[Federal Register Volume 67, Number 28 (Monday, February 11, 2002)]
[Notices]
[Pages 6226-6229]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-3256]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-351-828]


Certain Hot-Rolled Flat-Rolled Carbon Quality Steel Products From 
Brazil: Final Results of Antidumping Duty Administrative Review and 
Termination of the Suspension Agreement

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

ACTION: Notice of Final Results of Antidumping Duty Administrative 
Review of the Suspension Agreement.

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SUMMARY: We published in the Federal Register the preliminary results 
of review on August 8, 2001. See Certain Hot-Rolled Flat-Rolled Carbon 
Quality Steel Products from Brazil: Preliminary Results of Antidumping 
Duty Administrative Review of Suspension Agreement, 66 FR 41500 (August 
8, 2001) (Preliminary Results). This review covers three manufacturers 
and exporters of the subject merchandise, Companhia Siderurgica 
Nacional (CSN), Usinas Siderurgicas de Minas Gerais (USIMINAS), and 
Companhia Siderurgica Paulista (COSIPA) during the period of review 
(POR) from July 19, 1999 through June 30, 2000.
    Based on our analysis of the comments received, we have made some 
changes in our calculations. For these final results, we determine that 
CSN and USIMINAS have made sales below the reference price established 
by the Suspension Agreement. We also determine that the amount by which 
the estimated normal value exceeds the export price for each entry by 
CSN and USIMINAS/COSIPA indicates that the dumping margin on certain 
entries exceeds 15 percent of the weighted average margin for CSN and 
USIMINAS/COSIPA in the LTFV investigation. The Department determines 
that CSN and USIMINAS/COSIPA have violated the Agreement Suspending the 
Antidumping Investigation on Hot-Rolled Flat-Rolled Carbon-Quality 
Steel from Brazil (``the Suspension Agreement''). Because we find that 
the violations were not inconsequential and frustrated the purposes of 
this Agreement, we are terminating the Suspension Agreement.

EFFECTIVE DATE: February 11, 2002.

FOR FURTHER INFORMATION CONTACT: Phyllis Hall (CSN), Michael Ferrier or 
Dena Aliadinov (USIMINAS/COSIPA), or Abdelali Elouaradia, Enforcement 
Group III, Office 8, Import

[[Page 6227]]

Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW., Room 7866, 
Washington, DC 20230; telephone (202) 482-1398, (202) 482-1394, (202) 
482-3362, and (202) 482-1374, respectively.

SUPPLEMENTARY INFORMATION:

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 (Department) regulations 
are to the regulations at 19 CFR part 351 (April 2000).

Background

    We invited parties to comment on our preliminary results of review. 
Respondents filed a brief on September 7, 2001, and petitioners filed a 
rebuttal brief on September 17, 2001.

Scope of the Review

    The products covered are certain hot-rolled flat-rolled carbon-
quality steel 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 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 agreement.
    Specifically included in this scope 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 and/or niobium added 
to stabilize carbon and nitrogen elements. HSLA steels are recognized 
as steels with micro-alloying levels of elements such as chromium, 
copper, niobium, titanium, 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 this agreement, 
regardless of HTSUS definitions, are products in which: (1) Iron 
predominates, by weight, over each of the other contained elements; (2) 
the carbon content is 2 percent or less, by weight; and (3) none of the 
elements listed below exceeds the quantity, by weight, respectively 
indicated:
    1.80 percent of manganese, or
    1.50 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
    0.012 percent of boron, or
    0.10 percent of molybdenum, or
    0.10 percent of niobium, or
    0.41 percent of titanium, 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 this agreement unless otherwise 
excluded. The following products, by way of example, are outside and/or 
specifically excluded from the scope of this agreement:
     Alloy hot-rolled steel products in which at least one of 
the chemical elements exceeds those listed above (including e.g., ASTM 
specifications A543, A387, A514, A517, and A506).
     SAE/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 1.50 percent.
     ASTM specifications A710 and A736.
     USS Abrasion-resistant steels (USS AR 400, USS AR 500).
     Hot-rolled steel coil which meets the following chemical, 
physical and mechanical specifications:

--------------------------------------------------------------------------------------------------------------------------------------------------------
         C                  Mn                  P                  S                  Si                 Cr                 Cu                 Ni
--------------------------------------------------------------------------------------------------------------------------------------------------------
0.10-0.14%          0.90% Max           0.025% Max         0.005% Max          0.30-0.50%        0.30-0.50%         0.20-0.40%         0.20% Max
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Width = 44.80 inches maximum; Thickness = 0.063-0.198 inches;
Yield Strength = 50,000 ksi minimum; Tensile Strength = 70,000-88,000 
psi.
     Hot-rolled steel coil which meets the following chemical, 
physical and mechanical specifications:

--------------------------------------------------------------------------------------------------------------------------------------------------------
         C                  Mn                  P                  S                  Si                 Cr                 Cu                 Ni
--------------------------------------------------------------------------------------------------------------------------------------------------------
0.10-0.16%          0.70-0.90%          0.025% Max         0.006% Max         0.30-0.50%         0.30-0.50%         0.25% Max          0.20% Max
Mo
0.21% Max
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Width = 44.80 inches maximum; Thickness = 0.350 inches maximum;
Yield Strength = 80,000 ksi minimum; Tensile Strength = 105,000 psi 
Aim.
     Hot-rolled steel coil which meets the following chemical, 
physical and mechanical specifications:

