[Federal Register Volume 62, Number 91 (Monday, May 12, 1997)]
[Notices]
[Pages 25924-25926]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-12204]


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DEPARTMENT OF COMMERCE

International Trade Administration
[C-122-815]


Pure Magnesium and Alloy Magnesium From Canada; Preliminary 
Results of the Fourth Countervailing Duty Administrative Reviews for 
the 1995 Period of Review

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

ACTION: Notice of preliminary results of countervailing duty 
administrative reviews.

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SUMMARY: The Department of Commerce (the Department) is conducting 
administrative reviews of the countervailing duty orders on pure 
magnesium and alloy magnesium from Canada. For information on the net 
subsidy for the reviewed company, as well as for all non-reviewed 
companies, please see the Preliminary Results of Reviews section of 
this notice. If the final results remain the same as these preliminary 
results of administrative reviews, we will instruct the U.S. Customs 
Service (Customs) to assess countervailing duties as detailed in the 
Preliminary Results of Reviews section of this notice. Interested 
Parties are invited to comment. (See Public Comment section of this 
notice.)

EFFECTIVE DATE: May 12, 1997.

FOR FURTHER INFORMATION CONTACT: Sally Hastings or Cynthia Thirumalai, 
AD/CVD Enforcement, Group 1, Office 1, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, NW., Washington, DC 20230; telephone: 
(202) 482-3464 or (202) 482-4087, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On August 31, 1992, the Department published in the Federal 
Register (57 FR 39392) the countervailing duty orders on pure and alloy 
magnesium from Canada. On August 12, 1996, the Department published a 
notice of ``Opportunity to Request an Administrative Review'' (61 FR 
41771) of these countervailing duty orders. We received timely requests 
for review from NHCI on August 20, 1996 and from the Gouvernment du 
Quebec (GOQ) on August 21, 1996 and we initiated these reviews, 
covering the period January 1, 1995 through December 31, 1995, on 
September 15, 1996 (61 FR 48882).
    In accordance with 19 CFR 355.22(a), these reviews cover only the 
producer or exporter of the subject merchandise for which reviews were 
specifically requested. Accordingly, these reviews cover only NHCI. 
Also, these reviews cover seventeen programs.
    On October 30, 1996, the Department issued questionnaires to NHCI, 
the Government of Canada (GOC), and the GOQ. The Department received 
questionnaire responses from NHCI, the GOC and the GOQ on December 3, 
1996. The Department issued supplemental questionnaires to NHCI and the 
GOQ on April 10, 1997 and received supplemental questionnaire responses 
from both parties on April 24, 1997.

Applicable Statute

    Unless otherwise indicated, all citations to the statute are 
references to the provisions of the Tariff Act of 1930, as amended by 
the Uruguay Round Agreements Act (URAA) effective January 1, 1995 (the 
Act). The Department is conducting these administrative reviews in 
accordance with section 751(a) of the Act.

Scope of the Reviews

    The products covered by these reviews are pure and alloy magnesium 
from Canada. Pure magnesium contains at least 99.8 percent magnesium by 
weight and is sold in various slab and ingot forms and sizes. Magnesium 
alloys contain less than 99.8 percent magnesium by weight with 
magnesium being the largest metallic element in the alloy by weight, 
and are sold in various ingot and billet forms and sizes. Secondary and 
granular magnesium are not included. Pure and alloy magnesium are 
currently provided for in subheadings 8104.11.0000 and 8104.19.0000, 
respectively, of the Harmonized Tariff Schedule (HTS). Although the HTS 
subheadings are provided for convenience and Customs

[[Page 25925]]

purposes, our written descriptions of the scopes of these proceedings 
is dispositive.

