[Federal Register Volume 66, Number 190 (Monday, October 1, 2001)]
[Notices]
[Pages 49931-49940]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-24503]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-351-833, C-122-841, C-428-833, C-274-805, C-489-809]


Notice of Initiation of Countervailing Duty Investigations: 
Carbon and Certain Alloy Steel Wire Rod From Brazil, Canada, Germany, 
Trinidad and Tobago, and Turkey

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: The Department of Commerce is initiating countervailing duty 
investigations to determine whether manufacturers, producers, or 
exporters of carbon alloy steel wire rod from Brazil, Canada, Germany, 
Trinidad and Tobago, and Turkey receive countervailable subsidies.

ACTION: Initiation of Countervailing Duty Investigations.

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EFFECTIVE DATE: October 1, 2001.

FOR FURTHER INFORMATION CONTACT: Melani Miller (Brazil) at (202) 482-
0116; Sally Hastings or Craig Matney (Canada) at (202) 482-3464 or 
(202) 482-0588, respectively; Annika O'Hara or Melanie Brown (Germany) 
at (202) 482-3798 or (202) 482-4987, respectively; Suresh Maniam 
(Trinidad and Tobago) at (202) 482-0176; and Jennifer Jones (Turkey) at 
(202) 482-4194; Import Administration, International Trade 
Administration, U.S. Department of Commerce, Room 3099, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230.

Initiation of Investigations

The Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the statute are 
references to the provisions effective January 1, 1995, the effective 
date of the amendments made to the Tariff Act of 1930 (the ``Act'') by 
the Uruguay Round Agreements Act. In addition, unless otherwise 
indicated, all citations to the Department of Commerce's (the 
``Department'') regulations are references to the provisions codified 
at 19 CFR part 351 (April 2000).

The Petitions

    On August 31, 2001, the Department received petitions filed in 
proper form by Co-Steel Raritan, Inc., GS Industries, Keystone 
Consolidated Industries, Inc., and North Star Steel Texas, Inc. 
(collectively, the petitioners). The Department received various 
additional information to support the petitions on September 6, 7, 12, 
13, 18, and 21, 2001. In addition to supporting evidence, these later 
submissions contained new subsidy allegations not included in the 
original petitions for Germany, Trinidad and Tobago, and Turkey.
    The petitioners did not file these submissions with the 
International Trade Commission (``ITC'') until September 20, 2001 (for 
Germany and Turkey) and September 21, 2001 (for Brazil, Canada, and 
Trinidad and Tobago). As a result, while we have taken into account the 
supporting information contained in these submissions in these 
initiations, due to the lateness of the filing and the resulting lack 
of time for proper analysis, we have not addressed any new allegations 
that were made. However, we intend to examine these new allegations 
following the initiation.
    In accordance with section 702(b)(1) of the Act, the petitioners 
allege that manufacturers, producers, or exporters of the subject 
merchandise from Brazil, Canada, Germany, Trinidad and Tobago, and 
Turkey receive countervailable subsidies within the meaning of section 
701 of the Act, and that such imports are materially injuring, or 
threatening material injury to, an industry in the United States.
    The Department finds that the petitioners filed these petitions on 
behalf of the domestic industry because they are interested parties as 
defined in sections 771(9)(C) of the Act and they have demonstrated 
sufficient industry support. See infra, ``Determination of Industry 
Support for the Petitions.''

Scope of Investigations

    The merchandise covered by these investigations is certain hot-
rolled products of carbon steel and alloy steel, in coils, of 
approximately round cross section, 5.00 mm or more, but less than 19.0 
mm, in solid cross-sectional diameter.
    Specifically excluded are steel products possessing the above-noted 
physical characteristics and meeting the Harmonized Tariff Schedule of 
the United States (``HTSUS'') definitions for (a) stainless steel; (b) 
tool steel; (c) high nickel steel; (d) ball bearing steel; and (e) 
concrete reinforcing bars and rods. Also excluded are (f) free 
machining

[[Page 49932]]

steel products (i.e., products that contain by weight one or more of 
the following elements: 0.03 percent or more of lead, 0.05 percent or 
more of bismuth, 0.08 percent or more of sulfur, more than 0.04 percent 
of phosphorus, more than 0.05 percent of selenium, or more than 0.01 
percent of tellurium). All products meeting the physical description of 
subject merchandise that are not specifically excluded are included in 
this scope.
    The products under investigation are currently classifiable under 
subheadings 7213.91.3010, 7213.91.3090, 7213.91.4510, 7213.91.4590, 
7213.91.6010, 7213.91.6090, 7213.99.0031, 7213.99.0038, 7213.99.0090, 
7227.20.0010, 7227.20.0090, 7227.90.6051 and 7227.90.6058 of the HTSUS. 
Although the HTSUS subheadings are provided for convenience and customs 
purposes, the written description of the scope of these investigations 
is dispositive.

Consultations

    Pursuant to section 702(b)(4)(A)(ii) of the Act, the Department 
invited representatives of the Governments of Brazil (``GOB''), Canada 
(``GOC''), Germany (``GOG''), Trinidad and Tobago (``GOTT''), Turkey 
(``GRT''), and the European Commission (``EC'') for consultations with 
respect to the petitions filed. The Department held consultations with 
the GOTT on September 6 and 18, 2001; the GOB on September 13, 2001; 
the GRT on September 13; the GOG and the EC together on September 18, 
2001; and the GOC on September 21, 2001. The points raised in the 
consultations are described in individual country-specific consultation 
memoranda to the file dated September 6, 13, 14, 19, and 21, 2001, 
which are on file in the Department's Central Records Unit, Room B-099 
of the main Department of Commerce building (``CRU'').

