SUMMARY

On July 17, 2000, the U.S. Court of International Trade ("the Court") remanded the above-referenced case to the Department of Commerce ("the Department") on three issues: (1) to reopen the administrative record and collect additional evidence concerning Eletrosilex S.A.'s ("Eletrosilex's") claimed inability to respond to the supplemental questionnaires; (2) to determine whether it is appropriate for the Department to resort to total, as opposed to partial, adverse facts available ("FA") in determining a dumping margin for Eletrosilex; and (3) to determine whether the Department erred in its selection of the adverse FA dumping margin applied to Eletrosilex.

For these final remand results, we have collected additional information and reviewed our methodology in accordance with the Court's instructions. We determine that it is appropriate to apply total FA and to treat Eletrosilex as not acting to the best of its ability when it failed to respond to the Department's supplemental questionnaires. Consequently, we have selected as total adverse FA, the rate of 93.20 percent, a calculated margin for another respondent in the less-than-fair-value ("LTFV") investigation. For a more detailed explanation of each issue, please see the "Discussion" section below.

BACKGROUND

The Department issued the antidumping ("AD") questionnaire in the 1996-1997 administrative review to Eletrosilex on September 22, 1997. We received Eletrosilex's responses to Section A and Sections B, C, and D of this questionnaire on October 30, 1997, and December 1, 1997, respectively. After an analysis of Eletrosilex's questionnaire responses, on March 24, 1998, we issued the first of three supplemental questionnaires to Eletrosilex. Eletrosilex responded to this supplemental request for information on April 10, 1998. Due to continued deficiencies in Eletrosilex's response and the need for further clarifications on topics such as home market sales, U.S. sales, cost of production, constructed value, and ICMS taxes, on June 29, and July 6, 1998, the Department issued additional supplemental questionnaires to Eletrosilex noting, in accordance with section 782(d) of the Act, that failure to respond to the Department's supplemental requests for information could result in the use of FA. On July 2, 1998, the Department mailed the June 29, 1998, supplemental questionnaire to counsel for Eletrosilex because repeated telephone calls to counsel had failed to result in pick-up of the June supplemental at the Department's courier pick-up office. See, Commerce Memorandum: Eletrosilex Supplemental Questionnaires, (July 7, 1998). On July 7, 1998, counsel for Eletrosilex informed the Department that he had not picked up the supplemental questionnaire because of a business trip and the unexpected illness of his assistant. Id. Counsel further informed the Department that he would provide it with the status of the responses as soon as he found out. Id. On July 20, 1998, counsel for Eletrosilex called the Department to inform us that "because of top to bottom management reviews, and changes in staffing" Eletrosilex would not be able to respond in a timely manner to the second and third supplemental questionnaires (see Memorandum to the File from Robert Bolling, dated July 20, 1998) (emphasis added). Eletrosilex ultimately did not respond to the June 29 or July 6, 1998, supplemental questionnaires at all.

For purposes of the preliminary results of this review, the Department found that Eletrosilex had failed to cooperate to the best of its ability. However, we further stated that in light of the requirements of section 782(e) of the Tariff Act of 1930, as amended, ("the Act"), the facts of this review demonstrated that while Eletrosilex's data was incomplete for certain elements of the calculation, nevertheless, the Department had enough data on the record to calculate a dumping margin. Therefore, the Department resorted to partial adverse FA in order to recalculate Eletrosilex's depreciation expenses, amortization expenses, electricity cost, and financial expenses (see Silicon Metal from Brazil: Preliminary Results of Antidumping Duty Administrative Review, 63 FR 42001, 42007 (August 6, 1998) ("Preliminary Results"), and the "Analysis of Data Submitted by Eletrosilex Belo Horizonte (Eletrosilex) in the Sixth Administrative Review (96-97) of the Antidumping Duty Order on Silicon Metal from Brazil" memorandum, dated July 30, 1998). The resulting preliminary dumping margin for Eletrosilex was 33.11 percent.

Subsequently, the petitioners argued in their October 2, 1998, case brief, that the statement in the preliminary results of this review that "the Department has enough data on the record to reasonably calculate a dumping margin," was unsupported by the record. Specifically, the petitioners maintained that Eletrosilex provided inadequate cost data and insufficient evidence for the Department to determine whether the involvement of Eletrosilex's affiliates in its U.S. sales required the use of constructed export price ("CEP") as the basis for U.S. price, rather than export price ("EP"), as was claimed by Eletrosilex in its original questionnaire response and which was used by the Department in the preliminary results. Eletrosilex did not submit case or rebuttal briefs in this review and, thus, did not address the petitioners' comments.

