[Federal Register Volume 66, Number 192 (Wednesday, October 3, 2001)]
[Notices]
[Pages 50406-50408]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-24752]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-533-820]


Notice of Final Determination of Sales at Less Than Fair Value: 
Certain Hot-Rolled Carbon Steel Flat Products From India

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

EFFECTIVE DATE: October 3, 2001.

FOR FURTHER INFORMATION CONTACT: Timothy Finn or John Conniff at (202) 
482-0065 or (202) 482-1009 respectively, AD/CVD Enforcement, Office 4, 
Group II, Import Administration, International Trade Administration, 
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., 
Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

The Applicable Statute and Regulations

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

Final Determination

    We determine that certain hot-rolled carbon steel flat products 
from India are being sold, or are likely to be sold, in the United 
States at less than fair value (LTFV), as provided in section 735 of 
the Act. The estimated margin of sales at LTFV is shown in the 
Suspension of Liquidation section of this notice.

Case History

    On May 3, 2001, the Department of Commerce (Department) published 
the preliminary determination of the antidumping duty investigation of 
hot-rolled steel from India. See Notice of Preliminary Determination of 
Sales at Less Than Fair Value and Postponement of Final Determination: 
Certain Hot-Rolled Carbon Steel Flat Products from India, 66 FR 22157 
(May 3, 2001) (Preliminary Determination). The period of investigation 
(POI) is October 1, 1999, through September 30, 2000. We conducted 
verification of the questionnaire responses of the respondents, Ispat 
Industries Ltd., (Ispat) during the weeks of April 30, 2001 and May 8, 
2001, and Essar Steel Ltd., (Essar) during the weeks of June 11, 2001, 
and June 18, 2001. We gave interested parties an opportunity to comment 
on our Preliminary Determination and our findings at verification. On 
August 1, 2001, the respondents, Ispat Industries Ltd. (Ispat) and 
Essar Steel Ltd. (Essar), and the petitioners,\1\ submitted case 
briefs; and on August 9, 2001, all parties submitted rebuttal briefs. 
The Department received requests for a public hearing from both 
petitioners and respondents which were later withdrawn; therefore no 
public hearing was held.
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    \1\ The petitioners in this investigation are Bethlehem Steel 
Corporation, Gallatin Steel Company, IPSCO Steel Inc., LTV Steel 
Company, Inc., National Steel Corporation, Nucor Corporation, Steel 
Dynamics, Inc., U.S. Steel Group (a unit of USX Corporation), 
Weirton Steel Corporation, Independent Steelworkers Union, and 
United Steelworkers of America (collectively the petitioners).
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    Although the deadline for this determination was originally 
September 17, 2001, in light of the events of September 11, 2001 and 
the subsequent closure of the Federal Government for reasons of 
security, the time frame for issuing this determination has been 
extended by four days.
    The Department has conducted this investigation in accordance with 
section 731 of the Act.

Scope of Investigation

    For purposes of these investigations, the products covered are 
certain hot-rolled carbon steel flat products of a rectangular shape, 
of a width of 0.5 inch or greater, neither clad, plated, nor coated 
with metal and whether or not painted, varnished, or coated with 
plastics or other non-metallic substances, in coils (whether or not in 
successively superimposed layers), regardless of thickness, and in 
straight lengths of a thickness of less than 4.75 mm and of a width 
measuring at least 10 times the thickness. Universal mill plate (i.e., 
flat-rolled products rolled on four faces or in a closed box pass, of a 
width exceeding 150 mm, but not exceeding 1250 mm, and of a thickness 
of not less than 4.0 mm, not in coils and without patterns in relief) 
of a thickness not less than 4.0 mm is not included within the scope of 
these investigations.

[[Page 50407]]

    Specifically included within the scope of these investigations are 
vacuum degassed, fully stabilized (commonly referred to as 
interstitial-free (IF)) steels, high strength low alloy (HSLA) steels, 
and the substrate for motor lamination steels. IF steels are recognized 
as low carbon steels with micro-alloying levels of elements such as 
titanium or niobium (also commonly referred to as columbium), or both, 
added to stabilize carbon and nitrogen elements. HSLA steels are 
recognized as steels with micro-alloying levels of elements such as 
chromium, copper, niobium, vanadium, and molybdenum. The substrate for 
motor lamination steels contains micro-alloying levels of elements such 
as silicon and aluminum.
    Steel products to be included in the scope of these investigations, 
regardless of definitions in the Harmonized Tariff Schedule of the 
United States (HTSUS), are products in which: (i) Iron predominates, by 
weight, over each of the other contained elements; (ii) the carbon 
content is 2 percent or less, by weight; and (iii) none of the elements 
listed below exceeds the quantity, by weight, respectively indicated:

1.80 percent of manganese, or
2.25 percent of silicon, or
1.00 percent of copper, or
0.50 percent of aluminum, or
1.25 percent of chromium, or
0.30 percent of cobalt, or
0.40 percent of lead, or
1.25 percent of nickel, or
0.30 percent of tungsten, or
0.10 percent of molybdenum, or
0.10 percent of niobium, or
0.15 percent of vanadium, or
0.15 percent of zirconium.

