Remand of 3rd AR
Public Version of Business Proprietary
FINAL RESULTS OF REDETERMINATION ON REMAND
SHAKEPROOF ASSEMBLY COMPONENTS
DIVISION OF ILLINOIS TOOL WORKS, INC. v. UNITED STATES,
COURT NO. 97-12-02066
In accordance with the U.S. Court of International Trade's ("CIT") order in Slip. op. 99-70 (July 29, 1999), Court No. 97-12-02066, the Department of Commerce (the Department) has prepared these final results of redetermination on remand with respect to the final results of the 1995-1996 antidumping duty administrative review of Certain Helical Spring Lock Washers From the People's Republic of China, (Final Results: 62 Fed. Reg. 61794 (Nov. 19, 1997) ("Final Results"). Pursuant to the Court's remand instructions, the Department has (A) explained why the use of import prices to value domestically purchased materials promotes accuracy; (B) explained why good cause did not exist to verify prices submitted by respondent, Zhejiang Wanxin Group, Co., Ltd. ("ZWG"); (C) eliminated the use of March 1996 Indian import prices to value steel scrap; and (D) corrected an error in the total quantity and value figures used to value steel scrap.
A. The Department Properly Used Import Prices for Domestically Purchased Materials in Order to Promote Accuracy in the Determination of the Dumping Margin.
In antidumping cases involving nonmarket economies ("NME"), section 773(c) of the Tariff Act of 1930, as amended (the Act), requires that the Department determine normal value by valuing the NME producer's factors of production (e.g., materials, energy, transportation and labor) in a comparable market economy and adding an amount for factory overhead, selling and general expenses and profit. Section 773(c) further requires that factor values be based on the "best available information." See also, Olympia Industrial, Inc. v. United States, 7 F. Supp. 2d 997, 1000-1001 (CIT 1998), citing Rhone Poulenc, Inc. v. United States , 899 F.2d 1185, 1191 (Fed. Cir. 1990).
The factors of production methodology is used to determine normal value ("NV") in NME cases because prices and costs within a NME are not determined by market forces and, therefore, are not considered an appropriate basis for determining NV. NV is, generally, to be based on market values and costs. Thus, when the NME producer acquires an input, or other factor, from a market economy supplier and pays for it in market economy currency, the market price paid for that input can serve as an appropriate basis for determining value. Therefore, the Department has a long-standing practice of valuing factors obtained from market economy suppliers using the actual price paid by the NME producer, if the producer paid in a convertible market economy currency. See, e.g., Final Determination of Sales at Less Than Fair Value: Oscillating Fans and Ceiling Fans from the People's Republic of China, 56 Fed. Reg. 55271 (Oct. 25, 1991). This practice has been upheld by the courts on the grounds that it promotes a more accurate determination of NV in NME cases. See, e.g., Lasko Metal Products, Inc. v. United States, 810 F. Supp. 314 (Ct. Int'l Trade 1992), aff'd, 43 F.3d 1442 (Fed. Cir. 1994).
In the proceeding under review, the NME producer, ZWG, purchased an input, wire rod, from both market economy suppliers and domestic suppliers. Consistent with the practice described above, the Department used the actual price paid by ZWG in market economy currency to value the imported wire rod. The plaintiff does not challenge that decision.
The Department also used the price paid for imported wire rod to value the domestically sourced wire rod. The rationale for this approach is that, where the NME producer imports an input from a market economy in meaningful quantities, the actual import price paid is the best available information for valuing the identical domestic input and is consistent with the purpose of the NME methodology. The purpose of the factors of production methodology is to determine what NV would be if the producer's costs were set by the market forces in a comparable economy. Because the import price is an actual market price paid by the NME producer it provides a more accurate value than other potential surrogates. Therefore, the actual price paid for the imports constitutes the best available information for valuing this factor.
