[Federal Register Volume 64, Number 171 (Friday, September 3, 1999)]
[Notices]
[Pages 48369-48372]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-23047]


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

DEPARTMENT OF COMMERCE

International Trade Administration
[C-427-603]


Final Results of Expedited Sunset Review: Brass Sheet and Strip 
from France

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

ACTION: Notice of Final Results of Expedited Sunset Review: Brass Sheet 
and Strip from France.

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

SUMMARY: On February 1, 1999, the Department of Commerce (``the 
Department'') initiated a sunset review of the countervailing duty 
order on brass sheet and strip from France (64 FR 4840) pursuant to 
section 751(c) of the Tariff Act of 1930, as amended (``the Act''). On 
the basis of a notice of intent to participate and adequate substantive 
comments filed on behalf of domestic interested parties, as well as 
inadequate response (in this case, no response) from respondent 
interested parties, the Department determined to conduct an expedited 
(120 day) review. As a result of this review, the Department finds that 
termination of the countervailing duty order would be likely to lead to 
continuation or recurrence of a countervailable subsidy. The net 
countervailable subsidy and the nature of the subsidy are identified in 
the ``Final Results of Review'' section of this notice.

FOR FURTHER INFORMATION CONTACT: Kathryn B. McCormick or Melissa G. 
Skinner, Office of Policy for Import Administration, International 
Trade Administration, US Department of Commerce, 14th Street & 
Constitution Avenue, NW, Washington, D.C. 20230; telephone: (202) 482-
1698 or (202) 482-1560, respectively.

EFFECTIVE DATE: September 3, 1999.

Statute and Regulations

    This review was conducted pursuant to sections 751(c) and 752 of 
the Act. The Department's procedures for the

[[Page 48370]]

conduct of sunset reviews are set forth in Procedures for Conducting 
Five-year (``Sunset'') Reviews of Antidumping and Countervailing Duty 
Orders, 63 FR 13516 (March 20, 1998) (``Sunset Regulations''). Guidance 
on methodological or analytical issues relevant to the Department's 
conduct of sunset reviews is set forth in the Department's Policy 
Bulletin 98:3--Policies Regarding the Conduct of Five-year (``Sunset'') 
Reviews of Antidumping and Countervailing Duty Orders; Policy Bulletin, 
63 FR 18871 (April 16, 1998) (``Sunset Policy Bulletin'').

Scope

    This order covers shipments of coiled, wound-on-reels (traverse 
wound), and cut-to-length brass sheet and strip (not leaded or tinned) 
from France. The subject merchandise has, regardless of width, a solid 
rectangular cross section over 0.0006 inches (0.15 millimeters) through 
0.1888 inches (4.8 millimeters) in finished thickness or gauge. The 
chemical composition of the covered products is defined in the Copper 
Development Association (``C.D.A.'') 200 Series or the Unified 
Numbering System (``U.N.S.'') C2000; this review does not cover 
products with chemical compositions that are defined by anything other 
than the C.D.A. or U.N.S. series. The merchandise is currently 
classified under Harmonized Tariff Schedule (``HTS'') item numbers 
7409.21.00 and 7409.29.00. The HTS item numbers are provided for 
convenience and U.S. Customs purposes. The written description remains 
dispositive.
    This review covers all producers and exporters of brass sheet and 
strip from France.

History of the Order

    The Government of France, Pechiney S.A. (``Pechiney'') and 
Trefimeteaux S.A (``Trefimeteaux'') participated in the original 
investigation. Two programs were found to confer subsidies: (1) 
Government Equity Infusion and Other Financial Assistance to 
Trefimetaux, and (2) Certain Financing from Credit National.
    The Department published its final affirmative countervailing duty 
determination on brass sheet and strip from France in the Federal 
Register on January 12, 1987 (52 FR 1218) and issued the countervailing 
duty order on March 6, 1987 (52 FR 6996). The Department determined the 
estimated net subsidy to be 7.24 percent and the order remains in 
effect for all producers and exporters of brass sheet and strip from 
France. The Department has not conducted any administrative reviews 
since the issuance of the order.

