[Federal Register Volume 66, Number 192 (Wednesday, October 3, 2001)]
[Notices]
[Pages 50412-50415]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-24755]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-791-810]


Final Affirmative Countervailing Duty Determination: Certain Hot-
Rolled Carbon Steel Flat Products from South Africa

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

ACTION: Notice of Final Affirmative Countervailing Duty Investigation.

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SUMMARY: On April 20, 2001, the Department of Commerce (the Department) 
published in the Federal Register its preliminary affirmative 
determination in the countervailing duty investigation of certain hot-
rolled carbon steel flat products from South Africa.
    The subsidy rates in the final determination differ from those in 
the preliminary determination. The revised final subsidy rates for the 
investigated producers/exporters are listed below in the ``Suspension 
of Liquidation'' section of this notice.

EFFECTIVE DATE: October 3, 2001.

FOR FURTHER INFORMATION CONTACT: Sally C. Gannon at (202) 482-0162, 
Mark Hoadley at (202) 482-0666, or Julio Fernandez at (202) 482-0190, 
Office of AD/CVD Enforcement VII, Group III, Import Administration, 
International Trade Administration, U.S. Department of Commerce, Room 
7866, 14th Street and Constitution Avenue, NW., Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

[[Page 50413]]

Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the statute are 
references to the Tariff Act of 1930 (the Act), as amended. In 
addition, unless otherwise indicated, all citations to the Department's 
regulations are to the regulations codified at 19 CFR Part 351 (2000).

Background

    This investigation covers three producers/exporters: Highveld Steel 
and Vanadium Corporation Limited (Highveld), Iscor, Ltd. (Iscor), and 
Saldanha Steel Ltd. (Saldanha Steel). On April 20, 2001, the Department 
published the results of its preliminary determination in the 
investigation of certain hot-rolled carbon steel flat products from 
South Africa. See 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) (Preliminary Determination). We invited 
interested parties to comment on the Preliminary Determination. On 
April 26, 2001, Saldanha Steel Ltd. (Saldanha Steel) submitted comments 
on what it alleged to be clerical errors in the preliminary 
determination calculations. The Department addressed these allegations 
in the Memorandum to Joseph A. Spetrini From Barbara E. Tillman 
Regarding Clerical Error Allegations (May 7, 2001) (Clerical Error 
Memo) (on file in the Department's Central Records Unit, in Room B-
099).
    On May 7, 2001, we received comments from petitioners regarding the 
verification of the questionnaire responses. Verification of the 
parties' questionnaire responses was conducted from May 7 through May 
21, 2001. On June 13, 2001, we postponed the final determination in 
this investigation until September 17, 2001, pursuant to the 
postponement of the final determination in the companion antidumping 
duty investigation of certain hot-rolled carbon steel flat products 
from Thailand with which this investigation had previously been 
aligned. See Notice of Postponement of Final Antidumping Duty 
Determination: Certain Hot-Rolled Carbon Steel Flat Products from 
Thailand; and Notice of Postponement of Final Countervailing Duty 
Determinations: Certain Hot-Rolled Carbon Steel Flat Products from 
Thailand and South Africa, 66 FR 31888 (June 13, 2001).
    The GOSA, Saldanha Steel, and Iscor, as well as the petitioners, 
submitted timely case briefs in this investigation. On August 29, 2001, 
we received rebuttal briefs from Saldanha Steel and petitioners. On 
August 30, 2001, we conducted a public hearing.
    Although the deadline for this final determination was 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.

Scope of the Investigation

    The merchandise subject to this investigation is 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 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 this 
investigation.
    Specifically included within the scope of this investigation 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 included in the scope of this investigation, 
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 descriptions 
provided above are within the scope of this investigation unless 
otherwise excluded. The following products, by way of example, are 
outside or specifically excluded from the scope of this investigation:
     Alloy hot-rolled steel products in which at least one of 
the chemical elements exceeds those listed above (including, e.g., 
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 bearings 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 this investigation 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

[[Page 50414]]

products covered by this investigation, including vacuum degassed fully 
stabilized; high strength low alloy; and the substrate for motor 
lamination steel may also enter under the following tariff numbers: 
7225.11.00.00, 7225.19.00.00, 7225.30.30.50, 7225.30.70.00, 
7225.40.70.00, 7225.99.00.90, 7226.11.10.00, 7226.11.90.30, 
7226.11.90.60, 7226.19.10.00, 7226.19.90.00, 7226.91.50.00, 
7226.91.70.00, 7226.91.80.00, and 7226.99.00.00. 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 
Department's written description of the merchandise under investigation 
is dispositive.

Analysis of Programs and Analysis of Comments Received

    The programs under investigation as well as the issues raised in 
the case and rebuttal briefs submitted in this countervailing duty 
investigation are discussed in the Issues and Decision Memorandum in 
the Final Affirmative Countervailing Duty Determination: Certain Hot-
Rolled Carbon Steel Flat Products from South Africa, from Joseph A. 
Spetrini, Deputy Assistant Secretary for AD/CVD Enforcement III, to 
Faryar Shirzad, Assistant Secretary for Import Administration, dated 
September 21, 2001 (Decision Memorandum), which is hereby adopted by 
this notice. Attached to this notice as an appendix is a list of the 
programs under investigation and a list of the issues the parties 
raised and to which we have responded in the Decision Memorandum. 
Parties can find a complete discussion of the programs and issues 
raised in this investigation and the corresponding recommendations in 
this public memorandum, which is on file in the Department's Central 
Records Unit, in Room B-099. In addition, the Decision Memorandum can 
be accessed directly on the World Wide Web at http://ia.ita.doc.gov, 
under the heading ``Federal Register Notices.'' The paper copy and 
electronic version of the Decision Memorandum are identical in content.