Determination of Industry Support for the Petition

    Section 771(4)(A) of the Act defines the ``industry'' as the 
producers of a domestic like product. Thus, when determining the degree 
of industry support, the statute directs the Department to look to 
producers and workers who produce the domestic like product. The ITC, 
which is responsible for determining whether ``the domestic industry'' 
has been injured,
must also determine what constitutes a domestic like product in order 
to define the industry. While both the Department and the ITC must 
apply the same statutory definition regarding the domestic like product 
(section 771(10) of the Act), they do so for different purposes and 
pursuant to separate and distinct authority. In addition, the 
Department's determination is subject to limitations of time and 
information. Although this may result in different definitions of the 
like product, such differences do not render the decision of either 
agency contrary to the law.\1\
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    \1\ See Algoma Steel Corp. Ltd., v. United States, 688 F. Supp. 
639, 642-44 (CIT 1988); High Information Content Flat Panel Displays 
and Display Glass from Japan: Final Determination; Rescission of 
Investigation and Partial Dismissal of Petition, 56 FR 32376, 32380-
81 (July 16, 1991).
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    Section 771(10) of the Act defines the domestic like product as ``a 
product which is like, or in the absence of like, most similar in 
characteristics and uses with, the article subject to an investigation 
under this subtitle.'' Thus, the reference point from which the 
domestic like product analysis begins is ``the article subject to an 
investigation,'' i.e., the class or kind of merchandise to be 
investigated, which normally will be the scope as defined in the 
petitions. Moreover, the petitioners do not offer a definition of 
domestic like product distinct from the scope of the investigations.
    The petitions cover carbon and certain steel wire rod as defined in 
the ``Scope of the Investigations'' section, above, a single class or 
kind of merchandise. The Department has no basis on the record to find 
the petitioners' definition of the domestic like product to be 
inaccurate. The Department, therefore, has adopted the domestic like 
product definition set forth in the petitions.
    Section 732(b)(1) of the Act requires that a petition be filed on 
behalf of the domestic industry. Section 732(c)(4)(A) of the Act 
provides that a petition meets this requirement if the domestic 
producers or workers who support the petition account for: (1) At least 
25 percent of the total production of the domestic like product; and 
(2) more than 50 percent of the production of the domestic like product 
produced by that portion of the industry expressing support for, or 
opposition to, the petition. Finally, section 732(c)(4)(D) of the Act 
provides that if the petition does not establish support of domestic 
producers or workers accounting for more than 50 percent of the total 
production of the domestic like product, the administering agency 
shall: (i) Poll the industry or rely on other information in order to 
determine if there is support for the petition as required by 
subparagraph (A), or (ii) determine industry support using a 
statistically valid sampling method.
    In this case, the Department has determined that the petitions (and 
subsequent amendments) contain adequate evidence of industry support; 
therefore, polling is unnecessary. See Attachment 1 to the Initiation 
Checklists for each country dated September 24, 2001 (``Initiation 
Checklist''). To estimate total domestic production of steel wire rod, 
the petitioners relied on data compiled by the ITC,\2\ adjusted upward 
by five percent to include an estimate of production of products 
excluded by Presidential Proclamation 7273. In a letter dated September 
7, 2001, the petitioners' provided support for the five percent 
adjustment in the form of an affidavit from an industry representative 
familiar with the excluded products.
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    \2\ Certain Steel Wire Rod, Inv. No. TA-204-06, Final Staff 
Report, Table II-2 at II-4.
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    On September 14, 2001, the Department received comments regarding 
industry support from Ispat-Sidbec Inc., a Canadian producer of steel 
wire rod. The petitioners responded to these comments in a letter to 
the Department dated September 18, 2001. Further, on September 21, 
2001, the petitioners submitted a letter adding the support of Nucor 
Corp., a domestic producer of steel wire rod, for the petitions.
    The Department has reviewed the comments of Ispat-Sidbec and the 
petitioners. In order to estimate production for the domestic industry 
as defined for purposes of this case, the Department has relied upon 
not only the petitions and amendments thereto, but also upon ``other 
information'' it obtained through research and described in Attachment 
I of the Initiation Checklist. Based on information from these sources, 
the Department determined, pursuant to section 732(c)(4)(D), that there 
is support for the petitions as required by subparagraph (A). 
Specifically, the Department made the following determinations. For 
Brazil, Canada, Germany, Trinidad and Tobago, and Turkey the 
petitioners established industry support representing over 50 percent 
of total production of the domestic like product. Therefore, the 
domestic producers or workers who support the petitions account for at 
least 25 percent of the total production of the domestic like product, 
and the requirements of section 732(c)(4)(A)(i) are met. Furthermore, 
because the Department received no opposition to the petitions, the 
domestic producers or workers who support the petitions account for 
more than 50 percent of the production of the domestic like product

[[Page 49933]]

produced by that portion of the industry expressing support for or 
opposition to the petitions. Thus, the requirements of section 
732(c)(4)(A)(ii) are also met. Accordingly, the Department determines 
that the petitions were filed on behalf of the domestic industry within 
the meaning of section 732(b)(1) of the Act. See Initiation Checklist.

Injury Test

    Because Brazil, Canada, Germany, Trinidad and Tobago, and Turkey 
are each a ``Subsidies Agreement Country'' within the meaning of 
section 701(b) of the Act, section 701(a)(2) of the Act applies to 
these investigations. Accordingly, the ITC must determine whether 
imports of the subject merchandise from Brazil, Canada, Germany, 
Trinidad and Tobago, and Turkey materially injure, or threaten material 
injury to, a U.S. industry.

Allegations and Evidence of Material Injury and Causation

    The petitions allege that the U.S. industry producing the domestic 
like product is being materially injured, or is threatened with 
material injury, by reason of the individual and cumulated imports of 
the subject merchandise. The petitioners contend that the industry's 
injured condition is evident in the stagnation of U.S. producers' sales 
volumes and profits, the decline of their capacity utilization, the 
increase of U.S. inventories, and closures of U.S. production 
facilities. The allegations of injury and causation are supported by 
relevant evidence including U.S. Customs import data, lost sales, and 
pricing information. We have assessed the allegations and supporting 
evidence regarding material injury and causation, and have determined 
that these allegations are properly supported by accurate and adequate 
evidence and meet the statutory requirements for initiation (see Injury 
Allegation section of the Initiation Checklist for each individual 
country). In accordance with section 771(7)(G)(ii)(III) of the Act, 
which provides an exception to the mandatory cumulation provision for 
imports from any country designated as a beneficiary country under the 
Caribbean Basin Economic Recovery Act, we have considered the 
petitioners' allegation of injury with respect to Trinidad and Tobago 
independent of the allegations for each of the remaining countries 
named in the petition and found that the information provided satisfies 
the requirements (see Injury Allegation section of the Initiation 
Checklist for Trinidad and Tobago).

Allegations of Subsidies

    Section 702(b) of the Act requires the Department to initiate a 
countervailing duty proceeding whenever an interested party files a 
petition on behalf of an industry, that (1) alleges the elements 
necessary for an imposition of a duty under section 701(a), and (2) is 
accompanied by information reasonably available to the petitioners 
supporting the allegations.

Initiation of Countervailing Duty Investigations

    The Department has examined the countervailing duty petitions on 
carbon and certain alloy steel wire rod from Brazil, Canada, Germany, 
Trinidad and Tobago, and Turkey and found that they comply with the 
requirements of section 702(b) of the Act. Therefore, in accordance 
with section 702(b) of the Act, we are initiating a countervailing duty 
investigation in each country to determine whether manufacturers, 
producers, or exporters of carbon and certain alloy steel wire rod from 
Brazil, Canada, Germany, Trinidad and Tobago, and Turkey receive 
countervailable subsidies (see Initiation Checklist for each country).