Plaintiff challenges the Department's decision to use the price paid for the imported wire rod to value the wire rod purchased from suppliers in the PRC. In particular, plaintiff argues that the Department should have compared the price of wire rod imported from the United Kingdom with the price of the wire rod purchased from the PRC supplier to determine whether the U.K. prices were an appropriate surrogate value for domestic wire rod. Plaintiff asserts that the PRC price is higher and, therefore, the U.K. prices are suspect.
We find the approach suggested by plaintiff to be inappropriate and inconsistent with the statute. As discussed above, the statute requires that the Department use surrogate market values in lieu of actual costs in a NME because it is meaningless to compare market prices in the United States with prices that are not determined by market forces. Similarly, it is meaningless to compare the market price for the U.K. wire rod to PRC prices for domestic PRC wire rod. Moreover, if we were to use the NME prices as a benchmark, we would be injecting NME costs into the NV calculation in contravention of the statute. In essence, plaintiff suggests that we should not use a market price for imports unless it is approximately equal to or greater than the non-market value. Because such an approach would use the NME price to set limits on the NV calculation, it would be inconsistent with the statutory prohibition against basing NV on NME prices and costs.
For the reasons discussed above, the Department continues to find that the actual price paid for inputs imported from a market economy in meaningful quantities is the best available information and promotes accuracy in the dumping calculation. In making this decision, the Department has taken into account the concern expressed by the Court that describing "meaningful" as "not insignificant" was no definition at all. Slip op. at 7. The meaningful standard is similar to "significant" or "substantial" which are used numerous times in the statute. See, e.g., 19 U.S.C. §§ 1673b(b)(1)(B)(ii); 1673c(b); 1673c(g)(1); 1673e(c)(1)(D); 1677(5B)(B)(ii)(I); 1677(19)(E); 1677b(c)(4)(B); 1677e(a)(2)(C); 1677f-1(a)(1) and (2); 1677i(a)(2)(B)(ii); 1677j(a)(1)(C); and, 1677j(e)(1)(C). In certain instances, the Department has defined, by regulation or practice, what is "significant" or "substantial." For example, under the suspension of investigation provisions of the Act, i.e., 19 U.S.C. §1671c(b) and 19 U.S.C. §1673c (b), reference is made to exporters who account for "substantially all" of the imports of subject merchandise. For purposes of these provisions, the Department has specifically defined "substantially all" to mean exporters and producers that account for not less than 85 percent by value or volume of subject merchandise. 19 C.F.R. 353.18(c) (recodified at 19 C.F.R § 351.208(c)). However, in many instances what is "significant," "substantial" or "meaningful" must be determined on a case-by-case basis.
In the practice at issue here, the Department determines what is a meaningful level of imports on a case-by-case basis, i.e., reviewing the specific facts of each case in light of the purpose of the rule. We will find the imports "meaningful" if we can reasonably conclude from the quantities sold, and other aspects of the transactions, that the price paid is a reliable market economy value for the input. To illustrate, assume that a particular product is typically sold in lots of 1000 units, but the NME producer has a single import transaction for 20 units. In such a case, the Department is not likely to find the 20 units "meaningful". On the other hand, if an NME producer normally purchases from domestic suppliers 10-unit lots, we are more likely to find an import transaction for 10 units to be meaningful.
In the instant review, evidence on the record shows that ZWG purchased wire rod from seven different domestic suppliers and imported wire rod from the United Kingdom. See ZWG Sections C and D Questionnaire Response (Jan. 21, 1997) at Exhibit 8; ZWG Supplemental Questionnaire Response (Mar. 13, 1997) at Exhibit 7 ( Attachment included herein). There was no evidence, nor does plaintiff claim, that the wire rod ZWG purchased domestically was physically different from that which it imported from the United Kingdom. Final Results, 62 Fed. Reg. at 61796.
ZWG imported from the United Kingdom more than one-third of the wire rod it used in the production of the subject merchandise. The total amount imported exceeded the amounts purchased from any one of the seven PRC suppliers. In fact, in some cases [
] (see Attachment ). Based on this fact pattern, the Department concluded that ZWG's imports of wire rod were meaningful, i.e., they were a reliable basis for valuing domestic wire rod. Therefore, for the reasons discussed above, the Department used the import price to value wire rod purchased from PRC suppliers.