Background

    On February 1, 1999, the Department initiated a sunset review of 
the countervailing duty order on brass sheet and strip from France (64 
FR 4840), pursuant to section 751(c) of the Act. The Department 
received a Notice of Intent to Participate on behalf of Heyco Metals, 
Inc. (``Heyco''), Hussey Copper Ltd. (``Hussey''), Olin Corporation-
Brass Group (``Olin''), Outokumpu American Brass (``Outokumpu'') 
(formerly American Brass Company), PMX Industries, Inc. (``PMX''), 
Revere Copper Products, Inc. (``Revere''), the International 
Association of Machinists and Aerospace Workers, the United Auto 
Workers (Local 2367), and the United Steelworkers of America (AFL/CIO-
CLC) (hereinafter, collectively ``domestic interested parties'') on 
February 16, 1999, within the deadline specified in section 
351.218(d)(1)(i) of the Sunset Regulations. We received a complete 
substantive response from the domestic interested parties on March 3, 
1999, within the 30-day deadline specified in the Sunset Regulations 
under section 351.218(d)(3)(i).
    The domestic interested parties claimed interested party status 
under 19 U.S.C. 1677(9)(C) and (D) as well as under sections 771(9)(C) 
and (D) of the Act, as domestic brass mills, rerollers, and unions 
engaged in the production of brass sheet and strip. With the exception 
of Heyco, all of the aforementioned parties were original petitioners 
in this case.
    We did not receive a substantive response from any respondent 
interested party to this proceeding. Pursuant to section 
351.218(d)(2)(iii) of the Sunset Regulation, this constitutes a waiver 
of participation. As a result, pursuant to 19 CFR 351.218(e)(1)(ii)(C), 
the Department determined to conduct an expedited, 120-day, review of 
this order.
    The Department determined that the sunset review of the 
countervailing duty investigation on brass sheet and strip from France 
is extraordinarily complicated. In accordance with 751(c)(5)(C)(v) of 
the Act, the Department may treat a review as extraordinarily 
complicated if it is a review of a transition order (i.e., an order in 
effect on January 1, 1995). (See section 751(c)(6)(C) of the Act.) 
Therefore, on June 7, 1999, the Department extended the time limit for 
completion of the final results of this review until not later than 
August 30, 1999, in accordance with section 751(c)(5)(B) of the 
Act.1
---------------------------------------------------------------------------

    \1\ See Porcelain-on-Steel Cooking Ware From the People's 
Republic of China, Porcelain-on-Steel Cooking Ware From Taiwan, Top-
of-the-Stove Stainless Steel Cooking Ware From Korea (South) (AD & 
CVD), Top-of-the-Stove Stainless Steel Cooking Ware From Taiwan (AD 
& CVD), Standard Carnations From Chile (AD &CVD), Fresh Cut Flowers 
From Mexico, Fresh Cut Flowers From Ecuador, Brass Sheet and Strip 
From Brazil (AD & CVD), Brass Sheet and Strip From Korea (South), 
Brass Sheet and Strip From France (AD & CVD), Brass Sheet and Strip 
From Germany, Brass Sheet and Strip From Italy, Brass Sheet and 
Strip From Sweden, Brass Sheet and Strip From Japan, Pompon 
Chrysanthemums From Peru: Extension of Time Limit for Final Results 
of Five-Year Reviews, 64 FR 30305 (June 7, 1999).
---------------------------------------------------------------------------

Determination

    In accordance with section 751(c)(1) of the Act, the Department is 
conducting this review to determine whether termination of the 
countervailing duty order would be likely to lead to continuation or 
recurrence of a countervailable subsidy. Section 752(b) of the Act 
provides that, in making this determination, the Department shall 
consider the net countervailable subsidy determined in the 
investigation and subsequent reviews, and whether any change in the 
program which gave rise to the net countervailable subsidy has occurred 
and is likely to affect that net countervailable subsidy. Pursuant to 
section 752(b)(3) of the Act, the Department shall provide to the 
International Trade Commission (``the Commission'') the net 
countervailable subsidy likely to prevail if the order is revoked. In 
addition, consistent with section 752(a)(6), the Department shall 
provide to the Commission information concerning the nature of the 
subsidy and whether it is a subsidy described in Article 3 or Article 
6.1 of the 1994 WTO Agreement on Subsidies and Countervailing Measures 
(``Subsidies Agreement'').
    The Department's determinations concerning continuation or 
recurrence of a countervailable subsidy, the net countervailable 
subsidy likely to prevail if the order is revoked, and nature of the 
subsidy are discussed below. In addition, the domestic interested 
parties' comments with respect to each of these issues are addressed 
within the respective sections.