    All products that meet the physical and chemical description 
provided above are within the scope of these investigations unless 
otherwise excluded. The following products, by way of example, are 
outside or specifically excluded from the scope of these 
investigations:
     Alloy hot-rolled steel products in which at least one of 
the chemical elements exceeds those listed above (including, e.g., 
American Society for Testing and Materials (ASTM) specifications A543, 
A387, A514, A517, A506).
     Society of Automotive Engineers (SAE)/American Iron & 
Steel Institute (AISI) grades of series 2300 and higher.
     Ball bearing steels, as defined in the HTSUS.
     Tool steels, as defined in the HTSUS.
     Silico-manganese (as defined in the HTSUS) or silicon 
electrical steel with a silicon level exceeding 2.25 percent.
     ASTM specifications A710 and A736.
     USS abrasion-resistant steels (USS AR 400, USS AR 500).
     All products (proprietary or otherwise) based on an alloy 
ASTM specification (sample specifications: ASTM A506, A507).
     Non-rectangular shapes, not in coils, which are the result 
of having been processed by cutting or stamping and which have assumed 
the character of articles or products classified outside chapter 72 of 
the HTSUS.
    The merchandise subject to these investigations is classified in 
the HTSUS at subheadings: 7208.10.15.00, 7208.10.30.00, 7208.10.60.00, 
7208.25.30.00, 7208.25.60.00, 7208.26.00.30, 7208.26.00.60, 
7208.27.00.30, 7208.27.00.60, 7208.36.00.30, 7208.36.00.60, 
7208.37.00.30, 7208.37.00.60, 7208.38.00.15, 7208.38.00.30, 
7208.38.00.90, 7208.39.00.15, 7208.39.00.30, 7208.39.00.90, 
7208.40.60.30, 7208.40.60.60, 7208.53.00.00, 7208.54.00.00, 
7208.90.00.00, 7211.14.00.90, 7211.19.15.00, 7211.19.20.00, 
7211.19.30.00, 7211.19.45.00, 7211.19.60.00, 7211.19.75.30, 
7211.19.75.60, and 7211.19.75.90. Certain hot-rolled carbon steel flat 
products covered by these investigations, including: vacuum degassed 
fully stabilized; high strength low alloy; and the substrate for motor 
lamination steel may also enter under the following tariff numbers: 
7225.11.00.00, 7225.19.00.00, 7225.30.30.50, 7225.30.70.00, 
7225.40.70.00, 7225.99.00.90, 7226.11.10.00, 7226.11.90.30, 
7226.11.90.60, 7226.19.10.00, 7226.19.90.00, 7226.91.50.00, 
7226.91.70.00, 7226.91.80.00, and 7226.99.00.00. Subject merchandise 
may also enter under 7210.70.30.00, 7210.90.90.00, 7211.14.00.30, 
7212.40.10.00, 7212.40.50.00, and 7212.50.00.00. Although the HTSUS 
subheadings are provided for convenience and U.S. Customs purposes, the 
written description of the merchandise under investigation is 
dispositive.

Period of Investigation

    The period of investigation (POI) is October 1, 1999, through 
September 30, 2000. This period corresponds to the four most recent 
fiscal quarters prior to the month of the filing of the petition (i.e., 
November 2000).

Analysis of Comments Received

    All issues raised in the case and rebuttal briefs by parties to 
this proceeding and to which we have responded are listed in the 
Appendix to this notice and addressed in the ``Issues and Decision 
Memorandum'' (Decision Memorandum), dated September 21, 2001, which is 
hereby adopted by this notice. Parties can find a complete discussion 
of the issues raised in this investigation and the corresponding 
recommendations in this public memorandum which is on file in the 
Central Records Unit, room B-099 (B-099) of the main Department 
building. In addition, a complete version of the Decision Memorandum 
can be accessed directly on the Web at http://ia.ita.doc.gov. The paper 
copy and electronic version of the Decision Memorandum are identical in 
content.

