[Federal Register Volume 60, Number 90 (Wednesday, May 10, 1995)]
[Notices]
[Pages 24833-24838]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-11530]



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DEPARTMENT OF COMMERCE
[C-412-811]


Certain Hot-Rolled Lead and Bismuth Carbon Steel Products From 
the United Kingdom; Preliminary Results of Countervailing Duty 
Administrative Review

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

ACTION: Notice of Preliminary Results of Countervailing Duty 
Administrative Review.

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SUMMARY: The Department of Commerce (the Department) is conducting an 
administrative review of the countervailing duty order on certain hot-
rolled lead and bismuth carbon steel products from the United Kingdom. 
We have preliminarily determined the net subsidy to be 20.33 percent ad 
valorem for Allied Steel and Wire Limited (ASW Limited) and 7.03 
percent ad valorem for all other companies for the period September 17, 
1992 through December 31, 1992. We have preliminarily determined the 
net subsidy to be 20.33 percent ad valorem for ASW Limited, 2.68 
percent ad valorem for United Engineering Steels (UES), and 9.76 
percent ad valorem for all other companies for the periods January 1, 
1993 through January 14, 1993, and March 22, 1993 through December 31, 
1993. If the final results remain the same as these preliminary results 
of administrative review, we will instruct U.S. Customs to assess 
countervailing duties as indicated above.
    Interested parties are invited to comment on these preliminary 
results.

EFFECTIVE DATE: May 10, 1995.

FOR FURTHER INFORMATION CONTACT: Dana Mermelstein, Melanie Brown or 
Christopher Cassel, Office of Countervailing Compliance, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C. 
20230; telephone: (202) 482-2786.

SUPPLEMENTARY INFORMATION:

Background

    On March 22, 1993, the Department published in the Federal Register 
(58 FR 15327) the countervailing duty order on certain hot-rolled lead 
and bismuth carbon steel products from the United Kingdom. On March 4, 
1994, the Department published a notice of ``Opportunity to Request an 
Administrative Review'' (59 FR 10368) of this countervailing duty 
order. We received a timely request for review from UES, a respondent 
company.
    We initiated the review, covering the period September 17, 1992 
through December 31, 1993, on April 15, 1994 (59 FR 18099). The review 
covers two manufacturers/exporters of the subject merchandise and 
fifteen programs.

Applicable Statute and Regulations

    The Department is conducting this administrative review in 
accordance with section 751(a) of the Tariff Act of 1930, as amended 
(the Act). Unless otherwise indicated, all citations to the statute and 
to the Department's regulations are in reference to the provisions as 
they existed on December 31, 1994. However, references to the 
Department's Countervailing Duties; Notice of Proposed Rulemaking and 
Request for Public Comments, (54 FR 23366; May 31, 1989) (Proposed 
Regulations), are provided solely for further explanation of the 
Department's countervailing duty practice. Although the Department has 
withdrawn the particular rulemaking proceeding pursuant to which the 
Proposed Regulations were issued, the subject matter of these 
regulations is being considered in connection with an ongoing 
rulemaking proceeding which, [[Page 24834]] among other things, is 
intended to conform the Department's regulations to the Uruguay Round 
Agreements Act. See 60 FR 80; Jan. 3, 1995.

Scope of the Review

    Imports covered by this review are hot-rolled bars and rods of non-
alloy or other alloy steel, whether or not descaled, containing by 
weight 0.03 percent or more of lead or 0.05 percent or more of bismuth, 
in coils or cut lengths, and in numerous shapes and sizes. Excluded 
from the scope of this review are other alloy steels (as defined by the 
Harmonized Tariff Schedule of the United States (HTSUS) Chapter 72, 
note 1 (f)), except steels classified as other alloy steels by reason 
of containing by weight 0.4 percent or more of lead or 0.1 percent or 
more of bismuth, tellurium, or selenium. Also excluded are semi-
finished steels and flat-rolled products. Most of the products covered 
in this review are provided for under subheadings 7213.20.00.00 and 
7214.30.00.00 of the HTSUS. Small quantities of these products may also 
enter the United States under the following HTSUS subheadings: 
7213.31.30.00, 60.00; 7213.39.00.30, 00.60, 00.90; 7214.40.00.10, 
00.30, 00.50; 7214.50.00.10, 00.30, 00.50; 7214.60.00.10, 00.30, 00.50; 
and 7228.30.80. Although the HTSUS subheadings are provided for 
convenience and for Customs purposes, our written description of the 
scope of this proceeding is dispositive.

