894 F.2d 385 (Fed. Cir. 1990), 89-1490, Timken Co. v. United States

Docket Nº:89-1490.
Citation:894 F.2d 385
Party Name:The TIMKEN COMPANY, Plaintiff-Appellee, v. The UNITED STATES, Defendant, and China National Machinery and Equipment Import and Export Corporation, Defendant-Appellant.
Case Date:January 19, 1990
Court:United States Courts of Appeals, Court of Appeals for the Federal Circuit
 
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Page 385

894 F.2d 385 (Fed. Cir. 1990)

The TIMKEN COMPANY, Plaintiff-Appellee,

v.

The UNITED STATES, Defendant,

and

China National Machinery and Equipment Import and Export

Corporation, Defendant-Appellant.

No. 89-1490.

United States Court of Appeals, Federal Circuit

January 19, 1990

Page 386

Terence P. Stewart, Stewart and Stewart, Washington, D.C., argued for plaintiff-appellee. With him on the brief were Eugene L. Stewart, James R. Cannon, Jr., and Charles A. St. Charles, Washington, D.C. Of counsel was Scott A. Scherff, Canton, Ohio, of The Timken Co.

Lawrence R. Walders, Graham & James, Washington, D.C., argued for defendant-appellant. With him on the brief were Samuel X. Zhang, Eileen S. Carlson, and Brian E. McGill, Washington, D.C.

Before MARKEY, Chief Judge, RICH, Circuit Judge, and DUMBAULD, Senior District Judge [*].

RICH, Circuit Judge.

Defendant-Appellant China National Machinery and Equipment Import and Export Corp. (CMEC) appeals from the March 22, 1989 final judgment of the Court of International Trade (CIT), Timken Co. v. United States, 714 F.Supp. 535 (CIT 1989), affirming the U.S. Department of Commerce's (Commerce's) recalculation after remand of an affirmative dumping margin. We affirm.

BACKGROUND

August 25, 1986, Plaintiff-Appellee The Timken Company (Timken) filed an antidumping duty petition with Commerce, alleging that two companies were selling in the United States tapered roller bearings (TRBs) from the People's Republic of China (PRC) at less than fair value. October 2, 1986, Commerce determined that there was a reasonable indication that TRBs from the PRC were being sold at less than fair value and so on November 4, 1986, issued an antidumping questionnaire to CMEC, who is the only direct exporter of TRBs from the PRC.

After reviewing CMEC's response to the questionnaire, Commerce concluded that the PRC is a state-controlled economy for the purposes of investigation. Pursuant to statute and regulation, Commerce chose a comparable non-state-controlled, market economy in which to determine foreign market value of the TRBs. Commerce chose India as the comparable "surrogate" country. Commerce sent questionnaires to a number of Indian companies, but did not obtain any information which was considered adequate or reliable. Therefore, under 19 CFR 353.8(c), Commerce chose the "constructed value methodology" to calculate the foreign market value of the TRBs.

Under this methodology, Commerce tries to value the Chinese factors of production for TRBs in India, using the best information available for costs in India. Among the factors which must be calculated is the cost of steel, which is the primary material out of which TRBs are made. During the manufacturing process, a certain amount of the raw steel is left over, which can then be resold as scrap. Therefore, the cost of

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steel is equal to the raw material cost minus the value of scrap. This appeal centers around the methodology and information used by Commerce to calculate the value of raw steel and scrap.

In particular, Commerce asked the U.S. Consulate in Bombay to obtain information on raw and scrap steel prices in...

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