Large Power Transformers From France; Preliminary Results of Antidumping Administrative Review

Background

The Treasury Department published in the Federal Register an antidumping finding on LPTs from France on June 14, 1972 (37 FR 11772). On June 6, 1995, we published in the Federal Register (60 FR 29821) a notice of opportunity to

request an administrative review of the antidumping finding on LPTs from France covering the period June 1, 1994 through May 31, 1995. In accordance with 19 CFR 353.22(a)(1)(1995), JST requested that we conduct an administrative review of its sales. We published a notice of initiation of this antidumping duty administrative review on July 14, 1995 (60 FR 36260). The Department is conducting this administrative review in accordance with section 751 of the Act.

Scope of Review

Imports covered by the review are shipments of LPTs; that is, all types of transformers rated 10,000 kVA (kilovolt-amperes) or above, by whatever name designated, used in the generation, transmission, distribution, and utilization of electric power. The term ``transformers'' includes, but is not limited to, shunt reactors, autotransformers, rectifier transformers, and power rectifier transformers. Not included are combination units, commonly known as rectiformers, if the entire integrated assembly is imported in the same shipment and entered on the same entry and the assembly has been ordered and invoiced as a unit, without a separate price for the transformer portion of the assembly. This merchandise is currently classifiable under the Harmonized Tariff Schedule (HTS) item numbers 8504.22.00, 8504.23.00, 8504.34.33, 8504.40.00, and 8504.50.00. The HTS item numbers are provided for convenience and Customs purposes. The written description remains dispositive. This review covers one manufacturer/exporter of transformers, JST, and the period June 1, 1994 through May 31, 1995.

Export Price

For sales made by JST we calculated an export price, in accordance with section 772(a) of the Act, because the subject merchandise was sold to unrelated purchasers in the United States prior to importation into the United States. We calculated export price based on the delivered price to unrelated purchasers. We made deductions for international freight, foreign inland freight, U.S. inland freight, and U.S. duties.

Normal Value

We preliminarily determine that the use of constructed value (CV) is warranted to calculate NV for JST, in accordance with section 773(a) of the Act. While the home market is viable, the particular market situation in this case, which requires that the subject merchandise be built to each customer's specifications, does not permit proper price- to price comparisons in either the home market or a third country. Petitioner and JST agree that CV should be used to calculate NV. Petitioner notes that because LPTs are built to each purchaser's specifications, the likelihood of finding identical merchandise in the home and U.S. markets is remote, and that changing a single specification in an LPT frequently results in literally hundreds of changes to the other physical attributes of the unit. We have reviewed the specifications submitted, as well as information regarding the relationship of certain specifications to costs and have determined that the particular market situation does not permit proper price-to- price comparisons in this case. We have therefore based NV on CV. In addition, we note that in past proceedings involving large, custom- built capital equipment, including prior reviews of this finding, we have normally resorted to CV. (See, e.g., Large Power Transformers from France; Final Result of Antidumping Administrative Review, 60 FR 62808, December 7, 1995; and Mechanical Transfer Presses From Japan: Final Results of Antidumping Duty Administrative Review, 58 FR 68117, December 23, 1993.) CV consists of the cost of materials and fabrication, general expenses, profit, and packing. We used packing costs for merchandise exported to the United States. We made a circumstance-of-sale adjustment by deducting from CV home market direct selling expenses, i.e., warranties and commissions, and adding to CV U.S. direct selling expenses, i.e., commissions, selling expenses, and credit. We also made a circumstance-of-sale adjustment for JST's exchange rate guarantee. JST reported an aggregate profit figure based on its home market sales. JST urges the Department to use this figure for profit, particularly if the Department uses JST's SG&A figures for 1994, because SG&A and profit are both derived from JST's financial statements, and are, therefore, linked. While we have used JST's actual SG&A figures, we question the appropriateness of using JST's submitted profit figure, for the reasons explained in the proprietary memo to the Deputy Assistant Secretary for Compliance. Instead, we have calculated a profit figure based on JST's parent company, Schneider SA as facts otherwise available. However, there may be other profit figures that would be more appropriate for use in the calculation of CV. As examples, we could calculate JST's profit based only on above-cost sales if we had cost data for home market sales, or there may be other relevant information in JST's books and records. Therefore, we are inviting comment on this issue for the final results.

Preliminary Results of the Review

As a result of our comparison of export price to normal value, we preliminarily determine that no dumping margin exists for sales of LPTs made to the United States by JST during the period June 1, 1994 to May 31, 1995. Parties to the proceeding may request disclosure within 5 days of the date of publication of this notice. Any interested party may request a hearing within 10 days of publication. Any hearing, if requested, will be held 44 days after the publication of this notice, or the first workday thereafter. Interested parties may submit case briefs within 30 days of the date of publication of this notice. Rebuttal briefs, which must be limited to issues raised in the case briefs, may be filed not later than 37 days after the date of publication. The Department will publish a notice of final results of this administrative review, which will include the results of its analysis of issues raised in any such comments. The Department shall determine, and the Customs Service shall assess, antidumping duties on all appropriate entries. Upon completion of this review, the Department will issue appraisement instructions directly to the Customs Service. Furthermore, the following deposit rates will be effective upon publication of the final results of this administrative review for all shipments of LPTs from France entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided for by section 751(a)(2)(c) of the Act: (1) The cash deposit rate for the reviewed company will be the rate established in the final results of this review; (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 investigation, but the manufacturer is, the cash deposit rate will be the rate established for the most recent period for the manufacturer of the merchandise; and (4) for all other producers and/or exporters of this merchandise, the cash deposit rate shall be 24 percent, the rate established in the first notice of final results of

administrative review published by the Department (47 FR 10268, March 10, 1982). These deposit rates, when imposed, shall remain in effect until publication of the final results of the next administrative review. This notice also serves as a preliminary 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 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.

Paul L. Joffe, Deputy Assistant Secretary for Import Administration. Dated: March 29, 1996. [FR Doc. 96-8510 Filed 4-5-96; 8:45 am] BILLING CODE 3510-DS-P