65 FR 35608, June 5, 2000 A-357-804 Sunset Review Public Document MEMORANDUM TO: Troy H. Cribb Acting Assistant Secretary for Import Administration FROM: Jeffrey A. May Director Office of Policy SUBJECT: Issues and Decision Memo for the Expedited Sunset Review of the Antidumping Duty Order on Silicon Metal from Argentina; Final Results Summary: We have analyzed the substantive response of domestic interested parties in the expedited sunset review of the antidumping duty order on silicon metal from Argentina. We recommend that you approve the positions we have developed in the Discussion of the Issues section of this memorandum for these final results of review. Below is the complete list of the issues in this expedited sunset review for which we received comments by parties: 1. Likelihood of continuation or recurrence of dumping Weighted-average dumping margin Volume of imports 2. Magnitude of the margin likely to prevail Margins from the investigation Use of a more recent margin History of the Order: On September 26, 1991, the Department published an antidumping duty order on silicon metal from Argentina (56 FR 48779). On July 10, 1995, the Department published an amendment to the final determination and antidumping duty order, and assigned Electrometalurgica Andina, S.A.I.C. ("Andina") and "all others" a margin of 17.87 percent (60 FR 35551). There have been four completed administrative reviews of this order. In the first administrative review, covering the period March 29, 1991, through July 31, 1992, the Department assigned Andina a margin of 2.06 percent (58 FR 65336, December 14, 1993), and Silarsa, S.A. ("Silarsa") an amended margin of 24.62 percent based on best information available ("BIA") (59 FR 16176, April 6, 1994). In the second administrative review, covering the period September 1, 1992, through August 31, 1993, the Department assigned Andina and Silarsa margins of 13.80 percent and 24.62 percent, respectively (62 FR 5613, February 6, 1997). In the third administrative review, covering the period September 1, 1993, through August 31, 1994, the Department assigned Silarsa the BIA rate of 24.62 percent (60 FR 64416, December 15, 1995). In the fourth administrative review, covering the period September 1, 1997, through August 31, 1998, the Department assigned Andina a margin of zero percent (65 FR 5311, February 3, 2000). There has been one scope clarification in this proceeding. In response to a request by domestic interested parties for clarification of the scope of the antidumping duty order on silicon metal from the People's Republic of China, the Department determined that silicon metal containing between 89 percent and 99 percent silicon by weight, but which contains a higher aluminum content than the silicon metal containing at least 96 percent, but less than 99.99 percent silicon by weight, is the same class or kind of merchandise as the silicon metal described in the original order (58 FR 27542, May 10, 1993). Therefore, such material is now within the scope of the order on silicon metal from Argentina (62 FR 5613, February 6, 1999). There have been no duty absorption findings or changed circumstances reviews in this proceeding. Background: On November 2, 1999, the Department initiated a sunset review of the antidumping duty order on silicon metal from Argentina (64 FR 59160), pursuant to section 751(c) of the Tariff Act of 1930, as amended ("the Act"). The Department received a notice of intent to participate on behalf of American Silicon Technologies ("AST"), Elkem Metals Company ("Elkem"), and Globe Metallurgical Inc. ("Globe") (collectively, "domestic interested parties"), within the applicable deadline (November 15, 1999) specified in 19 CFR 351.218(d)(1)(i). Domestic interested parties claimed interested-party status under section 771(9)(C) of the Act, as U.S. producers of a domestic like product. On December 1, 1999, we received a complete substantive response from domestic interested parties, within the 30-day deadline specified in the Sunset Regulations under 19 CFR 351.218(d)(3)(i). Domestic interested parties claim that, in 1990, Elkem, Globe, and four other domestic producers filed the petition that resulted in the issuance of the antidumping duty order on silicon metal from Argentina (see December 1, 1999, Substantive Response of domestic interested parties at 2). Domestic interested parties also claim that at least one of them has actively participated in each of the administrative reviews conducted by the Department, as well as in a number of related appeals and remand proceedings. Id. at 3. Without a substantive response from respondent interested parties, the Department, pursuant to 19 CFR 351.218(e)(1)(ii)(C), determined to conduct an expedited, 120-day review of this order. In accordance with section 751(c)(5)(C)(v) of the Act, the Department may treat a review as extraordinarily complicated if it is a review of a transition order (i.e., an order in effect on January 1, 1995). This review concerns a transition order within the meaning of section 751(c)(6)(C)(ii) of the Act. Accordingly, on February 29, 2000, the Department determined that the sunset review of silicon metal from Argentina is extraordinarily complicated, and extended the time limit for completion of the final results of this review until not later than May 30, 2000, in accordance with section 751(c)(5)(B) of the Act. (1) Discussion