Best Information Available for ASW Limited

    During the investigation, ASW Limited, an exporter of the subject 
merchandise, withdrew from participation, and consequently received a 
rate based entirely on best information available (BIA). Section 776(c) 
of the Act requires the Department to use BIA ``whenever a party or any 
other person refuses or is unable to produce information requested in a 
timely manner and in the form required, or otherwise significantly 
impedes an investigation * * *''.
    In this review, ASW Limited did not respond to the Department's two 
requests for information; therefore, we are assigning ASW Limited a 
rate based on BIA. The rate we are applying is 20.33 percent ad 
valorem. This rate reflects the rate ASW received in the investigation 
(see Final Affirmative Countervailing Duty Determination: Certain Hot-
Rolled Lead and Bismuth Carbon Steel Products from the United Kingdom 
(58 FR 6237, 6243; January 27, 1993)) (Lead Bar). To this rate we added 
the rate calculated for UES in this review for the Inner Urban Areas 
Act program, since this program was not examined by the Department 
during the investigation.

Calculation Methodology for Assessment and Cash Deposit Purposes

    For each year, 1992 and 1993, we calculated the net subsidy on a 
country-wide basis by first calculating the subsidy rate for each 
company subject to the administrative review. We then weight-averaged 
the rate received by each company using as the weight the company's 
share of total UK exports to the United States of subject merchandise. 
To determine the value of ASW's exports based on BIA (see Best 
Information Available for ASW Limited, above), we subtracted the value 
of UES' exports of subject merchandise to the United States from the 
total value of U.S. imports of subject merchandise as reported in the 
U.S. IM-146 import statistics.
    We then summed the individual companies' weight-averaged rates to 
determine the subsidy from all programs benefitting UK exports of 
subject merchandise to the United States. Since the country-wide rate 
calculated using this methodology was above de minimis, as defined by 
19 CFR 355.7, for both 1992 and 1993, we proceeded to the next step and 
examined the net subsidy rate calculated for each company to determine 
whether individual company rates differed significantly from the 
weighted-average country-wide rate, pursuant to 19 CFR 355.22(d)(3).
    For 1992, we found that ASW Limited had a significantly different 
net subsidy rate; therefore, this company is treated separately for 
assessment and cash deposit purposes for the 1992 period. All other 
companies are assigned the country-wide rate for this period. For 1993, 
we found that both ASW Limited and UES had significantly different net 
subsidy rates; therefore these companies are treated separately for 
assessment and cash deposit purposes for the 1993 period. All other 
companies are assigned the country-wide rate for this period.

