[Federal Register Volume 62, Number 85 (Friday, May 2, 1997)]
[Notices]
[Pages 24085-24088]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-11459]


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DEPARTMENT OF COMMERCE

International Trade Administration
[C-357-803, C-357-403, C-357-002, and C-357-005]


Leather from Argentina, Wool from Argentina, Oil Country Tubular 
Goods from Argentina, and Carbon Steel Cold-Rolled Flat Products from 
Argentina; Preliminary Results of Changed Circumstances Countervailing 
Duty Reviews

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

ACTION: Notice of preliminary results of changed circumstances 
countervailing duty reviews and intent to revoke or amend the 
revocation of countervailing duty orders.

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SUMMARY: The Department of Commerce (the Department) is conducting 
changed circumstances reviews of the countervailing duty orders on 
Leather from Argentina (55 FR 40212), Wool from Argentina (48 FR 
14423), Oil Country Tubular Goods from Argentina (OCTG) (49 FR 46564), 
and Carbon Steel Cold-Rolled Flat Products from Argentina (Cold-Rolled) 
(49 FR 18006). The Department initiated these reviews on April 2, 1996 
to determine whether it has the authority to assess countervailing 
duties on entries of merchandise covered by these orders

[[Page 24086]]

occurring on or after September 20, 1991--the date on which Argentina 
became a ``country under the Agreement'' within the meaning of 19 
U.S.C. Sec. 1303(a)(1) (1988) (repealed 1994). The Department 
preliminarily determines that based upon the ruling of the U.S. Court 
of Appeals for the Federal Circuit (Federal Circuit) in Ceramica 
Regiomontana v. United States, 64 F.3d 1579, 1582 (Fed. Cir. 1995), it 
does not have the authority to assess countervailing duties on entries 
of merchandise covered by these orders occurring on or after September 
20, 1991. As a result, we have preliminarily determined to revoke the 
orders on Wool, Leather, and OCTG with respect to all unliquidated 
entries occurring on or after September 20, 1991. With respect to Cold-
Rolled, the order was revoked effective January 1, 1995; therefore, we 
intend to amend the effective date of the revocation to September 20, 
1991. We invite interested parties to comment on these preliminary 
results.

EFFECTIVE DATE: May 2, 1997.

FOR FURTHER INFORMATION CONTACT: Richard Herring, Office of AD/CVD 
Enforcement VI, 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:

Scope of Reviews

    The scope of each of the four countervailing duty orders is 
detailed in the Appendix to this notice.

Background

I. The Orders

    The countervailing duty orders on Leather, Wool, Cold-Rolled, and 
OCTG from Argentina were issued pursuant to former section 303 of the 
Tariff Act of 1930, as amended (the Act) (repealed, effective January 
1, 1995, by the Uruguay Round Agreements Act). Under former section 
303, the Department could assess (or ``levy'') countervailing duties, 
without an injury determination, on two types of imports: (i) dutiable 
merchandise from countries that were not signatories of the 1979 
Subsidies Code or ``substantially equivalent'' agreements (otherwise 
known as ``countries under the Agreement''), and (ii) duty-free 
merchandise from countries that were not signatories of the 1947 
General Agreement on Tariffs and Trade (1947 GATT). See S. Rep. No. 
249, 96th Cong. 1st Sess. 103-06 (1979); H. Rep. No. 317, 96th Cong. 
1st Sess. 43, 49-50 (1979). At the time these countervailing duty 
orders were issued, Wool, Leather, Cold-Rolled and OCTG were dutiable. 
Also at that time, Argentina was not a ``country under the Agreement'' 
and, therefore, U.S. law did not require injury determinations as a 
prerequisite to the issuance of these orders.