of the Issues In accordance with section 751(c)(1) of the Act, the Department conducted this review to determine whether revocation of the antidumping duty order would be likely to lead to continuation or recurrence of dumping. Section 752(c) of the Act provides that, in making this determination, the Department shall consider the weighted-average dumping margins determined in the investigation and subsequent reviews, and the volume of imports of the subject merchandise for the period before and the period after the issuance of the antidumping order. In addition, section 752(c)(3) of the Act provides that the Department shall provide to the International Trade Commission ("the Commission") the magnitude of the margin of dumping likely to prevail if the order is revoked. Below we address the comments of the domestic interested parties. 1. Likelihood of Continuation or Recurrence of Dumping Interested Party Comments In their substantive response of December 1, 1999, domestic interested parties contend that revocation of the subject order would result in continued and increased dumping of Argentine silicon metal in the United States. Citing the Sunset Policy Bulletin and the Statement of Administrative Action ("SAA") with respect to likelihood of dumping at any level above de minimis after the issuance of the order, domestic interested parties assert that the Department's margin determinations show that dumping has continued at significant levels (see December 2, 1999, Substantive Response of domestic interested parties at 4). For instance, domestic interested parties note Andina's margin of 4.95 percent and 13 percent in the 1991/92 and 1992/93 reviews, respectively, and Silarsa's margin of 24.62 percent in three administrative reviews (1991/92, 1992/93, and 1993/94). Id. at 4-5. Therefore, domestic interested parties assert that this history of continued dumping at levels above de minimis conclusively demonstrates that dumping is likely to continue or recur if the antidumping duty order is revoked. Id. at 5. In addition, domestic interested parties also assert that the Department's data show that, with the exception of one year (1993), the volume of imports has decreased from 3,131 metric tons ("MT") during the first nine months of 1991 to as little as zero MT per annum while the dumping order has been in place. Id. Further, domestic interested parties contend that U.S. Census Bureau data show that the volume of silicon metal imported into the United States from Argentina has significantly decreased since the antidumping duty order's issuance in 1991. Id. In fact, virtually no silicon metal has been imported into the United States from Argentina since 1993. Id. Department's Position Drawing on the guidance provided in the legislative history accompanying the Uruguay Round Agreements Act ("URAA"), specifically the Statement of Administrative Action ("the SAA"), H.R. Doc. No. 103-316, vol. 1 (1994), the House Report, H.R. Rep. No. 103-826, pt.1 (1994), and the Senate Report, S. Rep. No. 103-412 (1994), the Department issued its Sunset Policy Bulletin providing guidance on methodological and analytical issues, including the bases for likelihood determinations. In its Sunset Policy Bulletin, the Department indicated that determinations of likelihood will be made on an order-wide basis (see section II.A.2). In addition, the Department indicated that, normally, it will determine that revocation of an antidumping duty order is likely to lead to continuation or recurrence of dumping where (a) dumping continued at any level above de minimis after the issuance of the order, (b) imports of the subject merchandise ceased after the issuance of the order, or (c) dumping was eliminated after the issuance of the order and import volumes for the subject merchandise declined significantly (see section II.A.3). In addition to consideration of the guidance on likelihood cited above, section 751(c)(4)(B) of the Act provides that the Department shall determine that revocation of an order is likely to lead to continuation or recurrence of dumping where a respondent interested party waives its participation in the sunset review. In the instant review, the Department did not receive an adequate response from any respondent interested party. Pursuant to 19 CFR 351.218(d)(2)(iii), this constitutes a waiver of participation. As discussed in section II.A.3 of the Sunset Policy Bulletin, the SAA at 890, and the House Report at 63-64, if companies continue dumping with the discipline of an order in place, the Department may reasonably infer that dumping would continue if the discipline were removed. We note that there have been above de minimis margins for the investigated companies in all but one administrative review throughout the history of the order. Consistent with section 752(c) of the Act, the Department also considered the volume of imports before and after issuance of the order. According to the import statistics provided by domestic interested parties and, as confirmed by Census IM145 reports statistics, imports of subject merchandise decreased in 1992 and, since 1994, have significantly decreased from their pre-order levels. In fact, imports virtually ceased between 1994 and 1999. Based on this analysis, the Department finds that the existence of dumping margins after the issuance of the order is highly probative of the likelihood of continuation or recurrence of dumping. Therefore, given that dumping continued after the issuance of the order, average imports continued at levels far below pre-order levels from 1992 through 1999, and respondent interested parties waived their right to participate in this review, we determine that dumping is likely to continue if the order were revoked. 