[Federal Register Volume 59, Number 231 (Friday, December 2, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-29612]


[[Page Unknown]]

[Federal Register: December 2, 1994]


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DEPARTMENT OF COMMERCE
[C-475-817]

 

Preliminary Affirmative Countervailing Duty Determination: Oil 
Country Tubular Goods (``OCTG'') From Italy

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

EFFECTIVE DATE: December 2, 1994.

FOR FURTHER INFORMATION CONTACT:
Thomas McGinty or Peter Wilkniss, Office of Countervailing 
Investigations, Import Administration, U.S. Department of Commerce, 
Room 3099, 14th Street and Constitution Avenue NW., Washington, D.C. 
20230; telephone (202) 482-5055 and (202) 482-0588, respectively.

SUPPLEMENTARY INFORMATION: The Department preliminary determines that 
benefits which constitute subsidies within the meaning of section 701 
of the Tariff Act of 1930, as amended (``the Act''), are being provided 
to manufacturers, producers, or exporters of OCTC in Italy. For 
information on the estimated net subsidies, please see the Suspension 
of Liquidation section of this notice.

Case History

    Since the publication of the notice of initiation in the Federal 
Register (59 FR 37028, July 20, 1994), the following events have 
occurred.
    On August 1, 1994, we issued countervailing duty questionnaires to 
the Government of Italy (``GOI'') and the Commission of the European 
Communities (``EC''), in Washington, D.C., concerning petitioner's 
allegations. On August 8, 1994, the GOI responded to the first section 
of our questionnaire informing us that Dalmine S.p.A. (``Dalmine''), an 
Italian OCTG producer, accounted for more than 85 percent of the 
Italian exports of the subject merchandise to the United States during 
the POI. The GOI, the EC, and Dalmine submitted questionnaire responses 
on October 7, 1994. On October 18, 1994, we issued deficiency 
questionnaires to these parties. We received responses from the GOI, 
Dalmine, and the EC on November 7, 1994.
    On August 24, 1994, we postponed the preliminary determination in 
this investigation until November 23, 1994 (59 FR 43554, August 24, 
1994).

Scope of Investigation

    The products covered by this investigation are OCTG, which are 
hollow steel products of circular cross-section. These products include 
oil well casing, tubing, and drill pipe, of iron (other than cast iron) 
or steel (both carbon and allow), whether or not conforming to American 
Petroleum Institute (``API'') or non-API specifications, whether 
finished or unfinished (including green tubes). These investigations do 
not cover casing, tubing, or drill pipe containing 10.5 percent or more 
of chromium. The OCTG subject to these investigations are currently 
classified in the Harmonized Tariff Schedule (``HTS'') under these item 
numbers:

7304.20.10.00..........       7304.20.40.10            7304.20.10.20    
7304.20.30.80..........       7304.20.10.30            7304.20.10.40    
7304.20.10.50..........       7304.20.10.60            7304.20.10.80    
7304.20.20.00..........       7304.20.20.10            7304.20.20.20    
7304.20.20.30..........       7304.20.20.40            7304.20.20.50    
7304.20.20.60..........       7304.20.20.80            7304.20.30.00    
7304.20.30.10..........       7304.20.30.20            7304.20.30.30    
7304.20.30.40..........       7304.20.30.50            7304.20.30.60    
7304.20.30.80..........       7304.20.40.00            7304.20.40.10    
7304.20.40.20..........       7304.20.40.30            7304.20.40.40    
7304.20.40.50..........       7304.20.40.60            7304.20.40.80    
7304.20.50.10..........       7304.20.50.15            7304.20.50.30    
7304.20.50.45..........       7304.20.50.50            7304.20.50.60    
7304.20.50.75..........       7304.20.60.10            7304.20.60.15    
7304.20.60.30..........       7304.20.60.45            7304.20.60.50    
7304.20.60.60..........       7304.20.60.75            7304.20.70.00    
7304.20.80.00..........       7304.20.80.30            7304.20.80.45    
7304.20.80.60..........       7304.20.20.00            7304.20.40.00    
7305.20.60.00..........       7504.20.80.00            7306.20.10.30    
7306.20.10.90..........       7306.20.20.00            7306.20.30.00    
7306.20.40.00..........       7306.20.60.10            7306.20.60.50    
7306.20.80.10..........       7306.20.80.50                             
                                                                        

    Although the HTSUS subheadings are provided for convenience and 
U.S. Customs purposes, our written description of the scope of this 
proceeding is dispositive.