Brazil

A. Equityworthiness and Creditworthiness

    The petitioners allege that both Usina Siderurgica da Bahia S.A. 
(``Usiba'') and Cia Siderurgica do Nordeste (``Cosinor''), which were 
sold to the Gerdau Group in 1989 and 1991, respectively, were both 
unequityworthy and uncreditworthy during the time periods 1986 through 
1989 and 1986 through 1991, respectively. With respect to Usiba, the 
petitioners allege that Usiba never earned a profit prior to its sale 
to the Gerdau Group in 1989 and continued to incur losses after its 
sale. The petitioners point to several articles published in various 
publications in which Usiba's poor financial condition during the 
period 1986 through 1989 was discussed. Because of its financial 
condition, the petitioners contend that Usiba could not have attracted 
private capital during this period. With respect to Cosinor, the 
petitioners state that the GOB allegedly converted a significant amount 
of Cosinor's debt into equity in 1988 and then erased additional 
Cosinor debt in 1991. Moreover, the petitioners state that the GOB 
poured millions of dollars into Cosinor during the period 1986 through 
1991, which shows that Cosinor was unable to repay its debts to the GOB 
and that Cosinor was in such poor financial condition that it could not 
have attracted private capital during this period.
    We find that the petitioners have established a reasonable basis to 
believe or suspect that Usiba was unequityworthy and uncreditworthy in 
1988, the only year in which the petitioners have alleged a related 
program with respect to Usiba. With respect to Cosinor, as noted below 
in the Brazil ``Programs'' section, we are not initiating an 
investigation of the single program involving Cosinor during the years 
1986 through 1991. Thus, we are not initiating an investigation of 
Cosinor's equityworthiness and creditworthiness in these years.

B. Change in Ownership

    The petitioners allege that both Usiba and Cosinor received non-
recurring grants prior to changes in their ownership and that, after 
the changes in ownership, the Gerdau Group is, for all intents and 
purposes, the same ``person'' as Usiba and Cosinor, respectively. 
Consequently, according to the petitioners, consistent with the 
Department's recent Final Results of Redetermination Pursuant to Court 
Remand in Acciai Speciali Terni S.p.A. v. United States, et al., (Ct. 
No. 99-06-00364) (December 19, 2000) (``AST Remand Redetermination''), 
the past countervailable subsidies received by Usiba and Cosinor 
continue to be countervailable after the changes in ownership. 
Therefore, the petitioners request, consistent with the methodology in 
the AST Remand Redetermination, that all non-recurring subsidies 
provided to Usiba and Cosinor be attributed in full to the Gerdau 
Group.
    We will examine this issue in the course of the investigation to 
determine whether any non-recurring subsidies provided to Usiba should 
be attributed to Gerdau. We will not examine this issue with respect to 
Cosinor, however, because, as noted above, we are not investigating any 
programs specifically related to Cosinor.

C. Programs

    We are including in our investigation the following programs 
alleged in the petition to have provided countervailable subsidies to 
producers and exporters of the subject merchandise in Brazil:
1. Programs offered by the National Bank for Economic and Social 
Development (``BNDES'')
    a. Programa de Modernizacao da Siderurgia Brasiliera--Fund for the 
Modernization of the Steel Industry
    b. Financing for the Acquisition or Lease of Machinery and 
Equipment

[[Page 49934]]

through the Special Agency for Industrial Financing
    c. BNDES Export Financing
2. Programa de Financiamento as Exportacoes
3. Exemption of Import Duties, the Industrial Products Tax (``IPI''), 
the Merchandise Circulation Tax (``ICMS''), and the Merchant Marine 
Renewal Tax on the Imports of Spare Parts and Machinery
4. Tax Incentives Provided by Amazon Region Development Authority and 
the Northeast Region Development Authority
5. Amazonia Investment Fund and Northeast Investment Fund Tax Subsidies
6. Constitutional Funds for Financing Productive Sectors in the 
Northeast, North, and Midwest Regions (Fundos Constitucionais de 
Financiamento do Nordeste, do Norte, e do Centro-Oeste)
7. Fiscal Incentives for Regional Development (Provisional Measure No. 
1532 of Dec. 18, 1996)
8. Accelerated Depreciation
9. Exemption of Urban Building and Land Tax
10. Gerdau
    a. Equity Infusions and Debt Forgiveness Provided to Usina 
Siderurgica da Bahia S.A. During the Period 1986 through 1989
    b. BNDES Financing for the Acquisition of Acominas
11. Belgo-Mineira
    a. BNDES Financing for the Acquisition of Mendes Junior Siderurgia 
S.A.
    b. BNDES Financing for the Acquisition of Dedini Siderurgicia de 
Piracicaba
    We are not including in our investigation the following programs 
alleged to benefit producers and exporters of the subject merchandise 
in Brazil:
1. Rebate of ICMS Credit for Inputs Consumed in the Production of 
Exported Products
    The ICMS is a state-government value-added tax (``VAT'') applicable 
to both imports and domestic products. According to the petitioners, 
the ICMS tax is calculated on a monthly basis, and is based on the 
total monthly ICMS tax liability for domestic sales (as export sales 
are exempt) minus monthly tax credits from ICMS taxes embedded in the 
purchase price of inputs consumed for all products (domestic and 
export). The petitioners allege that the offset is countervailable 
because the tax exemption for exports and the tax credits for inputs 
used in the exported product exceed the ICMS paid on domestic sales. 
The alleged benefit would be the amount of the ICMS tax creditable to 
inputs consumed in the manufacture of exported products.
    We are not including this program in our investigation. As 
described by the petitioners, this program does no more than provide a 
rebate of a VAT tax collected on inputs to exported products. The fact 
that this rebate is effected as a credit in calculating the amount of 
VAT tax owed on domestic sales does not necessarily result in an 
excessive remission of indirect taxes pursuant to 19 CFR 351.517(a) of 
the Department's regulations.
2. Rebate of the IPI Credit on Inputs Consumed in the Production of 
Exported Products
    The petition states that the IPI is a federal VAT tax levied on 
most domestic and imported manufactured products. Exports are exempt 
from the IPI tax. According to the petitioners, an IPI tax credit is 
created in the amount of the IPI assessed on inputs used to produce 
goods sold in both the domestic and export markets. The IPI tax, 
however, is assessed only on products sold in the domestic market 
because export sales are exempt. Thus, the credit generated from the 
purchases of inputs for both domestic and export products exceeds the 
actual IPI tax paid on domestic sales of merchandise, leaving companies 
with excess IPI tax credits. Therefore, the benefit would be the amount 
of the IPI tax creditable to inputs consumed in the manufacture of the 
exported product.
    We are not including this program in our investigation. As 
described by the petitioners, this program does no more than provide a 
rebate of a VAT tax collected on inputs to exported products. The fact 
that this rebate is effected as a credit in calculating the amount of 
VAT tax owed on domestic sales does not necessarily result in an 
excessive remission of indirect taxes pursuant to 19 CFR 351.517(a) of 
the Department's regulations.
3. Exemption of Exports From the Social Integration Program (``PIS'') 
and Social Contribution of Billings (``COFINS'')
    Under PIS, firms make contributions on a monthly basis to create a 
social fund for employees. COFINS is a federal social financing program 
which is used to finance social security expenses. The petitioners 
contend that, in past antidumping duty investigations, the Department 
determined that these taxes are ``levied on total revenues (except for 
export revenues), and thus the taxes are direct, similar to taxes on 
profit or wages.''
    Within the context of a countervailing duty proceeding, taxes on 
revenues such as PIS and COFINS would generally be considered indirect 
taxes. (See 19 CFR 351.102(b) of the Department's regulations for the 
definition of an indirect tax.) In the case of these particular taxes, 
the Department's regulations at 19 CFR 351.517(a) state that a benefit 
exists to the extent that the amount remitted or exempted exceeds the 
amount levied. There is no information in this instance of any 
excessive remission. Thus, we are not including this allegation in our 
investigation.
4. Rebate of PIS and COFINS Taxes on Inputs Used for Exporting Products
    Through this program, the PIS and COFINS contributions assessed on 
the purchase of raw materials, intermediate products, and packing 
materials used in the production of exports can be claimed as an 
advance IPI credit. Companies may request a cash refund from the GOB if 
the amount of the advance IPI credit exceeds the amounts paid by the 
company for certain federal taxes and contributions.
    Based on the petitioners' description of this program, noted above, 
it appears to be a rebate of indirect taxes levied on inputs to export 
products. The petitioners' evidence does not indicate that the rebate 
is excessive. Therefore, we find no basis to call this program an 
export subsidy, and we are not including this program in our 
investigation.
5. Investment Incentives Provided by the Government of Minas Gerais to 
the Steel Industry
    The petition alleges that funding provided by the Brazilian state 
Government of Minas Gerais (``GOM'') through the Program for Industrial 
and Agroindustrial Integration and Diversification and the Program to 
Induce Industrial Modernization is countervailable. The petitioners 
contend that this program is de facto specific to the steel industry 
because, based on the prominence of the steel industry in Minas Gerais, 
steel production in the region receives a disproportionately large 
amount of the funding provided through these programs.
    According to the same GOM web site cited by the petitioners, the 
steel industry appears to be one of several prominent industries in 
Minas Gerais. Thus, although steel may be a large industry, there are 
also many other industries that appear to play a large role in the 
economy of Minas Gerais. Therefore, there is insufficient information 
to show that steel