Analysis of Programs

I. Programs Preliminarily Determined to Confer Subsidies

A. Allocation of Subsidies From BSC to UES
    UES is a joint venture company formed in 1986 by British Steel 
Corporation (BSC) and Guest, Keen & Nettlefolds (GKN). In return for 
shares in UES, BSC contributed a major portion of its Special Steels 
Business and GKN contributed its Brymbo Steel Works and its forging 
business. BSC was wholly owned by the Government of the United Kingdom 
at the time the joint venture was formed; BSC was privatized in 1988 
and now bears the name British Steel plc (BS plc).
    In Lead Bar, the Department found that BSC had received a number of 
subsidies prior to the 1986 sale of its Special Steels Business to UES. 
Further, the Department determined that the sale did not alter the 
effect of these previously bestowed subsidies, and thus the portion of 
BSC's pre-1986 subsidies which was attributable to the Special Steels 
Business productive unit transferred to UES (see Lead Bar at 6240). 
However, the Department modified this allocation methodology in the 
subsequent Remand Determination for Certain Hot-Rolled Lead and Bismuth 
Carbon Steel Products from the United Kingdom which was based on the 
privatization methodology set out in the General Issues Appendix 
appended to the Final Countervailing Duty Determination; Certain Steel 
Products from Austria (58 FR 37217, 37225; July 9, 1993) (Certain 
Steel). In Certain Steel, the Department stated that it can no longer 
be assumed that the entire amount of subsidies allocated to a certain 
productive unit follows it when it is sold; rather, a portion of the 
sales price of the productive unit represents the repayment of prior 
subsidies.
    To calculate a rate for the subsidies that were allocated from BSC 
to UES, we first determined the subsidies attributable to BSC's Special 
Steels Business (each of these subsidies to BSC is described in detail 
in Sections A(1) through A(4) below). To calculate the subsidies 
attributable to BSC's Special Steels Business, we divided the asset 
value of BSC's Special Steels Business by the value of BSC's total 
assets. We then applied this ratio to the net present value, in the 
year of the spin-off, of the future benefit streams from all of BSC's 
prior subsidies. The future benefit streams at the time of UES' 
creation reflect the Department's allocation over time of prior 
subsidies to BSC in accordance with the declining balance methodology 
(see section 355.49 of the Department's Proposed Regulations), as well 
as the effect of prior spin-offs of BSC productive units.
    We next estimated the portion of the purchase price which 
represents repayment of prior subsidies by determining the portion of 
BSC's net worth that was accounted for by subsidies. To do that, we 
divided the face value of the allocable subsidies received by BSC in 
each year from fiscal [[Page 24835]] year 1977/78 through fiscal year 
1984/85 (the year prior to the creation of UES) by BSC's net worth in 
the same year. We calculated a simple average of these ratios, which 
was then multiplied by the purchase price of the productive unit. Thus, 
we determined the amount of the purchase price which represents 
repayment of prior subsidies. This amount was subtracted from the 
subsidies attributed to BSC's Special Steels Business at the time of 
sale to arrive at the amount of subsidies allocated to UES in 1986.
    Having determined the amount of BSC's previously bestowed subsidies 
allocable to UES with the Special Steels Business in 1986, we then 
determined the benefit provided to UES by these subsidies in 1992 and 
in 1993. To do this, we divided the subsidies allocated to UES by the 
net present value (in the year of the spin-off) of the future benefit 
streams from subsidies received by BSC prior to the spin-off. The 
resulting percentage for each year, which represents the portion of 
BSC's future benefit streams to be apportioned to UES, was then 
multiplied by the total benefit amount from BSC's previously bestowed 
subsidies that would have been allocated to BSC in 1992 and 1993 absent 
any spin-offs or privatization. This provides the benefits to UES in 
1992 and 1993, respectively. We divided these benefit amounts by the 
company's total sales in 1992 and 1993, respectively, and preliminarily 
determine the net subsidy to be 3.76 percent ad valorem for 1992 and 
2.68 percent ad valorem for 1993.
    In determining the subsidies previously bestowed to BSC that were 
allocated to UES, we examined the following programs: equity infusions, 
Regional Development Grants, a National Loan Fund loan cancellation, 
and loans and interest rebates under ECSC Article 54.
(1) Equity Infusions
    In every year from 1978/79 through 1985/86, BSC received equity 
capital from the Secretary of State for Trade and Industry pursuant to 
section 18(1) of the Iron and Steel Acts 1975, 1981, and 1982. 
According to section 18(1), the Secretary of State for the Department 
of Trade and Industry may ``pay to the Corporation (BSC) such funds as 
he sees fit.'' The Government of the United Kingdom's equity 
investments in BSC were made pursuant to an agreed external financing 
limit which was based upon medium-term financial projections. BSC's 
performance was monitored by the Government of the United Kingdom on an 
ongoing basis and requests for capital were examined on a case-by-case 
basis. The UK government did not receive any additional ownership, such 
as stock or additional rights, in return for the capital provided to 
BSC under section 18(1) since it already owned 100 percent of the 
company.
    In Lead Bar (58 FR at 6241), the Department found BSC to be 
unequityworthy from 1978/79 through 1985/86, and thus determined that 
the Government of the United Kingdom's equity infusions were 
inconsistent with commercial considerations. Although, prior to the 
formation of UES, BSC's section 18(1) equity capital was written off in 
two stages (3,000 million in 1981 and 1,000 
million in 1982) as part of a capital reconstruction of BSC, the 
Department determined that BSC benefitted from these equity infusions, 
notwithstanding the subsequent write-off of equity capital. Therefore, 
the Department countervailed the equity investments as grants given in 
the years the equity capital was received. No new information or 
