Federal Register, Volume 64 Issue 33 (Friday, February 19, 1999)

[Federal Register Volume 64, Number 33 (Friday, February 19, 1999)]
[Notices]
[Pages 8299-8308]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-4197]

-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

International Trade Administration
[A-351-828]

Notice of Preliminary Determination of Sales at Less Than Fair
Value: Hot-Rolled Flat-Rolled Carbon-Quality Steel Products from Brazil

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

EFFECTIVE DATE: February 19, 1999.

FOR FURTHER INFORMATION CONTACT: Maureen McPhillips (Companhia
Siderurgica Nacional or ``CSN''), Barbara Chaves or Samantha Denenberg
(Usinas Siderurgicas de Minas Gerais and Companhia Siderurgica Paulista
or ``USIMINAS/COSIPA''), or Linda Ludwig, Import Administration,
International Trade Administration, U.S. Department of Commerce, 14th
Street and Constitution Avenue, NW, Washington, DC 20230; telephone:
(202) 482-0193, (202) 482-0414, (202) 482-1386, and (202) 482-3833,
respectively.

The Applicable Statute

Unless otherwise indicated, all citations to the Tariff Act of
1930, as amended (``the Act''), are references to the provisions
effective January 1, 1995, the effective date of the amendments made to
the Act by the Uruguay Round Agreements Act (``URAA''). In addition,
unless otherwise indicated, all citations to the Department's
regulations are to the regulations at 19 CFR Part 351 (1998).

Preliminary Determination

The Department preliminarily determines that hot-rolled flat-rolled
carbon-quality steel products (``hot-rolled steel'') from Brazil are
being, or are likely to be, sold in the United States at less than fair
value (``LTFV''), as provided in section 733 of the Act. The estimated
margins of sales at LTFV are shown in the ``Suspension of Liquidation''
section of this notice.

Period of Investigation

The period of investigation (POI) is July 1, 1997 through June 30,
1998.

Case History

On October 15, 1998, the Department initiated antidumping duty

[[Page 8300]]

investigations of imports of hot-rolled steel from Brazil, Japan, and
the Russian Federation. See Initiation of Antidumping Duty
Investigations: Certain Hot-Rolled Flat-Rolled Carbon-Quality Steel
Products from Brazil, Japan, and the Russian Federation (Initiation),
63 FR 56607, (October 22, 1998). Since the initiation of this
investigation the following events have occurred:
On October 22, 1998, the Department requested comments from
petitioners (Bethlehem Steel Corporation, U.S. Steel Group, a unit of
USX Corporation, Ispat Inland Steel, LTV Steel Company, Inc., National
Steel Corporation, California Steel Industries, Gallatin Steel Company,
Geneva Steel, Gulf States Steel, Inc., IPSCO Steel Inc., Steel
Dynamics, Weirton Steel Corporation, the Independent Steelworkers
Union, and the United Steelworkers of America) and respondents
regarding the criteria to be used for model matching purposes. On
October 22 and 27, 1998, petitioners and respondents (CSN, USIMINAS,
COSIPA, Nippon Steel Corporation, NKK Corporation, Kawasaki Steel,
Sumitomo Metal Industries, Ltd., and Kobe Steel Ltd.), submitted
comments on our proposed model matching criteria.
On October 19, 1998, the Department issued Section A of the
antidumping questionnaire to Companhia Acos Expeciais Itabira
(``ACESITA''). On October 20, 1998, the Department issued Section A of
the antidumping questionnaire to CSN, USIMINAS, and COSIPA. These four
companies are the only known producers of the subject merchandise from
Brazil. On October 30, 1998, the Department issued Sections B-D of the
antidumping questionnaire to COSIPA, USIMINAS, and CSN.
On October 27, 1998, ACESITA submitted a letter stating that it had
not exported subject merchandise to the United States during the POI.
Section 351.204(c)(1) allows the Department to not examine a particular
exporter or producer if that exporter or producer and the petitioners
agree. On November 2, 1998, having reviewed ACESITA's submission,
petitioners agreed that the Department need not examine ACESITA in this
proceeding. Consequently, ACESITA was not selected as a mandatory
respondent in this investigation. See Respondent Selection Memorandum,
(November 3, 1998). Thus, on November 3, 1998, the Department
terminated the investigation of ACESITA.
The Department set aside a period for all interested parties to
raise issues regarding product coverage. Throughout the month of
November, the Department received numerous filings from respondents and
other interested parties proposing amendments to the scope of these
investigations. On January 6 and 27, 1999, petitioners filed letters
agreeing to amend the scope of these investigations to exclude those
products for which Itochu International Inc., Nippon Steel Corporation,
and others had requested exclusion. See Scope Memorandum to Joseph A.
Spetrini, (February 12, 1999).
On November 16, 1998, the United States International Trade
Commission (``ITC'') notified the Department of its affirmative
preliminary finding of threat of material injury in this case.
Additionally, on November 25, 1998, the ITC published its preliminary
determination that there is a reasonable indication that an industry in
the United States is threatened with material injury by reason of
imports of the subject merchandise from Brazil (63 FR 65221).
On November 16, 1998, the Department received the Section A
questionnaire responses from CSN, USIMINAS, and COSIPA. Petitioners
filed comments on CSN's, USIMINAS' and COSIPA's Section A questionnaire
responses on November 30, 1998 and December 1, 1998. The Department
issued supplemental questionnaires for Section A to CSN, USIMINAS, and
COSIPA on December 4, 1998.
On December 21, 1998, the Department received responses to Sections
B, C, and D of the questionnaire from CSN, USIMINAS, and COSIPA. On
December 22, 1998, the Department issued a decision memorandum
collapsing USIMINAS and COSIPA for purposes of this investigation. See
the Affiliated Respondents section below. Petitioners filed comments on
CSN's and USIMINAS/COSIPA's Section B-D questionnaire responses on
December 28, 1998. The Department issued supplemental questionnaires
for Sections B, C and D to CSN and USIMINAS/COSIPA on January 4, 1999.
The Department received responses to the Section A supplemental
questionnaires on January 19, 1999 and responses to the Section B-D
supplemental questionnaires on January 25, 1999. Respondents submitted
additional data on February 2, 1999, February 3, 1999, and February 9,
1999.
In their petition filed on September 30, 1998, petitioners alleged
that there is a reasonable basis to believe or suspect that critical
circumstances exist with respect to imports of hot-rolled steel from
Brazil. While the Department preliminarily found critical circumstances
to exist in concurrent hot-rolled steel investigations of Japan and the
Russian Federation (see 63 FR 65750, November 30, 1998), we did not
issue a determination with respect to Brazil at that time. See the
Critical Circumstances section below.