B. Good Cause Did Not Exist to Verify Prices Submitted by ZWG.
Section 782(i) of the Act states:
The administering authority shall verify all information relied upon in making --
(1) a final determination in an investigation,
(2) a revocation under section 1675(d) of this title, and
(3) a final determination in a review under section 1675(a) of this title, if -
(A) verification is timely requested by an interested party as defined in section 1677(9) (C), (D), (E), (F), or (G) of this title, and
(B) no verification was made under this paragraph during the 2 immediately preceding reviews and determinations under section 1675(a) of this title of the same order, finding, or notice, except that this clause shall not apply if good cause for verification is shown. (19 U.S.C. § 1677m(i) (emphasis added).)
This statutory provision was implemented at section 353.36(a) of the Department's regulations, which reads in pertinent part:
(a) In general. (1) The Secretary will verify all factual information the Secretary relies on in:
(i) A final determination under § 353.18(i) or § 353.20;
(ii) The final results of an expedited review under § 353.22(g);
(iii) A revocation under § 353.25;
(iv) The final results of an administrative review under § 353.22(c) or (f) if the Secretary decides that good cause for verification exists; and
(v) The final results of an administrative review under § 353.22(c) if:
(A) An interested party, as defined in paragraph (k)(3), (k)(4),(k)(5), or (k)(6) of §353.2, not later than 120 days after the date of publication of the notice of initiation of review, submits a written request for verification; and
(B) The Secretary conducted no verification under this paragraph during either of the two immediately preceding administrative reviews.
19 C.F.R. § 353.36(a) (emphasis added).
Accordingly, neither 19 U.S.C. § 1677m(i)(3)(B) nor 19 C.F.R. § 353.36(a)(iv) bars verification,
if an interested party can show good cause that one should be conducted.
While verification for good cause is the exception, see High Tenacity Rayon Filament Yarn From Germany; Final Results of Antidumping Duty Administrative Review, 60 Fed. Reg. 15897, 15898 (Mar. 28, 1995), the Department has conducted verification when good cause has been shown even though the immediately preceding review or determination had also been verified. For example, in the initial less-than-fair-value investigation of Silicon Metal From Brazil, the Department conducted, as usual, a verification. See Preliminary Determination, 56 Fed. Reg. 13118, 13122 (Mar. 29, 1991) (Final Determination published at 56 Fed. Reg. 26977 (June 12, 1991)). However, in the immediately succeeding review (i.e., the first administrative review which covered the period March 29, 1991 through June 30, 1992), the Department determined that petitioners had demonstrated good cause to conduct a verification. See Silicon Metal From Brazil; Final Results of Antidumping Duty Administrative Review, 59 Fed. Reg. 42806, 42813 (Aug. 19, 1994). Similarly, in Certain Welded Carbon Steel Pipe and Tube From Turkey, even though the Department conducted a verification for the 1993-1994 period of review, see Preliminary Results (1993-1994), 62 Fed. Reg. 26286 (May 13, 1997) (Final Results (1993-1994), published at 62 Fed. Reg. 51629 (Oct. 2, 1997)), the Department found petitioners had demonstrated that good cause existed to conduct a verification during the immediately preceding 1994-1995 period of review. See Preliminary Results (1994-1995), 61 Fed. Reg. 35188, 35192 (July 5, 1996); Final Results (1994-1994), 61 Fed. Reg. 69067, 69071 (Dec. 31, 1996).
In sum, as provided for by both the statute and implementing regulations, the Department does conduct verifications when an interested party so requests and is able to demonstrate that good cause exists even though a verification may already have been conducted within the two immediately preceding reviews and determinations. Thus, as explained above, submitting a request and attempting to convince the Department that good cause existed to conduct a verification of ZWG for the period of review in question would not have been a futile act on Shakeproof's part. In this instance, however, Shakeproof made no such request nor did it argue that good cause existed for the Department to conduct a verification of the pricing information submitted by ZWG.