[[Page 49935]]

production in the region receives a disproportionately large amount of 
the funding provided through these programs. Because of this, we are 
not including these programs in our investigation.
6. Discounted Natural Gas From Petrobras
    The petition alleges that Belgo-Mineira, as well as possibly other 
Brazilian wire rod producers, purchase discounted natural gas from 
Petrobras, Brazil's state oil company.
    There is no information that any producer other than Belgo-Mineira 
signed an intention protocol with Petrobas to purchase discounted 
natural gas. Furthermore, as the intention protocol between Belgo-
Mineira and Petrobras was not signed until December 2000, there is no 
evidence that there was any financial contribution made to Belgo-
Mineira during 2000. Therefore, we are not including this program in 
our investigation.
7. Debt-to-Equity Conversion, Equity Infusions, and/or Debt Forgiveness 
Provided to Cosinor During the Period 1986 Through 1991
    The petition alleges that the GOB did not act like a rational 
private investor when it made various investments in Cosinor during the 
time period 1988 through 1991. The petitioners argue that in order to 
make steel firms in general more ``privatizable,'' the GOB spent 
millions upgrading and refurbishing these mills. It then sold the steel 
mills for much less than it invested. The petitioners allege that this 
made the GOB's investments inconsistent with those of a rational 
private investor.
    There is no information that Cosinor was in a poor financial 
condition at the time any of these investments were made. Although the 
petitioner has provided information with respect to actions taken by 
the GOB to make government firms more ``privatizable,'' there is no 
specific information relating to the state of Cosinor's financial 
condition. Moreover, with respect to the 1991 debt forgiveness, the 
petitioners have provided no information that this debt forgiveness was 
part of a debt-to-equity conversion. Therefore, because there is no 
evidence that Cosinor specifically was in poor financial condition, we 
have no evidence that a reasonable private investor would not have 
invested in Cosinor. Moreover, the petitioners have not provided 
evidence in support of its benefit allegation with respect to the 
alleged debt forgiveness. Thus, we do not recommend initiating an 
investigation of these transactions.

Canada

A. Equityworthiness and Creditworthiness

    The petitioners have identified three producers of carbon steel 
wire rod in Canada: Sidbec-Dosco (Ispat) Inc. (``Ispat-Sidbec), Stelco 
Inc. (``Stelco''), and Ivaco Inc. (``Ivaco'').
    The petitioners allege that, consistent with our previous findings 
in Steel Wire Rod from Canada, 62 FR 54972 (October 22, 1997) 
(``Canadian Wire Rod''), the Department should continue to find Sidbec-
Dosco Limited (``Sidbec-Dosco''), the predecessor to Isapt-Sidbec, 
unequityworthy from 1983 through 1992. The petitioners note that in 
Canadian Wire Rod, the Department initiated an unequityworthy 
investigation on Sidbec-Dosco for the years alleged in this 
investigation, but made a final determination of unequityworthiness 
only for 1988 because that was the only year in which we determined 
that a countervailable equity infusion was made. Based on our previous 
initiation of an equityworthiness inquiry for Sidbec-Dosco, if in the 
course of this investigation we discover that Sidbec-Dosco received 
equity infusions in any year during the period from 1983 through 1992, 
we will investigate whether it was unequityworthy in that year.
    In addition, the petitioners allege that all three producers were 
uncreditworthy at various times. Consistent with Canadian Wire Rod, the 
petitioners request that the Department continue to find Sidbec-Dosco 
uncreditworthy from 1983 through 1992. Furthermore, because of a lack 
of public information regarding the current owner, Ispat-Sidbec, the 
petitioners request that the Department assess the creditworthiness of 
Ispat-Sidbec from 1992 through 2000. Based on our previous finding of 
uncreditworthiness for Sidbec-Dosco, if in the course of this 
investigation we discover that Sidbec-Dosco received any non-recurring 
subsidies, loans, or loan guarantees in any year during the period from 
1983 through 1992, we will investigate whether it was uncreditworthy in 
that year. However, because the petitioners have provided no support 
for their allegation of uncreditworthiness for Ispat-Sidbec from 1992 
through 2000, we will not examine its creditworthiness.
    In addition, the petitioners allege that Stelco was uncreditworthy 
from 1988 through 1994 and that Ivaco was uncreditworthy from 1989 
through 1998. However, as stated below and in the Initiation Checklist 
for Canada, because we are not initiating on any programs with respect 
to Stelco or Ivaco within the alleged years, we do not need to 
investigate the creditworthiness for these two companies.