In light of petitioners' claim that the record evidence was insufficient to properly determine production costs or to determine whether Eletrosilex's U.S. sales were CEP or EP transactions, we re-evaluated whether information on the record was sufficient for purposes of calculating a dumping margin in accordance with section 782(e) of the Act. As a result of this re-evaluation of Eletrosilex's responses, we determined that there was insufficient information on the record to enable us to distinguish between CEP and EP transactions or to properly test home market transactions for sales below the cost of production in order to establish their reliability as a benchmark for comparison to U.S. sales in determining whether U.S. sales were sold at dumped prices. When taken together, we considered these inadequacies in Eletrosilex's information to result in a response that was so incomplete that it could not serve as a reliable basis for determining whether dumping was taking place.

Moreover, for the final results of the review, we determined that Eletrosilex did not act to the best of its ability to comply with the Department's requests for information, justifying an adverse inference under section 776(b) of the Act. Consequently, pursuant to section 776(b) of the Act, we based Eletrosilex's margin on adverse FA for purposes of the final results. As adverse FA for Eletrosilex, we used the highest rate calculated for any respondent in any segment of this proceeding. This rate is 93.20 percent (see Final Determination of Sales at Less Than Fair Value: Silicon Metal from Brazil, 55 FR 38716 (September 20, 1990)). Eletrosilex appealed our final determination to the CIT and this remand resulted from that appeal.

Following the CIT's decision (July 17, 2000), on August 1, 2000, Wayne Bishop notified the Department that he was withdrawing his appearance as counsel to Eletrosilex. Further, he instructed the Department that all future correspondence should be served directly to the company. Mr. Bishop did not advise the Department whether new counsel for Eletrosilex had been retained. Consistent with the Court's remand instructions and Mr. Bishop's advice, on September 11, 2000, the Department sent (via Federal Express) a letter directly to Eletrosilex asking for additional information by September 19, 2000, on its alleged inability to respond to the supplemental questionnaires. On September 20, 2000, Phillipe Bruno filed an appearance with the Department as Eletrosilex's new counsel. Mr. Bruno requested an extension of time in order to respond to the Department's request for new information. We established a new deadline of September 29, 2000, to allow Eletrosilex to submit new information for the record. Upon review of the information, the Department requested additional clarification of the submitted information. After two additional extensions of time, both requested by Eletrosilex, we received those clarifications on November 8, 2000.

On December 20, 2000, the Department issued a draft remand redetermination to interested parties for comments. On January 3, 2001, Eletrosilex commented on the Departmental draft remand. The petitioners elected not to submit comments on the draft.

DISCUSSION

1. Whether Eletrosilex Acted to the Best of its Ability When It Failed to Respond to the Department's 1998 Supplemental Questionnaires.

On September 29, 2000, Eletrosilex submitted an Affidavit from Mr. Cancado, Eletrosilex's President and Administrative-Financial Director as part of its response to the Department's September 11, 2000, letter requesting additional information on Eletrosilex's alleged inability to respond to the questionnaires in the underlying AD administrative review. In the Affidavit, Mr. Cancado stated that on April 16, 1998, after Eletrosilex failed to meet certain financial obligations, the Montparnasse Fund ("the Fund"), a major investor in Eletrosilex, took control of the company. According to the Affidavit, the Fund's most immediate goal was to find a buyer for Eletrosilex that would be able to inject capital and assume control of management responsibilities in the company. The affidavit reflects the following time line of events. In May 1998, Eletrosilex (now managed by a representative of the Fund) decided to suspend "certain" operations while the company assessed its situation and set goals. Within weeks, a number of high level executives, including the President of the company, its Financial and Commercial Directors and part of the staff reporting to them, were relieved of their responsibilities.

In June 1998, the Fund found a potential buyer for Eletrosilex. That buyer requested from Eletrosilex a complete package of historical and commercial data, along with future sales projections. On June 29 and July 6, 1998, the Department issued to Eletrosilex two additional supplemental questionnaires pursuant to the 1996-1997 administrative review.