Moreover, the Department did not find good cause for verification. ZWG submitted a summary of its U.K. imported wire rod purchases and documentation for one sale including a Sales Contract, specifications attachment to the Sales Contract, Invoice and Bill of Lading, in Exhibit 7 of its Questionnaire Response dated January 7, 1997. In addition, ZWG submitted a corrected summary of its purchases in Exhibit 7 of its Supplemental Questionnaire response dated March 13, 1997. Based on a thorough review of this documentation, the Department concluded that verification was not warranted.
C. The Use of March 1996 Indian Import Prices to Value Steel Scrap Have Been Eliminated
Pursuant to the Court's instructions, Slip op. at 10-11, we have eliminated the March 1996 Indian import data for steel scrap from the German Federal Republic, Korea and the United Kingdom in our dumping margin calculations.
D. The Error in the Total Quantity and Value Figures Used to Value Steel Scrap Has Been Corrected
We have corrected the error in the total quantity and value figures used to value steel scrap.
We gave interested parties, Shakeproof and ZWG, the opportunity to comment on the "Draft Final Results of Redetermination on Remand." Their comments and our analysis of those comments follows:
Comment 1: Shakeproof states that the Department's methodology of valuing all steel obtained from local NME suppliers using unverified import prices has never been done in any prior segment of the HSLW proceeding. Moreover, as the Court has already stated in this proceeding, the use of import prices to value domestically sourced inputs is neither longstanding practice nor supported by Lasko Metal Products, Inc. v. United States, 43 F.3d 1442, 1446 (Fed. Cir. 1994) (Lasko.).
ZWG contends, to the contrary, that the Department's methodology is in accordance with the antidumping statute, judicial decisions and the Department's longstanding practice involving NMEs. In support of this, ZWG points to several cases where the Department used import price to value the entire amount of the input, including that domestically sourced.
Response 1: Although Shakeproof is correct that the contested valuation methodology for steel wire rod was never used in any prior HSLW segment, the claim is misleading. Though this valuation methodology has never been used in any prior HSLW segment, ZWG has never used a significant amount of steel wire rod imported from a market economy country as an input before this period of review (POR). Because the amount of market economy steel wire rod possibly imported from South Korea during the Less than Fair Value Investigation was "very small," the Department relied on Indian surrogate prices. Final Determination of Sales at Less Than Fair Value: Certain Helical Spring Lock Washer's from the People's Republic of China, 58 FR 48833 at 48842 (September 20, 1993). See also Less than Fair Value Verification Report which is attached as Exhibit 2 to ZWG's Supplemental Questionnaire Report dated March 13, 1997 for the 1995-1996 review.
Regarding the Department's practice of using import prices to value domestically sourced inputs, our position as explained to the Court in our Opposition Brief (June 29, 1998) is that Lasko supports the use of the import prices to value factors in two ways. First, Lasko stands for the proposition that the antidumping law requires Commerce to use the best available information in valuing factors of production in an NME country in order to calculate the most accurate dumping margin possible. As the Federal Circuit cogently noted in Lasko, "[t]he Act simply does not say - anywhere - that the factors of production must be ascertained in a single fashion. The Act requires the ITA determination to be based on the best available information regarding the values of such factors in a market economy country or countries considered appropriate by the administering authority." (Lasko, 43 F.3d at 1446).
Second, Lasko specifically recognizes that import prices are accurate measures of factor values and states:
"In this case, the best available information on what the supplies used by the Chinese manufacturers would cost in a market economy country was the price charged for those supplies on the international market. See Allied Signal Aerospace Co. v. United States, 996 F.2d 1185, 1191 (Fed Cir. 1993) (statutory purpose "is to facilitate the determination of dumping margins as accurately as possible ..." (Lasko, F.3d at 1446).