Changes Since the Preliminary Determination

    Based on our findings at verification, and analysis of comments 
received, we have made adjustments to the preliminary determination 
calculation methodologies in calculating the final dumping margins in 
this proceeding. These adjustments are discussed in detail in the 
Decision Memorandum and are listed below:
Ispat
    (1) We revised Ispat's pay dates for certain U.S. sales to reflect 
the actual date of payment.
    (2) We recalculated the reported home market commission amounts to 
reflect changes from verification.
    (3) We adjusted expenses for two home market sales to reflect 
changes from verification.
    (4) We included credit expenses (the variable CREDITH) in 
calculating selling expense for the COP test.
    (5) We made other ministerial corrections to ferro alloy inputs 
(RHALLOYs).
Essar
    (1) We allowed the adjustment for duty drawback under the Advance 
License program.
    (2) For U.S. Imputed Credit, we allowed adjustments based upon the 
actual pay date reported.
    (3) For affiliated party inputs, we adjusted Essar's transfer price 
to reflect the market value for iron ore pellet because the transfer 
price for this product was below its market price.
    (4) At verification, Essar reported, in accordance with the 
Department's policies, that it had failed to identify a small quantity 
of U.S. sales transactions that occurred during the POI.
    There was key information concerning the transactions that was not 
included in the corrections Essar

[[Page 50408]]

presented, thus we could not pursue the most accurate margin possible 
for these sales. Pursuant to 776(a)(2) of the Act, we have determined 
that it is necessary to use facts available for these transactions. 
There is no evidence on the record that Essar has not acted to the best 
of its ability. Therefore, we have assigned to these sales a neutral 
facts available rate based upon the weighted-average dumping margin 
calculated for Essar's remaining U.S. sales. See Decision Memorandum at 
Comment 10.

Verification

    As provided in section 782(i) of the Act, we verified the 
information submitted by the respondent for use in our final 
determination. We used standard verification procedures including 
examination of relevant accounting and production records, and original 
source documents provided by the respondent.

Suspension of Liquidation

    Pursuant to section 735(c)(1)(B) of the Act, we are instructing the 
U.S. Customs Service (Customs) to continue to suspend liquidation of 
all entries of hot-rolled carbon steel flat products from India that 
are entered, or withdrawn from warehouse, for consumption on or after 
May 3, 2001 (the date of publication of the Preliminary Determination 
in the Federal Register). Customs shall continue to require a cash 
deposit or the posting of a bond equal to the estimated amount by which 
the normal value exceeds the U.S. price as shown above. We will adjust 
the deposit requirements to account for any export subsidies found in 
the companion countervailing duty investigation. The suspension of 
liquidation instructions will remain in effect until further notice.

------------------------------------------------------------------------
                                                               Margin
                  Manufacturer/ exporter                      (percent)
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Ispat Industries Ltd......................................         43.07
Essar Steel Ltd...........................................         29.35
All Others................................................         33.17
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ITC Notification

    In accordance with section 735(d) of the Act, we have notified the 
International Trade Commission (ITC) of our determination. As our final 
determination is affirmative, the ITC will determine, within 45 days, 
whether these imports are causing material injury, or threat of 
material injury, to an industry in the United States. If the ITC 
determines that material injury, or threat of injury does not exist, 
the proceeding will be terminated and all securities posted will be 
refunded or canceled. If the ITC determines that such injury does 
exist, the Department will issue an antidumping order directing Customs 
officials to assess antidumping duties on all imports of the subject 
merchandise entered or withdrawn from warehouse for consumption on or 
after the effective date of the suspension of liquidation.
    This determination is issued and published in accordance with 
sections 735(d) and 777(i)(1) of the Act.

    Dated: September 21, 2001.
Faryar Shirzad,
Assistant Secretary for Import Administration.

Appendix--Issues in Decision Memorandum

Common Issues

    1. Duty Drawback Adjustment--DEPB Program
    2. The Appropriate Date of U.S. Sales
    3. Inclusion of Excise Taxes in Reported Costs

Essar Steel Ltd.

    4. Duty Drawback Adjustment--Verification
    5. Duty Drawback Adjustment--Advance License Program
    6. U.S. Imputed Credit Expenses Disallowed in the Preliminary 
Determination
    7. Treatment of Pre-Operative Expenses
    8. Treatment of Cost of Services Provided by an Affiliated Party
    9. Use of the Revised Interest Expense Ratio
    10. Unreported U.S. Sales
    11. Use of Updated Credit Periods to Calculate Home Market 
Credit Expenses

Ispat Industries Ltd.

    12. Capitalization of Production Costs
    13. Start-Up Adjustment--Hot-Strip Mill
    14. Exclusion of Costs Related to Start-Up
    15. IMIL ``Learning Curve''/Start-Up Adjustment
    16. Overstated General and Administrative (G&A) Expenses
    17. Scrap Revenue Offset to Costs
    18. Proper Classification of Bad Debt Expense
    19. Adjusting Home Market Price in the Cost Test for Imputed 
Credit Expense
    20. Identifying the Proper Quality Characteristics
    21. Calculating Credit Expenses Based on Home Market Price and 
Excise Tax
    22. Verification Corrections
    23. Ministerial Corrections
[FR Doc. 01-24752 Filed 10-2-01; 8:45 am]
BILLING CODE 3510-DS-P