After reviewing the Department's requests for information, Eletrosilex determined that it could not respond within the deadlines stipulated in those requests. According to the recently submitted Affidavit, Eletrosilex determined that it would take at least seven days to prepare the Department's questionnaire responses because the key sales personnel, knowledgeable about the data had departed, and the response would have to be prepared by the Administrative Manager and his staff, who were working to meet the deadline for compilation of information for the potential new purchaser of Eletrosilex and to prepare evaluative data for Eletrosilex's own assessment needs.

On July 20, 1998, Eletrosilex informed the Department that it could not meet the established deadlines citing a total management restructuring within the company. At no point, though, did Eletrosilex request an extension of time or clearly inform the Department that it could not respond at all to the information requests.

On August 3, 1998, Eletrosilex became aware that the Department had issued its preliminary results in the 1996-1997 AD administrative review, wherein it determined a dumping margin of 33.11 percent for Eletrosilex. According to Eletrosilex's Affidavit, at that time, the acquisition discussions were "very serious," and due to the "high potential for reaching an agreement," management made a conscious decision to refrain "from hiring new officers and staff, and had postponed all cost-related decisions so that those decisions could be made by the acquiring company. Accordingly, Eletrosilex concluded that it should temporarily suspend the costs associated with participating in further annual reviews at the DOC" until the completion of the acquisition discussions. Affidavit, at paragraph 10. Therefore, Eletrosilex did not file case or rebuttal briefs addressing the Department's preliminary results of review and petitioners' allegations regarding those preliminary results.

We note, however, that during June and July 1998 Eletrosilex continued to produce and sell subject merchandise in the home market. See Lists of home market sales from: Final Results of Antidumping Duty Administrative Review: Silicon Metal From Brazil, 65 FR 7497 (February 15, 2000) ("1997-1998 Silicon Metal") and Silicon Metal From Brazil: Preliminary Results of Antidumping Duty Administrative Review and Notice of Intent Not To Revoke Order in Part 65 FR 47960, (August 4, 2000) ("1998-1999 Silicon Metal").

By October 1998, acquisition discussions had not proven successful. Eletrosilex had completed its internal assessment, and decided to implement a new operational strategy as part of this plan. At that time, Eletrosilex hired a new Commercial Director and, once again, authorized use of resources to participate in the antidumping process.

We conclude from this evidence that during the months of May, June and July 1998, there were four concurrent activities which could have affected Eletrosilex: 1) producing and selling subject merchandise in the home market; 2) preparing information for a potential buyer found by the Fund; 3) compiling evaluative data for Eletrosilex's own assessment needs; and 4) participating in the Department's antidumping duty review. The record clearly shows that Eletrosilex decided to continue the first three activities but not the fourth, since it had decided to suspend making any "cost-related decision." Affidavit, at paragraph 10. This choice was not forced upon Eletrosilex rather, it was a management decision. Nowhere in the Affidavit has Eletrosilex stated that it could not dedicate resources to answering the Department's supplemental questionnaires. Rather, the Affidavit indicates that operations continued and that the current management made conscious decisions regarding what resources to expend for daily operations and where these resources should be dedicated. In fact, the information in this document demonstrates that once the management decided to dedicate resources to the new operational strategy it developed, the firm hired a new Commercial Director, additional staff, and even resumed participation in the Department's AD proceedings. Thus, the circumstances set out by information on the record, including the new information submitted during this remand proceeding, indicate that Eletrosilex had the capability to respond to the Department's requests, but made a management decision not to do so. Consequently, we conclude that Eletrosilex did not cooperate to the best of its ability when it decided not to provide any additional information in the course of the review.

2. Application of Total FA

Section 776(a)(2)(B) of the Act provides that if an interested party fails to provide requested information in a timely manner or in the form or manner requested, the Department shall use, subject to sections 782(c)(d) and (e), facts otherwise available in reaching the applicable determination. In this review, as described in detail below, Eletrosilex failed to provide the necessary information in the form and manner requested. Thus, pursuant to section 776(a) of the Act, the Department is applying, subject to sections 782(c)(d) and (e), facts otherwise available.

While not responding to the Department's supplemental questionnaires, Eletrosilex did not suggest any alternative form in which it might be able to submit the requested information, as provided by section 782(c) of the Act. Accordingly, we have not considered whether to modify the requirements of the supplemental questionnaires.

Section 782(d) of the Act provides that, if the Department determines that a response to a request for information does not comply with the request, the Department will inform the person submitting the response of the nature of the deficiency and shall, to the extent practicable, provide that person the opportunity to remedy or explain the deficiency. If that person submits further information that continues to be unsatisfactory, or this information is not submitted

within the applicable time limits, the Department may, subject to section 782(e), disregard all or part of the original and subsequent responses, as appropriate.