"[T]he cost of raw materials from a market economy supplier, paid in [a] convertible currenc[y], provides Commerce with the closest approximation of the cost of producing the goods in a market economy country." Id., 810 F. Supp. 314, 317 (Ct. Int'l Trade 1992).
Thus we continue to believe that Lasko supports the methodology employed by the Department in this case.
Further, as ZWG pointed out, the application of this methodology was not limited to the review of HSLW. As we stated in the investigation of Melamine Institutional Dinnerware from the PRC,
"When melamine powder was purchased from a market economy, we used the prices paid to market economy suppliers to value this input, even though the producer did not purchase 100 percent of the melamine powder from a market economy. We believe that the market economy price is the most appropriate basis for determining the value of melamine powder purchased from PRC suppliers." (62 FR 1708, Comment 4 at 1710, (January 13, 1997).)
See also, Collated Roofing Nails from the PRC, 62 FR 51410, Comment 7 at 51416 (October 1, 1997), and Saccharin from the PRC, 59 FR 58818 at 58822 (November 15, 1994) where the Department used an import price for phthalic anhydride although the record was not clear whether all of the input was imported.
Comment 2: Shakeproof asserts that the draft remand did not comply with the Court's remand order to explain, with reference to the record, how its use of import prices to value the entire factor of production for steel wire rod promoted accuracy, including, but not limited to how it was more accurate than the use of surrogate value. Instead, the Department has merely attempted to show that the quantities imported provide a basis for accepting the import prices.
ZWG contends that the Department has correctly exercised its discretion to determine that the quantity of imports is "meaningful" and "not insignificant."
Response 2: We disagree with Shakeproof that our redetermination does not comply with the Court's remand order. As discussed in the opinion, the Court was concerned that "Although Commerce claims that the amount of imported steel wire rod used in this case is significant, the Court cannot agree as there is no basis on which to evaluate what Commerce means when it uses this term." Slip Op. At 6. In our redetermination, we have explained that in this context the terms "significant" and "substantial" and "meaningful" must be determined on a case-by-case basis, based on the specific facts of the case. However, in reaching a conclusion as to whether imports are meaningful and, hence, that the price of the imports can be used to value the input, we examine whether the quantities purchased and the other aspects of the transaction indicate that the price paid is a reliable market economy value for the input. The factual information discussed in the remand regarding quantities indicates the price paid for the imported input is, indeed, a reliable market economy value .
We further explain why the use of import prices enhances the accuracy of our calculations. Because NME prices are not reliable and cannot be used to determine normal value for goods produced in NME countries, the Act has provided section 773(c)(1)(B) which permits the Department to determine normal value on the basis of the factors of production and provides that the valuation of factors of production shall be based on the "best available information regarding the values of such factors in a market economy country or countries."
In NME countries we do not have market economy prices and, thus, are forced to resort to the best available information, which is often a surrogate value. At best, this surrogate value represents only an estimate of what an NME producer might pay for the factor in question if it were operating in a market economy setting. In this case, however, we have an actual, market economy price for steel wire rod paid by the NME producer in question. It is an actual price determined by market economy forces which has been paid to the market economy supplier by the respondent in convertible currency. Thus, the actual market economy price is both reliable and accurate. Because it is an actual market price paid by ZWG, it is a more accurate reflection of what ZWG's costs might be if it were operating in a market economy setting. This approach is clearly in keeping with Court's admonition in Lasko that "[t]he cost of raw materials from a market economy supplier, paid in [a] convertible currenc[y], provides Commerce with the closest approximation of the cost of producing the goods in a market economy country." 810 F. Supp. 314, 317 (Ct. Int'l Trade 1992).