Scope of Investigation

For purposes of this investigation, the products covered are
certain hot-rolled flat-rolled carbon-quality steel products of a
rectangular shape, of a width of 0.5 inch or greater, neither clad,
plated, nor coated with metal and whether or not painted, varnished, or
coated with plastics or other non-metallic substances, in coils
(whether or not in successively superimposed layers) regardless of
thickness, and in straight lengths, of a thickness less than 4.75 mm
and of a width measuring at least 10 times the thickness. Universal
mill plate (i.e., flat-rolled products rolled on four faces or in a
closed box pass, of a width exceeding 150 mm but not exceeding 1250 mm
and of a thickness of not less than 4 mm, not in coils and without
patterns in relief) of a thickness not less than 4.0 mm is not included
within the scope of these investigations.
Specifically included in this scope are vacuum degassed, fully
stabilized (commonly referred to as interstitial-free (``IF'')) steels,
high strength low alloy (``HSLA'') steels, and the substrate for motor
lamination steels. IF steels are recognized as low carbon steels with
micro-alloying levels of elements such as titanium and/or niobium added
to stabilize carbon and nitrogen elements. HSLA steels are recognized
as steels with micro-alloying levels of elements such as chromium,
copper, niobium, titanium, vanadium, and molybdenum. The substrate for
motor lamination steels contains micro-alloying levels of elements such
as silicon and aluminum.
Steel products to be included in the scope of this investigation,
regardless of HTSUS definitions, are products in which: (1) iron
predominates, by weight, over each of the other contained elements; (2)
the carbon content is 2 percent or less, by weight; and (3) none of the
elements listed below exceeds the quantity, by weight, respectively
indicated:

1.80 percent of manganese, or
1.50 percent of silicon, or
1.00 percent of copper, or
0.50 percent of aluminum, or
1.25 percent of chromium, or
0.30 percent of cobalt, or
0.40 percent of lead, or
1.25 percent of nickel, or
0.30 percent of tungsten, or
0.012 percent of boron, or
0.10 percent of molybdenum, or

[[Page 8301]]

0.10 percent of niobium, or
0.41 percent of titanium, or
0.15 percent of vanadium, or
0.15 percent of zirconium.

All products that meet the physical and chemical description
provided above are within the scope of this investigation unless
otherwise excluded. The following products, by way of example, are
outside and/or specifically excluded from the scope of this
investigation:
Alloy hot-rolled steel products in which at least one of
the chemical elements exceeds those listed above (including e.g., ASTM
specifications A543, A387, A514, A517, and A506).
SAE/AISI grades of series 2300 and higher.
Ball bearing steels, as defined in the HTSUS.
Tool steels, as defined in the HTSUS.
Silico-manganese (as defined in the HTSUS) or silicon
electrical steel with a silicon level exceeding 1.50 percent.
ASTM specifications A710 and A736.
USS Abrasion-resistant steels (USS AR 400, USS AR 500).
Hot-rolled steel coil which meets the following chemical,
physical and mechanical specifications:

--------------------------------------------------------------------------------------------------------------------------------------------------------
C Mn P S Si Cr Cu Ni
--------------------------------------------------------------------------------------------------------------------------------------------------------
0.10--0.14%.................. 0.90% Max....... 0.025% Max...... 0.005% Max...... 0.30--0.50%.... 0.50--0.70%.... 0.20--0.40%.... 0.20% Max.
--------------------------------------------------------------------------------------------------------------------------------------------------------

Width = 44.80 inches maximum; Thickness = 0.063--0.198 inches;
Yield Strength = 50,000 ksi minimum; Tensile Strength = 70,000--88,000
psi.
Hot-rolled steel coil which meets the following chemical,
physical and mechanical specifications:

--------------------------------------------------------------------------------------------------------------------------------------------------------
C Mn P S Si Cr Cu Ni
--------------------------------------------------------------------------------------------------------------------------------------------------------
0.10--0.16%.................. 0.70--0.90%..... 0.025% Max...... 0.006% Max...... 0.30--0.50%.... 0.50--0.70%.... 0.25% Max...... 0.20% Max.
--------------------------------------------------------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------------------------------------------------------
Mo
--------------------------------------------------------------------------------------------------------------------------------------------------------
0.21% Max.................... ............... ............... ............... .............. .............. .............. ...............
...
--------------------------------------------------------------------------------------------------------------------------------------------------------

Width = 44.80 inches maximum; Thickness = 0.350 inches maximum;
Yield Strength = 80,000 ksi minimum; Tensile Strength = 105,000 psi
Aim.
Hot-rolled steel coil which meets the following chemical,
physical and mechanical specifications:

--------------------------------------------------------------------------------------------------------------------------------------------------------
C Mn P S Si Cr Cu Ni
--------------------------------------------------------------------------------------------------------------------------------------------------------
0.10--0.14%.................. 1.30--1.80%..... 0.025% Max...... 0.005% Max...... 0.30--0.50%.... 0.50--0.70%.... 0.20--0.40%.... 0.20% Max.
V(wt.)....................... Cb
0.10 Max..................... 0.08% Max.
--------------------------------------------------------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------------------------------------------------------
C Mn P S Si Cr Cu Ni
--------------------------------------------------------------------------------------------------------------------------------------------------------
0.15% Max.................... 1.40% Max....... 0.025% Max...... 0.010% Max...... 0.50% Max...... 1.00% Max...... 0.50% Max...... 0.20% Max.
Nb........................... Ca.............. Al..............
0.005% Min................... Treated......... 0.01--0.07%.....
--------------------------------------------------------------------------------------------------------------------------------------------------------

Width = 39.37 inches; Thickness = 0.181 inches maximum; Yield
Strength = 70,000 psi minimum for thicknesses 0.148 inches
and 65,000 psi minimum for thicknesses > 0.148 inches; Tensile Strength
= 80,000 psi minimum.
Hot-rolled dual phase steel, phase-hardened, primarily
with a ferritic-martensitic microstructure, contains 0.9 percent up to
and including 1.5 percent silicon by weight, further characterized by
either: (i) Tensile strength between 540 N/mm\2\ and 640 N/mm\2\ and an
elongation percentage 26 percent for thicknesses of 2 mm
and above, or (ii) a tensile strength between 590 N/mm\2\ and 690 N/
mm\2\ and an elongation percentage 25 percent for
thicknesses of 2mm and above.
Hot-rolled bearing quality steel, SAE grade 1050, in
coils, with an inclusion rating of 1.0 maximum per ASTM E 45, Method A,
with excellent surface quality and chemistry restrictions as follows:
0.012 percent maximum phosphorus, 0.015 percent maximum sulfur, and
0.20 percent maximum residuals including 0.15 percent maximum chromium.
The merchandise subject to these investigations is classified in
the Harmonized Tariff Schedule of the United States (``HTSUS'') at
subheadings: 7208.10.15.00, 7208.10.30.00, 7208.10.60.00,
7208.25.30.00, 7208.25.60.00, 7208.26.00.30, 7208.26.00.60,
7208.27.00.30, 7208.27.00.60, 7208.36.00.30, 7208.36.00.60,
7208.37.00.30, 7208.37.00.60, 7208.38.00.15, 7208.38.00.30,
7208.38.00.90, 7208.39.00.15, 7208.39.00.30, 7208.39.00.90,
7208.40.60.30, 7208.40.60.60, 7208.53.00.00, 7208.54.00.00,
7208.90.00.00, 7210.70.30.00, 7210.90.90.00, 7211.14.00.30,
7211.14.00.90, 7211.19.15.00,