Pursuant to section 782(e) of the Act, notwithstanding the Department's determination that the submitted information is "deficient" under section 782(d) of the Act, the Department shall not decline to consider such information if all of the following requirements are satisfied: (1) the information is submitted by the established deadline; (2) the information can be verified; (3) the information is not so incomplete that it cannot serve as a reliable basis for reaching the applicable determination; (4) the interested party has demonstrated that it acted to the best of its ability; and (5) the information can be used without undue difficulties.

After careful and extensive re-evaluation of the information on the record, we continue to determine that the use of total adverse FA is warranted for Eletrosilex in the underlying administrative review in accordance with section 782(e) of the Act. Specifically, we note that Eletrosilex failed to meet the third, fourth and fifth criteria enunciated under this section of the statute.

With respect to section 782(e)(3) of the Act, we note that the information is so deficient that it cannot serve as a reliable basis for reaching the applicable determination. First, although Eletrosilex stated that it had no CEP sales during the period of review ("POR") (see Eletrosilex's Section A questionnaire response, dated October 30, 1997, at page 4) and that all of its sales in the United States during the POR were EP sales (see Eletrosilex's Sections B, C, and D response dated December 1, 1997, at page C-4), the sales documentation provided by Eletrosilex in Exhibit 5 of its Section A response, indicates that this may not be the case. The sample purchase order contained in Exhibit 5 of Eletrosilex's Section A response, which relates to one of Eletrosilex's U.S. sales made during the POR, is marked for the attention of the Director of [ ]. According to Exhibit 5 of Eletrosilex's Section A response, [ ] (a U.S. affiliate of Eletrosilex), is engaged in the export and import of several products, including silicon metal. The text of the purchase order further references faxes from [ ] and Eletrosilex S/A in Brazil (see Exhibit 5 of Eletrosilex's Section A response).

All of this information indicates that at least some of Eletrosilex's sales to the United States may have been CEP transactions. Since the treatment of EP transactions is different from that of CEP transactions in an AD analysis, (i.e., different adjustments are made to both U.S. and home market prices depending upon whether the U.S. sale is an EP or CEP transaction) the Department cannot calculate an accurate or appropriate dumping margin without discerning the type of transaction. In an attempt to clarify this information, the Department issued a supplemental questionnaire to Eletrosilex on March 24, 1998. However, Eletrosilex only partially responded to this request for information and, thus the appropriate treatment of its U.S. sales (as either EP or CEP transactions) remained unclear.

In the continued absence of sufficient support for Eletrosilex's claim that all sales to the United States should be treated as EP transactions, the Department took the additional step of issuing further supplemental questionnaires, requesting sales documentation that would be regularly generated by Eletrosilex in the course of selling to the United States and that would help resolve this issue. Eletrosilex failed to provide even this documentation. Moreover, we note that this was not the only unresolved issue addressed in the supplemental questionnaires. In addition, we had requested that Eletrosilex provide the financial statements and other relevant documents for the following affiliates: [ ], [ ], [ ] and [ ] which are necessary to determine the appropriate amount of selling expenses and profit in a CEP calculation. Furthermore, the Department asked Eletrosilex questions regarding the following expense and revenue items: depreciation expenses, by-product revenue, indirect selling expenses, electricity costs, fixed overhead, interest income, duty drawback, and ICMS taxes. These are all critical elements of determining the costs that are needed to test the home market for sales below cost of production. When the Department considers the significance of the deficiencies in Electrosilex's cost data and U.S. sales information taken together, we find the response overall to be so incomplete that it cannot serve as a reliable basis for conducting our AD analysis.

With respect to section 782(e)(4) of the Act, as discussed in detail in section 1 above, we have determined that Eletrosilex did not act to the best of its ability to comply with the Department's requests for information.

Further, we note that Eletrosilex has also failed to satisfy the fifth criteria of section 782(e) of the Act, that is, the information submitted cannot be used without undue difficulties. Eletrosilex failed to provide significant elements that comprise the cost of production for silicon metal. Furthermore, the distinction between CEP and EP is the fundamental basis for calculating U.S. price, and we cannot use the response information for this issue without undue difficulty. While we could make an inference regarding Eletrosilex's U.S. sales and classify them as CEP, the Department does not have the information necessary to make the required CEP adjustments without undue difficulties. For example, as a result of Eletrosilex's failure to respond to the supplemental questionnaires, there is insufficient information on the record for us to determine the appropriate amount of selling expenses and profit to use in a CEP calculation.