B. Change in Ownership

    The petitioners allege that Sidbec-Dosco received non-recurring 
grants prior to its change in ownership and that, after the change in 
ownership, Ispat-Sidbec is, for all intents and purposes, the ``same 
person'' as Sidbec-Dosco. Consequently, according to the petitioners, 
consistent with the Department's recent AST Remand Redetermination, the 
past countervailable subsidies received by Sidbec-Dosco continue to be 
countervailable after the changes in ownership. Therefore, the 
petitioners request, consistent with the methodology in the AST Remand 
Redetermination, that all non-recurring subsidies provided to Sidbec-
Dosco be attributed in full to Ispat-Sidbec.
    We will examine this issue in the course of the investigation to 
determine whether non-recurring subsidies provided to Sidbec-Dosco 
should be attributed to Ispat-Sidbec.

C. Programs

    We are including in our investigation the following programs 
alleged in the petition to have provided countervailable subsidies to 
producers and exporters of the subject merchandise in Canada:

1. 1988 Conversion of Sidbec-Dosco's Debt into Sidbec Capital Stock
2. 1984 through 1992 Government of Quebec Grants to Sidbec-Dosco
3. Tax Credit for Mining Incentives for Stelco
    We are not including in our investigation the following programs 
alleged to benefit producers and exporters of the subject merchandise 
in Canada:
1. Provision of Electricity for Less Than Adequate Remuneration for 
Stelco
    The petition states that Ontario Hydro's agreement with Stelco to 
not increase electricity costs for Stelco, which is described in 
Stelco's 1994 annual report, is a countervailable benefit. The 
petitioners argue that, because energy costs have escalated in recent 
years and the wire rod industry is highly energy-intensive, Ontario 
Hydro's commitment to lock rates in for Stelco indicates that Ontario 
Hydro is receiving less than adequate remuneration for the provision of 
electricity. The petitioners contend that this 1994 agreement shows 
that the Canadian government has a history of providing discounted 
rates.

[[Page 49936]]

    We are not investigating this allegation because the petitioners 
have not provided evidence to support their claims of specificity and 
benefit. Even assuming that Stelco's rates did not increase, that does 
not provide a basis for speculating that others' rates did rise. The 
benefit claim, too, is based on speculation. Finally, we find no basis 
to ascribe the behavior of Hydro Quebec to Ontario Hydro.
2. Federal and Provincial Government Assistance for Plant Modernization 
Under SDI or Other Government Programs
    Ivaco reported in its 1999 financial statement that it underwent a 
C$65 million modernization program. The petitioners contend that, 
because the Department found that Ivaco received grants from a 
Government of Quebec (``GOQ'') agency in Canadian Wire Rod to assist 
with modernization, it is likely that Ivaco also received such grants 
or loans for the 1999 modernization. The petitioners also state that 
Stelco has undertaken new expansion projects which have likely 
benefitted from this type of assistance it could not have afforded on 
its own. Finally, the petitioners allege that Ispat-Sidbec likely also 
received such funds because it is located in an area that has 
traditionally benefitted from such projects and it could not have 
afforded such projects on its own.
    The petitioners have not provided any information evidencing that 
any of these companies actually received a financial contribution or a 
benefit from any Canadian governmental entity for plant modernization 
and associated programs. Therefore, we are not initiating an 
investigation of this allegation.
3. McGill University Research and Development Services and Production 
Assets Provided to Ivaco
    Ivaco reported in its 1999 financial statement that it participated 
in joint research work with McGill University in 1999. The petitioners 
note that McGill's web site states that the largest source of funding 
for McGill is grants from the GOQ. Thus, the petitioners contend that 
McGill is a quasi-government agency, and is providing a countervailable 
benefit to Ivaco by way of the provision of goods and services for less 
than adequate remuneration in the form of free research and assets.
    In past cases, the Department has established several criteria in 
order to assess whether an entity should be considered to be the 
government or a public entity for purposes of countervailing duty 
investigations. (See, e.g., Notice of Preliminary Affirmative 
Countervailing Duty Determination and Alignment With Final Antidumping 
Duty Determinations: Certain Hot-Rolled Carbon Steel Flat Products From 
South Africa, 66 FR 20261 (April 20, 2001).) The criteria include (1) 
significant government ownership, (2) the government's presence on the 
entity's board of directors, (3) the government's control over the 
entity's activities, (4) the entity's pursuit of governmental policies 
or interests, and (5) whether the entity is created by statute. The 
petitioners have provided no information with respect to any of these 
criterion. Lacking evidence that McGill is a government or public 
entity, we are not initiating an investigation with respect to this 
allegation.
4. Ivaco's Industrial Revenue Bonds
    The petitioners allege that industrial revenue bonds, which are 
listed in Ivaco's financial statements for 1984 through 1996, appear to 
be provided at preferential rates of borrowing. The petitioners argue 
that, because there was no mention of similar bonds in the financial 
statements of other wire rod producers, or because this type of bond 
financing would only make sense for large manufacturing concerns and 
would almost never be used outside of the manufacturing industry, these 
bonds must be specific because they are limited only to Stelco, or only 
to ``industrial'' activities.
    The petitioners have provided no evidence showing that these bonds 
were limited to Ivaco, other producers of subject merchandise, or 
``industrial'' activities. Because there is only speculation as to the 
specificity of these bonds and the petitioners have not provided any 
information regarding the provider(s) of these bonds (regardless of 
country of issuance), we do not recommend initiating an investigation 
of these industrial revenue bonds.
5. Britannia Environmental Agreement With Ivaco
    The petition alleges that the Government of British Columbia's 
(``GOBC'') agreement with the previous (including Ivaco) and current 
owners of a mining site in British Columbia with respect to the 
environmental clean-up of the site is a countervailable subsidy because 
the owners were responsible for paying only half of the expected clean-
up cost, leaving the GOBC responsible for covering the remaining costs.
    The petitioners have provided no evidence in the petition showing 
that this transaction was related to the subject merchandise or its 
production. Moreover, the petitioners state that this agreement was 
reached in April 2001, which was after the period of time we would be 
examining in this investigation. Therefore, as there was no benefit or 
financial contribution during the POI, we are not including this 
program in our investigation.
6. Operating Assistance to Stelco
    The petitioners state that, according to Stelco's annual reports, 
Stelco received government assistance to continue operating during 
periods of financial distress in the early 1990's.
    The petitioners withdrew this allegation in their supplemental 
petition submission dated September 13, 2001. Therefore, we are not 
including this program in our investigation.
7. Assistance for Energy Projects for Stelco
    The petitioners cite a 1999 report by Stelco which states that 
projects implemented at one of Stelco's plants to improve energy 
efficiency relied on incentives provided by ``government and utility 
demand side management programs.'' Thus, the petitioners allege that 
the GOC provided assistance to Stelco in the form of grants, or by way 
of work that may have been done directly by the government itself.
    The petitioners did not submit documentation to support their 
allegation. Moreover, the petitioners did not provide sufficient 
evidence that any financial contribution or benefit was provided during 
2000, or that any potential subsidies were specific only to Stelco (and 
did not provide any information with respect to other producers). 
Therefore, we are not including this program in our investigation.
8. Manufacturing and Processing Profits Deduction/Credit Provided to 
Stelco
    The petition notes that, according to its financial statements, 
Stelco received a manufacturing and processing profits deduction or 
credit from 1986 through 2000. The petitioners claim that this 
deduction/credit is a countervailable subsidy because it was either 
regionally specific or, alternately, provided only to Stelco.
    The petitioners have provided no evidence to support their claim 
that this tax program was regionally specific. The petitioners have 
also not provided any supporting evidence showing that this tax 
deduction/credit was specific because it was limited only to Stelco. 
Thus, we are not including this program in our investigation.

