[Federal Register Volume 64, Number 190 (Friday, October 1, 1999)]
[Notices]
[Pages 53331-53332]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-25625]


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DEPARTMENT OF COMMERCE

International Trade Administration
[C-357-004]


Final Results of Full Sunset Review: Carbon Steel Wire Rod From 
Argentina

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

ACTION: Notice of Final Results of Full Sunset Review: Carbon Steel 
Wire Rod from Argentina.

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Summary: On May 28, 1999, the Department of Commerce (``the 
Department'') published a notice of preliminary results of the full 
sunset review of the suspended countervailing duty investigation on 
carbon steel wire rod from Argentina (64 FR 28978) pursuant to section 
751(c) of the Tariff Act of 1930, as amended (``the Act''). We provided 
interested parties an opportunity to comment on our preliminary 
results. We received comments from both domestic and respondent 
interested parties. As a result of this review, the Department finds 
that termination of this suspended investigation would be likely to 
lead to continuation or recurrence of a countervailable subsidy at the 
levels indicated in the Final Results of Review section of this notice.
For Further Information Contact: Scott E. Smith or Melissa G. Skinner, 
Office of Policy for Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, D.C. 20230; telephone: (202) 482-
6397 or (202) 482-1560, respectively.

Effective Date: October 1, 1999.

Statute and Regulations

    This review was conducted pursuant to sections 751(c) and 752 of 
the Act. The Department's procedures for the 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'') and in 19 CFR Part 351 (1998) 
in general. 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

    The merchandise subject to this suspended countervailing duty 
investigation is carbon steel wire rod, both high carbon and low 
carbon, manufactured in Argentina and exported, directly or indirectly 
from Argentina to the United States. The term ``carbon steel wire rod'' 
covers a coiled, semi-finished, hot-rolled carbon steel product of 
approximately round solid cross section, not under 0.02 inches nor over 
0.74 inches in diameter, not tempered, not treated, and not partly 
manufactured, and valued at over 4 cents per pound. As of the 
publication of the last administrative review, 1 the 
merchandise subject to this order was classifiable under item numbers 
7213.20.00, 7213.31.30, 7213.39.00, 7213.41.30, 7213.49.00, and 
7213.50.00 of the Harmonized Tariff Schedule of the United States 
(``HTSUS''). Although the HTSUS subheadings are provided for 
convenience and customs purposes, the written description remains 
dispositive.
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    \1\ See Carbon Steel Wire Rod from Argentina; Final Results of 
Countervailing Duty Administrative Review, 56 FR 40309 (August 14, 
1991).
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Background

    On May 28, 1999, the Department issued the Preliminary Results of 
Full Sunset Review: Carbon Steel Wire Rod from Argentina (64 FR 28978) 
(``Preliminary Results''). In our preliminary results, we found that 
termination of the suspended investigation would be likely to lead to 
continuation or recurrence of a countervailable subsidy. Further, we 
found that the net countervailable subsidy likely to prevail if the 
suspended investigation were terminated is 5.36 percent ad valorem, the 
subsidy rate determined in the suspended investigation. Additionally, 
we found that each of the three programs (the reembolso, pre-export 
financing, and post-export financing) fall within the definition of an 
export subsidy under Article 3.1(a) of the 1994 WTO Agreement on 
Subsidies and Countervailing Measures (``Subsidies Agreement'').
    On July 12, 1999, within the deadline specified in 19 CFR 
351.309(c)(1)(i), we received comments on behalf of Co-Steel (formerly 
Raritan River Steel), GS Industries, and North Star Steel Company 
(collectively, the ``domestic interested parties''), the domestic 
participants in this review, and on behalf of Acindar Industria 
Argentina de Aceros S.A. (``Acindar''), the respondent in this review. 
On July 15, 1999, within the deadline specified in 19 CFR 351.309(d), 
the Department received rebuttal comments from the domestic interested 
parties. We have addressed the comments received below.

Comments

    Comment 1: In its July 12, 1999, case brief, Acindar states that it 
disagrees with the Department's Preliminary Results in this sunset 
proceeding. Acindar states that, in the Department's Preliminary 
Results, we noted that Communique A-1807 ``totally suspended'' pre-
export (as well post-export) financing as of March 8, 1991. Acindar 
argues that a suspension of this duration can hardly be considered 
temporary and that the Department should conclude that the subsidy 
attributable to pre- and post-export financing is zero and, 
consequently, reduce its final net countervailable subsidy rate to 
zero.
    In their July 12, 1999, case brief, the domestic interested parties 
state that they agree with the Department's Preliminary Results in this 
proceeding. With respect to Acindar's assertion, the domestic 
interested parties argue that Acindar and the Government of Argentina 
have presented no evidence that pre- and post-export financing subsidy 
programs have been terminated. According to the domestic interested 
parties, because the programs are in place, their temporary suspension 
strongly suggests that subsidies would recur if the suspended 
investigation were terminated.
    Department Position: The Department agrees with the domestic 
interested parties. Acindar and the Government of Argentina have 
presented no evidence to indicate that pre- and post-export financing 
programs have been eliminated. The Statement of Administrative Action 
accompanying the Uruguay Round Agreements Act, H.R. Doc. 103-316, vol. 
I (``SAA''), at 888, states that temporary suspension or partial 
termination of a subsidy program will be probative of continuation or 
recurrence of countervailable subsidies. We acknowledge that, as a 
result of the suspension agreement, as amended, the pre-export and 
post-export financing programs have been suspended for producers of 
subject merchandise since 1982 and 1986, respectively. However, the 
Department notes that the suspension of a program is not the same as 
the termination of a program. Programs which have been suspended, and 
not officially terminated through legislative action, are more likely 
to be