Analysis of Programs

I. Programs Previously Determined to Confer Subsidies

    A. Exemption from Payment of Water Bills
    Pursuant to a December 15, 1988 agreement between NHCI and La 
Societe du Parc Industriel et Portuaire de Becancour (Industrial Park), 
NHCI is exempt from payment of its water bills. Except for the taxes 
associated with its bills, NHCI does not pay the invoiced amounts of 
its water bills.
    In the Final Affirmative Countervailing Duty Determinations: Pure 
Magnesium and Alloy Magnesium from Canada (Magnesium from Canada) 57 FR 
30948 (July 13, 1992), the Department determined that the exemption 
received by NHCI was limited to a specific enterprise or industry, or 
group of enterprises or industries because no other company receives 
such an exemption. In these reviews, neither the GOQ nor NHCI provided 
new information which would warrant reconsideration of this 
determination.
    We preliminarily determine the countervailable benefit to be the 
amount NHCI would have paid absent the exemption. To calculate the 
benefit under this program, we divided the amount NHCI would have paid 
for water during the POR by NHCI's total POR sales of Canadian-
manufactured products on an F.O.B. basis. We preliminarily determine 
that the net subsidy provided by this program is 0.50 percent ad 
valorem.
B. Article 7 Grants from the Quebec Industrial Development Corporation
    The Societe de Developpement Industriel du Quebec (SDI) administers 
development programs on behalf of the GOQ. SDI provides assistance 
under Article 7 of the SDI Act in the form of loans, loan guarantees, 
grants, assumptions of costs associated with loans, and equity 
investments. This assistance involves projects capable of having a 
major impact upon the economy of Quebec. Article 7 assistance greater 
than 2.5 million dollars must be approved by the Council of Ministers, 
and assistance over 5 million dollars becomes a separate budget item 
under Article 7. Assistance provided in such amounts must be of 
``special economic importance and value to the province.'' (See 
Magnesium from Canada, 57 FR 30949 (July 13, 1992).)
    In 1988, NHCI was awarded a grant under Article 7 to cover a large 
percentage of the cost of certain environmental protection equipment. 
In Magnesium from Canada, we determined that NHCI received a 
disproportionately large share of assistance under Article 7. On this 
basis, we determined that the Article 7 grant was limited to a specific 
enterprise or industry, or group of enterprises or industries. In these 
reviews, neither the GOQ nor NHCI provided new information which would 
warrant reconsideration of this determination.
    For the reasons set forth in the Final Results of the Third 
Countervailing Duty Administrative Reviews: Pure Magnesium and Alloy 
Magnesium from Canada, 62 FR 18749 (April 17, 1997), we preliminarily 
determine in these reviews that the Article 7 assistance received by 
NHCI was a non-recurring grant because it represented a one-time 
provision of funds. In these reviews, neither the GOQ nor NHCI provided 
new information which would warrant reconsideration of this 
determination.
    We calculated the benefit from the grant received by NHCI using the 
company's cost of long-term, fixed-rate debt as the discount rate and 
our declining balance methodology, consistent with 19 CFR 355.49. We 
divided that portion of the benefit allocated to the POR by NHCI's 
total sales of Canadian-manufactured products on an F.O.B. basis. We 
preliminarily determine the net subsidy provided by this program to be 
2.68 percent ad valorem.

II. Programs Preliminarily Found Not to be Used

    We preliminarily find that NHCI did not apply for or receive 
benefits under the following programs during the POR:
     St. Lawrence River Environment Technology Development 
Program, Program for Export Market Development,
     The Export Development Corporation,
     Canada-Quebec Subsidiary Agreement on the Economic 
Development of the Regions of Quebec,
     Opportunities to Stimulate Technology Programs,
     Development Assistance Program,
     Industrial Feasibility Study Assistance Program,
     Export Promotion Assistance Program,
     Creation of Scientific Jobs in Industries,
     Business Investment Assistance Program,
     Business Financing Program,
     Research and Innovation Activities Program,
     Export Assistance Program,
     Energy Technologies Development Program,
     Transportation Research and Development Assistance 
Program.