2. Magnitude of the Margin Likely to Prevail: Interested Party Comments: In their substantive response, domestic interested parties cite to the Act and the Sunset Policy Bulletin and assert that the Department should, in the case of Andina, report to the Commission a margin of 17.87 percent because this margin was calculated in the original investigation and reflects the behavior of the exporter without the discipline of the order in place (see December 1, 1999, Substantive Response of domestic interested parties at 7). Domestic interested parties note that, although Andina's dumping margins declined since the original investigation, its import volumes decreased over the same period. Id. For instance, Andina's U.S. sales volumes decreased from 2,600 MT during the six-month period of investigation to 250 MT during the initial twelve-month 1993/94 period of review. Id. Further, after the 1993/94 review, Andina's exports of silicon metal to the United States virtually ceased. Accordingly, the Department should report to the Commission the original margin of 17.87 percent for Andina. Id. at 8. With respect to Silarsa, for which no company-specific margin was calculated in the original investigation, domestic interested parties note that the Department determined a company-specific margin of 24.62 percent in three consecutive administrative reviews. They contend that because the 24.62 percent dumping margin is specific to Silarsa and is higher than the "all others" rate of 17.87 percent from the original investigation, the Department should provide to the Commission the more recently calculated margin of 24.62 percent for Silarsa. Id. at 9. Department's Position In the Sunset Policy Bulletin, the Department stated that it will normally provide to the Commission the margin that was determined in the final determination in the original investigation. Further, for companies not specifically investigated or for companies that did not begin shipping until after the order was issued, the Department normally will provide a margin based on the "all others" rate from the investigation (see section II.B.1 of the Sunset Policy Bulletin). Exceptions to this policy include the use of a more recently calculated margin, where appropriate, and consideration of duty absorption determinations (see sections II.B.2 and 3 of theSunset Policy Bulletin). Absent a corresponding decrease in the margin of dumping and increase in the volume of imports, consistent with the SAA at 890 and the House Report at 64, the Department normally will select a margin from the investigation, because that is the only calculated rate that reflects the behavior of exporters without the discipline of an order in place. The Department agrees, in part, with the arguments of the domestic interested parties. With respect to Andina's rate, we find that the original rate of 17.87 percent is the appropriate rate to report to the Commission. Although the Department determined lower rates (one of which was zero percent) for Andina in subsequent administrative reviews, these lower rates do not correspond to an increase in imports. According to the IM145 reports, average imports decreased significantly from 1992 through 1999, the period after the issuance of the order. Therefore, without a corresponding decrease in the margin of dumping and increase in the volume of imports, we will report to the Commission the original rate of 17.87 percent for Andina because this is the only rate that reflects the behavior of the exporter without the discipline in place. With respect to Silarsa, the Department disagrees with domestic interested parties that we should provide to the Commission a more recent rate simply because it is higher than the original rate. According to section II.B.1 of the Sunset Policy Bulletin, the Department will normally provide the "all others" rate for companies not specifically investigated in the original investigation. Therefore, the Department will report to the Commission the "all others" rate of 17.87 percent from the original investigation. As such, the Department will report to the Commission the margins contained in the Final Results of Review section of this decision memo. Final Results of Review We determine that revocation of the antidumping duty order on silicon metal from Argentina would be likely to lead to continuation or recurrence of dumping at the followingpercentage weighted-average margins: Manufacturer/exporters Margin (percent) Electrometalurgica Andina, S.A.I.C. ("Andina") 17.87 All Others 17.87 Recommendation Based on our analysis of the comments received, we recommend adopting all of the above positions. If the recommendations are accepted, we will publish the Final Results of Review in the Federal Register. AGREE______ DISAGREE______ Troy H. Cribb Acting Assistant Secretary for Import Administration (Date) ________________________________________________________________________________ End Notes 1. See Extension of Time Limit for Final Results of Expedited Five-Year Reviews, 65 FR 11761 (March 6, 2000).