Continuation or Recurrence of a Countervailable Subsidy

    Drawing on the guidance provided in the legislative history 
accompanying the Uruguay Round Agreements Act (``URAA''), specifically 
the SAA, H.R. Doc. No. 103-316, vol. 1 (1994), the House Report, H.R. 
Rep. No. 103-826, pt.1 (1994), and the Senate Report, S.

[[Page 48371]]

Rep. No. 103-412 (1994), the Department issued its Sunset Policy 
Bulletin providing guidance on methodological and analytical issues, 
including the basis for likelihood determinations. The Department 
clarified that determinations of likelihood will be made on an order-
wide basis (see section III.A.2 of the Sunset Policy Bulletin). 
Additionally, the Department normally will determine that revocation of 
a countervailing duty order is likely to lead to continuation or 
recurrence of a countervailable subsidy where (a) A subsidy program 
continues, (b) a subsidy program has been only temporarily suspended, 
or (c) a subsidy program has been only partially terminated (see 
section III.A.3.a of the Sunset Policy Bulletin). Exceptions to this 
policy are provided where a company has a long record of not using a 
program (see section III.A.3.b of the Sunset Policy Bulletin).
    In addition to considering the guidance on likelihood cited above, 
section 751(c)(4)(B) of the Act provides that the Department shall 
determine that revocation of an order is likely to lead to continuation 
or recurrence of dumping where a respondent interested party waives its 
participation in the sunset review. Pursuant to the SAA, at 881, in a 
review of a countervailing duty order, when the foreign government has 
waived participation, the Department shall conclude that revocation of 
the order would be likely to lead to a continuation or recurrence of a 
countervailable subsidy for all respondent interested 
parties.2 In the instant review, the Department did not 
receive a response from the foreign government or from any other 
respondent interested party. Pursuant to section 351.218(d)(2)(iii) of 
the Sunset Regulations, this constitutes a waiver of participation.
---------------------------------------------------------------------------

    \2\ See 19 CFR 351.218(d)(2)(iv).
---------------------------------------------------------------------------

    The domestic interested parties argue that revocation of the 
countervailing duty order on brass sheet and strip from France will 
result in the continuation or recurrence of a countervailable subsidy. 
Citing the SAA, the domestic interested parties assert that 
continuation, temporary or partial termination of a subsidy program 
will be highly probative of the likelihood of continuation or 
recurrence of countervailable subsidies, absent significant evidence to 
the contrary (see March 3, 1999 Substantive Response of domestic 
interested parties at 33). The domestic interested parties assert that 
there is no indication that the French government's subsidy programs 
have been modified or eliminated (see March 3, 1999 Substantive 
Response of domestic interested parties at 38), and they submit as 
support the fact that the order has never been subject to an 
administrative review.
    In its final countervailing duty determination (January 12, 1987; 
52 FR 1218), the Department concluded that the Government of France was 
providing countervailable subsidies to exporters of the subject 
merchandise through two different programs: (1) Government Equity 
Infusion and Other Financial Assistance and (2) Certain Financing from 
Credit National. Trefimetaux, the sole producer/exporter reviewed by 
the Department, was determined to be receiving subsidies through both 
of these programs.
    There have been no administrative reviews of this order, nor has 
any evidence been submitted to the Department demonstrating the 
termination of these programs that conferred countervailable subsidies. 
Therefore, it is reasonable to assume that these programs continue to 
exist and are utilized. Absent argument and evidence to the contrary, 
the Department determines that there is a likelihood of continuation or 
recurrence of a countervailable subsidy if the order were revoked.

Net Countervailable Subsidy

    In the Sunset Policy Bulletin, the Department stated that, 
consistent with the SAA and House Report, the Department normally will 
select a rate from the investigation, because that is the only 
calculated rate that reflects the behavior of exporters and foreign 
governments without the discipline of an order or suspension agreement 
in place. The Department noted that this rate may not be the most 
appropriate rate if, for example, the rate was derived from subsidy 
programs which were found in subsequent reviews to be terminated, there 
has been a program-wide change, or the rate ignores a program found to 
be countervailable in a subsequent administrative review. 3
---------------------------------------------------------------------------

    \3\ See section III.B.3 of the Sunset Policy Bulletin.
---------------------------------------------------------------------------