[[Page 8302]]

7211.19.20.00, 7211.19.30.00, 7211.19.45.00, 7211.19.60.00,
7211.19.75.30, 7211.19.75.60, 7211.19.75.90, 7212.40.10.00,
7212.40.50.00, 7212.50.00.00. Certain hot-rolled flat-rolled carbon-
quality steel covered by this investigation, including: vacuum
degassed, fully stabilized; high strength low alloy; and the substrate
for motor lamination steel may also enter under the following tariff
numbers: 7225.11.00.00, 7225.19.00.00, 7225.30.30.50, 7225.30.70.00,
7225.40.70.00, 7225.99.00.90, 7226.11.10.00, 7226.11.90.30,
7226.11.90.60, 7226.19.10.00, 7226.19.90.00, 7226.91.50.00,
7226.91.70.00, 7226.91.80.00, and 7226.99.00.00. Although the HTSUS
subheadings are provided for convenience and Customs purposes, the
written description of the merchandise under investigation is
dispositive.

Product Comparisons

In accordance with section 771(16) of the Act, all products
produced by the respondents covered by the description in the ``Scope
of Investigation'' section above and sold in Brazil during the POI are
considered to be foreign like products for purposes of determining
appropriate product comparisons to U.S. sales. The Department has
relied on eleven characteristics to match U.S. sales of subject
merchandise to comparison market sales of the foreign like product:
paint, quality, carbon content, strength, thickness, width, coiled or
non-coiled, whether or not temper rolled, whether or not pickled, edge
trim, and whether or not with patterns in relief. The Department
assigned weights to each characteristic. Where there were no sales of
identical merchandise in the home market to compare to U.S. sales, the
Department compared U.S. sales to the next most similar foreign like
product on the basis of the characteristics listed in the antidumping
questionnaire and reporting instructions. The Department compared prime
merchandise to prime merchandise, consistent with our practice.

Affiliated Respondents

Under section 771(33)(E) of the Act, if one party owns, directly or
indirectly, five percent or more of the other they are affiliated.
Since USIMINAS owns 49.79% of COSIPA, the Department determined that
USIMINAS and COSIPA are affiliated. See Collapsing Memorandum to Joseph
A. Spetrini, (December 22, 1998).
Furthermore, it is the Department's practice to collapse affiliated
producers for purposes of calculating a margin when they have
production facilities for similar or identical products that would not
require substantial retooling in order to restructure manufacturing
priorities and the facts demonstrate that there is significant
potential for manipulation of pricing or production. In accordance with
Sec. 351.401(f) of the Antidumping Regulations, the Department
concluded that both companies are fully integrated producers currently
offering a similar range of products, including hot-rolled products
that would not require substantial retooling to restructure
manufacturing priorities. Furthermore, in light of USIMINAS's high
level of ownership of COSIPA, common directors, and the fact that
COSIPA is consolidated on USIMINAS's financial statements, there is a
significant possibility of price or production manipulation between the
two companies. For these reasons, the Department collapsed USIMINAS and
COSIPA into one entity for the purpose of this investigation. See Id.
While it also appears that there may be links between the collapsed
entity, USIMINAS/COSIPA, and CSN, there is insufficient information on
the record at this time to consider all three companies to be
affiliated and to collapse CSN with USIMINAS/COSIPA. Therefore, we
preliminarily do not find CSN to be affiliated with USIMINAS/COSIPA and
we preliminarily are not collapsing CSN with USIMINAS/COSIPA.
The Department notes that affiliation and collapsing are very
complex and difficult issues. Therefore, the Department invites parties
to submit information and comment on these issues to ensure that our
decision is based on a complete and thorough record. The Department
intends to examine these issues carefully for the final determination
of this investigation. Any new information that parties wish to provide
the Department must be submitted no later than March 1, 1999. All
information or arguments parties provide will be fully analyzed in
making our final determination.

Level of Trade

In accordance with section 773(a)(1)(B)(i) of the Act, to the
extent practicable, the Department determines Normal Value (``NV'')
based on sales in the comparison market at the same level of trade
(``LOT'') as the Export Price (``EP'') or Constructed Export Price
(``CEP'') transaction. The NV LOT is that of the starting price of
sales in the comparison market or, when NV is based on Constructed
Value (``CV''), that of the sales from which the Department derives
selling, general, and administrative expenses (``SG&A'') and profit.
For EP, the LOT is also the level of the starting price sale, which is
usually from the exporter to the importer. For CEP, it is the level of
the constructed sale from the exporter to the importer.
To determine whether NV sales are at a different LOT than EP or CEP
sales, the Department examines stages in the marketing process and
selling functions along the chain of distribution between the producer
and the unaffiliated customer. If the comparison market sales are at a
different LOT, and the difference affects price comparability, as
manifested in a pattern of consistent price differences between the
sales on which NV is based and comparison market sales at the LOT of
the export transaction, the Department makes a LOT adjustment in
accordance with section 773(a)(7)(A) of the Act. For CEP sales, if the
NV level is more remote from the factory than the CEP level and there
is no basis for determining whether the differences in the levels
between NV and CEP sales affects price comparability, the Department
adjusts NV under section 773(A)(7)(B) of the Act (the CEP offset
provision). See Notice of Final Determination of Sales at Less Than
Fair Value: Certain Cut-to-Length Carbon Steel Plate from South Africa,
62 FR 61731 (November 19, 1997).

CSN

CSN sells to trading companies in the U.S. market and service
centers/distributors and end-users in the home market. CSN states that
it provides warranties, technical assistance, and freight arrangements
equally to service centers/distributors and end-users. Thus, the
selling functions provided to different classes of home market
customers do not vary significantly. CSN provides the same selling
functions for U.S. sales except for technical assistance. Technical
assistance is only provided with respect to home market sales. However,
CSN notes that this assistance is mainly provided in connection with
warranty claims which are available to all customers. We find that
technical assistance does not constitute a significant difference
between the services provided to home market and U.S. customers.
Consequently, the Department preliminarily determines that there is
only one LOT in the home market and that it is at the same level as the
single LOT in the U.S. market.