Injury Test

    Because Italy is a ``country under the Agreement'' within the 
meaning of section 701(b) of the Act, the U.S. International Trade 
Commission (``ITC'') is required to determine whether imports of OCTG 
from Italy materially injure, or threaten material injury to, a U.S. 
industry. On August 3, 1994, the ITC preliminarily determined that 
there is a reasonable indication that an industry in the United States 
is being materially injured or threatened with material injury by 
reason of imports from Italy of the subject merchandise (59 FR 42286, 
August 17, 1994).

Petitioner

    The petition in this investigation was filed by IPSCO Steel, Inc., 
Maverick Tube Corporation, Koppel Steel Corporation, North Star Steel 
Ohio, and USS/Steel Group.

Corporate History of Respondent Dalmine

    Prior to its liquidation in 1988, Finsider S.p.A. (``Finsider'') 
was the holding company for all state-owned steel companies in Italy. 
Dalmine was an operating company wholly owned by Finsider. After 
Finsider's liquidation, a new government-owned holding company, ILVA 
S.p.A. (``ILVA''), was created. ILVA took over the former Finsider 
companies, among them Dalmine, which became a subsidiary of ILVA in 
1989, when Finsider's shareholding in Dalmine was transferred to ILVA.
    Between 1990 and 1993, Dalmine itself was restructured. Dalmine 
became a financial holding company, with industrial, trading, and 
service shareholdings. As part of its restructuring, Dalmien made 
several asset purchases, sold two of its subsidiaries to private 
parties, and closed several manufacturing facilities. As of December 
31, 1993, the Dalmine Group consisted of a holding company (Dalmine 
S.p.A.), four wholly-owned, and one majority-owned, manufacturing 
companies, and a number of sales and service subsidiaries.
    During the POI, ILVA was owned by the Istituto per la Ricostruzione 
Industriale (``IRI''), a holding company which was wholly-owned by the 
GOI.

Spin-Offs

    In its questionnaire response, Dalmine reported that between 1990 
and 1991, as part of its overall restructuring process, the company 
sold two ``productive units'' to private buyers. According to Dalmine, 
these sales involved assets that do not produce the subject 
merchandise. Based on our analysis of Dalmine's response with respect 
to the productive units sold, we preliminarily determine that the 
amount of potentially spun-off benefits is insignificant. Therefore, we 
have not evaluated whether these benefits are attributable to sales of 
the subject merchandise for purposes of this preliminary determination. 
(See Final Concurrence Memorandum dated November 23, 1994.)

Equityworthiness

    Petitioner has alleged that Dalmine was unequityworthy in 1989, the 
year it received an indirect equity infusion from the GOI, through ILVA 
S.p.A. (``ILVA''), and that the equity infusion was, therefore, 
inconsistent with commercial considerations.
    In its questionnaire response, Dalmine has provided evidence that 
private investors, unrelated to Dalmine or the GOI, purchased a 
significant percentage of the 1989 equity offering, on the same terms 
as ILVA. Therefore, the Department preliminarily determines that ILVA's 
purchase of Dalmine's shares was consistent with commercial 
considerations. (See section 355.44(e)(1)(i) of the Proposed 
Regulations published on May 31, 1989, at 54 FR 23366.)

Creditworthiness

    Petitioner has alleged that Dalmine was uncreditworthy in every 
year between 1979 and 1993. In accordance with section 355.44 of the 
Proposed Regulations, we examined Dalmine's current, quick, times 
interest earned, and debt-to-equity ratios, in addition to its profit 
margin. Based on this analysis, we preliminarily determine that Dalmine 
was creditworthy from 1979 through 1993. (See Creditworthy Memorandum, 
November 23, 1994). Specifically, although a number of the financial 
indicators are weak for certain years, none of the indicators are weak 
over the medium or long term, and when examined together on a yearly 
basis, the indicators support the determination that Dalmine was 
creditworthy in every year examined. In addition, Dalmine received 
comparable long-term, commercial loans from private lenders in several 
of the years examined. While we have based our preliminary 
creditworthiness determination on the company's financial indicators, 
the fact that Dalmine received a number of long-term commercial loans 
during this period supports our finding.