II. The Ruling by the Court of Appeals for the Federal Circuit 
Regarding Ceramic Tile from Mexico

    On September 6, 1995, the Federal Circuit held, in a case involving 
imports of dutiable ceramic tile, that once Mexico became a ``country 
under the Agreement'' on April 23, 1985 pursuant to the Understanding 
between the United States and Mexico Regarding Subsidies and 
Countervailing Duties (the Mexican MOU), the Department could not 
assess countervailing duties on ceramic tile from that country under 
former section 303(a)(1) of the Act. Ceramica Regiomontana v. United 
States, 64 F.3d 1579, 1582 (Fed. Cir. 1995) (Ceramica). ``After Mexico 
became a `country under the Agreement,' the only provision under which 
ITA could continue to impose countervailing duties was section 1671.'' 
Id. One of the prerequisites to the assessment of countervailing duties 
under 19 U.S.C. Sec. 1671 (1988), according to the Federal Circuit, is 
an affirmative injury determination. See also Id. at Sec. 1671e. 
However, at the time the countervailing duty order on ceramic tile was 
issued, the requirement of an affirmative injury determination under 
U.S. law was not applicable. Therefore, the Federal Circuit looked to 
see whether the statute contained any transition rules when Mexico 
became a country under the Agreement which might provide the order on 
tile with the required injury test. Specifically, the Federal Circuit 
looked at section 104(b) of the Trade Agreements Act of 1979, Pub. L. 
No. 96-39 (July 20, 1979) (1979 Act) and found that there were no 
statutory means to provide an injury test.
    Section 104(b) was designed to provide an injury test for certain 
countervailing duty orders issued under former section 303 prior to the 
effective date of the 1979 Act (which established Title VII and, in 
particular, section 701 of the Act). However, in order to induce other 
countries to accede to the 1979 Subsidies Code (or substantially 
equivalent agreements), the window of opportunity was intentionally 
limited. In order to qualify (i) the exporting nation had to be a 
country under the Agreement (e.g., a signatory of the Subsidies Code) 
by January 1, 1980, (ii) the order had to be in existence on January 1, 
1980 (i.e., the effective date of Title VII), and (iii) the exporting 
country (or in some instances its exporters) had to request the injury 
test on or before January 2, 1983.
    In Ceramica, the countervailing duty order on ceramic tile was 
issued in 1982 and Mexico did not become a country under the Agreement 
until April 23, 1985. Therefore, the Federal Circuit held that in the 
absence of an injury test and the statutory means to provide an injury 
test, the Department could not assess countervailing duties on ceramic 
tile and the Federal Circuit ordered the Department to revoke the order 
effective April 23, 1985 (i.e., the date Mexico became a country under 
the Agreement). Ceramica, 64 F.3d at 1583. As the Federal Circuit 
stated, once Mexico became a ``country under the Agreement,'' ``[t]he 
only statutory authority upon which Congress could impose duties was 
section 1671. Without the required injury determination, Commerce 
lacked authority to impose duties under section 1671.''

III. The Issue

    On September 20, 1991, the United States and Argentina signed the 
Understanding Between the United States of America and the Republic of 
Argentina Regarding Subsidies and Countervailing Duties (Argentine 
MOU). Section III of the Argentine MOU contains provisions 
substantially equivalent to the provisions in the Mexican MOU that were 
before the Federal Circuit in Ceramica. Therefore, on April 2, 1996, 
the Department initiated the instant changed circumstances reviews in 
order to determine whether it has the authority, in light of the 
Ceramica decision, to assess countervailing duties on unliquidated 
entries of merchandise made on or after September 20, 1991 (i.e., the 
effective date of the Argentine MOU) which are covered by the orders on 
Leather from Argentina, Wool from Argentina, OCTG from Argentina, and 
Cold-Rolled from Argentina. Initiation of Changed Circumstances 
Countervailing Duty Administrative Reviews: Leather from Argentina, 
Wool from Argentina, Oil Country Tubular Goods from Argentina, and 
Cold-Rolled Carbon Steel Flat Products from Argentina, 61 FR 14553 
(Apr. 2, 1996).
Preliminary Results of Changed Circumstances Countervailing Duty 
Administrative Reviews and Intent to Revoke, or Amend the Revocation 
of, Countervailing Duty Orders
    The orders on Leather, Wool, OCTG, and Cold-Rolled from Argentina 
involve