USIMINAS/COSIPA

In the home market, USIMINAS/COSIPA made sales to end-users,

[[Page 8303]]

affiliated distributors, and unaffiliated distributors. USIMINAS/COSIPA
claim four channels of distribution with respect to these sales: (1)
Direct sales to end users; (2) sales through affiliated distributors to
end-users; (3) sales to unaffiliated distributors; and (4) sales to
end-users for which an affiliated distributor was contracted to further
process the merchandise for USIMINAS.
USIMINAS/COSIPA claim that there is a significant difference
between prices charged to end-users and prices charged to distributors.
USIMINAS/COSIPA further claim that prices charged to distributors and
to end-users differ significantly from prices charged by affiliated
distributors to their downstream customers.
In determining whether separate levels of trade actually existed in
the home market, the Department first examined available information on
the record about the company's selling functions for each channel of
distribution. USIMINAS/COSIPA indicated that the selling functions
performed by the affiliated distributors in the second channel of
distribution (downstream sales) are much more significant than those
performed by USIMINAS/COSIPA in any of the other home market channels
of distribution (mill direct sales). The following are examples of
selling functions provided for downstream sales but not mill direct
sales: inventory maintenance, faster delivery times because of higher
inventory maintenance, more flexible credit terms, special warehousing,
technical services, and more extensive delivery services. Additionally,
downstream sales involve much smaller volume purchases than mill direct
sales. For mill direct sales, USIMINAS/COSIPA provide only limited
after-sales services/warranties, freight and delivery arrangements and
technical advice. Thus, we determined that the downstream sales by
affiliates were made at a different LOT than other HM sales.
While the USIMINAS/COSIPA mill direct sales to end-users (whether
or not further processed) and mill direct sales to unaffiliated
distributors involve different channels of distribution, these sales do
not involve significant differences in selling functions. As noted
above, all mill direct sales involve limited after-sales services/
warranties, freight and delivery arrangements and technical advice, and
there are no significant differences in selling functions. Therefore,
the Department does not consider these channels to represent different
levels of trade. Thus, we preliminarily determine that downstream sales
and mill direct sales represent two different home market LOTs.
In the U.S. market, USIMINAS/COSIPA claim that all sales were made
at one level of trade, through one channel of distribution. USIMINAS/
COSIPA state that all U.S. sales were made to unaffiliated trading
companies. USIMINAS/COSIPA state that these sales are made at the same
level of trade as USIMINAS/COSIPA's direct home market sales to
unaffiliated distributors (Home Market Channel 3). However, as noted
above, the Department finds the selling functions of all home market
mill direct sales to be quite similar to each other, constituting a
single LOT. The Department additionally finds the selling functions for
mill direct sales to be similar to U.S. sales. The only selling
functions associated with U.S. sales are after-sales service/warranties
and freight and delivery arrangements. As noted above, these services
are also provided to home market mill direct customers. The only other
selling function offered for home market mill direct sales is a limited
amount of technical advice. Both home market mill direct sales and U.S.
sales involve sales to large customers, including service centers/
distributors that resell steel. (U.S. sales are only made to
resellers.) Therefore, based on our analysis of selling functions, the
Department finds U.S. sales to be at the same LOT as home market mill
direct sales.
To the extent possible, we compared sales made in the U.S. to mill
direct sales in the home market, which are at the same level of trade
as the U.S. sales. To the extent that we were unable to match U.S.
sales to identical home market sales at the same LOT, we used facts
available as the basis of NV because we do not have complete data on
downstream sales (i.e., sales at the other home market LOT). See the
Fair Value Comparisons section below.

Date of Sale

As stated in 19 CFR 351.401(i), the Department will use invoice
date as the date of sale unless another date better reflects the date
on which the exporter or producer establishes the material terms of
sale. Both CSN and USIMINAS/COSIPA reported the date of the nota fiscal
(i.e., the date the product leaves the factory) as the home market date
of sale, and the date of the commercial invoice (i.e., the invoice
issued on the date of shipment from the port) as the date of the U.S.
sale.
CSN maintains that it uses the date of the nota fiscal for home
market sales in its accounting records because this is the date on
which material terms of sale are finalized. Moreover, CSN notes that it
adds estimated freight and insurance expenses to each invoice, which
are not confirmed in writing until the date of the nota fiscal. For its
U.S. sales, CSN reported the date of the commercial invoice, stating
that it is the date on which the material terms of sale are finalized
and recorded in its accounting records.
USIMINAS and COSIPA maintain that for their home market sales, the
nota fiscal is the date on which the material terms of sale are first
finalized. The nota fiscal is also used by both companies' accounting
systems to register home market sales. In response to another inquiry,
COSIPA noted that it cannot provide order confirmation data since it
does not keep records of this documentation. For their U.S. sales,
USIMINAS and COSIPA claim that the actual quantity produced can and
does change five to 20 percent from the time of order confirmation to
the nota fiscal or commercial invoice. Therefore, they do not believe
that order confirmation is the appropriate date of sale. USIMINAS and
COSIPA both reported the date of the commercial invoice as the date of
sale. USIMINAS claims it chose to report commercial invoice (instead of
nota fiscal when the terms are first finalized) because it is the date
to which all U.S. sales are tied in its accounting system. COSIPA
claims that it reported commercial invoice because the mill's location
at a port ensures that the nota fiscal and the commercial invoice leave
the mill on the same date.
Petitioners claim that the sales documentation provided by
respondents indicates that the order confirmation date, not the date of
the commercial invoice or nota fiscal, appears to be the date when the
material terms of sale are set for a majority of the respondents' home
market and U.S. sales of hot-rolled steel. Given the relevance of
petitioners' comments and the nature of marketing these types of made-
to-order products, the Department determined that petitioners' claims
have some merit. Consequently, on December 4, 1998, and January 4,
1999, the Department requested that respondents provide additional
information concerning the nature and frequency of price and quantity
changes occurring between order confirmation date and invoice date. The
Department also asked respondents to report the order date for all home
market and U.S. sales and to ensure that the entire universe of sales
with order or invoice dates within the POI were properly reported.
USIMINAS and COSIPA subsequently reported in their supplemental
responses U.S. sales based both on commercial invoice (as previously

