[Federal Register Volume 67, Number 169 (Friday, August 30, 2002)]
[Notices]
[Pages 55813-55815]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-22244]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-122-841]


Final Affirmative Countervailing Duty Determination: Carbon and 
Certain Alloy Steel Wire Rod from Canada

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

ACTION: Notice of final affirmative countervailing duty determination.

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SUMMARY: The Department of Commerce has made a final determination that 
countervailable subsidies are being provided to certain producers and 
exporters of carbon and certain alloy steel wire rod from Canada. For 
information on the estimated countervailing duty rates, please see the 
``Suspension of Liquidation'' section, below.

EFFECTIVE DATE: August 30, 2002.

FOR FURTHER INFORMATION CONTACT: Craig Matney, Audrey Twyman, or 
Stephen Cho, Office of AD/CVD Enforcement Group 1, Import 
Administration, U.S. Department of Commerce, Room 3099, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
1778, (202) 482-3534, or (202) 482-3798, respectively.

SUPPLEMENTARY INFORMATION:

Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the statute are 
references to the provisions of the Tariff Act of 1930, as amended by 
the Uruguay Round Agreements Act effective January 1, 1995 (``the 
Act''). In addition, unless otherwise indicated, all citations to the 
Department of Commerce's (``the Department'') regulations are to 19 CFR 
Part 351 (April 2001).

Petitioners

    The petitioners in this investigation are Co-Steel Raritan, Inc., 
GS Industries, Keystone Consolidated Industries, Inc., and North Star 
Steel Texas, Inc. (collectively, ``petitioners'').

Case History

    The following events have occurred since the publication of the 
preliminary determination in the Federal Register. See Preliminary 
Affirmative Countervailing Duty Determination: Carbon and Certain Alloy 
Steel Wire Rod from Canada, 67 FR 5984 (February 8, 2002) 
(``Preliminary Determination'').
    On February 26, 2002, the petitioners submitted further comments 
with respect to the responses filed by the Government of Canada 
(``GOC''), the Government of Quebec (``GOQ''), Ispat Sidbec, Inc. 
(``Ispat Sidbec''), Ivaco, Inc. (``Ivaco''), and Stelco, Inc. 
(``Stelco'') (collectively, ``respondents''). The Department issued 
supplemental questionnaires to these respondents on March 1, 2002, and 
received responses to those questionnaires on March 15 and 18, 2002.
    On March 19, 2002, we published a Federal Register notice aligning 
the final determination in this proceeding with the earliest final 
determination in the companion antidumping duty investigations. See 
Countervailing Duty Investigations of Carbon and Certain Alloy Steel 
Wire Rod from Canada, Germany, Trinidad and Tobago, and Turkey: Notice 
of Alignment With Final Antidumping Duty Determinations, 67 FR 12524, 
(March 19, 2002).
    Between April 22, 2002, and May 14, 2002, we conducted 
verifications of the questionnaire responses submitted by the GOQ, 
Ispat Sidbec, Stelco and Ivaco.
    On July 8 and 12, 2002, we received case briefs and rebuttal 
briefs, respectively, from GOQ, Ispat Sidbec, Stelco and the 
petitioners.

Period of Investigation

    The period for which we are measuring subsidies, or period of 
investigation (``POI''), is calendar year 2000.

Scope of Investigation

    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 19.00 
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 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).
    Also excluded from the scope are 1080 grade tire cord quality wire 
rod and 1080 grade tire bead quality wire rod. Grade 1080 tire cord 
quality rod is defined as: (i) Grade 1080 tire cord quality wire rod 
measuring 5.0 mm or more but not more than 6.0 mm in cross-sectional 
diameter; (ii) with an average partial decarburization of no more than 
70 microns in depth (maximum individual 200 microns); (iii) having no 
inclusions greater than 20 microns; (iv) having a carbon segregation 
per heat average of 3.0 or better using European Method NFA 04-114; (v) 
having a surface quality with no surface defects of a length greater 
than 0.15 mm; (vi) capable of being drawn to a diameter of 0.30 mm or 
less with 3 or fewer breaks per ton, and (vii) containing by weight the 
following elements in the proportions shown: (1) 0.78 percent or more 
of carbon, (2) less than 0.01 percent of aluminum, (3) 0.040 percent or 
less, in the aggregate, of phosphorus and sulfur, (4) 0.006 percent or 
less of nitrogen, and (5) not more than 0.15 percent, in the aggregate, 
of copper, nickel and chromium.
    Grade 1080 tire bead quality rod is defined as: (i) Grade 1080 tire 
bead quality wire rod measuring 5.5 mm or more but not more than 7.0 mm 
in cross-sectional diameter; (ii) with an average partial 
decarburization of no more than 70 microns in depth (maximum individual 
200 microns); (iii) having no inclusions greater than 20 microns; (iv) 
having a carbon segregation per heat average of 3.0 or better using 
European Method NFA 04-114; (v) having a surface quality with no 
surface defects of a length greater than 0.2 mm; (vi) capable of being 
drawn to a diameter of 0.78 mm or larger with 0.5 or fewer breaks per 
ton; and (vii) containing by weight the following elements in the 
proportions shown: (1)

