Initiation of Antidumping Duty Investigation: Wheel Inserts from Taiwan Publication: Federal Register Agency: International Trade Administration Byline: Susan G. Esserman Date: 12 October 1994 Subject: American Government

[Federal Register Volume 59, Number 196 (Wednesday, October 12, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-25221]


[[Page Unknown]]

[Federal Register: October 12, 1994]


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DEPARTMENT OF COMMERCE
(A-583-823)

 

Initiation of Antidumping Duty Investigation: Wheel Inserts from 
Taiwan

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

EFFECTIVE DATE: October 12, 1994.

FOR FURTHER INFORMATION CONTACT: Michelle Frederick or John Brinkmann, 
Office of Antidumping Investigations, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, N.W., Washington, D.C. 20230; 
telephone: (202) 482-0186 or (202) 482-5288, respectively.

Initiation of Investigation

The Petition

    On September 15, 1994, we received a petition filed in proper form 
by Consolidated International Automotive, Inc. (petitioner). At the 
request of the Department of Commerce (the Department), petitioner 
filed supplements to support and clarify the petition's data on 
September 30 and October 3, 1994. In accordance with 19 CFR 353.12 
(1994), petitioner alleges that wheel inserts from Taiwan are being, or 
are likely to be, sold in the United States at less than fair value 
within the meaning of section 731 of the Tariff Act of 1930, as amended 
(the Act), and that these imports are materially injuring, or threaten 
material injury to, a U.S. industry.
    Petitioner states that it has standing to file the petition because 
it is an interested party, as defined under section 771(9)(C) of the 
Act, and because the petition is filed on behalf of the U.S. industry 
producing the product subject to this investigation. If any interested 
party, as described under paragraphs (C), (D), (E), or (F) of section 
771(9) of the Act, wishes to register support for, or opposition to, 
this petition, such party should file a written notification with the 
Assistant Secretary for Import Administration.
    Under the Department's regulations, any producer or reseller 
seeking exclusion from a potential antidumping duty order must submit 
its request for exclusion within 30 days of the date of publication of 
this notice. The procedures and requirements regarding the filing of 
such requests are contained in 19 CFR 353.14.

Scope of Investigation

    The products covered by this investigation are wheel inserts, also 
referred to as lug hole inserts and insert bushings, made from steel, 
aluminum, brass or zinc. A wheel insert is a washer-like product with a 
circular collar that protrudes into a stud hole to provide a protective 
seat between a lug nut and an aluminum or alloy wheel mounted on ground 
transportation vehicles. A wheel insert can be heat-treated or non 
heat-treated, with or without knurls, and with or without surface 
coatings. Surface coatings include, but are not limited to, chrome 
plating, nickel plating, zinc plating (with or without wax coating), 
oxide coating and powder coating.
    The products under investigation are currently classifiable under 
subheading 8708.70.6060 of the Harmonized Tariff Schedule of the United 
States (HTSUS). Although the HTSUS subheading is provided for 
convenience and customs purposes, our written description of the scope 
of this investigation is dispositive.

United States Price and Foreign Market Value

    Petitioner based United States Price (USP) on a November 1993 price 
quotation obtained for a standard black zinc plated wheel insert. The 
terms of the price quotation were FOB Kaohsiung, Taiwan, with payment 
based on an irrevocable sight letter of credit (L/C). Petitioner made a 
deduction for credit. Credit was calculated using the short term 
interest rate published by Taiwanese banks for September of 1993 and a 
credit period of 55 days, the average of the 50-60 days stated on the 
price quotation for delivery after receipt of the L/C.
    Petitioner based its estimate of foreign market value (FMV) on 
constructed value (CV) claiming that no producers in Taiwan sell the 
subject merchandise in Taiwan or to any third country markets.
    According to 19 CFR 353.12(b)(7), if petitioner is unable to 
furnish information on foreign sales or costs, it must provide 
information on production costs in the United States and then adjust 
these costs to reflect for differences in the production costs between 
the United States and the home market country of exportation.
    To calculate constructed value, petitioner adjusted its own 
manufacturing costs for a standard black zinc plated wheel insert for 
known differences in costs between the United States and Taiwan. We 
adjusted the reported material costs to account for revenue received by 
petitioner from the sale of scrap material. Because the plating costs 
included selling, general and administrative expenses as well as the 
profit of petitioner's plater, we have adjusted the plating expenses to 
exclude these amounts.
    For overhead, utilities were adjusted using a ratio of Taiwanese to 
U.S. electricity costs. Other components of petitioner's overhead were 
adjusted using the ratio of Taiwanese to U.S. labor costs. Certain 
components of overhead were not adjusted by petitioner. Because we view 
this industry sufficiently labor intensive to justify using the ratio 
of Taiwanese to U.S. labor costs to adjust overhead, we have applied 
the labor ratio uniformly to all components of overhead (except 
utilities). Additionally, because petitioner allocated overhead 
expenses (inclusive of expenses related to petitioner's plating 
operation) over payroll expenses (exclusive of plating wages), we have 
added plating wages to petitioner's calculation of payroll expenses.
    Petitioner provided two hourly wage rates for Taiwanese 
manufacturing workers, one obtained from private research, the other 
obtained from a public source. Because of the Department's preference 
for publicly available information, we selected the latter and adjusted 
it as follows: 1) we disallowed petitioner's inclusion of an annual 
bonus because petitioner's wage rate calculation did not include 
bonuses; and 2) we inflated the wage rate for one year instead of two, 
as calculated by petitioner, because we determined that the wage rate 
was from 1992. The statutory minimum percentages of 10 percent for 
selling, general and administrative expenses and eight percent for 
profit were relied upon in petitioner's calculation.
    After the above adjustments were made, the recalculated dumping 
margin for wheel inserts produced on a screw machine is 46.28 percent.

Initiation of Investigation

    Pursuant to section 732(c) of the Act, the Department must 
determine, within 20 days after a petition is filed, whether a petition 
sets forth an allegation necessary for the initiation of an antidumping 
duty investigation, and whether the petition contains information 
reasonably available to the petitioner supporting the allegation.
    We have examined the petition for wheel inserts from Taiwan, as 
amended, and have found that it meets the requirements of section 
732(b) of the Act. Therefore, we are initiating an antidumping duty 
investigation to determine whether imports of wheel inserts from Taiwan 
are being, or are likely to be, sold in the United States at less than 
fair value. If this investigation proceeds normally, we will make our 
preliminary determination by February 22, 1995.

International Trade Commission (ITC) Notification

    Section 732(d) of the Act requires us to notify the ITC of these 
actions and we have done so.

Preliminary Determinations by the ITC

    The ITC will determine by October 30, 1994, whether there is a 
reasonable indication that imports of wheel inserts from Taiwan are 
materially injuring, or threaten material injury to, a U.S. industry. 
Pursuant to section 733(a) of the Act, a negative ITC determination 
will result in the investigation being terminated; otherwise, the 
investigation will proceed according to statutory and regulatory time 
limits.
    This notice is published pursuant to section 732(c)(2) of the Act 
and 19 CFR 353.13(b).

    Dated: October 5, 1994.
Susan G. Esserman,
Assistant Secretary for Import Administration.
[FR Doc. 94-25221 Filed 10-11-94; 8:45 am]
BILLING CODE 3510-DS-P