[[Page 49937]]

9. Investment Tax Credits Provided to Stelco
    The petition notes that Stelco's financial statements from 1986 
through 2000 indicate that ``capital assets are recorded at historical 
cost less investment tax credits and include construction in process.'' 
The petition also notes that, in a past antidumping investigation, 
Stelco reported that it received investment tax credits that represent 
``reimbursement by the Canadian government of research and development 
expenses.'' Because some of the investment tax credits examined in the 
Final Affirmative Countervailing Duty Determination: Oil Country 
Tubular Goods from Canada, 51 FR 15037 (April 22, 1986) (``Oil Country 
Tubular Goods'') were found to be specific, and because it is unclear 
which type of industrial tax credits were included in Stelco's 
financial statements, the petitioners urge the Department to 
investigate Stelco's investment tax credits. Alternately, the 
petitioners argue that, because only Stelco's financial statements 
mentioned these types of credits, these investment tax credits were not 
provided through a generally available program and were only available 
to Stelco.
    As noted above, the petitioners state as part of their argument 
that Stelco received ``reimbursement by the Canadian government of 
research and development expenses.'' However, the Department found in 
Oil Country Tubular Goods that research and development investment tax 
credits were not specific. Moreover, the petitioners have not provided 
any supporting evidence showing that this tax deduction/credit was, in 
fact, limited only to Stelco. Therefore, we are not including this 
program in our investigation.

GERMANY

A. General

    The petitioners made several allegations regarding possible 
subsidies to Georgsmarienhuette GmbH (``GMH'') and Brandenburger 
Elecktrostahlwerke (``BES''). Based on our review of import data for 
the period January 1, 2000 through December 31, 2000, neither of these 
two companies had any imports of subject merchandise into the United 
States during the expected POI (see Memorandum to File, ``Importers of 
Steel Wire Rod from Germany during the year 2000,'' dated September 24, 
2000). Given this, GMH and BES would not be selected to respond to our 
countervailing duty questionnaire. Therefore, we have not analyzed the 
petitioners' allegations with respect to these two companies and have 
not included them in our initiation of this investigation. However, if 
new information indicates that either GMH or BES should respond to our 
countervailing duty questionnaire, we will evaluate the petitioners' 
allegations at that time.

B. Equityworthiness and Creditworthiness

    The petitioners allege that Saarstahl AG (``Saarstahl'') was both 
unequityworthy and uncreditworthy and that Ispat Hamburger Stahlwerke 
(``Ispat)'' was uncreditworthy.
    First, the petitioners allege that, consistent with our previous 
findings in Final Affirmative Countervailing Duty Determination: Steel 
Wire Rod from Germany, 64 FR 54990 (October 22, 1997) (German Wire 
Rod), the Department should continue to find Saarstahl, uncreditworthy 
in 1989. The petitioners also allege that Saarstahl was uncreditworthy 
from 1993 to 2000. In support of this argument, the petitioners, citing 
to Certain Hot-Rolled Lead and Bismuth Carbon Steel Products from 
Germany; Preliminary Results of Countervailing Duty Administrative 
Review, 64 FR 16915 (April 7, 1997), claim that Saarstahl, due to 
massive financial losses, has been involved in a creditor arrangement 
from 1993 through 2000. Specifically, the petitioners refer to 
information on Saarstahl's website indicating that it is required to 
pay ten percent of its outstanding debt in order to obtain the 
relinquishment of its remaining debt. The petitioners also point to a 
1997 news article confirming that Saarstahl's shareholders agreed to 
pay ten percent of the company's debts as part of a government-approved 
plant to relieve Saarstahl of its remaining debt. As a result, 
according to the petitioners, no rational investor would have loaned 
money to Saarstahl during these times.
    Based on the same information relied upon for the uncreditworthy 
allegation (i.e., the creditor arrangement beginning in 1993), the 
petitioners also allege that Saarstahl was unequityworthy in 1994, 
1996, 1998, and 1999, the years in which they claim the GOG made equity 
infusions into Saarstahl.
    In Notice of Initiation of Countervailing Duty Investigations: 
Steel Wire Rod from Germany, Trinidad and Tobago, Canada and Venezuela, 
62 FR 13866, 13868 (March 24, 1997), we initiated an uncreditworthy 
investigation for Saarstahl for the period 1993 through 1996 (in 
addition to the year 1989, as stated above). We did not, however, 
initiate an unequityworthy investigation for these same years because 
the petitioners had not alleged any equity infusions in the relevant 
years. Id. Our examination of the petitioners' evidence and, in 
particular, the information on Saarstahl's website concerning its 
bankruptcy proceedings, indicate sufficient evidence of Saarstahl's 
uncreditworthiness and unequityworthiness to warrant investigation. 
Specifically, we find that Saarstahl began bankruptcy proceedings in 
1993 and made its last payment pursuant to a settlement agreement with 
creditors in 1999. Therefore, based upon our previous finding and these 
facts, we will investigate Saarstahl's creditworthiness in 1989 and 
those years between 1993 and 1999 in which it received any non-
recurring subsidies, loans, or loan guarantees. Regarding Saarstahl's 
equityworthiness allegation, because we are not initiating with respect 
to any equity infusions into Saarstahl during the alleged years, we 
will not investigate Saarstahl's equityworthiness.
    Second, consistent with German Wire Rod, the petitioners allege 
that Ispat was uncreditworthy in 1994. 62 FR at 54991. Based on our 
previous finding, we will consider Ispat's uncreditworthiness in 1994 
if we find that it received any non-recurring subsidies, loans, or loan 
guarantees in that year.

C. Change in Ownership

    The petitioners request that the Department examine the pre- and 
post-sale entity for each respondent that underwent a change in 
ownership and conduct a ``same person'' analysis, consistent with the 
methodology in the AST Remand Redetermination.
    We will examine this issue in the course of the investigation to 
determine whether non-recurring subsidies provided to pre-sale company 
should be attributed to the post-sale company.

