federal register - U.S. Government Printing Office

6170 Federal Register / Vol. 62, No. 28 / Tuesday, February 11, 1997 / Noticesmade adjustments to CV, in accordancewith 19 C.F.R. 353.56, for differences incircumstances of sale.The home market and CV databasesthat MELCO submitted did not containmatches for certain U.S. sales. SeeMemorandum from Analyst to File:Preliminary Results for MELCO, January30, 1997. Therefore, in accordance withsection 776 of the Act, we applied a ratebased on the facts available to thesesales. Given the nature and extent of thedeficiency, we have selected theweighted-average rate that we calculatedfor all other sales in this review (1.92percent) as facts available. See section776(a) of the Act.Level of Trade and CEP OffsetAs set forth in section 773(a)(7) of theAct and in the Statement ofAdministrative Action (H.R. Doc. 316,Vol. 1, 103d Cong., 2d Sess. (1994))(SAA) at 829–831, to the extentpracticable, we will calculate NV basedon sales at the same level of trade as theU.S. sale. In this review, we were unableto find comparison sales at the samelevel of trade as the U.S. sales.Accordingly, we compared the sales inthe United States to sales at a differentlevel of trade in the comparison market.In accordance with section773(a)(7)(A) of the Act, if we compare aU.S. sale with a home market sale madeat a different level of trade, we willadjust the NV to account for thisdifference if two conditions are met.First, there must be differences betweenthe actual selling functions performedby the seller at the level of trade of theU.S. sale and at the level of trade of thecomparison market sale used todetermine NV. Second, the differencesmust affect price comparability asevidenced by a pattern of consistentprice differences between sales at thedifferent levels of trade in the market inwhich NV is determined. For CEP sales,section 773(a)(7)(B) of the Actestablishes the procedures for making aCEP ‘‘offset’’ when two conditions exist:(1) NV is established at a level of tradewhich constitutes a more advancedstage of distribution than the level oftrade of the CEP; and (2) the dataavailable do not provide an appropriatebasis for a level-of-trade adjustment.We based the level of trade of CEPsales on the price in the United Statesafter making the CEP deductions undersection 772(d) but before making thedeductions under section 772(c). Wherehome market sales served as the basisfor NV, we determined the NV level oftrade based on starting prices in thehome market. Where NV was based onCV, we determined the NV level of tradebased on the level of trade of the salesfrom which we derived SG&A and profitfor CV.In order to determine whether sales inthe comparison market are at a differentlevel of trade than the CEP, weexamined whether the comparison saleswere at different stages in the marketingprocess than the CEP. We made thisdetermination on the basis of a reviewof the distribution system in thecomparison market, including sellingfunctions, class of customer, and thelevel of selling expenses for each typeof sale. Different stages of marketingnecessarily involve differences inselling functions, but differences inselling functions, even substantial ones,are not alone sufficient to establish adifference in the level of trade.Similarly, while customer categoriessuch as ‘‘distributor’’ and ‘‘wholesaler’’may be useful in identifying differentlevels of trade, they are insufficient inthemselves to establish that there is adifference in the level of trade. SeeCertain Corrosion-Resistant CarbonSteel Flat Products and Certain Cut-to-Length Carbon Steel Plate from Canada:Preliminary Results of AntidumpingDuty Administrative Review, 61 FR51896 (October 4, 1996).MELCO requested that we make alevel-of-trade adjustment, or a CEPoffset if we could not quantify a levelof-tradeadjustment, because sales in thehome market involved a more advancedlevel of trade than the level of trade ofthe CEP. Our analysis of the reportedselling expenses, selling functions, andcustomer classes of U.S. and homemarket sales demonstrates that the homemarket sales are distributed through amore advanced marketing stage thanthat involved at the level of trade of theCEP.Because we compared CEP sales tohome market sales at a different level oftrade, we examined whether a level-oftradeadjustment was appropriate. Inthis case, we were unable to quantifyprice differences involving comparisonsof sales made at different levels of tradebecause the same level of trade as thatof the CEP did not exist in the homemarket. Therefore, we could notdetermine whether there was a patternof consistent price differences betweenthe levels of trade based on respondent’shome market sales of merchandiseunder review.Because we were unable to quantify alevel-of-trade adjustment based on apattern of consistent price differences,we granted a CEP offset where thecomparison sales were at a moreadvanced level of trade than the sales tothe United States, in accordance withsection 773(a)(7)(B) of the Act.To calculate the CEP offset, inaccordance with section 772(d)(1)(D) ofthe Act, we considered the home marketindirect selling expenses and deductedthis amount from NV on home marketsales which we compared to U.S. CEPsales. We limited the home marketindirect selling expense deduction bythe amount of the indirect sellingexpenses incurred in the United States.Currency ConversionWe made currency conversions inaccordance with section 773A of theAct. Currency conversions were made atthe rates certified by the Federal ReserveBank. Section 773A(a) directs theDepartment to use a daily exchange rateto convert foreign currencies into U.S.dollars unless the daily rate involves a‘‘fluctuation.’’ It is our practice to findthat a fluctuation exists when the dailyexchange rate differs from a benchmarkrate by 2.25 percent. See PreliminaryResults of Antidumping DutyAdministrative Review: Certain WeldedCarbon Steel Pipe and Tube fromTurkey, 61 FR 35188, 35192 (July 5,1996). The benchmark rate is defined asthe rolling average of the rates for thepast 40 business days. Because wefound no fluctuation in this case, webelieve it is appropriate to use a dailyexchange rate for currency conversionpurposes.Preliminary Results of the ReviewAs a result of our comparison of theCEP to NV, we preliminarily determinethat the following dumping marginexists for the period January 1, 1995through December 31, 1995:Manufacturer/exporterMargin(percent)MELCO ..................................... 1.92Parties to the proceeding may requestdisclosure within five days of the dateof publication of this notice. Anyinterested party may request a hearingwithin 10 days of publication. Anyhearing, if requested, will be heldapproximately 44 days after thepublication of this notice. Interestedparties may submit written comments(case briefs) within 30 days of the dateof publication of this notice. Rebuttalcomments (rebuttal briefs), which mustbe limited to issues raised in the casebriefs, may be filed not later than 37days after the date of publication. TheDepartment will publish a notice offinal results of this administrativereview, including the results of itsanalysis of issues raised in any suchwritten comments, within 120 days ofpublication of these preliminary results.