--------------------------------------------------------------------------------------------------------------------------------------------------------
         C                  Mn                  P                  S                  Si                 Cr                 Cu                 Ni
--------------------------------------------------------------------------------------------------------------------------------------------------------
0.10-0.14%          1.30-1.80%          0.025% Max         0.005% Max         0.30-0.50%         0.50-0.70%         0.20-0.40%         0.20% Max
V(wt.)              Cb
0.10% Max           0.08% Max
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[[Page 6228]]

Width = 44.80 inches maximum; Thickness = 0.350 inches maximum;
Yield Strength = 80,000 ksi minimum; Tensile Strength = 105,000 psi 
Aim.
     Hot-rolled steel coil which meets the following chemical, 
physical and mechanical specifications:

--------------------------------------------------------------------------------------------------------------------------------------------------------
         C                  Mn                  P                  S                  Si                 Cr                 Cu                 Ni
--------------------------------------------------------------------------------------------------------------------------------------------------------
0.15% Max           1.40% Max           0.025% Max         0.010% Max         0.50% Max          1.00% Max          0.50% Max          0.20% Max
Nb                  Ca                  A1
0.005% Min          Treated             0.01-0.07%
--------------------------------------------------------------------------------------------------------------------------------------------------------

Width = 39.37 inches; Thickness = 0.181 inches maximum;
Yield Strength = 70,000 psi minimum for thicknesses  0.148 
inches and 65,000 psi minimum for thicknesses > 0.148 inches; Tensile 
Strength = 80,000 psi minimum.
     Hot-rolled dual phase steel, phase-hardened, primarily 
with a ferritic-martensitic microstructure, contains 0.9 percent up to 
and including 1.5 percent silicon by weight, further characterized by 
either (i) tensile strength between 540 N/mm\2\ and 640 N/mm\2\ and an 
elongation percentage  26 percent for thicknesses of 2 mm 
and above, or (ii) a tensile strength between 590 N/mm\2\ and 690 N/
mm\2\ and an elongation percentage  25 percent for 
thicknesses of 2 mm and above.
     Hot-rolled bearing quality steel, SAE grade 1050, in 
coils, with an inclusion rating of 1.0 maximum per ASTM E 45, Method A, 
with excellent surface quality and chemistry restrictions as follows: 
0.012 percent maximum phosphorus, 0.015 percent maximum sulfur, and 
0.20 percent maximum residuals including 0.15 percent maximum chromium.
     Grade ASTM A570-50 hot-rolled steel sheet in coils or cut 
lengths, width of 74 inches (nominal, within ASTM tolerances), 
thickness of 11 gauge (0.119 inch nominal), mill edge and skin passed, 
with a minimum copper content of 0.20%.
    The merchandise subject to this agreement is classified in the 
Harmonized Tariff Schedule of the United States (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, 
7210.70.30.00, 7210.90.90.00, 7211.14.00.30, 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, 7211.19.75.90, 
7212.40.10.00, 7212.40.50.00, 7212.50.00.00. Certain hot-rolled flat-
rolled carbon-quality steel covered by this agreement, 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. 
Although the HTSUS subheadings are provided for convenience and Customs 
purposes, the written description of the merchandise under this 
agreement is dispositive.

Period of Review

    The POR is July 19, 1999 through June 30, 2000.

Analysis of Comments Received

    All issues raised in the case and rebuttal briefs by parties to 
this administrative review are addressed in the ``Issues and Decision 
Memorandum'' (Decision Memorandum) from Joseph A. Spetrini, Deputy 
Assistant Secretary, Import Administration, to Faryar Shirzad, 
Assistant Secretary for Import Administration, dated February 4, 2002, 
which is hereby adopted by this notice. A list of the issues raised, 
all of which are addressed in the Decision Memorandum, is attached to 
this notice as an Appendix. Parties can find a complete discussion of 
all issues raised in this review, and the corresponding recommendations 
in this public memorandum, on file in Room B-099 of the U.S. Department 
of Commerce.
    In addition, a complete version of the Decision Memorandum can be 
accessed directly on the World Wide Web at www.ia.ita.doc.gov/frn. The 
paper copy and electronic version of the Decision Memorandum are 
identical in content.

Changes Since the Preliminary Determination

    Based on our analysis of comments received, we have made certain 
changes in the margin calculations. These changes are noted in various 
sections of the Decision Memorandum, accessible in B-099 and on the 
World Wide Web at www.ia.ita.doc.gov/frn.

Final Results of Review

    The purpose of the review has been to review the current status of, 
and compliance with, the terms of the Suspension Agreement.