D. Programs

    We are including in our investigation the following programs 
alleged in the petition to have provided countervailable subsidies to 
producers and exporters of the subject merchandise in Germany:
1. Allegations Pertaining Only to Saarstahl
    a. Private Bank Debt Forgiveness/Liquidity Assurances by the GOS
    b. 1989 Debt Forgiveness for Saarstahl
    c. Subsidies Leading up to the 1997 Reorganization of Saarstahl
    d. Research and Development Assistance to Saarstahl
2. Subsidies Pertaining Only to Ispat
    a. Forgiveness of Ispat Hamburger Stahlwerke's 1994 Debt

[[Page 49938]]

3. Subsidies Pertaining to All/Other Producers and Exporters
    a. Investment Allowance Act
    b. Joint Program: Upswing East
    c. Treuhandanstalt Assistance
    d. Aid for Closure of Steel Operations
    e. Structural Improvement Assistance Aids
4. State (Land) Government Benefits
    a. Ruhr District Action Program
    b. Consolidation Funds
    c. Special Depreciation
    d. Ecological Tax Scheme
5. ECSC Programs
    a. ECSC Article 54 Loans
    b. ECSC Loan Guarantees
    c. Interest Rate Rebates
    d. ECSC Redeployment Aid Under Article 56(2)(b) (Worker Assistance)

    We are not including in our investigation the following programs 
alleged to benefit producers and exporters of the subject merchandise 
in Germany:
1. Alleged Subsidies to GMH
    As noted above, based on our review of Customs' information, we 
believe that GMH did not export to the United States during our 
expected POI. Given this, GMH would not be selected to respond to our 
countervailing duty questionnaire. Consequently, we have not included 
the following subsidies which allegedly were provided only to GMH in 
our investigation. However, if new information indicates that this 
company should respond to our countervailing duty questionnaire, we 
will evaluate the petitioners' allegations at that time.

a. Operating Assistance to GMH from the Government of Lower Saxony and 
the GOG
b. Debt Relief and Grant Assistance in Connection with the Sale of GMH
c. Guaranteed Annual Management Service Contract Payments to GMH
2. Extension of Investment Premium Scheme in the New Lander
    The petitioners allege that the German Parliament extended an 8 
percent investment premium to large enterprises located in the new 
German Lander. In support of their allegation, the petitioners cite to 
a 1997 EC Report on competition policy.
    Based on our review of the support documentation, it appears that 
the investment premium was not extended, as petitioners have alleged. 
Specifically, the report states:

    The German Parliament had approved an Act which put back from 
1996 to 1998 the date by which qualifying investment projects had to 
be completed; the Act did not affect the date for the start of the 
investment. The Commission considered that this extension 
constituted additional aid to the same projects, and would not 
encourage new projects. It was therefore operating assistance, and 
the Commission, citing the judgment in Philip Morris, refused to 
authorize the extension, which did not satisfy the tests laid down 
in Article 93.
(Footnote omitted.)

    Because the information submitted by the petitioners does not 
support their allegation, we are not investigating this alleged 
subsidy.
3. German Lander Guarantee Schemes
    The petitioners allege that certain Lander provide guarantee 
schemes for the rescue and restructuring of large industries. In 
claiming that this program is specific, the petitioners point to the 
fact that the guarantee schemes are only available in certain regions 
of Germany.
    By the petitioners' own description, and according to the source 
documentation they submitted, these guarantee schemes are operated by 
the individual Lander. Therefore, because the individual Lander are the 
granting authorities, the petitioners need to address whether the 
benefits are specific within each of the Lander. They have not done so.
    Because the petitioners have not alleged the elements necessary for 
the imposition of countervailing duties, we are not investigating this 
alleged subsidy.
4. Capital Investment Grants
    The petitioners allege that the Steel Investment Allowance Act 
provides grants amounting to 20% of the acquisition cost of assets 
purchased or produced prior to January 1986 and ordered or produced 
after July 30, 1981.
    Because the period covered by this program (1981-1986) predates the 
15-year allocation period, there is no basis to believe that benefits 
continue to exist in the POI. Therefore, we are not investigating this 
alleged subsidy.

Trinidad and Tobago

A. Equityworthiness and Creditworthiness

    The petitioners allege that, consistent with our previous findings 
in Final Affirmative Countervailing Duty Determination: Steel Wire Rod 
from Trinidad and Tobago, 62 FR 55003 (October 22, 1997) (``Trinidad 
Wire Rod''), the Department should find the Iron and Steel company of 
Trinidad and Tobago (``ISCOTT'') unequityworthy from June 13, 1984, to 
December 31, 1991. In addition, the petitioners cite to the 
Department's recent decision in Stainless Steel Plate in Coils from 
Belgium, 66 FR 20425, 20428 (April 23, 2001) in which the Department 
determined that where an investment decision occurs without a pre-
infusion objective analysis, that investment results in a benefit. 
Accordingly, in this investigation, the petitioners allege that because 
they are unaware of any pre-infusion objective analysis undertaken by 
the GOTT and because in Trinidad Wire Rod the Department determined 
that the equity infusions made by the GOTT were part of an open-ended 
agreement to provide financial support regardless of financial 
performance, that ISCOTT was unequityworthy for all years in which the 
GOTT made equity infusions into ISCOTT (i.e., from June 13, 1984 
through December 31, 1994).
    In addition, the petitioners allege that, consistent with Trinidad 
Wire Rod, the Department should find ISCOTT uncreditworthy from June 
13, 1984 to December 31, 1994.
    For those years in which we previously found ISCOTT to be 
uncreditworthy (i.e., from June 13, 1984 through December 31, 1991), we 
will consider its unequityworthiness if we find that ISCOTT received 
any equity infusions during this period. In addition, for those years 
from 1992 through 1994, because, after examination of documentation 
from Trinidad Wire Rod 1997 (which was submitted on the record of this 
investigation), we found no evidence of any pre-infusion objective 
analysis, we will investigate whether ISCOTT was unequityworthy in 
these years if we find that ISCOTT received any equity infusions during 
this period. Also, if in the course of this investigation we discover 
that ISCOTT received any non-recurring subsidies, loans, or loan 
guarantees in any year during the period from June 13, 1984 to December 
31, 1994, we will investigate whether it was uncreditworthy in that 
year.

B. Change in Ownership

    The petitioners allege that ISCOTT received non-recurring grants 
prior to its change in ownership and that, after the changes in 
ownership, the successor company, Caribbean Ispat Limited (``CIL'') is, 
for all intents and purposes, the same ``person'' as ISCOTT. 
Consequently, according to the petitioners, consistent with the 
Department's recent AST Remand Redetermination, the past 
countervailable subsidies received by ISCOTT continue to be 
countervailable after the changes in ownership. Therefore, the 
petitioners request, consistent with the methodology in the AST Remand 
Redetermination, that all non-recurring subsidies provided to ISCOTT be 
attributed in full to CIL.

[[Page 49939]]

    We will examine this issue in the course of the investigation to 
determine whether non-recurring subsidies provided to ISCOTT should be 
attributed to CIL.