Benchmarks and Discount Rates

    Dalmine did not take out any long-term fixed rate lira denominated 
loans or other debt obligations in any of the years of the government 
loans under investigation. Therefore, in accordance with section 
355.44(b)(4) of the Proposed Regulations, we used, as the benchmark 
interest rate, the Bank of Italy reference rate. We have determined 
that this rate constitutes the best approximation of the cost of long-
term borrowing in Italy and the only long-term fixed interest rate 
commonly available in Italy. (See Final Affirmative Countervailing Duty 
Determinations: Certain Steel Products from Italy (``Certain Steel from 
Italy''), 58 FR, 37327 (July 9, 1993).)
    We have also used this rate as the discount rate for allocating 
over time the benefit from non-recurring grants for the same reasons as 
explained in Final Affirmative Countervailing Duty Determination: 
Certain Steel Products from Spain, 58 FR 37374, 37376 (July 9, 1993).
    For long-term loans denominated in other currencies, we used, as 
the benchmark interest rate, the average long-term fixed interest rate 
denominated in the same currency. (See section E--Article 54 Loans 
below.)

Calculation Methodology

    For purposes of this preliminary determination, the period for 
which we are measuring subsidies (the POI) is calendar year 1993. In 
determining the benefits received under the various programs described 
below, we used the following calculation methodology. We first 
calculated the benefit attributable to the POI for each countervailable 
program, using the methodologies described in each program section 
below. For each program, we then divided the benefit attributable to 
Dalmine in the POI by Dalmine's total sales revenue, as none of the 
programs was limited to either certain subsidiaries or products of 
Dalmine. Next, we added the benefits for all programs, including the 
benefits for programs which were not allocated over time, to arrive at 
Dalmine's total subsidy rate. Because Dalmine is the only respondent 
company in this investigation, this rate is also the country-wide rate.
    Consistent with our practice in preliminary determinations, when a 
response to an allegation denies the existence of a program, receipt of 
benefits under a program, or eligibility of a company or industry under 
a program, and the Department has no persuasive evidence showing that 
the response is incorrect, we accept the response for purposes of the 
preliminary determination. All such responses, however, are subject to 
verification. If the response cannot be supported at verification, and 
the program is otherwise countervailable, the program will be 
considered a subsidy in the final determination.
    Based upon our analysis of the petition and the responses to our 
questionnaires, we preliminarily determine the following:

I. Programs Preliminarily Determined To Be Countervailable

A. Benefits Provided Under Law 675/77
    Law 675/77 was enacted in 1977 to bring about restructuring and 
reconversion in the following industrial sectors: (1) electronic 
technology; (2) the manufacturing industry; (3) the agro-food industry; 
(4) the chemical industry; (5) the steel industry; (6) the pulp and 
paper industry; (7) the fashion sector; and (8) the automobile and 
aviation sectors. Law 675/77 also sought to promote optimal 
exploitation of energy resources, and ecological and environmental 
recovery.
    A primary goal of this legislation was to bring all government 
industrial assistance programs under a single law. Other goals were (1) 
to reorganize and develop the industrial sector as a whole; (2) to 
increase employment in the South; and (3) to maintain employment in 
depressed areas. Among other measures taken, the Interministerial 
Committee for the Coordination of Industrial Policy (''CIPI'') was 
created as a result of Law 675/77. CIPI approves individual projects in 
each of the industrial sectors listed above.
    Six main programs were provided under Law 675/77: (1) Interest 
contributions on bank loans; (2) mortgage loans provided by the 
Ministry of Industry at subsidized interest rates; (3) interest 
contributions on funds raised by bond issues; (4) capital grants for 
projects in the South; (5) personnel retraining grants; and (6) VAT 
reductions on purchases of capital goods by companies in the South. 
Dalmine reported that it received benefits under items (1), (2), and 
(5) above.
    In its response, the GOI asserts that the steel and automobile 
industries did not receive a ``disproportionate'' share of benefits 
associated with interest contributions when the extent of government 
investment in those industries is compared to the extent of investment 
in other industries. However, in keeping with past practice, we did not 
consider the level of investment in the individual industries receiving 
benefits under Law 675/77. Instead, we followed the analysis outlined 
in Grain-Oriented Electrical Steel and Final Affirmative Countervailing 
Duty Determination: Certain Steel Products from Brazil, 58 FR 37295, 
37295 (July 9, 1993), of comparing the share of benefits received by 
the steel industry to the collective share of benefits provided to 
other users of the programs.
    According to the information provided by the GOI, the two dominant 
users of the interest contribution program were (1) the Italian steel 
industry which accounted for 33 percent of the benefits, and (2) the 
auto industry which accounted for 34 percent of the benefits. Likewise, 
with respect to the mortgage loans, the two dominant users were the 
auto and steel industries which received 45 percent and 31 percent of 
the benefits, respectively.
    In light of the above evidence, we preliminarily determine that the 
steel industry was a dominant user of both the interest contribution 
and the mortgage loan programs under Law 675/77 because the steel 
industry has been a dominant user of these programs. (See section 
355.43(b)(2)(iii) of the Proposed Regulations.) Therefore, we 
preliminarily determine that benefits received by Dalmine under these 
programs are being provided to a specific enterprise or industry or 
group of enterprises or industries. On this basis, we preliminarily 
find Law 675/77 financing to be countervailable.
    Under the interest contribution program, Italian commercial banks 
provided loans to industries designated under Law 675/77. According to 
the responses of the GOI and Dalmine, the interest owed by the 
recipient companies was partially offset by interest contributions from 
the GOI. Dalmine received bank loans with interest contributions under 
Law 675/77 which were outstanding in the POI.
    Because Dalmine knew that it would receive the GOI interest 
contributions over the life of the loan when it obtained the loans, we 
consider the contributions to constitute reductions in the interest 
rates charged rather than grants (see Certain Steel from Italy at 
37335).
    Under the mortgage loan program, the GOI provides long-term loans 
at subsidized interest rates. Dalmine received financing under this 
program which was outstanding in the POI.
    To determine whether these programs conferred a benefit, we 
compared the effective interest rate paid by Dalmine to the benchmark 
interest rate, discussed above. Based on this comparison, we 
preliminarily determine that the financing provided under these 
programs is inconsistent with commercial considerations, i.e., on terms 
more favorable than the benchmark financing.
    To calculate the benefit from these programs, we used our standard 
long-term loan methodology as described in section 355.49(c)(1) of the 