[[Page 8304]]

reported) and U.S. sales based on order confirmation date (as requested
by the Department). USIMINAS and COSIPA stated, however, that they were
unable to provide complete data based on order confirmation dates due
to the limited time available to them, but that they would supply
complete data as soon as practicable. COSIPA reported the order
confirmation dates of the U.S. sales by manually tracing these dates,
as these records are not maintained on its computer system. Because of
COSIPA's location at a port, its reported nota fiscal or commercial
invoice date (the names in this case are interchangeable) also serves
as an ex-factory date of shipment. This is not the case for USIMINAS.
For home market sales, USIMINAS reported order confirmation dates
corresponding to nota fiscal dates in the POI.
In its supplemental response, CSN reported those home market and
U.S. order confirmation dates that were accessible from its database.
However, the data was not complete as CSN states that the order
confirmation date is not reliably maintained in its database. CSN also
reported the date of the nota fiscal (i.e., the ex-factory shipment
date) of its U.S. sales.
For this preliminary determination, the Department is using the
dates reported by respondents as the date of sale since there is
insufficient information on the record at this time to determine which
date of sale is most appropriate. Thus, for home market sales, the
Department is using the nota fiscal date as the date of sale, and for
U.S. sales, the commercial invoice date. However, in most cases, the
U.S. date of sale reported by respondents is after the date of shipment
of the product from the factory. Because it is the Department's
practice to use shipment date as the latest date of sale, the
Department is using the ex-factory shipment date as the date of sale
for U.S. sales in those cases in which the commercial invoice date is
later. While CSN reported its ex-factory shipment dates, USIMINAS did
not provide specific ex-factory shipment dates. USIMINAS did, however,
state in its Section A response that commercial invoices are normally
issued within two weeks after the merchandise leaves the factory.
Section 776(a)(2) of the Act provides, that if an interested party:
(A) withholds information that has been requested by the Department;
(B) fails to provide such information in a timely manner or in the form
or manner requested; (C) significantly impedes a proceeding under the
antidumping statute; or (D) provides such information but the
information cannot be verified, as provided in section 782(i), the
Department shall, subject to subsections 782(d), use facts otherwise
available in reaching the applicable determination.
Because USIMINAS did not provide specific ex-factory shipment
dates, the Department resorted to facts available. As facts available,
the Department is estimating USIMINAS's ex-factory shipment date by
subtracting 14 days from the reported date of sale. See USIMINAS/COSIPA
Analysis Memorandum, February 12, 1999.
The Department intends to fully examine the date of sale issue
during verification and will incorporate our findings, as appropriate,
in our analysis for the final determination. If the Department
determines that the order confirmation date is the most appropriate
date of sale, we may resort to facts available for the final
determination to the extent that respondents have failed to report
order confirmation date or relevant sales. Due to the complexity of
this issue, the Department invites all interested parties to submit
comments in accordance with the schedule set forth in this notice.

Fair Value Comparisons

To determine whether sales of hot-rolled steel from Brazil to the
United States were made at less than fair value, the Department
compared the EP to the NV, as described in the ``Export Price'' and
``Normal Value'' sections of this notice below. In accordance with
section 777A(d)(1)(A)(i) of the Act, the Department calculated
weighted-average EPs for comparison to weighted-average NVs.
However, in the case of USIMINAS/COSIPA, the Department used facts
available as the basis of NV if there were no identical matches at the
same LOT. As explained in the ``Transactions Reviewed'' section below,
the respondent did not provide useable downstream sales data.
Additionally, the respondent did not provide complete cost data to
enable us to calculate difference of merchandise adjustments. If there
were no identical matches at the same LOT (mill direct sales), we were
thus unable to determine if the best match would be to downstream
sales. Nor could we calculate a difference in merchandise adjustment
for comparisons to similar products. Therefore, we matched only
identical product sales at the same LOT and used facts available for
all other sales.
Section 776(b) of the Act provides that adverse inferences may be
used when an interested party has failed to cooperate by not acting to
the best of its ability to comply with the Department's requests for
information. See also, Statement of Administrative Action (SAA)
accompanying the URAA, H.R. Rep. No. 316, 103d Cong., 2d Sess. 870
(1994). As adverse facts available, we used the highest calculated
margin for U.S. sales that fell within the mainstream of USIMINAS/
COSIPA's transactions. We selected a margin for sales that could be
considered indicative of USIMINAS/COSIPA's customary selling practices
and rationally related to the transactions to which the adverse facts
available are being applied. In selecting the adverse margin, the
Department sought a margin that is sufficiently adverse to effectuate
the statutory purpose of adverse facts available, which is to induce
respondents to provide the Department with complete information in a
timely manner. See Final Determination of Sales at Less Than Fair
Value: Stainless Steel Wire Rod from Italy, 63 FR 40422, 40428, (July
29, 1998). See USIMINAS/COSIPA Analysis Memorandum, February 12, 1999.

Transactions Reviewed

CSN
On November 12, 1998, CSN submitted a letter informing the
Department that its home market sales to affiliated resellers were
limited to two service centers/distributors. Furthermore, CSN claimed
that these sales represented less than five percent of its home market
sales of hot-rolled steel. Pursuant to section 351.403(d) of the
Department's regulations, on December 16, 1998, the Department informed
CSN that based on the information presently on the record, we would not
require CSN to report the home market sales of its related resellers.
However, CSN's claims regarding these sales to affiliates will be
subject to verification. See Downstream Sales Reporting Request letter
to CSN, (December 15, 1998).
USIMINAS/COSIPA
On November 25, 1998, USIMINAS/COSIPA submitted a request that they
not be required to report their home market sales by affiliated
resellers (``downstream sales''). USIMINAS/COSIPA claimed that these
sales accounted for a small percentage of their home market sales, that
the sales were made at a different level of trade from the U.S. sales,
and that the merchandise was physically different from U.S. sales.
USIMINAS/COSIPA identified three affiliated resellers. On December 15,
1998, the Department informed USIMINAS/COSIPA that they must report
their downstream sales because they exceeded five percent of the total

[[Page 8305]]

quantity of USIMINAS/COSIPA's sales. See Downstream Sales Reporting
Request letter to USIMINAS/COSIPA, (December 15, 1998).
While USIMINAS/COSIPA provided some information regarding its
downstream sales in its January 25, 1999, submission, this information
was incomplete. In particular, most product characteristics were not
fully reported. As a result, we were unable to determine whether these
sales matched to U.S. sales. We have requested respondent to provide
complete information with respect to its downstream sales, but we will
not receive this additional information in time for this preliminary
determination. Therefore, we are not using submitted downstream sales
data for this preliminary determination. See the Fair Value Comparisons
section above.

Export Price

The Department based its calculations on EP, in accordance with
section 772(a) of the Act, because the subject merchandise was sold by
the producer or exporter directly to the first unaffiliated purchaser
in the United States prior to importation. Furthermore, the Department
calculated EP based on packed prices charged to the first unaffiliated
customer in the United States.
The Department made company-specific adjustments as follows.