Comment 3: Shakeproof claims that the Department misrepresented Shakeproof's position when the Department stated that Shakeproof wanted to test import prices by comparing them to the prices of steel wire rod purchased from the PRC suppliers. Instead, Shakeproof asked that ZWG's reported import prices should be tested using publicly available data regarding all steel wire rod prices in China (including imports into China). Shakeproof also asserts that the Department failed to employ the criteria it used in the remand in Olympia Indus., Inc. v. United States, Slip Op. 98-49 (Aug. 31, 1998), which dealt with the reliability of the PRC trading company data for valuing steel inputs used to produce heavy forged hand tools.
ZWG states that Shakeproof's reliance on Olympia is misplaced because the issue was not whether the Department should value steel inputs at actual prices paid in market economy currencies for Chinese producers who purchased steel directly from market economy suppliers. Rather, in Olympia, the issue was whether the Department could use import prices as surrogate data when the steel was imported by Chinese trading companies that later resold the steel to Chinese producers in renminbi, the Chinese currency. ZWG asserts that the Olympia criteria only applies where the Department must compare the reliability of two surrogates (the PRC trading company import data versus surrogate company import statistics). ZWG notes that Olympia does not apply where the respondent itself bought the factor from a market economy in a market economy currency.
Response 3: We disagree that we misrepresented Shakeproof's position regarding the comparison of import prices from the U.K. to Chinese prices. See Shakeproof Brief (April 30, 1998) at 25 ("[a] cursory investigation of the situation in China during the POR by Commerce would have indicated a large disparity in the prices of imports of steel wire rod and domestically produced steel wire rod - steel wire bars and rods produced in China had a substantially higher price than imports.")
We also disagree with Shakeproof's reliance on Olympia. In this respect, ZWG is correct in its interpretation of Olympia and Olympia's inapplicability to this case. There is a critical difference between the instant case and Olympia because ZWG, the PRC producer in the instant case, purchased its steel wire rod from a market economy supplier through a market economy trading house paying in convertible, market economy currency. By way of contrast, Olympia, a PRC producer, purchased its steel from a PRC trading house, paying for the goods in renminibi, the Chinese currency. The facts of Olympia, however, are not the facts in this case. The PRC producer in this case, ZWG, imported steel directly from a market economy supplier, paying in a market economy currency, unlike its counterpart in Olympia. Thus, we do not reach the issue addressed in Olympia.
Comment 4: Shakeproof disagrees that it could have requested verification, stating that the Court has already ruled on the point (Slip Op. at 10). Since Shakeproof could not request verification, it had no obligation do so, as argued by the Department. Moreover, since the Department's decision to use import values to value the domestically purchased steel did not become known until the time of the preliminary results, Shakeproof had no reason to request verification. It also asserts, generally, that import prices must be verified whenever the Department intends to use those import prices to value non-imported inputs in an NME case.
ZWG comments that Shakeproof has misread the statutory provisions regarding verification. Section 782 of the Act provides for mandatory verifications and for additional verifications if the Department decides that "good cause" exists. Nothing in the statute precludes an interested party from demonstrating that "good cause" exists for verification. ZWG comments that Shakeproof cannot claim that the statute and regulations rendered it helpless to request a verification, when petitioner failed to submit any evidence in a timely manner that attempted to demonstrate that "good cause" existed for verification.
Response 4: We respectfully disagree with the Court's reading of the Act and the Department's regulations that Shakeproof did not have the right to request verification. Slip Op. at 10. As we explained above, notwithstanding the fact that the first review was verified, Shakeproof could have requested, based on a showing of good cause, that the Department conduct a verification of the instant review. Shakeproof did not make a request for verification under the "good cause" provision for verification in section 782(i)(3)(b) of the Act. Section 353.36(a) of the Department's regulations in effect at the time lists the five different administrative scenarios under which the Department will conduct a verification. Section 353.36(a)(1)(v) sets out the scenario the Department generally follows regarding the verification of administrative reviews. Under this section, verifications are normally conducted where no verification was conducted during the two immediately preceding administrative reviews. However, section 353.36(a)(1)(iv) provides for an exception to the two year time interval set out in section 353.36(a)(1)(v) by permitting the Department to conduct a verification any time that "good cause for verification exists." (See also, 19 U.S.C. 1677m(i)(3)(B) quoted above in Section B of the Remand Determination.) Accordingly, Shakeproof was not precluded by the Act or the Department's regulations from making its case that good cause existed for the Department to undertake verification in the instant review. It did not do so.