As discussed above, by not providing the requested information, Eletrosilex has failed to meet the third, fourth, and the fifth criteria enunciated under section 782(e) of the Act. As a result, the Department must resort to the use of total facts available for Eletrosilex in the underlying review.

A. Adverse Inferences

For the reasons set out above, we determine that Eletrosilex did not act to the best of its ability to comply with the request for information, justifying an adverse inference under section 776(b) of the Act. Pursuant to section 776(b) of the Act, we are basing Eletrosilex's margin on adverse FA for purposes of this remand redetermination.

B. Selection and Corroboration of Adverse FA

Section 776(b) of the Act authorizes the Department to use as adverse FA information derived from the petition, the final determination from the LTFV investigation, a previous administrative review, or any other information placed on the record. Section 776(c) of the Act requires the Department to corroborate, to the extent practicable, secondary information used as FA. Secondary information is defined as "[i]nformation derived from the petition that gave rise to the investigation or review, the final determination concerning the subject merchandise, or any previous review under section 751 concerning the subject merchandise." See Statement of Administrative Action ("SAA") accompanying the URAA, H.R. Doc. No. 316, 103d Cong., 2d Sess. 870 (1994).

The SAA further provides that the term "corroborate" means simply that the Department will satisfy itself that the secondary information to be used has probative value (see SAA at 870). Thus, to corroborate secondary information, the Department will, to the extent practicable,

examine the reliability and relevance of the information used. The rate selected here,

93.20 percent, is a calculated rate for another respondent in a prior segment of this proceeding. Thus, it is not necessary to question the reliability of the rate. See e.g., Extruded Rubber Thread from Malaysia; Final Results of Antidumping Duty Administrative Review, 65 FR 6140 (February 8, 2000) and 1996-1997 Silicon Metal.

As to the relevance of the margin used for adverse FA, the courts have stated that "by requiring corroboration of adverse inference rates, Congress clearly intended that such rates should be reasonable and have some basis in reality." See F.Lli De Cecco Di Filippo Fara S. Martino S.p.A., v. U.S., 216 F. 3^rd 1027, 1034 (Fed. Cir. 2000).

In determining an adverse FA rate for Eletrosilex, the Department notes that calculated margins for Eletrosilex have historically fluctuated between the present rate of 18.87 percent and 51.84 percent. See 1997-1998 Silicon Metal, and Silicon Metal From Brazil: Amended Final Results of Antidumping Duty Administrative Review in Accordance With Court Decision, 65 FR 33297 (May 23, 2000) ("1992-1993 Amended Final"). Eletrosilex received a calculated rate of 18.87 percent for the 1997-1998 POR, a calculated rate of 39.00 percent for the 1995-1996 POR, a calculated rate of 6.33 percent for the 1994-1995 POR, a calculated rate of 38.39 percent for the 1993-1994 POR, and a calculated rate of 51.84 percent for the 1992-1993 POR. See 1997-1998 Silicon Metal, 1996-1997 Silicon Metal, Final Results of Antidumping Duty Administrative Review: Silicon Metal From Brazil, 63 FR 6899 (February 11, 1998) ("1995-1996 Silicon Metal"), Silicon Metal From Brazil; Amended Final Results of Antidumping Duty Administrative Review, 62 FR 54087 (October 17, 1997), Silicon Metal From Brazil; Amended Final Results of Antidumping Duty Administrative Review, 62 FR 54094 (October 17, 1997) and, 1992-1993 Amended Final respectively.

It is in the context of substantial fluctuations in its dumping margins that we evaluate Eletrosilex's failure to cooperate to the best of its ability in the review at issue. In situations involving non-cooperative respondents, the Department has stated in the past that it is its normal practice, to select as adverse FA the highest margin from the current or any previous segment of the same proceeding. See, Elemental Sulphur from Canada: Final Results of Antidumping Duty Administrative Review, 65 FR 11,980 (March 7, 2000); Brass Sheet and Strip from Germany: Final Results of Antidumping Duty Administrative Review, 63 FR 42,823 (Aug. 11, 1998).