CSN

The Department made deductions from the starting price, where
appropriate, for inland freight, and brokerage and handling incurred by
CSN on its U.S. sales, in accordance with section 772(c)(2)(A) of the
Act. The Department added an amount to the USP for the duty paid on
imported coke, for which CSN received a duty drawback upon exportation
of the merchandise. U.S. foreign inland freight was not reported for
certain sales. As adverse facts available for these sales, we used the
highest reported inland freight on any U.S. sale. No other adjustments
were claimed or allowed.

USIMINAS/COSIPA

The Department made deductions from the starting price, where
appropriate, for the following movement expenses, in accordance with
section 772(c)(2)(A) of the Act: foreign inland freight, international
freight, and foreign brokerage and handling expenses. No other
adjustments were claimed or allowed.

Normal Value

After testing home market viability and whether home market sales
were at below-cost prices, the Department calculated NV as noted in the
``Price-to-Price Comparisons'' and ``Price-to-CV Comparison'' sections
of this notice.

Home Market Viability

In order to determine whether there is a sufficient volume of sales
in the home market to serve as a viable basis for calculating NV (i.e.,
the aggregate volume of home market sales of the foreign like product
is equal to or greater than five percent of the aggregate volume of
U.S. sales), the Department compared each of the respondents' volume of
home market sales of the foreign like product to the volume of U.S.
sales of the subject merchandise, in accordance with section
773(a)(1)(C) of the Act. Since each of the respondents' aggregate
volume of home market sales of the foreign like product was greater
than five percent of its aggregate volume of U.S. sales for the subject
merchandise, the Department determined that the home market was viable
for all respondents. Therefore, the Department has based NV on home
market sales in the usual commercial quantities and in the ordinary
course of trade.

Arm's Length Test

Sales to affiliated customers in the home market not made at arm's
length prices (if any) were excluded from our analysis because the
Department considered them to be outside the ordinary course of trade.
See 19 CFR 351.102. To test whether these sales were made at arm's
length prices, the Department compared, on a model-specific basis, the
prices of sales to affiliated and unaffiliated customers net of all
movement charges, direct selling expenses, and packing. Where, for the
tested models of subject merchandise, prices to the affiliated party
were on average 99.5 percent or more of the price to unaffiliated
parties, the Department determined that sales made to the affiliated
party were at arm's length. See 19 CFR 351.403(c). In instances where
no price ratio could be constructed for an affiliated customer because
identical merchandise was not sold to unaffiliated customers, the
Department was unable to determine that these sales were made at arm's
length prices and, therefore, excluded them from our LTFV analysis. See
Notice of Final Determination of Sales at Less Than Fair Value: Certain
Cold-Rolled Carbon Steel Flat Products from Argentina, 58 FR 37062,
37077 (July 9, 1993). Where the exclusion of such sales eliminated all
sales of the most appropriate comparison product, the Department made a
comparison to the next most similar product.

Cost of Production (COP) Analysis

Based on the cost allegation submitted by petitioners in the
original petition, the Department found reasonable grounds to believe
or suspect that respondents had made sales in the home market at prices
below the cost of producing the merchandise, in accordance with section
773(b)(2)(A)(i) of the Act. As a result, the Department initiated an
investigation to determine whether respondents made home market sales
during the POI at prices below their respective COPs within the meaning
of section 773(b) of the Act. See Initiation Notice, 63 FR 56607,
(October 22, 1998).
The Department conducted the COP analysis described below.

A. Calculation of COP

In accordance with section 773(b)(3) of the Act, the Department
calculated COP for hot-rolled steel based on the sum of the cost of
materials and fabrication for the foreign like product, plus amounts
for home market SG&A, interest expenses, and packing costs. The
Department relied on the COP data submitted by each respondent in its
cost questionnaire response, except, as discussed below, in specific
instances where the submitted costs were not appropriately quantified
or valued.

CSN

The Department relied on CSN's COP and CV data submitted on January
25, 1999, except in the following instances: (1) we revised the general
and administrative expense rate to include amortization of goodwill;
(2) we recalculated CSN's financial expense rate to correct a
mathematical error in its computation; and (3) we adjusted CSN's total
cost of manufacture by a factor which restates electricity purchases
from an affiliated party to the supplier's cost of production rather
than the transfer price. See Cost Calculation Memorandum, February 12,
1999. Additionally, CSN failed to report costs for certain products.
See the Price-to-Price Comparisons section below.

USIMINAS/COSIPA

The Department relied on USIMINAS/COSIPA's COP and CV data
submitted on February 2 and 3, 1999 except in the following instances:
(1) we revised financial expense based on the consolidated expense of
the companies; and (2) we revised their submitted

[[Page 8306]]

SG&A expenses to include severance payments and profit sharing and to
exclude net miscellaneous sales, dividend income and gains on
investments, as well as several other smaller items. See Cost
Calculation Memorandum, February 12, 1999. Because USIMINAS/COSIPA
submitted multiple costs for many product control numbers (``CONNUMs'')
and did not provide separate production quantities, we were unable to
weight average the multiple costs. Therefore, as facts available, we
used the highest of the reported COPs or CVs for each CONNUM. See
Preliminary Results of Antidumping Duty Administrative Review: Extruded
Rubber Thread from Malaysia, 63 FR 60295, 60297, (November 9, 1998).
See Cost Calculation Memorandum, February 12, 1999. Additionally,
USIMINAS/COSIPA failed to report costs for certain products. See the
Price-to-Price Comparisons section below.

B. Test of Home Market Prices

The Department compared the weighted-average COP for each
respondent, adjusted where appropriate (see above), to home market
sales prices of the foreign like product as required under section
773(b) of the Act. In determining whether to disregard home market
sales made at prices less than the COP, the Department examined whether
(1) within an extended period of time, such sales were made in
substantial quantities; and (2) such sales were made at prices which
permitted the recovery of all costs within a reasonable period of time.
On a product-specific basis, the Department compared the COP to home
market prices, less any applicable movement charges, taxes, billing
adjustment, and discounts and rebates.

C. Results of the COP Test

Pursuant to section 773(b)(2)(C) of the Act, where less than 20
percent of respondent's sales of a given product were at prices less
than the COP, the Department did not disregard any below-cost sales of
that product because we determined that the below-cost sales were not
made in ``substantial quantities.'' Where 20 percent or more of a
respondent's sales of a given product during the POI were at prices
less than the COP, the Department determined such sales to have been
made in ``substantial quantities,'' in accordance with 773(b)(2)(C)(i),
within an extended period of time, in accordance with section
773(b)(2)(B) of the Act. In such cases, because the Department compared
prices to weighted-average COPs for the POI , the Department also
determined that such sales were not made at prices which would permit
recovery of all costs within a reasonable period of time, in accordance
with section 773(b)(2)(D) of the Act. Therefore, the Department
disregarded the below-cost sales. Where all sales of a specific product
were at prices below the COP, the Department disregarded all sales of
that product.