[[Page 55814]]

0.78 percent or more of carbon, (2) less than 0.01 percent of soluble 
aluminum, (3) 0.040 percent or less, in the aggregate, of phosphorus 
and sulfur, (4) 0.008 percent or less of nitrogen, and (5) either not 
more than 0.15 percent, in the aggregate, of copper, nickel and 
chromium (if chromium is not specified), or not more than 0.10 percent 
in the aggregate of copper and nickel and a chromium content of 0.24 to 
0.30 percent (if chromium is specified).
    The designation of the products as ``tire cord quality''' or ``tire 
bead quality''' indicates the acceptability of the product for use in 
the production of tire cord, tire bead, or wire for use in other rubber 
reinforcement applications such as hose wire. These quality 
designations are presumed to indicate that these products are being 
used in tire cord, tire bead, and other rubber reinforcement 
applications, and such merchandise intended for the tire cord, tire 
bead, or other rubber reinforcement applications is not included in the 
scope. However, should petitioners or other interested parties provide 
a reasonable basis to believe or suspect that there exists a pattern of 
importation of such products for other than those applications, end-use 
certification for the importation of such products may be required. 
Under such circumstances, only the importers of record would normally 
be required to certify the end use of the imported merchandise.
    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, 7227.20.0020, 7227.20.0090, 7227.20.0095, 7227.90.6051, 
7227.90.6053, 7227.90.6058, and 7227.90.6059 of the HTSUS. Although the 
HTSUS subheadings are provided for convenience and customs purposes, 
the written description of the scope of this proceeding is dispositive.

Scope Comments

    On April 2, 2002, in conjunction with the preliminary 
determinations in the companion antidumping duty proceedings, the scope 
in both the companion countervailing duty and antidumping duty 
proceedings was revised. See Memorandum to Faryar Shirzad, dated April 
2, 2002, ``Carbon and Certain Alloy Steel Wire Rod: Requests for 
exclusion of various tire cord quality wire rod and tire bead quality 
wire rod products from the scope of Antidumping Duty (Brazil, Canada, 
Egypt, Germany, Indonesia, Mexico, Moldova, South Africa, Trinidad and 
Tobago, Ukraine, and Venezuela) and Countervailing Duty (Brazil, 
Canada, Germany, Trinidad and Tobago, and Turkey) Investigations,'' 
which is on file in the Department's Central Records Unit in Room B-099 
of the main Department building (``CRU'').
    Since April 2, 2002, a number of parties have filed requests asking 
the Department to exclude various products from the scope of the 
concurrent antidumping duty (Brazil, Canada, Germany, Indonesia, 
Mexico, Moldova, Trinidad and Tobago and Ukraine) and countervailing 
duty (Brazil, Canada, Germany, Trinidad and Tobago, and Turkey) 
investigations. On May 6, 2002, Ispat Hamburger Stahlwerke GmbH and 
Ispat Walzdraht Hochfeld GmbH (collectively, Ispat Germany) requested 
an exclusion for ``super clean valve spring wire.'' Two parties filed 
additional exclusion requests on June 14, 2002: Bluff City Steel asked 
that the Department exclude ``clean-steel precision bar,'' and Lincoln 
Electric Company sought the exclusion of its EW 2512 grade of metal 
inert gas welding wire. On June 28, 2002, petitioners filed objections 
to a range of scope exclusion requests including: i) Bluff City Steel's 
request for clean precision bar; ii) Lincoln Electric Company's request 
for EW 2512 grade wire rod; iii) Ispat Germany's request for ``super 
clean valve spring wire;'' iv) Tokusen USA's January 22, 2002, request 
for 1070 grade tire cord and tire bead quality wire rod (tire cord wire 
rod); and v) various parties' request for 1090 grade tire cord wire 
rod.
    In addition, Moldova Steel Works requested the exclusion of various 
grades of tire cord wire rod on July 17, 2002. The Rubber Manufacturers 
Association (the RMA), Ispat Germany, Lincoln Electric and Bluff City 
filed rebuttals to petitioners' June 28 submission on July 8, 11, 17, 
and 29, 2002, respectively. The RMA filed additional comments on July 
30, 2002.\1\
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    \1\ On August 9, 2002, Bekaert Corporation requested an 
exclusion for certain high chrome/high silicon steel wire rod from 
the scope of these investigations. This request was filed too late 
to be considered for the final determinations in these 
investigations.
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    The Department has analyzed these requests and the petitioners' 
objections and we find no modifications to the scope are warranted. See 
Memorandum from Richard Weible to Faryar Shirzad, ``Carbon and Certain 
Alloy Steel Wire Rod; Antidumping Duty (Brazil, Canada, Germany, 
Indonesia, Mexico, Moldova, Trinidad and Tobago, and Ukraine) and 
Countervailing Duty (Brazil, Canada, Germany, Trinidad and Tobago, and 
Turkey) Investigations: Requests for Scope Exclusion'' dated August 23, 
2002, which is on file in the CRU.