Therefore, it is not unreasonable to assume that a respondent, knowing the Department's practice in assigning adverse FA, would have provided current information if its current margin was less. Moreover, we note that several respondents in this proceeding similarly have received widely varying calculated margins, ranging from zero to 61.58 percent for CBCC and up to 81.61 percent for RIMA in the 1993-1994 and 1994-1995 PORs, respectively, and, in the original LTFV investigation, CCM and CBCC received calculated margins of 93.20 and 87.79 percent, respectively. See, Silicon Metal From Brazil; Amended Final Results of Antidumping Duty Administrative Review, 62 FR 54094 (October 17, 1997), Silicon Metal from Brazil, Final Results of Redetermination Pursuant to Court Remand (Sep. 23, 1999), and Final Determination of Sales at Less Than Fair Value: Silicon Metal from Brazil, 55 FR 38716 (September 20, 1990). Notably, these widely varying margins generally have not coincided among all companies. In the same periods that margins of 61.58 percent and 81.61 percent were calculated for individual companies, other companies received zero or single digit rates.

Eletrosilex, an experienced participant in the antidumping proceedings since the 1991-1992 POR, knew that if it failed to act to the best of its ability, and the Department applied adverse FA, the rate selected could very well be the highest calculated rate in the proceeding, i.e., the 93.20 percent rate obtained in the LTFV investigation. In determining the FA rate here, the Department considered the fact that, in the 1993-1994 and 1994-1995 PORs, the Department calculated dumping margins of 61.58 percent for CBCC and 81.61 percent for RIMA, respectively, while at the same time, calculating zero or single digit rates for other respondents, demonstrating that in this particular market, some companies may continue to dump at substantial margins while others have eliminated or substantially lowered their margins. The fact that these disparate rates have continued throughout the reviews since the original LTFV investigation, combined with the Eletrosilex's management decision not to respond to the requests for information, supports our conclusion that the 93.20 percent rate from the investigation remains reasonable and relevant. The Department's determination here is in accordance with the Department's policy of selecting the highest corroborated rate in the entire proceeding in order to induce future cooperation of a respondent.

In sum, pursuant to section 776(b) of the Act, we are basing Eletrosilex's margin on adverse FA for purposes of this remand redetermination. As adverse FA for Eletrosilex, we have used a calculated rate from a prior segment of this proceeding. This rate is 93.20 percent. See, Final Determination of Sales at Less Than Fair Value: Silicon Metal from Brazil, 55 FR 38716 (September 20, 1990).

COMMENTS RECEIVED

Comment 1: Eletrosilex claims that the Department has not presented evidence indicating that Eletrosilex was unwilling to provide the requested additional information during the 1996-1997 POR. According to Eletrosilex, the Court concluded that the information on the record was insufficient to show that Eletrosilex failed to act to the best of its ability. Consequently, in the current case, the Court instructed the Department to reopen and collect additional information. Further, Eletrosilex claims that despite the additional information, collected by the Department during the current stage of the proceeding, the Department "mischaracterized" the submitted information and, instead, concluded that Eletrosilex made a deliberate "management decision" not to respond to the Department's requests for information, despite having the capability of responding. See, Sixth Administrative Review of Silicon Metal from Brazil (Remand),

January 3, 2001, at 2; ("Eletrosilex's Comments"). Eletrosilex claims that lack of participation in the remainder of the review was not a management decision in the same way that it was not a management decision to become bankrupt, to provide voluminous data to a potential buyer, or to lose key personnel. Moreover, Eletrosilex argues that the fact that it continued to sell the subject merchandise in the home market has no bearing on the issue of cooperation with the Department, because "no court can blame a company for placing a priority in carrying on its essential business, which is to sell the product that it produces." See, Eletrosilex's Comments,

at 3.

Department's Position: We disagree with Eletrosilex. Our review of the record, including the additional information provided by Eletrosilex, indicates that throughout the 1996-1997 POR, Eletrosilex was involved in several aspects of its business activities with the exception of cooperating with the Department. As stated above, after advising the Department on July 20, 1998, that it would not respond to any additional questionnaires, due to the management and staffing restructuring, Eletrosilex ceased any further contact with the Department. After the Department published its preliminary results, Eletrosilex failed to file any briefs explaining its circumstances or suggesting alternative solutions. However, throughout this period, the record clearly reflects that Eletrosilex was busy selling substantial quantities of silicon metal in the home market, seeking new capital (through investors or buyers) and cutting costs (i.e., suspending of certain operations). See, the Affidavit, paragraphs 5,10. It is only after the Department assigned a total adverse FA rate of 93.20 percent in the final results of that review that Eletrosilex dedicated resources to the antidumping process and filed a complaint with the Court. Contrary to Eletrosilex's claim, it has provided no record evidence that it was unable to cooperate with the Department. Rather, the record demonstrates that Eletrosilex reallocated its resources, thus, indeed making a "management decision" as to cooperation (or lack thereof) with the Department.