[[Page 24087]]

the same set of pertinent facts as the Department faced in connection 
with the countervailing duty order on ceramic tile from Mexico. For 
this reason, the Federal Circuit's decision in Ceramica applies to the 
orders against Argentina, and requires the Department to revoke these 
orders as of the date Argentina became a ``country under the 
Agreement.''
    First, at the time the countervailing duty orders on Mexico and 
Argentina were issued, the requirement of an affirmative injury 
determination under U.S. law was not applicable. Second, both countries 
subsequently entered into substantially equivalent agreements with the 
United States and, hence, became ``countries under the Agreement'' 
within the meaning of former section 303(a)(1) of the Act. Third, once 
Mexico and Argentina qualified as countries under the Agreement, the 
assessment of countervailing duties on subsequent entries of dutiable 
merchandise became dependent upon a finding of subsidization and injury 
in accordance with section 701 of the Act (i.e., 19 U.S.C. Sec. 1671). 
See Ceramica, 64 F.3d at 1582. Fourth, none of the transition rules in 
effect when both countries attained this status afforded the statutory 
means of providing an injury test. As explained above, section 104 of 
the 1979 Act only applies to countervailing duty orders issued before 
January 1, 1980. The parties have raised the question of whether 
section 271 of the Uruguay Round Agreements Act (adding new section 753 
to the Act) applies to these orders. Section 753 established a 
mechanism to provide an injury test for outstanding countervailing duty 
orders issued under former section 303. However, section 753 of the Act 
was not enacted into law until January 1, 1995. Therefore, pursuant to 
the Federal Circuit's reasoning in Ceramica, section 753 is not 
applicable under these circumstances.
    Pursuant to section 751(d) of the Act, the Department may revoke, 
in whole or in part, a countervailing duty order if the Department 
determines, based on a review under section 751(b)(1) of the Act, that 
changed circumstances exist sufficient to warrant revocation. For the 
foregoing reasons, and consistent with our determinations in Ceramic 
Tile from Mexico, 61 FR 6630 (Feb. 21, 1996) and Leather Wearing 
Apparel from Mexico, 61 FR 26163 (May 24, 1996), the Department 
preliminarily determines that there is a reasonable basis to believe 
that the requirement for revocation based upon the changed 
circumstances occasioned by the ruling in Ceramica has been met. 
Therefore, we are hereby notifying the public of our intent to amend 
our earlier revocation of the order on Cold-Rolled by changing the 
effective date from January 1, 1995 to September 20, 1991. For the 
orders on Wool, Leather, and OCTG from Argentina, we intend to revoke 
these measures effective September 20, 1991. If our final determination 
remains unchanged from this notice of intent, these revocations will 
apply to all unliquidated entries of subject merchandise entered or 
withdrawn from warehouse for consumption on or after September 20, 
1991.
    If final revocation occurs, we intend to instruct the U.S. Customs 
Service to terminate the suspension of liquidation and liquidate all 
unliquidated entries of the subject merchandise entered or withdrawn 
from warehouse for consumption on or after September 20, 1991, without 
regard to countervailing duties. We will also instruct the U.S. Customs 
Service to refund with interest any estimated countervailing duties 
collected with respect to those entries. We note that the requirements 
for a cash deposit of estimated countervailing duties were previously 
terminated in conjunction with the section 753 determination covering 
Cold-Rolled.
    The current requirements for a cash deposit of estimated 
countervailing duties will continue until publication of the final 
results of these changed circumstances reviews.
    Interested parties may request a hearing not later than 10 days 
after the date of publication of this notice and may submit written 
arguments in case briefs on these preliminary results within 21 days of 
the date of publication. Rebuttal briefs, limited to arguments raised 
in case briefs, may be submitted 7 days after the time limit for filing 
the case briefs. Parties must specify which of the four orders their 
comments or rebuttal briefs address. In addition, interested parties 
may only comment with respect to the order(s) for which they are 
interested parties; they may not submit comments for the other orders. 
Parties who submit arguments in this proceeding are requested to submit 
with the argument: (1) the name of the interested party on behalf of 
which the argument is submitted, (2) a statement of the issue, and (3) 
a brief summary of the argument. Copies of case briefs and rebuttal 
briefs must be served on interested parties in accordance with 19 
C.F.R. Sec. 355.38(e). The Department will publish the final results of 
these changed circumstance reviews and its final determination on 
revocation, including its analysis of issues raised in any case or 
rebuttal brief or at a hearing.
    This notice is published in accordance with section 751(b)(1) of 
the Act (19 U.S.C. 1675(b)(1)) and 19 CFR 355.22(h).