evidence of changed circumstances was presented in this review to 
warrant a reconsideration of that finding.
    Because the Department determined in Lead Bar that the infusions 
are non-recurring benefits, we have allocated the benefits over the 
average useful life of renewable physical assets in the steel industry 
(15 years) in accordance with our non-recurring grant methodology (see 
section 355.49 of the Proposed Regulations; see also Certain Steel at 
37230).
    While uncreditworthiness was not specifically alleged or 
investigated during the investigation on lead bar, in the Final 
Countervailing Duty Determination; Certain Steel Products from the 
United Kingdom (58 FR 37393; July 9, 1993) (UK Certain Steel), the 
Department found that BSC was uncreditworthy from 1977/78 through 1985/
86. No new information or evidence of changed circumstances was 
presented in this review to warrant a reconsideration of that finding. 
Therefore, to calculate the benefit from these grants, we have used a 
discount rate which includes a risk premium (see section 
355.44(b)(6)(iv) of the Proposed Regulations).
    After calculating the 1992 and 1993 allocation of subsidies from 
BSC to UES, as described above (Allocation of Subsidies From BSC to 
UES), we divided the subsidies allocated to UES for each year by the 
company's total sales of all products domestically-produced during the 
respective year. On this basis, we preliminarily determine the net 
subsidy for this program to be 3.35 percent ad valorem in 1992 and 2.38 
percent ad valorem in 1993.
(2) Regional Development Grant Program
    Regional development grants were paid to BSC under the Industry Act 
of 1972 and the Industrial Development Act of 1982. In order to qualify 
for assistance under these two Acts, an applicant had to be engaged in 
manufacturing and located in an assisted area. Assisted areas are 
older, industrial regions identified as having deep-seated, long-term 
problems such as high levels of unemployment, migration, slow economic 
growth, derelict land, and obsolete factory buildings.
    Regional development grants were given for the purchase of specific 
assets. According to the Government of the United Kingdom, the program 
involved one-time grants, disbursed sometimes over several years.
    BSC received regional development grants during the period between 
fiscal years 1978/79 and 1985/86. The Department found this program 
countervailable in Lead Bar (58 FR 6242), because it is limited to 
specific regions. No new information or evidence of changed 
circumstances was presented in this review to warrant a reconsideration 
of that finding.
    In Lead Bar, we also determined that since each grant requires a 
separate application, these grants are non-recurring. Accordingly, we 
have calculated the benefits from this program by allocating the 
benefits over the average useful life of renewable physical assets in 
the steel industry (15 years) in accordance with our non-recurring 
grant methodology (see Certain Steel at 37227; see also section 355.49 
of the Proposed Regulations). Since BSC was uncreditworthy from 1978/79 
through 1985/86 (as discussed under Equity Infusions), we have used a 
discount rate which includes a risk premium (see section 
355.44(b)(6)(iv) of the Proposed Regulations) to calculate the benefits 
from these grants. After calculating the 1992 and 1993 allocation of 
subsidies from BSC to UES, described above (Allocation of Subsidies 
From BSC to UES), we divided the subsidies allocated to UES for each 
year by the company's total sales in the respective year and calculated 
the ad valorem benefit for each year. On this basis, we preliminarily 
determine the net subsidies for this program to be 0.12 percent ad 
valorem for 1992 and 0.08 percent ad valorem for 1993. [[Page 24836]] 
(3) National Loan Funds Loan Cancellation
    In conjunction with the 1981/1982 capital reconstruction of BSC, 
section 3(1) of the Iron and Steel Act of 1981 extinguished certain 
National Loans Fund (NLF) loans, as well as the accrued interest 
thereon, at the end of BSC's 1980/81 fiscal year. Because this loan 
cancellation was provided specifically to BSC, the Department 
determined in Lead Bar (58 FR 6242) that it provided a countervailable 
benefit. No new information or evidence of changed circumstances was 
presented in this review to warrant a reconsideration of that finding.
    We calculated the benefit for this review using our standard 
methodology for non-recurring grants. We allocated the benefits from 
this loan cancellation over the average useful life of renewable 
physical assets in the steel industry (15 years) (see section 355.49 of 
the Proposed Regulations; see also Certain Steel at 37230); because BSC 
was found to be uncreditworthy in 1981/82 (as discussed under Equity 
Infusions), we have used a discount rate which includes a risk premium 
(see section 355.44(b)(6)(iv) of the Proposed Regulations). After 
calculating the 1992 and 1993 allocation of subsidies from BSC to UES, 
described above (Allocation of Subsidies From BSC to UES), we divided 
the subsidies allocated to UES for each year by the company's total 
sales in the respective year and calculated the ad valorem benefit for 
each year. On this basis, we preliminarily determine the net subsidies 
for this program to be 0.29 percent ad valorem for 1992 and 0.22 
percent ad valorem for 1993.
(4) European Coal and Steel Community (ECSC) Article 54 Loans/Interest 
Rebates
    The European Coal and Steel Community's (ECSC) Article 54 
Industrial Investment loans are direct, long-term loans from the 
Commission of the European Communities to be used by the iron and steel 
industry for purchasing new equipment or financing modernization. The 
purpose of the program is to facilitate the borrowing process for 
companies in the ECSC, some of which may not otherwise be able to 
obtain loans. In UK Certain Steel, the Department determined that this 
program is limited to the iron and steel industry, and thus is 
countervailable to the extent that it provides loans on terms 
inconsistent with commercial considerations. No new information or 
evidence of changed circumstances was presented in this review to 
warrant a reconsideration of that finding.
    In addition, interest rebates on Article 54 loans were granted to 