We note that when a party gives the Department an inadequate response to an initial questionnaire, then totally ignores supplemental requests for information by the Department and claims that management decisions precluded participation, such actions cannot mean that the party has acted to the best of its ability. Otherwise, parties could easily ignore any supplemental questionnaires issued by the Department, without any concern that the Department could apply total adverse FA. In fact, it appears that Eletrosilex took a calculated step of "wait and see" rather than attempting to dedicate the necessary resources in answering the supplemental questionnaire. Despite claims of financial distress, it is evident that once Eletrosilex learned that in the final results of the 1996-1997 administrative review the Department applied total adverse FA, Eletrosilex dedicated sufficient resources to file a complaint with the Court against the Department. In sum, Eletrosilex reiterated its prior position without providing any new arguments. For the foregoing reasons, the Department continues to determine that Eletrosilex failed to cooperate to the best of its ability in the instant review.

Comment 2: Eletrosilex claims that the Department's choice of a total adverse FA rate of 93.20 percent is neither relevant nor reliable in this case. Eletrosilex also argues that the fact that other respondents had rates higher than Eletrosilex in the preceding administrative reviews does not prove that the 93.20 percent is a relevant rate. Finally, in the event the Department continues to find that a total adverse FA rate is applicable, Eletrosilex claims that such rate should not exceed 51.84 percent, Eletrosilex's own highest calculated rate in a prior proceeding.

Department's Position: We disagree with Eletrosilex. Despite its claim that the Department's selection of the 93.20 percent rate is irrelevant and unreliable, Eletrosilex fails to provide any evidence to support its claim. We note that the statute expressly authorizes the Department to use a prior segment margin as adverse FA. The statute provides that "adverse inferences may include reliance on information derived from...a final determination in the {LTFV} investigation...{or} any previous review under section 751, or any other information placed on the record." See, section 776(b) of the Act. In determining the FA rate here, the Department considered the history of this proceeding, which demonstrates the fact that, in the 1993-1994 and 1994-1995 PORs, the Department calculated dumping margins of 61.58 percent for CBCC and 81.61 percent for RIMA, respectively, while at the same time, calculating zero or single digit rates for other respondents, proving that in this particular market, some companies may continue to dump at substantial margins while others have eliminated or substantially lowered their margins. The fact that these disparate rates have continued throughout the reviews since the original LTFV investigation, combined with the Eletrosilex's management decision not to respond to the requests for information, supports our conclusion that the 93.20 percent rate from the investigation remains reasonable and relevant. Finally, the Department's determination here is in accordance with the Department's policy of generally selecting the highest rate in the entire proceeding in order to induce future cooperation of a respondent.

Comment 3: Eletrosilex complains that the Department's statement in the background section of this redetermination, ie., "...two additional extensions of time, both requested by Eletrosilex" implies lack of cooperation on the part of Eletrosilex in the instant case. It claims that the two extensions were necessary in order to satisfy the Department's requests in providing further clarifications and are, therefore, evident of full cooperation with the Department.

Department's Position: We agree with Eletrosilex in part. As a matter of practice, the Department summarizes in the background section of a remand all procedural steps that took place in the instant case. In response to the Department's requests for additional information, Eletrosilex requested two extensions of time. Both extension requests were filed according to the Department's regulations and granted. Consequently, the Department's reference is factually correct. We note, however, that there was no intent to imply any lack of cooperation on the part of Eletrosilex with respect to its requests for extensions within the context of the remand proceeding.

FINAL RESULTS OF REDETERMINATION

As a result of this redetermination, we determine that pursuant to sections 776(a), 782(c)(d) and (e) of the Act, the use of total FA is appropriate and further, pursuant to section 776(b) and (c) of the Act, adverse inferences are warranted in assigning an FA margin to Eletrosilex. Therefore, we are using total adverse FA in reaching the applicable determination and assigning, as total adverse FA in this case, the rate of 93.20 percent to Eletrosilex.

____________________________

Bernard T. Carreau, fulfilling the duties of
Assistant Secretary for Import Administration

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(Date)