C. Programs

    We are including in our investigation the following programs 
alleged in the petition to have provided countervailable subsidies to 
producers and exporters of the subject merchandise in Trindad and 
Tobago:

1. Equity Infusions into ISCOTT
2. Debt Forgiveness Provided in Conjunction With CIL's Purchase of 
ISCOTT
3. Export Allowance Under Act No. 14
4. Export Market Development Grants
5. Export Promotion Allowance
6. Corporate Tax Exemptions Under the Fiscal Incentives Act
7. Provision of Electricity

    We are not including in our investigation the following programs 
alleged to benefit producers and exporters of the subject merchandise 
in Trinidad and Tobago:
1. Point Lisas Lease
    The petition alleges that the GOTT holds a majority ownership in 
Point Lisas Industrial Port Development Company, Ltd. (``PLIPDECO''), 
and that PLIPDECO received less than adequate remuneration from its 
lease with CIL. The petitioners state that, while the lease terms were 
examined in Trinidad Wire Rod and found not countervailable, the 
renegotiation of the lease terms in 1996 was not examined.
    In Trinidad Wire Rod, we found that PLIPDECO received adequate 
remuneration from the CIL lease, and therefore, no subsidy existed. The 
petitioners have provided no new evidence in the petition that the 1996 
renegotiation of lease terms provided less than adequate remuneration 
to PLIPDECO. Therefore, we are not investigating the Point Lisas lease.

Turkey

A. Programs

    We are including in our investigation the following programs 
alleged in the petition to have provided countervailable subsidies to 
producers and exporters of the subject merchandise in Turkey:

1. Deduction from Taxable Income for Export Revenue
2. Export Credit Bank of Turkey Subsidies
    a. Pre-shipment Export Loans
    b. Foreign Trade Corporate Companies Rediscount Credit Facility
    c. Export Credit Insurance Program
    d. Past Performance Related Foreign Currency Loan
    e. Revolving Export Credits
    f. Buyer's Credits
3. Foreign Exchange Loan Assistance
4. Payments for Exports on Turkish Ships/State Aid for Exports Program
5. Advance Refunds of Tax Savings
6. Taxes, Duties, and Credit Charges Exemption
7. Customs Duty Exemption
8. Energy Incentive
9. General Incentives Program (``GIP'')
    a. Incentive Program on Domestically Obtained Goods
    b. Investment Allowances
    i. Investment Allowance Based on Region
    ii. 200% Investment Allowance
    c. Subsidized Credit Facility
    d. Resource Utilization Support Fund
    i. VAT Rebate
    ii. 15% Investment Payment
    iii. Payments to Exporters
    e. Incentives Granted to Less Developed and Industrial Belt Regions
    i. Law 4325 Land Allocation
    ii. Electricity Discounts
    iii. Special Incentives for East and Southeast Turkey

    We are not including in our investigation the following programs 
alleged to benefit producers and exporters of the subject merchandise 
in Turkey:
1. Export Incentive Certificate Customs Duty and Other Tax Exemptions
    The petitioners allege that this program, under which companies 
were permitted to import spare parts free of customs duties and certain 
other taxes provided the imported parts were used in the manufacture of 
goods for export, bestowed countervailable benefits on producers and 
exporters of subject merchandise in the POI. The Department previously 
investigated this program and found it terminated with no residual 
benefits accruing. (See Certain Welded Carbon Steel Pipes and Tubes and 
Welded Carbon Steel Line Pipe from Turkey; Final Results of 
Countervailing Duty Administrative Review, 64 FR 44496, 44497 (August 
16, 1999)). Therefore, the Department is not investigating this 
program.
2. General Incentives Programs
    a. 100% Investment Allowance.
    The petitioners allege that a one hundred percent allowance is 
provided under the GIP for certain investments regardless of geographic 
region. The Department previously investigated this program in Certain 
Welded Carbon Steel Pipes and Tubes from Turkey; Preliminary Results of 
Countervailing Duty Administrative Review (``Pipe Prelim 1998''), 65 FR 
18070 (April 6, 2000). We note that in Pipe Prelim 1998, the Department 
found that this program was neither de jure nor de facto specific and, 
thus, not countervailable. In the instant proceeding, the petitioners 
provided no information to the contrary. Therefore, the Department is 
not investigating the one hundred percent investment allowance program.
    b. Law 4325 Corporate and Income Tax Exemption.
    The petitioners allege that Law 4325 provides tax exemptions for 
new businesses established between January 1, 1998, and December 31, 
2000, for certain cities within the less-developed regions. They also 
allege that companies qualifying for this deduction, and who employ at 
least ten workers, are exempt from corporate and income taxes for a 
period of five years from the beginning of their operations. However, 
the information provided by the petitioners does not confirm the 
existence of this program. Thus, because the petitioners have not met 
the requirements of section 702(b) of the Act by supporting their 
allegations with reasonably available information, the Department is 
not investigating the alleged Law 4325 tax exemptions.
3. Export Tax Rebate and Supplemental Tax Rebate
    The petitioners allege that the GRT provides export tax rebates to 
exporters based on the percentage of export receipts converted from a 
foreign currency into Turkish lira. They also allege that the Turkish 
government provides supplemental tax rebates to exporters with annual 
exports of more than $2 million. In Certain Welded Carbon Steel Pipe 
and Tube Products from Turkey; Preliminary Results of Countervailing 
Duty Administrative Reviews, 52 FR 47621 (December 15, 1987) the 
Department stated that ``the Government of Turkey eliminated basic and 
supplemental export tax rebates on exports of iron and steel products 
to the United States.'' Furthermore, benefits received under this 
program are considered recurring and as such, would be expensed in the 
year of receipt. (See 19 CFR 351.524). Therefore, the Department is not 
investigating this program.

Distribution of Copies of the Petitions

    In accordance with section 702(b)(4)(A)(i) of the Act, a copy of 
the public version of the respective petition has been provided to the 
GOB, GOC, GOG, GOTT, GRT, and EC. We will

[[Page 49940]]

attempt to provide a copy of the public version of the respective 
petition to each exporter named in each petition, as provided for under 
19 CFR 351.203(c)(2).

ITC Notification

    We have notified the ITC of our initiations, as required by section 
702(d) of the Act.

Preliminary Determination by the ITC

    The ITC will determine no later than October 15, 2001, whether 
there is a reasonable indication that imports of carbon and certain 
alloy steel wire rod from Brazil, Canada, Germany, Trinidad and Tobago, 
and Turkey are causing material injury, or threatening to cause 
material injury, to a U.S. industry. A negative ITC determination for 
any country will result in the investigation being terminated for that 
country; otherwise, these investigations will proceed according to 
statutory and regulatory time limits.
    This notice is issued and published pursuant to section 777(i) of 
the Act.

    Dated: September 24, 2001.
Faryar Shirzad,
Assistant Secretary for Import Administration.
[FR Doc. 01-24503 Filed 9-28-01; 8:45 am]
BILLING CODE 3510-DS-P