledge of the destination of sales should be enough under the antidumping law. Petitioner, citing to Chrome-Plated Lug Nuts from Taiwan, (56 FR 36130, July 31, 1991) and Urea from the U.S.S.R., (52 FR 19557, May 26, 1987), respectively, argues that: (1) it is the Department's longstanding practice to base U.S. price on sales by a producer to an unrelated trading company outside the United States only when the producer knows at the time of sale that the merchandise is destined for the United States; and, (2) the Department does not base U.S. price on sales to an unrelated trading company when the producer does not know at the time of sale that the merchandise is destined for the United States. Petitioner states that in this case, AVISMA's export sales were to unrelated companies for shipment to places outside the United States and that AVISMA was not aware of the final destination of the merchandise it sold for export at the time of sale. Petitioner states that under these circumstances, the U.S. price must be based on the sale from the trading company to the U.S. purchaser, i.e., the sale for export to the United States. Petitioner, citing to Pure Magnesium and Alloy Magnesium from the Russian Federation, (60 FR 16440, March 30, 1995), further argues that even if AVISMA had a general knowledge that some unknown portion of the merchandise it exported might be entered for consumption in the United States, such knowledge is insufficient to transform AVISMA's export sales into sales of merchandise subject to the antidumping duty order. Petitioner further challenges Interlink's suggestion that it is ``irrelevant and unnecessary'' for the Department to identify the particular shipments that were resold to the United States in order to make a final determination. Petitioner states that section 751(a)(2) of the Act explicitly requires that assessments and deposits of estimated antidumping duties be based on entries of merchandise subject to an antidumping duty order and that merchandise sold for export to destinations outside the United States is not subject to a U.S. antidumping duty order.

Department's Position

We disagree with respondents. Section 772(b) of the Act defines purchase price as ``the price at which merchandise is purchased, or agreed to be purchased, prior to the date of importation, from a reseller or the manufacturer or producer of the merchandise for exportation to the United States.'' The Department has consistently defined a U.S. sale as a sale in which a manufacturer is informed in advance that the merchandise is destined for the United States, or has reason to know of the ultimate destination of the merchandise at the time of sale, through special markings, market-specific specifications, or shipping instructions. See, e.g., Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts From France, et al.; Final Results of Antidumping Duty Administrative Review, (57 FR 28360, 28423, June 24, 1992); Ferrovanadium and Nitride Vanadium From the Russian Federation; Notice of Final Determination of Sales at Less Than Fair Value, (60 FR 27957, May 26, 1995); Natural Bristle Paint Brush and Brush Heads From the People's Republic of China; Final Results of Antidumping Duty Administrative Review, (55 FR 42599, October 22, 1990); Television Receivers, Monochrome and Color, From Japan; Final Results of Antidumping Duty Administrative Review, (58 FR 11211, February 24, 1993); Oil Country Tubular Goods From Canada; Final Results of Antidumping Duty Administrative Review, (55 FR 50739, December 10, 1990); Urea From the Union of Soviet Socialist Republics; Final Determination of Sales at Less Than Fair Value, (52 FR 19557, May 26, 1987); and, Pure Magnesium and Alloy Magnesium from the Russian Federation; Final

Determination of Sales at Less Than Fair Value, (60 FR 16440, March 30, 1995). Furthermore, the Stainless Steel case cited by AVISMA does not contradict the Department's practice. While AVISMA suggests that it knew or should have known that part of the merchandise was destined for the United States, the record demonstrates that AVISMA was not informed in advance of the destination of the merchandise that it sold to Interlink nor did it have reason to know of the ultimate destination of the merchandise at the time of sale. Interlink, as an international trader of metals, sells titanium sponge to other countries as well as to the United States and titanium sponge specifications are based on world-wide standards in accordance with its expected applications rather than the ultimate destination of the merchandise.

Comment 2

Respondent argues that the Department should review Interlink's sales to the United States because the request for review submitted on behalf of AVISMA, Interlink, and RMI clearly was intended to cover Interlink's sales to the United States during the period of review. Respondent states that the submission on behalf of the three companies requested the Department to conduct a review of ``AVISMA's U.S. sales subject to the antidumping duty order on titanium sponge from Russia.'' Respondent states that since AVISMA is a producer of titanium sponge, Interlink is an exporter of titanium sponge, and RMI is an importer of titanium sponge, the clear intent of the request for review was to seek a review of AVISMA's sales to the United States through the only exporter identified, Interlink. Respondent argues that Interlink, in seeking a review of AVISMA's sales, clearly intended for the Department to review Interlink's shipments and that the Department cannot rationally construe the request for review in any other manner. Petitioner argues that since AVISMA was the only party for which a review was requested it is the only party the Department is authorized by law to review. Petitioner states that 19 CFR 353.22(a) authorizes the Department to review only those producers or resellers for which it has received a timely request for review. Petitioner states that, pursuant to 19 CFR 353.22(e)(2), if the Department does not receive a timely request for review of a producer or resellers, antidumping duties are automatically assessed on entries of merchandise not covered by the review request in the amount of the antidumping duties deposited at the time the merchandise entered the United States. Petitioner states that in this case, the Department received a timely request for review of a specified producer, AVISMA and that therefore, the assessment and deposit rates for all other producers and resellers, including Interlink, are determined by operation of law. Petitioner, citing to Chrome-Plated Lug Nuts from Taiwan, (56 FR 36130, July 31, 1991), argues that the Department does not, and in the context of an administrative review, it cannot review sales by an unrelated trading company unless it is asked to do so.

Department's Position

We disagree with the respondent. With respect to requests for review, section 353.22(a) of the Department's regulations states that, ``(e)ach year during the anniversary month of the publication of an order * * * an interested party * * * may request * * * an administrative review of specified individual producers or resellers covered by an order (emphasis added)'.' For those producers or resellers for whom no review is specifically requested, the Department ``will instruct the Customs Service to assess antidumping duties * * * on the merchandise not covered by the request.'' 19 C.F.R. Sec. 353.22(e)(2)(1995). In the instant case, interested parties (i.e., AVISMA, Interlink, RMI, and TIMET) only requested an administrative review of AVISMA's sales, not Interlink's sales. Accordingly, since a review of Interlink's sales was not requested by interested parties, such sales are not covered by this administrative review.

Final Results of Review

Based on our analysis of the comments received, we have not changed the final results from those presented in the preliminary results of review. Accordingly, we have determined that, consistent with the preliminary results, the margin for Russian titanium sponge that entered the United States during the period of review will continue to be the rate from the most recent review, which is 83.96 percent. The Department will issue appraisement instruction directly to the U.S. Customs Service. Furthermore, as provided by section 751(a)(1) of the Act, the cash deposit rate for all shipments of titanium sponge from Russia, entered or withdrawn from warehouse, for consumption on or after the publication date of the final results of this administrative review, will be 83.96 percent. These deposit requirements, when imposed, 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 353.26 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 notice also serves as a reminder to parties subject to administrative protective orders (APOs) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 353.34(d). Timely written notification of return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation. This administrative review and notice are in accordance with section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and 19 CFR 353.22.

Dated: February 29, 1996. Susan G. Esserman, Assistant Secretary for Import Administration. [FR Doc. 96-5596 Filed 3-8-96; 8:45 am] BILLING CODE 3510-DS-P