Compliance With Section IV(E) of the Suspension Agreement

    Under the statute, the Department is required to review entries 
made under the Suspension Agreement to determine whether the terms of 
the Agreement are being complied with by the signatories of the 
Suspension Agreement. Specifically, section IV(E) of the Suspension 
Agreement requires that for each entry of each exporter the amount by 
which the estimated normal value exceeds the export price (or the 
constructed export price) will not exceed a specified amount. That 
limit is 15 percent of the weighted average amount by which the 
estimated normal value exceeded the export price (or the constructed 
price) for all less-than-fair-value entries of the exporter examined 
during the course of the investigation.
    We examined the extent to which CSN and USIMINAS/COSIPA may have 
made sales that were not in compliance with this provision of the 
Suspension Agreement. To this end, we examined (see Department's 
Analysis Memorandum, dated February 4, 2002, proprietary version) the 
number of sales which had margins that exceeded the limit established 
by the Suspension Agreement and the amount by which the margins of 
these sales exceeded this limit. As a result, we found that at least 
one company made sales at dumping margins that exceeded the limit 
established by the Suspension Agreement and that neither the number of 
sales nor the amount by which they exceeded the limit was 
insignificant. On this basis, we cannot conclude that these sales with 
dumping margins inconsistent with those allowed under the Suspension 
Agreement are inconsequential or inadvertent. See Decision Memorandum 
and USIMINAS/COSIPA and CSN Final Analysis Memoranda, dated February 4, 
2002.

[[Page 6229]]

Compliance With Section IV(A) of the Suspension Agreement

    Section IV(A) of the Suspension Agreement contains the reference 
price requirements for merchandise subject to the Suspension Agreement. 
We compared the price charged by the mill to the first unaffiliated 
customer in the United States to the reference price for the applicable 
period for that sale (based upon the order confirmation date). The 
Suspension Agreement states that the reference price includes all 
transportation charges to the U.S. port of entry, together with port 
fees, duties, offloading, wharfage and other charges incurred in 
bringing the steel to the first customs port of discharge in the U.S. 
market. In addition, the Suspension Agreement stipulates that if the 
sale for export is on terms that do not include these expenses, the 
Signatories will ensure that the actual terms are equivalent to a price 
that is not lower than the reference price. Therefore, we have added to 
the price to the first unaffiliated U.S. customer any of these charges 
that were not included in the price terms to that first unaffiliated 
U.S. customer, and we compared this total to the applicable reference 
price.
    In our analysis, we examined the quantity of sales below the 
reference price established by the Suspension Agreement and the amount 
by which these prices were below the reference price. As a result, we 
found that for at least one company, neither the number of sales made 
below the reference price established by the Suspension Agreement nor 
the amount by which they were below the reference price was 
insignificant. On this basis, we cannot conclude that these sales with 
prices inconsistent with the reference price established by the 
Suspension Agreement are inconsequential or inadvertent. See Decision 
Memorandum and USIMINAS/COSIPA and CSN's Preliminary Analysis 
Memoranda, dated February 4, 2002.

Termination of Agreement

    Therefore, we determine that CSN and USIMINAS/COSIPA have made 
sales in violation of the terms of the Suspension Agreement as set out 
in section IV(E) and section IV(A). Pursuant to section XI(B) of the 
Agreement, the Department hereby terminates with this notice the 
Agreement Suspending the Antidumping Investigation on Hot-Rolled Flat-
Rolled Carbon-Quality Steel from Brazil. In accordance with section 
XIII(B) of the Agreement and section 734(1)(A)(i) of the Act, the 
Department will instruct U.S. Customs to suspend liquidation of 
unliquidated entries of the merchandise on the date of publication of 
this determination for all entries entered 90 days before the date of 
this publication. Given that the Department completed the original 
investigation (see Notice of Final Determination of Sales at Less Than 
Fair Value; Certain Hot-Rolled Flat-Rolled Carbon Quality Steel 
Products from Brazil, 64 FR 38756 (July 19, 1999), the Department will 
publish in the Federal Register an antidumping duty order under section 
736(a) of the Act with respect to the suspension of unliquidated 
entries entered 90 days before the date of this publication.
    This determination is issued and published in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: February 4, 2002.
Faryar Shirzad,
Assistant Secretary, for Import Administration.

Appendix I--Issues in Decision Memorandum

    1. Sales Involving Trading Companies / Agency Sale Approach
    2. Adjustment to U.S. Price for Comparison to Reference Price--
Commissions
    3. Adjustment to U.S. Price for Comparison to Reference Price--
Ocean Freight
    4. Adjustment to U.S. Price for Comparison to Reference Price--
U.S. Inland Freight
    5. Adjustment to U.S. Price for Comparison to Reference Price--
Credit Insurance
    6. Violation of Suspension Agreement--Alleged Inadvertent Nature
    7. Margin Calculation--Entry Basis versus Sales Item Basis
    8. U.S. Commission Offset--Margin Calculation
    9. U.S. Warranty--Direct versus Indirect Expense
    10. U.S. Credit Expense--Credit Days
    11. U.S. Credit Expense--Interest Rate
    12. Freight Costs--Estimated versus Actual
    13. PIS /COFINS Taxes

[FR Doc. 02-3256 Filed 2-8-02; 8:45 am]
BILLING CODE 3510-DS-P