steel companies during the restructuring and modernization of the 
industry in the early 1980s. To qualify for the rebates, companies had 
to meet certain criteria, such as being in the process of reducing 
their steel production capacity or of implementing improvements in 
processing that would yield energy savings and improved efficiency.
    The interest rebates, which were limited to a maximum of 3 percent 
of the total investment over a period of five years, were funded from 
the ECSC operational budget. While levies imposed on ECSC steel 
companies have provided the revenues for the operational budget since 
1985, contributions by Member States supplemented the budget before 
that time. For this reason, the Department determined in UK Certain 
Steel that a portion of those interest rebates was countervailable. 
Following the same methodology in this review to determine the 
countervailable portion, we calculated the ratio of the contributions 
by Member States to the ECSC's total available funds for each year in 
which the rebates were given, and then multiplied this ratio by the 
rebate amount.
    BSC received one Article 54 loan in fiscal year 76/77 and two 
Article 54 loans in fiscal year 77/78, all of which were provided in 
U.S. dollars and are still outstanding. BSC also received interest 
rebates during the first five years of the 76/77 loan. Because BSC 
qualified for the interest rebate at the time the loan was granted, we 
considered the rebate to constitute a reduction in the interest rate 
charged rather than a grant.
    We considered the loan made to BSC during its creditworthy period 
(i.e., in BSC's 76/77 fiscal year) separately from the two loans made 
during its uncreditworthy period (i.e., in BSC's 77/78 fiscal year). 
For the Article 54 loan provided when BSC was creditworthy, we used as 
our benchmark the average U.S. long-term commercial rate for 1977. We 
used this rate because we did not have information on U.S. dollar loans 
borrowed in the UK in 1977. To calculate the benefit from this loan we 
employed our long-term loan methodology (see section 355.49(c)(1) of 
the Proposed Regulations). We then compared the amount of interest that 
would have been paid on the benchmark loan to the interest paid by BSC 
(factoring in the interest rebate as discussed above) and found that 
BSC's interest payments were higher than those it would have made on 
the benchmark loan. Therefore, we find that this particular loan was 
provided on terms consistent with commercial considerations.
    For the loans provided when BSC was uncreditworthy, we used as our 
benchmark the highest U.S. lending rate available for long-term fixed 
rate loans at the time the loan was granted, plus a risk premium equal 
to 12 percent of the U.S. prime rate for 1977. See, Final Affirmative 
Countervailing Duty Determination: New Steel Rail, Except Light Rail, 
from Canada (54 FR 31991; August 3, 1989); see also, section 
355.44(b)(6)(iv) of the Proposed Regulations. Again, we used a U.S. 
interest rate because we did not have information on U.S. dollar loans 
borrowed in the UK in 1977. We then compared the cost of the benchmark 
financing to the cost of the financing that BSC received under this 
program and found that the two Article 54 loans to BSC during its 
uncreditworthy period were provided on terms inconsistent with 
commercial considerations.
    To calculate the benefit from these loans we used our long-term 
loan methodology (see section 355.49(c)(1) of the Proposed 
Regulations). Using this methodology and a benchmark discount rate 
which includes a risk premium (see section 355.44(b)(6)(iv) of the 
Proposed Regulations), we calculated the grant equivalent and allocated 
it over the life of the loans. Then we calculated the 1992 and 1993 
allocation of subsidies from BSC to UES, as described above (Allocation 
of Subsidies From BSC to UES). We then divided the subsidies allocated 
to UES for each year by the company's total sales in the respective 
year to calculate the ad valorem benefit for each year. On this basis, 
we preliminarily determine the net subsidy for this program to be 
0.0005 percent ad valorem for 1992 and 0.0004 percent ad valorem for 
1993.
B. Subsidies Provided to UES
Assistance Under the Inner Urban Areas Act 1978
    UES received two grants under the Inner Urban Areas Act, one in 
1988 and one in 1992. Under this program, the Secretary of State for 
the Environment provides grants to 57 local authorities in the United 
Kingdom for the improvement of downtrodden urban areas. The Department 
of the Environment (DOE) selects these areas based upon census data. 
The local authorities submit program plans to the DOE for evaluation. 
Assistance is awarded on a discretionary basis depending on the quality 
of the proposed scheme and the benefit to the community, by either 
creating jobs or [[Page 24837]] improving the environment. Under 
Section 5 of the Act, a private company can apply for a grant to be 
used for environmental improvement (i.e., beautification of industrial 
areas). Approximately 10 percent of the money is given to private 
companies.
    Because assistance under the Inner Urban Areas Act is awarded only 
to local authorities and companies located in selected regions of the 
United Kingdom, we conclude that payments under this program are 
countervailable (see the Memorandum for Paul L. Joffe from Joseph A. 
Spetrini, dated May 3, 1995, Administrative Review of the 
Countervailing Duty Order on Certain Hot-rolled Lead and Bismuth Carbon 
Steel Products which is on file in the Central Records Unit, Room B-099 
of the Department of Commerce) (Memorandum). Further, because receipt 
of these grants is based on separate applications which have to meet 
the required criteria, and consistent with our determinations in 
Certain Steel (see 58 FR at 37726-7), we determine these grants to be 
non-recurring. Therefore, we have calculated the benefit for the POR 
using our standard methodology for non-recurring grants. Both of the 
grants received by UES under this program were less than 0.5 percent of 
UES Ltd.'s total sales, and thus were allocated to the year of receipt. 
On this basis, we preliminarily determine the net subsidies for this 
program to be 0.0012 percent ad valorem for 1992 and zero for 1993.