Price-to-Price Comparisons

The Department performed price-to-price comparisons where there
were sales of comparable merchandise in the home market that did not
fail the cost test. The Department made adjustments, where appropriate,
for physical differences in the merchandise in accordance with section
773(a)(6)(C) of the Act. (As noted above, we only compared identical
sales for USIMINAS/COSIPA. Thus, adjustments for physical differences
in merchandise were not made.) In accordance with Section 773(a)(6),
the Department deducted home market packing costs and added U.S.
packing costs.

Brazilian Taxes

Consistent with past practice, the Department adjusted NV for the
full amount of IPI and ICMS taxes collected on the subject merchandise
because these are VAT taxes that have a basis for deduction according
to Section 773 (a)(6)(B)(iii) of the Act. The Department did not deduct
the Brazilian PIS and COFINS taxes as suggested by respondents in
calculating NV. Since these taxes are levied on total revenues, the
taxes are not imposed directly on the product or its components.
Accordingly, there is no basis to deduct them in the calculation of NV
under Section 773 (a)(6)(B)(iii) of the Act. See Final Results of
Antidumping Duty Administrative Review: Certain Cut-To-Length Carbon
Steel Plate from Brazil, 63 FR 12744, 12746 (March 16, 1998).
In addition, respondents argue that the IPI and ICMS tax credits
received on inputs used to manufacture export products should be
deducted from the home market NV. The Department disagrees. Since these
tax credits partially offset respondents' liability for taxes collected
on sales, such a deduction would double count for taxes for which we
have already made an adjustment. Therefore, the Department did not make
a further tax deduction in determining NV.

CSN

CSN did not provide COP data for all home market CONNUMs. Section
776(a)(2) of the Act provides, that if an interested party: (A)
withholds information that has been requested by the Department; (B)
fails to provide such information in a timely manner or in the form or
manner requested; (C) significantly impedes a proceeding under the
antidumping statute; or (D) provides such information but the
information cannot be verified, as provided in section 782(i), the
Department shall, subject to subsection 782(d), use facts otherwise
available in reaching the applicable determination.
Section 776(b) of the Act provides that adverse inferences may be
used when an interested party has failed to cooperate by not acting to
the best of its ability to comply with the Department's requests for
information. See also, Statement of Administrative Action (SAA)
accompanying the URAA, H.R. Rep. No. 316, 103d Cong., 2d Sess. 870
(1994). In the instant case, because CSN failed to provide COP data for
all home market CONNUMS, the Department applied adverse facts available
in determining the margin for all U.S. sales matching to home market
sales for which COP data was not provided. We also applied adverse
facts available in determining the margin for all U.S. sales matches
for which information to calculate difference in merchandise
adjustments was not provided. As adverse facts available, we used the
highest margin calculated for any individual product (i.e., CONNUM).
The highest margin was based on sales that fell within the mainstream
of CSN's transactions. We considered these sales indicative of CSN's
customary selling practices and rationally related to the transaction
to which the adverse facts available are being applied. In selecting
the adverse margin, the Department sought a margin that is sufficiently
adverse to effectuate the statutory purpose of adverse facts available,
which is to induce respondents to provide the Department with complete
information in a timely manner.
For CSN, the Department based NV on prices of home market sales
that passed the cost test. The Department made deductions for foreign
inland freight and taxes. The Department notes that the deduction for
inland freight should be net of VAT taxes. While we have requested this
information, we did not receive it in time for this preliminary
determination. Consequently, as facts available, the Department has
estimated an amount for VAT taxes paid on inland freight, and deducted
this from the reported amounts. In addition, the Department made
circumstance-of-sale (COS) adjustments for differences in credit,
warranty expenses, and bank charges, where appropriate. On a few sales
CSN incurred a bank fee that was charged upon the customer's payment.

[[Page 8307]]

CSN adjusted its accounts receivable accordingly, and the Department
included this adjustment in its calculations. For U.S. sales by CSN,
the Department recalculated credit to take into account the difference
between ex-factory and ex-port date of shipment. See CSN Analysis
Memorandum, February 12, 1999. For home market sales, the Department
recalculated home market credit and used a price net of VAT taxes for
the basis of the recalculation. See Final Determination of Antidumping
Administrative Review: Certain Cut-To-Length Carbon Steel Plate from
Brazil, 62 FR 18486 , 18487 (April 15, 1997). The Department
recalculated both home market and U.S. credit expenses for those sales
with missing payment dates. As facts available, the Department used the
date of the respondent's supplemental submission of January 25, 1999,
as the date of payment for sales missing payment dates. Because it is
CSN's standard practice to charge late payment fees, we imputed home
market interest revenue for sales with unreported payment dates. Where
appropriate, we adjusted the home market starting price for billing
adjustments. The Department also made adjustments for home market
inventory carrying costs and indirect selling expenses to offset the
U.S. commissions.

USIMINAS/COSIPA

On February 9, 1999, the respondent indicated that there were
clerical errors in one of its sales databases previously submitted to
the Department and submitted replacement data. Because these errors
were clerical in nature and did not change the universe of sales
reported, we used the revised data for this preliminary determination.
For USIMINAS/COSIPA, the Department based NV on prices of home
market sales that passed the cost test. The Department made deductions
for billing adjustments and discounts. The Department made deductions,
where appropriate, for inland freight, inland insurance and
warehousing. See USIMINAS/COSIPA Analysis Memorandum, February 12,
1999. The Department notes that the deduction for inland freight should
be net of VAT taxes. However, while we have requested this information,
we did not receive it in time for this preliminary determination.
Consequently, as facts available, the Department has estimated an
amount for VAT taxes paid on inland freight, and deducted this from the
reported amounts. We made COS adjustments for imputed credit expense
and warranties. Since USIMINAS/COSIPA did not properly calculate home
market interest, the Department recalculated home market credit using a
published Brazilian prime rate. See USIMINAS/COSIPA Analysis
Memorandum, February 12, 1999. For U.S. sales by USIMINAS/COSIPA, the
Department recalculated credit to take into account the difference
between ex-factory and ex-port date of shipment. As facts available,
the Department used the date of the respondents' supplemental
submission of January 25, 1999, as the date of payment for sales
missing payment dates. See USIMINAS/COSIPA Analysis Memorandum,
February 12, 1999. For home market sales, the Department recalculated
home market credit and used a price net of VAT taxes for the basis of
the recalculation. See Final Determination of Antidumping
Administrative Review: Certain Cut-To-Length Carbon Steel Plate from
Brazil, 62 FR 18486 , 18487 (April 15, 1997). Because it is the
standard practice for the respondents to charge late payment fees, the
Department imputed interest revenue for sales with unreported payment
dates.
USIMINAS/COSIPA did not provide COP data for all home market
CONNUMs. In the instant case, the Department determined that USIMINAS/
COSIPA's failure to provide COP data for all home market CONNUMS
satisfies the requirements of section 776(a)(2)(A), (B), and (C) of the
Act. Therefore, for all U.S. sales matching to home market sales for
which COP data was not provided, the Department applied adverse facts
available equal to the highest calculated margin. The highest margin
was based on sales that fell within the mainstream of USIMINAS/COSIPA's
transactions. We considered these sales indicative of their customary
selling practices and rationally related to the transaction to which
the adverse facts available are being applied. In selecting the adverse
margin, the Department sought a margin that is sufficiently adverse to
effectuate the statutory purpose of adverse facts available, which is
to induce respondents to provide the Department with complete
information in a timely manner.