Injury Test

    Because Canada is a ``Subsidies Agreement country'' within the 
meaning of section 701(b) of the Act, the International Trade 
Commission (``ITC'') is required to determine whether imports of the 
subject merchandise from Canada materially injure, or threaten material 
injury to, a U.S. industry. On October 15, 2001, the ITC transmitted to 
the Department its preliminary determination that there is a reasonable 
indication that an industry in the United States is being materially 
injured by reason of imports from Canada of the subject merchandise. 
See Carbon and Certain Alloy Steel Wire Rod From Brazil, Canada, Egypt, 
Germany, Indonesia, Mexico, Moldova, South Africa, Trinidad and Tobago, 
Turkey, Ukraine, and Venezuela, 66 FR 54539 (October 29, 2001).

Analysis of Comments Received

    All issues raised in the case and rebuttal briefs by parties to 
this investigation are addressed in the ``Issues and Decision 
Memorandum'' from Richard W. Moreland, Deputy Assistant Secretary, 
Import Administration to Faryar Shirzad, Assistant Secretary, Import 
Administration, dated August 23, 2002 (``Decision Memorandum''), which 
is hereby adopted by this notice. Attached to this notice as Appendix I 
is a list of the issues which parties have raised and to which we have 
responded in the Decision Memorandum. Parties can find a complete 
discussion of all issues raised in this investigation and the 
corresponding recommendations in this public memorandum which is on 
file in the CRU. In addition, a complete version of the Decision 
Memorandum can be accessed directly on the Internet at http://ia.ita.doc.gov/frn/ under the heading ``Canada.'' The paper copy and 
electronic version of the Decision Memorandum are identical in content.

Suspension of Liquidation

    As a result of our Preliminary Determination, we instructed the 
Customs Service to suspend liquidation of all entries of carbon and 
certain alloy steel wire rod from Canada, except for subject 
merchandise produced and exported by Stelco and Ivaco (both of which 
had either a zero or de minimis weighted-average margin), which were 
entered or withdrawn from warehouse,

[[Page 55815]]

for consumption on or after February 8, 2002, the date of the 
publication of the Preliminary Determination in the Federal Register. 
In accordance with section 703(d) of the Act, we instructed Customs to 
discontinue the suspension of liquidation for countervailing duty 
purposes for merchandise entered on or after June 8, 2002, but to 
continue the suspension of liquidation of entries made between February 
8, 2002, and June 7, 2002.
    We have calculated an individual net subsidy rate for each 
manufacturer of the subject merchandise pursuant to section 
705(c)(1)(B)(i) of the Act. In accordance with sections 777A(e)(2) and 
705(c)(5)(A) of the Act, we have set the ``all others'' rate as Ispat 
Sidbec's rate, because the rates for all other investigated companies 
are either zero or de minimis. We determine the total estimated net 
subsidy rate for each company to be:

------------------------------------------------------------------------
                                                        Net Subsidy Rate
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Ispat Sidbec.........................................               6.61
Stelco...............................................               0.00
Ivaco................................................               0.00
All Others...........................................               6.61
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    We will issue a countervailing duty order and reinstate the 
suspension of liquidation (except for imports from Stelco and Ivaco, 
which have either a zero or de minimis rate) if the ITC issues a final 
affirmative injury determination and we will instruct Customs to 
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 the ITC 
confirms that it will not disclose such information, either publicly or 
under an Administrative Protective Order (``APO''), without the written 
consent of the Assistant Secretary for Import Administration.

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 an APO of their responsibility concerning the destruction of 
proprietary information disclosed under 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.

    Dated: August 23, 2002.
Faryar Shirzad,
Assistant Secretary for Import Administration

Appendix I

List of Comments and Issues in the Decision Memorandum
Comment 1: Post-Privatization Treatment of Ispat Sidbec's Pre-
Privatization Subsidies
Comment 2: Application of the Department's Change-in-Ownership 
Methodology
Comment 3: Equityworthiness and Creditworthiness
Comment 4: Countervailability of 1988 Debt-to-Equity Conversion and 
1986-1992 Grants
Comment 5: 1986-1992 Grants
Comment 6: Project Bessemer
Comment 7: Ispat Sidbec's Freight Revenue
Comment 8: Ispat Sidbec's AUL
Comment 9: Ispat Inland's Sales
Comment 10: Deitcher Brothers Sales
Comment 11: Calculation of Deposit Rate
Comment 12: Stelco's Energy Efficiency and Conservation Programs
Comment 13: New Subsidy Allegations
[FR Doc. 02-22244 Filed 8-29-02; 8:45 am]
BILLING CODE 3510-DS-S