Preliminary Results of Reviews

    In accordance with 19 C.F.R. 355.22(c)(4)(ii), we calculated an 
individual subsidy rate for each producer/exporter subject to these 
administrative reviews. For the period January 1, 1995 through December 
31, 1995, we preliminarily determine the net subsidy for NHCI to be 
3.18 percent ad valorem. If the final results of these reviews remain 
the same as these preliminary results, the Department intends to 
instruct Customs to assess countervailing duties as indicated above. 
The Department also intends to instruct Customs to collect cash 
deposits of estimated countervailing duties as indicated above of the 
F.O.B. invoice price on all shipments of the subject merchandise from 
NHCI entered or withdrawn from warehouse, for consumption on or after 
the date of publication of the final results of these administrative 
reviews.
    Because the URAA replaced the general rule in favor of a country-
wide rate with a general rule in favor of individual rates for 
investigated and reviewed companies, the procedures for establishing 
countervailing duty rates, including those for non-reviewed companies, 
are now essentially the same as those in antidumping cases, except as 
provided for in section 777A(e)(2)(B) of the Act. The requested reviews 
will normally cover only those companies specifically named. See 19 CFR 
355.22(a). Pursuant to 19 CFR 355.22 (g), for all companies for which a 
review was not requested, duties must be assessed at the cash deposit 
rate, and cash deposits must continue to be collected, at the rate 
previously ordered. As such, the countervailing duty cash deposit rate 
applicable to a company can no longer change, except pursuant to a 
request for a review of that company. See Federal-Mogul Corporation and 
The Torrington Company v. United States, 822 F.Supp. 782 (CIT 1993) and 
Floral Trade Council v. United States, 822 F.Supp. 766 (CIT 1993) 
(interpreting 19 CFR 353.22(e), the antidumping regulation on automatic 
assessment, which is identical to 19 CFR 355.22(g)). Therefore, the 
cash deposit rates for all companies except those covered by these 
reviews will be unchanged by the results of these reviews.
    We will instruct Customs to continue to collect cash deposits for 
non-reviewed companies, except Timminco Limited (which was excluded 
from the

[[Page 25926]]

orders during the investigation), at the most recent company-specific 
or country-wide rate applicable to the company. Accordingly, the cash 
deposit rates that will be applied to non-reviewed companies covered by 
these orders are those established in Pure and Alloy Magnesium from 
Canada: Final Results of the First (1992) Countervailing Duty Reviews 
(62 FR 13857 (March 24, 1997)). These rates shall apply to all non-
reviewed companies until a review of a company assigned these rates is 
requested. In addition, for the period January 1, 1995 through December 
31, 1995, the assessment rates applicable to all non-reviewed companies 
covered by these orders are the cash deposit rates in effect at the 
time of entry, except for Timminco Limited (which was excluded from the 
orders during the original investigation).

Public Comment

    Parties to these proceedings may request disclosure of the 
calculation methodology and interested parties may request a hearing 
not later than 10 days after the date of publication of this notice. 
Interested parties may submit written arguments in case briefs on these 
preliminary results within 30 days of the date of publication. Rebuttal 
briefs, limited to arguments raised in case briefs, may be submitted 
seven days after the time limit for filing the case brief. Parties who 
submit an argument in this proceeding are requested to submit with the 
argument (1) a statement of the issue, and (2) a brief summary of the 
argument. 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 19 CFR 355.38.
    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 19 CFR 355.38, are due.
    The Department will publish the final results of these 
administrative reviews, including the results of its analysis of issues 
raised in any case or rebuttal briefs or at a hearing.
    These administrative reviews and notice are in accordance with 
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)).

    Dated: May 5, 1997.
Robert S. LaRussa
Acting Assistant Secretary for Import Administration.
[FR Doc. 97-12204 Filed 5-9-97; 8:45 am]
BILLING CODE 3510-DS-P