[[Page 53332]]

reinstated. Communique A-1807 was a decree suspending pre- and post-
export financing, not terminating these programs. Therefore, absent 
evidence from Acindar and/or the Government of Argentina that pre- and 
post-export financing programs have been terminated by legislative 
action, the Department finds that there is a likelihood of continuation 
or recurrence of countervailable subsidy if the suspended investigation 
were terminated.
    Comment 2: Acindar quotes the Department's Preliminary Results, 
stating ``the rebate system was changed to cover only the 
reimbursements of indirect local taxes and does not cover import 
duties, except reimbursement of duties paid on imported products which 
are re-exported. Additionally, the Department found that the rates of 
reimbursement were reduced by 33 percent for all products * * *'' 
According to Acindar, this statement indicates that whatever net 
countervailable subsidy formerly existed by reason of the reembolso no 
longer can exist. To reflect this fact, Acindar requests that the 
Department readjust its final net countervailable subsidy.
    The domestic interested parties argue that Acindar and the 
Government of Argentina have presented no evidence that the reembolso 
program has been terminated. They further argue that the Department 
found, in an administrative review of oil country tubular goods, that 
the legal structure of the reembolso program had been altered. However, 
they claim the Government of Argentina has not terminated the program. 
Domestic interested parties also contend that, according to the SAA at 
888, even partial termination of a subsidy program is probative of a 
recurrence of countervailable subsidies. According to the domestic 
interested parties, because the reembolso program continues to exist, 
the Department should find that there is a likelihood of continuation 
or recurrence of a countervailable subsidy.
    Department Position: The Department agrees with the domestic 
interested parties. Acindar and the Government of Argentina have 
presented no evidence to indicate that the reembolso program has been 
terminated. In fact, the reembolso program continues to exist, but, as 
noted in the final results of the 1991 administrative review of the 
countervailing duty order on oil country tubular goods from Argentina, 
has been modified to cover only reimbursements of indirect local taxes, 
and no longer covers import duties, except reimbursement of duties paid 
on imported products which are re-exported.2 This 
modification of the reembolso program is in no way tantamount to a 
termination and does not preclude additional modifications to the 
program. Because Acindar and/or the Government of Argentina have 
submitted no evidence that this program has been terminated and that 
its reinstatement is not likely, the Department finds that there is a 
likelihood of continuation or recurrence of countervailable subsidy if 
the suspended investigation were terminated.
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    \2\ See Oil Country Tubular Goods from Argentina; Final Results 
of Countervailing Duty Administrative Review, 62 FR 55589 (October 
27, 1997) (affirming the preliminary determination).
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    Comment 3: Acindar argues that the Department's distinction between 
countervailing duty orders and suspension agreements, with respect to 
Ceramica,3 is weak. Acindar argues that the only incentive 
to enter into a suspension agreement is the threat of countervailing 
duties. Since the threat of such duties absent an injury determination 
disappeared when Argentina achieved ``country under the agreement'' 
status, the suspension agreement should likewise lapse.
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    \3\ See Ceramica Regiomontana v. United States, 64 F.3d 1579 
(Fed. Cir. 1995) (``Ceramica'').
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    The domestic interested parties argue that Ceramica did not address 
the issue of suspension agreements or their administrability by the 
Department. According to the domestic interested parties, Ceramica 
addressed only the Department's authority to assess countervailing 
duties on imports that did not receive an injury test. The Department 
is not assessing countervailing duties, but rather administering a 
negotiated agreement between the governments of Argentina and the 
United States. Therefore, according to the domestic interested parties, 
the findings in Ceramica are irrelevant to this sunset review.
    Department Position: The Department agrees with the domestic 
interested parties. As discussed in the Department's Preliminary 
Results, Ceramica addresses the Department's authority to assess 
countervailing duties on imports where the Commission made no injury 
determination with respect to those imports. Accordingly, the findings 
in Ceramica do not inform this sunset analysis. The Department is not 
assessing countervailing duties with respect to subject merchandise. In 
fact, the Department terminated the suspension of liquidation as a 
result of the conclusion of this agreement.

Final Results of Review

    As a result of this review, the Department finds that termination 
of the suspended countervailing duty investigation would be likely to 
lead to continuation or recurrence of a countervailable subsidy for the 
reasons set forth in the preliminary results of our review. 
Furthermore, for the reasons set forth in our preliminary results of 
review and, as discussed above, we find that the net countervailing 
duty rate of 5.36 percent ad valorem is the rate likely to prevail if 
the suspended investigation were terminated. Finally, we continue to 
find that the reembolso, pre-export financing, and post-export 
financing programs, because receipt of benefits is contingent upon 
export, fall within the definition of an export subsidy under Article 
3.1(a) of the Subsidies Agreement.
    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: September 27, 1999.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 99-25625 Filed 9-30-99; 8:45 am]
BILLING CODE 3510-DS-P