II. Program Preliminarily Determined Not to Confer Subsidies

Article 55 Assistance

    UES received Article 55 assistance between 1989 and 1992 for a 
project involving multi-oxygen lances. Under Article 55 of the ECSC 
Treaty, assistance is made available to ``promote technical and 
economic research relating to the production and increased use of coal 
and steel and to occupational safety in the coal and steel 
industries.'' Since the end of 1986, this program has been funded 
solely through levies on steel producing companies.
    Because the results of the research conducted under Article 55 are 
made publicly available, we find this program to be not countervailable 
(see Memorandum). Moreover, we note that to the extent that Article 55 
assistance is funded solely by levies on steel companies, we would find 
no benefit.

III. Programs Preliminarily Determined Not To Be Used

    We also examined the following programs and preliminarily determine 
that exporters of certain hot-rolled lead and bismuth carbon steel 
products from the United Kingdom did not use them during the review 
period (see Memorandum; see also Memorandum For the File, ECSC Article 
56(2)(b) from the Team, dated March 3, 1995, which is on file in the 
Central Records Unit, Room B-099 of the Department of Commerce):

(A) New Community Instrument Loans
(B) ECSC Article 54 Loan Guarantees
(C) NLF Loans
(D) ECSC Conversion Loans
(E) European Regional Development Fund Aid
(F) Article 56 Rebates
(G) Regional Selective Assistance
(H) ECSC Article 56(b)(2) Redeployment Aid
(I) BRITE/EuRAM II