In addition, there is nothing in the statute or regulations and Shakeproof has pointed to nothing requiring the Department to verify actual market economy import prices used to value an input, whether imported or not. In its questionnaire and supplemental responses, ZWG submitted an actual market economy price in market economy currency and documentation supporting that price which were accepted by the Department. At that time, Shakeproof did not dispute the acceptance and use of the price of the market economy input by the Department. Indeed, Shakeproof does not object to the U.K. price for valuing of imported steel (Shakeproof Memorandum of Points and Authorities (April 30, 1998) at 17. In this review, when the Department has satisfactory evidence of a price and there is no objection to use of this price for factor valuation by the other interested party(ies), there is no statutory or regulatory requirement for verification by the Department. If Shakeproof felt the U.K. price was not credible, it certainly was permitted under the Act and regulations to request verification for "good cause." It did not.
Moreover, in the new regulation section 351.408 (c)(1), which codifies the Departmental practice of using the actual import price where a portion (meaningful amount) of the factor is purchased from a market economy supplier and paid for in market economy currency, verification is not required.
Comment 5: Shakeproof argues that the Department failed to investigate fully the type and quality of the imported steel and ZWG's use of imported steel wire rod during the POR. More specifically, Shakeproof alleges that the Department made no attempt to examine the physical differences in the imported steel wire rod such as such as carbon content and diameters. Response 5: First, we would note that Shakeproof has raised these arguments in the context of its claim that Olympia applies to a situation where the input is imported directly by the producer of the subject merchandise. (Indeed, the inquiries suggested by Shakeproof are the considerations the Department takes into account in applying the Olympia test.) As explained in response to Comment 3, we do not believe that the Olympia test applies here.
Nevertheless, we disagree that Shakeproof can, at this late date, claim physical differences exist between the domestically sourced and imported steel wire rod. This imported steel wire rod was used in both the preliminary and final results of this review and no argument as to physical differences was made during those stages of the proceeding. It should be noted
hat in its Supplemental Questionnaire Response dated March 13, 1997 at page 17, ZWG stated that the quality of (domestically sourced) 1060 green wire rod and U.K. wire rod does not differ. Moreover, both the 1060 green wire rod and imported U.K. steel wire rod had high carbon content. (See Exhibit 10 of ZWG's Supplemental Questionnaire Response and Exhibit 7-3 of ZWG's Section D Response, January 21, 1997). The Department has stated above and in the Final Results, 62 FR at 61796, that there is no evidence that the wire rod which ZWG purchased domestically was physically different from that which it imported from the United Kingdom.
Shakeproof is also now questioning whether the imported steel wire rod was actually used in the production of merchandised during the POR. Again this claim is raised too late to be considered.
Comment 6: Shakeproof maintains that Indian surrogate values should be used to value steel obtained from NME suppliers because it was done in all prior reviews. Shakeproof also adds that the use of Indian steel prices is consistent with the "statutory preference for use of selected surrogate country data" (See Olympia Remand).
ZWG agrees with the Department's use of ZWG's actual price for imported steel wire rod to value ZWG's entire steel wire rod factor for the reasons stated in comments 1, 2 and 3 above.
Response 6: For the reasons stated in Comments 1, 2, and 3 above, we continue to believe that in the circumstances presented by this case, actual import prices provide the best available information for valuing ZWG's steel wire rod input. It should again be noted that this is the first segment of this proceeding in which ZWG has imported a significant amount of steel wire rod from a market economy country through a market economy supplier, and hence, the first time that this issue has been raised in this proceeding.
Based on the above remand analysis, the Department has recalculated ZWG's dumping margin to be 14.37 percent.
Robert S. LaRussa
for Import Administration
Date: September 27, 1999