Subsidy Rates

    In accordance with section 705(c)(1)(B)(i)(I) of the Act, we have 
calculated an individual rate for the companies under investigation, 
Highveld, Iscor and Saldanha. We have determined that the total 
estimated countervailable subsidy rate for Highveld is 0.45 percent ad 
valorem, which is de minimis. In accordance with section 705(c)(2) of 
the Act, we, therefore, determine that no countervailable subsidies are 
being provided to Highveld for the production or exportation of subject 
merchandise. As discussed in the ``Cross-Ownership and Attribution of 
Subsidies'' section of the Decision Memorandum, we are treating 
Saldanha Steel and Iscor as a single entity and, therefore, have 
calculated a single rate to be applied to these companies. With respect 
to the ``all others'' rate, section 705(c)(5)(A)(i) of the Act requires 
that the ``all others'' rate equal the weighted-average countervailable 
subsidy rates established for exporters and producers individually 
investigated, excluding any zero and de minimis countervailable subsidy 
rates. Therefore, because Highveld's rate is de minimis, we are using 
the Saldanha/Iscor rate as the ``all others'' rate.

------------------------------------------------------------------------
          Producer/Exporter                       Subsidy rate
------------------------------------------------------------------------
Saldanha Steel/Iscor.................  6.37% Ad Valorem
Highveld.............................  0.45% Ad Valorem
All Others...........................  6.37% Ad Valorem
------------------------------------------------------------------------

Suspension of Liquidation

    In accordance with our preliminary affirmative determination, we 
instructed the U.S. Customs Service (Customs) to suspend liquidation of 
all entries of certain hot-rolled carbon steel flat products from South 
Africa, which were entered or withdrawn from warehouse for consumption 
on or after April 20, 2001, the date of the publication of our 
Preliminary Determination in the Federal Register, and to require a 
cash deposit or bond for such entries of the merchandise in the amounts 
indicated in the Preliminary Determination. In the Preliminary 
Determination, in accordance with section 703(d) of the Act, we 
instructed Customs to discontinue the suspension of liquidation for 
merchandise entered on or after August 18, 2001, but to continue the 
suspension of liquidation of entries made between April 20, 2001 and 
August 17, 2001.
    We will reinstate suspension of liquidation under section 706(a) of 
the Act for all entries, except those from Highveld, if the 
International Trade Commission (ITC) issues a final affirmative injury 
determination, and we will require a cash deposit of estimated 
countervailing duties for such entries of merchandise in the amounts 
indicated above. If the ITC determines that material injury, or threat 
of material injury, does not exist, this proceeding will be terminated 
and all estimated duties deposited or securities posted as a result of 
the suspension of liquidation will be refunded or canceled.

ITC Notification

    In accordance with section 705(d) of the Act, we will notify the 
ITC of our determination. In addition, we are making available to the 
ITC all non-privileged and non-proprietary information related to this 
investigation. We will allow the ITC access to all privileged and 
business proprietary information in our files, provided that the ITC 
confirms that it will not disclose such information, either publically 
or under an administrative protective order (APO), without the written 
consent of the Assistant Secretary for Import Administration.
    If the ITC determines that material injury, or threat of material 
injury, does not exist, these proceedings will be terminated. If 
however, the ITC determines that such injury does exist, we will issue 
a countervailing duty order.

Return or Destruction of Proprietary Information

    In the event that the ITC issues a final negative injury 
determination, this notice will serve as the only reminder to parties 
subject to the APO of their responsibility concerning the destruction 
of proprietary information disclosed under the APO in accordance with 
19 CFR 351.305(a)(3). Failure to comply is a violation of the APO.
    This determination is published pursuant to sections 705(d) and 
777(i) of the Act.


[[Page 50415]]


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

Appendix I--Issues and Decision Memorandum

I. Subsidies Valuation Information

A. Industrial Development Corporation
B. Diversification of the South African Economy and Specificity of 
Programs
C. Allocation Period
D. Realignment of the Benefit Stream
E. Calculation of Discount Rates and Benchmark Loan Rates
F. Creditworthiness
G. Cross-Ownership and Attribution of Subsidies
H. Trading Companies

II. Programs Determined to Confer Subsidies

A. Section 37E Tax Allowances
B. Industrial Loan Financing Provided by the IDC and Findevco Ltd.
C. Loan Guarantees Provided by the IDC
D. Wharfage Fees for Exports

III. Programs Determined Not to Confer Subsidies

A. The IDC's Equity Infusions in Saldanha Steel
B. Improvements to Saldanha Bay Port
C. Improvements to the Sishen-Saldanha Rail Line

IV. Analysis of Comments

Comment 1: Treatment of the IDC
Comment 2: Diversification of the South African Economy and Specificity 
of Programs
Comment 3: Average Useful Life of Assets
Comment 4: Realignment of the Benefit Stream
Comment 5: Creditworthiness
Comment 6: Cross-Ownership
Comment 7: Section 37E and Specificity as an Export Subsidy
Comment 8: Section 37E and Specificity as a Domestic Subsidy
Comment 9: Equity Infusions
Comment 10: Loan Guarantees Provided by the IDC
Comment 11: Rates for Loan Guarantees
Comment 12: Wharfage Fees
Comment 13: Saldanha Bay Port Expansion Project, the Sishen-Saldanha 
Rail Line Upgrade and General Infrastructure
Comment 14: Improvements to the Sishen-Saldanha Rail Line
Comment 15: Improvements to Saldanha Bay Port
Comment 16: Saldanha Steel's Sales Values

V. Total Ad Valorem Rate

VI. Recommendation

[FR Doc. 01-24755 Filed 10-2-01; 8:45 am]
BILLING CODE 3510-DS-P