Proposed Regulations. We then divided the benefit allocated to the POI 
for each program by Dalmine's total sales in 1993. On this basis, we 
determine the net subsidy from these programs to be 0.47 percent ad 
valorem for all manufacturers, producers, and exporters in Italy of the 
subject merchandise.
    With respect to retraining grants provided to Dalmine under Law 
675/77, it is the Department's practice to treat training benefits as 
recurring grants. (See Certain Steel General Issues Appendix at 37226). 
Since the only grant reported under this program was received by 
Dalmine in 1986, any benefit to Dalmine as a result of this grant 
cannot be attributed to the POI. Therefore, we determine that 
retraining benefits provided under Law 675/77 conferred no benefit to 
Dalmine during the POI.
B. Grants Under Law 193/84
    According to the GOI, Articles 2, 3, and 4 of Law 193/84 provide 
for subsidies to close steel plants. As stated in Art. 20 of Law N. 46 
of 17/2/1982, steel enterprises producing seamless pipes, welded pipes, 
conduits and welded pipes for water and gas are the recipients of these 
subsidies. As benefits under this program are limited to the steel 
industry, we preliminarily determine that Law 193/84 is de jure 
specific and, therefore, countervailable. In this investigation, 
information provided by Dalmine indicates that the company received 
grants under Law 193/84.
    To calculate the benefit during the POI, we used our standard grant 
methodology (see section 355.49(b) of the Proposed Regulations). We 
then divided the benefits attributable to Dalmine under Law 193/84 in 
the POI by Dalmine's total sales. On this basis, we determine the 
estimated net subsidy to be 0.75 percent ad valorem for all 
manufacturers, producers, and exporters in Italy of the subject 
merchandise.
C. Exchange Rate Guarantee Program
    This program, which was enacted by Law 796/76, provides exchange 
rate guarantees on foreign currency loans from the European Coal and 
Steel Community (``ECSC) and The Council of European Resettlement Fund 
(``CER''). Under the program, repayment amounts are calculated by 
reference to the exchange rate in effect at the time the loan is agreed 
upon. The program sets a ceiling and a floor on repayment to limit the 
effect on the borrower of exchange rate changes over time. For example, 
if the lire depreciates five percent against the DM (the currency in 
which the loan is taken out), borrowers would normally find that they 
would have to repay five percent more (in lire terms). However, under 
the Exchange Rate Guarantee Program, the ceiling would act to limit the 
increased repayment amount to two percent. There is also a floor in the 
program which would apply if the lire appreciated against the DM. The 
floor would limit any windfall to the borrower.
    In Grain-Oriented Electrical Steel, the Department found this 
program to be not countervailable because of incomplete information 
regarding the specificity of the program. The Department stated that, 
because the determination was reached while lacking certain important 
information, the finding of non-countervailability would not carry over 
to future investigations.
    In this investigation, information provided by the GOI shows that 
the steel industry received 25% of the benefits under the program. 
Based on this information, the Department preliminarily determines that 
the steel industry was a dominant user of exchange rate guarantees 
under Law 796/76 and, thus, that benefits received by Dalmine under the 
law are being provided to a specific enterprise or industry or group of 
enterprises or industries. (See section 355.43(b)(2)(iii) of the 
Proposed Regulations.) Therefore, we preliminarily determine that the 
exchange rate guarantees offered under the program are countervailable 
to the extent they are provided on terms inconsistent with commercial 
considerations.
    Dalmine provided information that it could have purchased an 
exchange rate guarantee from commercial sources. However, Dalmine's 
information pertained to 1993, not to the period when the government-
provided guarantees were taken out. The GOI's response indicates that 
commercial exchange rate guarantees were not available in 1986, the 
year in which the loan and the guarantee were received. Therefore, we 
preliminarily determine the benefit to Dalmine to be the total amount 
of GOI payments on these loans made during the POI by the GOI. (Because 
the amount the government will pay in any given year will not be known 
until that year, benefits can only be calculated on a year-by-year 
basis.) We divided the GOI's payments in 1993 by Dalmine's 1993 total 
sales. On this basis, we determine the estimated net subsidy from this 
program to be 0.20 percent ad valorem for all manufacturers, producers, 
and exporters in Italy of the subject merchandise.