Preliminary Results of Review

    In accordance with 19 CFR 355.22(b)(1), an administrative review 
``normally will cover entries or exports of merchandise during the most 
recently completed reporting year of the government of the affected 
country.'' However, because this is the first administrative review of 
this countervailing duty order, in accordance with 19 CFR 
Sec. 355.22(b)(2), it covers the period, and the corresponding entries, 
``from the date of suspension of liquidation * * * to the end of the 
most recently completed reporting year of the government of the 
affected country.'' This period is September 17, 1992 through December 
31, 1993. Because the reporting year of the Government of the United 
Kingdom is the calendar year, we calculated a separate net subsidy for 
each year, 1992 and 1993.
    Furthermore, during the 1993 calendar year, certain entries were 
not subject to suspension of liquidation. The Department issued its 
preliminary affirmative countervailing duty determination in the 
investigation on September 17, 1992 (57 FR 42974). On October 16, 1992, 
in accordance with section 705(a)(1) of the Tariff Act of 1930, as 
amended (the Act), we aligned the final determination with the final 
determination in the companion antidumping duty investigation of the 
same merchandise (57 FR 48020; October 21, 1992). On November 6, 1992, 
at the request of respondents, we postponed both final determinations 
until January 11, 1993 (57 FR 53691; November 12, 1992), and on January 
11, 1993, we postponed for a second time both determinations until 
January 19, 1993 (58 FR 4981; January 19, 1993).
    Pursuant to section 705 of the Act and Article 5.3 of the GATT 
Subsidies Code, we cannot require suspension of liquidation for more 
than 120 days without the issuance of a countervailing duty order. 
Therefore, the Department instructed Customs to terminate the 
suspension of liquidation of the subject merchandise entered, or 
withdrawn from warehouse, for consumption on or after January 15, 1993. 
The Department reinstated suspension of liquidation and required cash 
deposits of estimated countervailing duties of entries made on or after 
March 22, 1993, the date of the publication of the countervailing duty 
order. Merchandise entered on or after January 15, 1993 and before 
March 22, 1993 is to be liquidated without regard to countervailing 
duties.
    For the period September 17, 1992 through December 31, 1992, we 
preliminarily determine the net subsidy to be 20.33 percent ad valorem 
for ASW Limited and 7.03 percent ad valorem for all other companies. 
For the periods January 1, 1993 through January 14, 1993, and March 22, 
1993 through December 31, 1993, we preliminarily determine the net 
subsidy to be 20.33 percent ad valorem for ASW Limited, 2.68 percent ad 
valorem for United Engineering Steels (UES), and 9.76 percent ad 
valorem for all other companies.
    If the final results of this review remain the same as these 
preliminary results, the Department intends to instruct the Customs 
Service to assess the following countervailing duties:

                                                                        
[[Page 24838]]
------------------------------------------------------------------------
                                                                 Rate   
         Period                        Company                (percent) 
------------------------------------------------------------------------
September 17, 1992-       ASW Limited......................        20.33
 December 31, 1992.                                                     
                          All other companies..............         7.03
January 1, 1993-January   ASW Limited......................        20.33
 14, 1993.                                                              
                          UES..............................         2.68
                          All other companies..............         9.76
March 22, 1993-December   ASW Limited......................        20.33
 31, 1993.                                                              
                          UES..............................         2.68
                          All other companies..............         9.76
------------------------------------------------------------------------

  The Department also intends to instruct the Customs Service to 
collect a cash deposit of estimated countervailing duties of 20.33 
percent of the f.o.b. invoice price on all shipments of the subject 
merchandise from ASW Limited, 2.68 percent of the f.o.b. invoice price 
on all shipments of the subject merchandise from UES, and 9.76 percent 
of the f.o.b. invoice price on all shipments of the subject merchandise 
from all other companies, except Glynwed (which was excluded from the 
order during the original investigation), entered, or withdrawn from 
warehouse, for consumption on or after the date of publication of the 
final results of this review.
    Interested parties may request disclosure of the calculation 
methodology and may request a hearing within 10 days of the date of 
publication. Case briefs or other written comments from interested 
parties may be submitted not later than 30 days after the date of 
publication of this notice. Rebuttal briefs and rebuttal comments, 
limited to issues raised in the case briefs, may be filed not later 
than 37 days after the date of publication. Any hearing, if requested, 
will be held seven days after the scheduled date for submission of 
rebuttal briefs. Copies of case briefs and rebuttal briefs must be 
served on interested parties in accordance with section 355.38(e) of 
the Commerce regulations.
    Representatives of parties to the proceeding may request disclosure 
of proprietary information under administrative protective order no 
later than 10 days after the representative's client or employer 
becomes a party to the proceeding, but in no event later than the date 
the case briefs, under section 355.38(c), are due.
    The Department will publish the final results of this 
administrative review including the results of its analysis of issues 
raised in any case or rebuttal brief or at a hearing.
    This administrative review and notice are in accordance with 
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and 19 CFR 355.22.

    Dated: May 3, 1995.
Paul L. Joffe,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 95-11530 Filed 5-9-95; 8:45 am]
BILLING CODE 3510-DS-P