    Dated: April 25, 1997.
Robert S. LaRussa,
Acting Assistant Secretary for Import Administration.

Appendix--Scope of the Reviews

I. OCTG From Argentina

    Imports covered by this review include shipments of Argentine 
OCTG. OCTG include hollow steel products of circular cross-section 
intended for use in the drilling of oil or gas and oil well casing, 
tubing and drill pipe or carbon or alloy steel, whether welded or 
seamless, manufactured to either American Petroleum Institute or 
proprietary specifications. The scope covers both finished and 
unfinished OCTG. The products covered in this review are provided 
for under item numbers of the Harmonized Tariff Schedule (HTS): 
7304.20.20, 7304.20.40, 7304.20.50, 7304.20.60, 7304.20.80, 
7304.39.00, 7304.51.50, 7304.20.70, 7304.59.60, 7304.59.80, 
7304.90.70, 7305.20.40, 7305.20.60, 7305.20.80, 7305.31.40, 
7305.31.60, 7305.39.10, 7305.39.50, 7305.90.10, 7305.90.50, 
7306.20.20, 7306.20.30, 7306.20.40, 7306.20.60, 7306.20.80, 
7306.30.50, 7306.50.50, 7306.60.70, 7306.90.10. The HTS subheadings 
are provided for convenience and Customs purposes. The written 
description remains dispositive.

II. Wool From Argentina

    Imports covered by this review include shipments of Argentine 
wool finer than 44s and not on the skin. These products are provided 
for under HTS item numbers: 5101.11.60, 5101.19.60, 5101.21.40, and 
5101.29.40. The HTS subheadings are provided for convenience and 
Customs purposes. The written description remains dispositive.

III. Leather From Argentina

    Imports covered by this review include shipments of Argentine 
leather. The types of leather that are covered include bovine 
(excluding upper and lining leather not exceeding 28 square feet, 
buffalo leather, and upholstery leather), sheep (excluding vegetable 
pretanned sheep and lambskin leather), swine, reptile (excluding 
vegetable pretanned and not fancy reptile leather), patent leather, 
calf and kip patent laminated, and metalized leather. Leather is an 
animal skin that has been subjected to certain treatment to make it 
serviceable and resistant to decomposition. It is used in the 
footwear, clothing, furniture and other industries. The types of 
leather included within the scope are currently classified under HTS 
item numbers 4104.10.60, 4104.10.80, 4104.21.00, 4104.22.00, 
4104.29.50, 4104.29.90, 4104.31.50, 4104.31.60, 4104.31.80, 
4104.39.50, 4104.39.60, 4104.39.80, 4105.12.00, 4105.19.00, 
4105.20.30, 4105.20.60, 4107.10.00, 4107.29.60, 4107.90.30, 
4107.90.60, 4109.00.30, 4109.00.40, and 4109.00.70. The HTS 
subheadings are provided for convenience

[[Page 24088]]

and Customs purposes. The written description remains dispositive.

IV. Cold-Rolled From Argentina

    Imports covered by this review include shipments of Argentine 
cold-rolled carbon steel flat products, whether or not corrugated or 
crimped; whether or not painted or varnished and whether or not 
pickled; not cut, not pressed, and not stamped to non-rectangular 
shape; not coated or plated with metal; over 12 inches in width and 
under 0.1875 inches in thickness whether or not in coils; as 
currently provided for under the following item numbers of the HTS: 
7209.11.00, 7209.12.00, 7209.13.00, 7209.14.00, 7209.21.00, 
7209.22.00, 7209.23.00, 7209.24.00, 7209.31.00, 7209.32.00, 
7209.33.00, 7209.34.00, 7209.41.00, 7209.42.00, 7209.43.00, 
7209.44.00, 7209.90.00, 7210.70.00, 7211.30.50, 7211.41.70, 
7211.49.50, 7211.90.00, 7212.40.50. The HTS item numbers are 
provided for convenience and Customs purposes. The written 
description remains dispositive.

[FR Doc. 97-11459 Filed 5-1-97; 8:45 am]
BILLING CODE 3510-DS-P