Currency Conversion

The Department made currency conversions into U.S. dollars based on
the exchange rates in effect on the dates of the U.S. sales, as
certified by the Federal Reserve Bank, in accordance with section
773A(a) of the Act.

Critical Circumstances

On October 30, 1998, petitioners alleged that there is a reasonable
basis to believe or suspect that critical circumstances exist with
respect to imports of hot-rolled steel from Brazil. In accordance with
19 CFR 351.206(c)(2)(i), since this allegation was filed at least 20
days prior to the preliminary determination, the Department must issue
its preliminary critical circumstances determination no later than the
preliminary determination.
Section 733(e)(1) of the Act provides that if a petitioner alleges
critical circumstances, the Department will determine whether there is
a reasonable basis to believe or suspect that:
(A)(i) There is a history of dumping and material injury by reason
of dumped imports in the United States or elsewhere of the subject
merchandise, or (ii) the person by whom, or for whose account, the
merchandise was imported knew or should have known that the exporter
was selling the subject merchandise at less than its fair value and
that there was likely to be material injury by reason of such sales,
and (B) there have been massive imports of the subject merchandise over
a relatively short period.
1. History of Dumping or Importer Knowledge of Dumping
To determine whether there is a history of dumping of the subject
merchandise, the Department normally considers evidence of an existing
antidumping duty order in the United States or elsewhere to be
sufficient. The Department found that there is an antidumping duty
order on hot-rolled steel from Brazil in Mexico, and therefore
determined that there is a history of dumping and material injury by
reason of dumped imports of the subject merchandise.
2. Massive Imports
Since the first prong of the critical circumstances test has been
met, the Department must examine whether there have been massive
imports over a relatively short period of time. To determine whether
imports were massive over a relatively short time period, the
Department typically compares the import volume of the subject
merchandise for the three months immediately preceding and following
the filing of the petition. See 19 CFR 351.206(i). Pursuant to 19 CFR
351.206(h)(2), the Department will consider an increase of 15 percent
or more in the imports of the subject merchandise over the relevant
period to be massive. According to official U.S. Customs Bureau
statistics for the first two months of the comparison period (October
and November) and according to preliminary Customs Bureau statistics

[[Page 8308]]

for the third month (December), there was less than a 15 percent
increase in imports from the level of the preceding three months.
Therefore, there have not been massive imports over the examined
period, and the Department preliminarily does not find that critical
circumstances exist for CSN or USIMINAS/COSIPA. See CSN and USIMINAS/
COSIPA Analysis Memorandums, February 12, 1999. The Department notes
that it has requested company specific shipment information from CSN,
USIMINAS, and COSIPA but that we have not received it in time for this
preliminary determination. We invite interested parties to comment on
the issue of critical circumstances, and we will consider these
comments and the company specific data in making our final
determination.

Verification

As provided in section 782(i) of the Act, the Department will
verify all information relied upon in making our final determination.

Suspension of Liquidation

In accordance with section 733(d) of the Act, the Department is
directing the U.S. Customs Service to suspend liquidation of all
imports of subject merchandise that are entered, or withdrawn from
warehouse, for consumption on or after the date of publication of this
notice in the Federal Register. The Department will instruct the U.S.
Customs Service to require a cash deposit or the posting of a bond
equal to the weighted-average amount by which the NV exceeds the export
price, as indicated below. These suspension-of-liquidation instructions
will remain in effect until further notice. The weighted-average
dumping margins are as follows:

------------------------------------------------------------------------
Weighted-
Exporter/manufacturer average
margin
------------------------------------------------------------------------
CSN........................................................ 50.66
USIMINAS/COSIPA............................................ 71.02
All Others................................................. 58.76
------------------------------------------------------------------------

International Trade Commission Notification

In accordance with section 733(f) of the Act, the Department has
notified the ITC of our determination. If our final determination is
affirmative, the ITC will determine before the later of 120 days after
the date of this preliminary determination or 45 days after our final
determination whether imports of hot-rolled steel are materially
injuring, or threaten material injury to the U.S. industry.

Public Comment

Case briefs or other written comments may be submitted to the
Assistant Secretary for Import Administration no later than fifty days
after the date of publication of this notice, and rebuttal briefs,
limited to issues raised in case briefs, no later than fifty-five days
after the date of publication of this preliminary determination. A list
of authorities used and an executive summary of issues should accompany
any briefs submitted to the Department. This summary should be limited
to five pages total, including footnotes. In accordance with section
774 of the Act, the Department will hold a public hearing, if
requested, to afford interested parties an opportunity to comment on
arguments raised in case or rebuttal briefs. Tentatively, any hearing
will be held fifty-seven days after publication of this notice at the
U.S. Department of Commerce, 14th Street and Constitution Avenue, N.W.,
Washington, D.C. 20230, at a time and location to be determined.
Parties should confirm by telephone the date, time, and location of the
hearing 48 hours before the scheduled time.
Interested parties who wish to request a hearing, or to participate
if one is requested, must submit a written request to the Assistant
Secretary for Import Administration, U.S. Department of Commerce, Room
1870, within 30 days of the date of publication of this notice.
Requests should contain: (1) the party's name, address, and telephone
number; (2) the number of participants; and (3) a list of the issues to
be discussed. At the hearing, each party may make an affirmative
presentation only on issues raised in that party's case brief, and may
make rebuttal presentations only on arguments included in that party's
rebuttal brief. See 19 CFR 351.310(c). If this investigation proceeds
normally, we will make our final determination no later than April 28,
1999.
This determination is issued and published in accordance with
sections 733(d) and 777(i)(1) of the Act.

Dated: February 12, 1999.
Richard W. Moreland,
Acting Assistant Secretary for Import Administration.
[FR Doc. 99-4197 Filed 2-18-99; 8:45 am]
BILLING CODE 3510-DS-P