II. Programs Preliminarily Determined to be not Countervailable

A. 1988/89 Equity Infusion
    In November 1989, Dalmine completed an equity rights offering which 
allowed existing shareholders to purchase seven new shares for every 
ten shares they already owned. The new shares were offered at a price 
of LIT 300 per share. At that time, ILVA owned 81.7 percent of 
Dalmine's equity, with the remaining 18.3 percent owned by private 
investors. Pursuant to the rights offering, ILVA subscribed to its full 
allotment of the new shares. The remainder of the new shares were 
purchased by private shareholders. All shares were purchased at LIT 300 
per share.
    Petitioner argues that although Dalmine's shares were nominally 
publicly traded, the vast majority of Dalmine shares were indirectly 
owned by the GOI and, therefore, shares were not purchased in adequate 
volume by private investors to establish a valid benchmark. 
Specifically, petitioner contends that in 1991 ILVA owned 99.9 percent 
of Dalmine and, therefore, Dalmine's shares were in fact not publicly 
traded. Consequently, because essentially no private purchases were 
being made, the market price at the time of the equity infusion cannot 
serve as a valid benchmark. Furthermore, petitioner asserts that it is 
highly likely that the remaining shares not purchased by ILVA were 
purchased indirectly by the GOI through other holding companies.
    In response to our questionnaire, Dalmine provided a list of all 
purchasers of shares in the 1989 offering. There is not evidence to 
indicate that the shares not purchased by ILVA were purchased by other 
government controlled or owned entities, as petitioner suggests. 
Moreover, the extent of ILVA's ownership in 1991 is not relevant to the 
choice of a benchmark for the equity investment in 1989.
    We have preliminarily determined that, because 18.3 percent of the 
equity infusion was purchased by private shareholders, the sale of 
these shares provides the market-determined price for Dalmine's equity. 
Furthermore, in accordance with section 355.44 (e)(1) of the 
Department's Proposed Regulations, we preliminarily determine that the 
equity infusion is not countervailable because the market-determined 
price for Dalmine's shares is not less than the price paid by ILVA for 
those shares.
B. European Social Fund (``ESF'') Grants
    The ESF was established by the 1957 European Economic Community 
Treaty to increase employment and help raise worker living standards.
    As described in Grain-Oriented Electrical Steel, the ESF receives 
its funds from the EC's general budget whose main revenue sources are 
customs duties, agricultural levies, value-added taxes collected by the 
member states, and other member state contributions.
    The member states are responsible for selecting the projects to be 
funded by the EC. The EC then disburses the grants to the member states 
which manage the funds and implement the projects. According to the EC, 
ESF grants are available to (1) people over 25 who have been unemployed 
for more than 12 months; (2) people under 25 who have reached the 
minimum school-leaving age and who are seeking a job; and (3) certain 
workers in rural areas and regions characterized by industrial decline 
or lagging development.
    The GOI has stated that the ESF grants received by Italy have been 
used for vocational training. Certain regions in the South are also 
eligible for private sector re-entry and retraining schemes. Since 
1990, the vocational training grants have been available to unemployed 
youths and long-term unemployed adults all over Italy, according to the 
GOI. Before 1990, however, the GOI gave preference to certain regions 
in Italy.
    In Grain-Oriented Electrical Steel, we determined that this program 
was not regionally specific and not otherwise limited to a specific 
enterprise or industry, or group of enterprises or industries. 
Furthermore, we noted that to the extent there is a regional preference 
(i.e., southern Italy) in the distribution of ESF benefits, it has not 
resulted in a countervailable benefit to the production of the subject 
merchandise, which is produced in northern Italy.
    The GOI's response in this investigation is consistent with the 
information provided in Grain-Oriented Electrical Steel. Therefore, we 
preliminarily determine that this program is not limited to a specific 
enterprise or industry, or group of enterprises or industries and, 
therefore, is not countervailable.
C. ECSC Article 54 Loans
    Under Article 54 of the 1951 ECSC Treaty, the European Commission 
provides loans directly to iron and steel companies for modernization 
and the purchase of new equipment. The loans finance up to 50 percent 
of an investment project. The remaining financing needs must be met 
from other sources. The Article 54 loan program is financed by loans 
taken by the Commission, which are then re-lent to iron and steel 
companies in the member states at a slightly higher interest rate than 
that at which the Commission obtained them.
    Consistent with the Department's finding in Grain-Oriented 
Electrical Steel, we preliminarily determine that this program is 
limited to the iron and steel industry. As a result, loans under this 
program are specific.
    Of the Article 54 loans Dalmine had outstanding during the POI, 
some were denominated in U.S. dollars and others were in Dutch guilders 
(``NLG''). To determine whether the loans were provided on terms 
inconsistent with commercial considerations, we used benchmark interest 
rates for the currencies in which the loans were denominated. That is, 
for the U.S. dollar loans we used the average interest rate on long-
term fixed-rate U.S. dollar loans obtained in the United States, as 
reported by the Federal Reserve. For the NLG denominated loan, we used 
the average long-term bond rate for private borrowers in the 
Netherlands, as reported by the Organization for Economic Cooperation 
and Development (``OECD'').
    Because the interest rate spaid on Dalmine's Article 54 loans are 
higher than the benchmark interest rates, the Department preliminarily 
determines that loans provided under this program are not preferential 
and, therefore, not countervailable.
D. 1989 Provisional Payment in Connection With 1989 Equity Infusion
    In March 1989, ILVA made a payment to Dalmine in anticipation of 
purchasing new shares in Dalmine. The payment was provisional in nature 
because EC authorization of the capital increase was necessary, and if 
authorization was not granted, the money would have been repaid to 
ILVA. The capital increase was not finalized until November 1989, due 
to delays in EC approval. At that time, the payment became equity 
capital.
    Consistent with the Department's position in Final Affirmative 
Countervailing Duty Determination: Grain-Oriented Electrical Steel from 
Italy (Grain-Oriented Electrical Steel), 59 FR 18357 (April 18, 1994), 
we preliminarily determine that the funds provided by ILVA to Dalmine 
are countervailable.
    During the period March-November 1989, Dalmine had use of the money 
and paid no interest on it.
    Therefore, we have treated the funds provided by ILVA to Dalmine as 
an interest-free short-term loan from March 1989 to November 1989.
    Because any benefit from this interest-free loan would be allocable 
entirely to 1989, no benefit is attributable to the POI.