    The domestic interested parties, citing the SAA, note that the 
Administration intends that Commerce normally will select the rate from 
the investigation, because that is the only calculated rate that 
reflects the behavior or exporters and foreign governments without the 
discipline of an order in place (see March 3, 1999 Substantive Response 
of domestic interested parties at 45). Therefore, the domestic 
interested parties argue that the Department should determine that the 
net countervailable subsidy likely to prevail is 7.24 percent, the rate 
set forth in the original investigation.
    The rate determined in the original investigation was 7.24 percent 
for all imports of brass sheet and strip from France, and, as noted 
above, there have been no administrative reviews of this order. Absent 
administrative review, the Department has never found that substantive 
changes have been made to the programs found to be countervailable. 
Therefore, since no changes have been made to any of the French subsidy 
programs, and absent any argument and evidence to the contrary, the 
Department determines that the net countervailable subsidy that would 
be likely to prevail in the event of revocation of the order would be 
7.24 percent. This rate is for all producers and exporters of the 
subject merchandise from France.

Nature of the Subsidy

    In the Sunset Policy Bulletin, the Department states that, 
consistent with section 752(a)(6) of the Act, the Department will 
provide to the Commission information concerning the nature of the 
subsidy, and whether the subsidy is a subsidy described in Article 3 or 
Article 6.1 of the Subsidies Agreement. The domestic interested parties 
did not address this issue in their substantive response of March 3, 
1999.
    Because the receipt of benefit under one of the two programs is 
contingent on exports, this program falls within the definition of an 
export subsidy under Article 3.1(a) of the Subsidies Agreement. The 
remaining program, although not falling within the definition of an 
export subsidy under Article 3.1(a) of the Subsidies Agreement, could 
be found to be inconsistent with Article 6 if the net countervailable 
subsidy exceeds five percent, as measured in accordance with Annex IV 
of the Subsidies Agreement. The Department, however, has no information 
with which to make such a calculation, nor do we believe it appropriate 
to attempt such a calculation in the course of a sunset review. Rather, 
we are providing the Commission with the following program 
descriptions.
    Certain Financing from Credit National. Trefimetaux received 
countervailable subsidies under a program of loans provided by Credit 
National, which has a strong relationship with the Government (the 
President of France appoints the General Manager). In this case, the 
Department found that Trefimetaux received special loans from Credit 
National between 1976 and 1985.

[[Page 48372]]

Specifically, Credit National provided to Trefimetaux a loan with an 
interest reduction contingent upon increasing exports, including the 
subject merchandise. Therefore, the Department determines that this 
program constituted an export subsidy.
    Government Equity Infusion and Other Financial Assistance to 
Trefimetaux. This program enabled Trefimetaux to receive equity 
infusions and other financial assistance from Pechiney, its parent 
company, from 1982 to 1985. Pechiney received direct equity infusions 
from the Government of France, and provided them to Trefimetaux through 
(1) equity infusions, (2) loans on terms inconsistent with commercial 
considerations, and (3) government grants during a period when 
Trefimetaux was determined by the Department to be neither equity nor 
credit-worthy.

Final Results of Review

    As a result of this review, the Department finds that revocation of 
the countervailing duty order would be likely to lead to continuation 
or recurrence of a countervailable subsidy. The net countervailable 
subsidy has been determined to be:

------------------------------------------------------------------------
                                                                Margin
                   Manufacturer/Exporter                      (percent)
------------------------------------------------------------------------
Trefimetaux S.A............................................         7.24
All Others.................................................         7.24
------------------------------------------------------------------------

    The Government of France's subsidy programs, as determined in the 
original investigation, have been deemed to be countervailable 
subsidies within the definitions provided by Article 3 and Article 6.1 
of the Subsidies Agreement, and all of these subsidy programs, as 
determined in the original investigation, remain in place today.
    This notice serves as the only reminder to parties subject to 
administrative protective order (APO) of their responsibility 
concerning the disposition of proprietary information disclosed under 
APO in accordance with 19 CFR 351.305 of the Department's regulations. 
Timely notification of return/destruction of APO materials or 
conversion to judicial protective order is hereby requested. Failure to 
comply with the regulations and the terms of an APO is a sanctionable 
violation.
    This five-year (``sunset'') review and notice are in accordance 
with sections 751(c), 752, and 777(i)(1) of the Act.

    Dated: August 30, 1999.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 99-23047 Filed 9-2-99; 8:45 am]
BILLING CODE 3510-DS-P