III. Programs Preliminarily Determined to be Not Used

    Based on the information provided in the responses, we 
preliminarily determine that the following programs were not used. This 
determination is subject to verification.

1. Preferential IMI Export Financing Under Law 227/77
2. Preferential Insurance Under Law 227/77
3. Retraining Grants under Law 181/89
4. Benefits under ECSC Article 56
Verification
    In accordance with section 776(b) of the Act, we will verify the 
information submitted by respondents prior to making our final 
determination.
Suspension of Liquidation
    In accordance with section 703(d) of the Act, we are directing the 
U.S. Customs Service to suspend liquidation of all entries of OCTG from 
Italy, which are entered or withdrawn from warehouse, for consumption 
on or after the date of the publication of this notice in the Federal 
Register, and to require a cash deposit or bond for such entries of the 
merchandise in the amounts indicated below. This suspension will remain 
in effect until further notice.
OCTG
Country-Wide Ad Valorem Rate--1.42 percent
ITC Notification
    In accordance with section 703(f) of the Act, we will notify the 
ITC of our determination. In addition, we are making available to the 
ITC all nonprivileged and nonproprietary information relating to this 
investigation. We will allow the ITC access to all privileged and 
business proprietary information in our files, provided the ITC 
confirms that it will not disclose such information, either publicly or 
under an administrative protective order, without the written consent 
of the Deputy Assistant Secretary for Investigations, Import 
Administration.
    If our final determination is affirmative, the ITC will make its 
final determination within 45 days after the Department makes its final 
determination.
Public Comment
    In accordance with 19 CFR 355.38, we will hold a public hearing, if 
requested, to afford interested parties an opportunity to comment on 
this preliminary determination. The hearing will be held on January 23, 
1995, at the U.S. Department of Commerce, Room 3708, 14th Street and 
Constitution Avenue NW., Washington, D.C. 20230. Individuals who wish 
to request a hearing must submit a written request within ten days of 
the publication of this notice in the Federal Register to the Assistant 
Secretary for Import Administration, U.S. Department of Commerce, room 
B099, 14th Street and Constitution Avenue, NW., Washington, DC 20230. 
Parties should confirm by telephone the time, date, and place of the 
hearing 48 hours before the scheduled time.
    Requests should contain: (1) The party's name, address, and 
telephone number; (2) the number of participants; (3) the reason for 
attending; and (4) a list of the issues to be discussed. In addition, 
ten copies of the business proprietary version and five copies of the 
nonproprietary version of the case briefs must be submitted to the 
Assistant Secretary no later than January 13, 1995. Ten copies of the 
business proprietary version and five copies of the nonproprietary 
version of the rebuttal briefs must be submitted to the Assistant 
Secretary no later than January 20, 1995. An interested party may make 
an affirmative presentation only on arguments included in that party's 
case or rebuttal briefs. Written arguments should be submitted in 
accordance with section 355.38 of the Commerce Department's regulations 
and will be considered if received within the time limits specified 
above.
    This determination is published pursuant to section 703(f) of the 
Act (19 U.S.C. 1671b(f)).

    Dated: November 23, 1994.
Susan G. Esserman,
Assistant Secretary for Import Administration.
[FR Doc. 94-29612 Filed 12-1-94; 8:45 am]
BILLING CODE 3510-DS-P-M