[Federal Register Volume 67, Number 192 (Thursday, October 3, 2002)]
[Notices]
[Pages 62134-62136]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-24800]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-351-834]


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

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

ACTION: Notice of final determination of sales at less than fair value.

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SUMMARY: On May 9, 2002, the Department of Commerce published its 
preliminary determination of sales at less than fair value and 
postponement of final determination of certain cold-rolled carbon steel 
flat products from Brazil. The period of investigation is July 1, 2000, 
through June 30, 2001.
    Based on our analysis of the comments received, we have made 
changes in the margin calculations. Therefore, the final determination 
differs from the preliminary determination. The final weighted-average 
dumping margins are listed below in the section entitled Final 
Determination Margins.

EFFECTIVE DATE: October 3, 2002.

FOR FURTHER INFORMATION CONTACT: Irina Itkin or Elizabeth Eastwood, AD/
CVD Enforcement Group I, Office 2, Import Administration, International 
Trade Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
0656 or (202) 482-3874, respectively.

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 (URAA). In addition, unless 
otherwise indicated, all citations to the regulations of the Department 
of Commerce (the Department) are to 19 CFR part 351 (April 2001).

Final Determination

    We determine that certain cold-rolled carbon steel flat products 
(cold-rolled steel) from Brazil are being, or are likely to be, sold in 
the United States at less than fair value (LTFV), as provided in 
section 735 of the Act.

Background

    The preliminary determination in this investigation was issued on 
April 26, 2002. See Notice of Preliminary Determination of Sales at 
Less Than Fair Value and Postponement of Final Determination: Certain 
Cold-Rolled Carbon Steel Flat Products From Brazil, 67 FR 31200 (May 9, 
2002) (Preliminary Determination). Since the preliminary determination, 
the following events have occurred.
    In May 2002, we conducted verification of the questionnaire 
responses of the respondent in this case, Usinas Siderurgicas de Minas 
Gerais (USIMINAS) and Companhia Siderurgica Paulista (COSIPA) 
(collectively ``USIMINAS/COSIPA'').
    We gave interested parties an opportunity to comment on the 
preliminary determination. In July and August 2002, we received case 
and rebuttal briefs from the petitioners (Bethlehem Steel Corporation, 
National Steel Corporation, Nucor Corporation, and United States Steel 
Corporation) and USIMINAS/COSIPA. The Department held a public hearing 
on August 16, 2002, at the request of the following petitioners: 
Bethlehem Steel Corporation, National Steel Corporation, and United 
States Steel Corporation.
    With respect to scope, in the preliminary LTFV determinations in 
this and the companion cold-rolled steel investigations, the Department 
preliminarily excluded certain porcelain enameling steel from the scope 
of these investigations. See Scope Appendix to the Notice of 
Preliminary Determination of Sales at Less Than Fair Value: Certain 
Cold-Rolled Carbon Steel Flat Products from Argentina, 67 FR 31181 (May 
9, 2002) (Scope Appendix--Argentina Preliminary LTFV Determination). On 
June 13, 2002, we issued a preliminary decision on the remaining 75 
scope exclusion requests filed in a number of the on-going cold-rolled 
steel investigations (see the June 13, 2002, memorandum regarding 
``Preliminary Scope Rulings in the Antidumping Investigations on 
Certain Cold-Rolled Carbon Steel Flat Products from Argentina, 
Australia, Belgium, Brazil, France, Germany, India, Japan, Korea, the 
Netherlands, New Zealand, the People's Republic of China, the Russian 
Federation, South Africa, Spain, Sweden, Taiwan, Thailand, Turkey, and 
Venezuela, and in the Countervailing Duty Investigations of Certain 
Cold-Rolled Carbon Steel Flat Products from Argentina, Brazil, France, 
and Korea'' (Preliminary Scope Rulings), which is on file in the 
Central Records Unit (CRU), room B-099 of the main Department 
building). We gave parties until June 20, 2002, to comment on the 
preliminary scope rulings, and until June 27, 2002, to submit rebuttal 
comments. We received comments and/or rebuttal comments from 
petitioners and respondents from various countries subject to these 
investigations of cold-rolled steel. In addition, on June 13, 2002, 
North American Metals Company (an interested party in the Japanese 
proceeding) filed a request that the Department issue a ``correction'' 
for an already excluded product. On July 8, 2002, the petitioners 
objected to this request.
    At the request of multiple respondents, the Department held a 
public hearing with respect to the Preliminary Scope Rulings on July 1, 
2002. The Department's final decisions on the scope exclusion requests 
are addressed in the Scope of Investigation section below.

Scope of Investigation

    For purposes of this investigation, the products covered are 
certain cold-rolled (cold-reduced) flat-rolled carbon-quality steel 
products. A full description of the scope of this investigation is 
contained in the ``Scope Appendix'' attached to the Notice of 
Correction to Final Determination of Sales at Less Than Fair Value: 
Certain Cold-Rolled Carbon Steel Flat Products from Australia, 67 FR 
52934 (Aug. 14, 2002). For a complete discussion of the comments 
received on the Preliminary Scope Rulings, see the memorandum regarding 
``Issues and Decision Memorandum for the Final Scope Rulings in the 
Antidumping Duty Investigations on Certain Cold-Rolled Carbon Steel 
Flat Products from Argentina, Australia, Belgium, Brazil, France, 
Germany, India, Japan, Korea, the Netherlands, New Zealand, the 
People's Republic of China, the Russian Federation, South Africa, 
Spain, Sweden, Taiwan, Thailand, Turkey, and Venezuela, and in the 
Countervailing Duty Investigations of Certain Cold-Rolled Carbon Steel 
Flat Products from Argentina, Brazil, France, and Korea,'' dated July 
10, 2002, which is on file in the CRU.

[[Page 62135]]

Period of Investigation

    The period of investigation is July 1, 2000, through June 30, 2001, 
which corresponds to the four most recent fiscal quarters prior to the 
month of the filing of the petition (i.e., September 2001).

Affiliated Respondents

    In the last cold-rolled investigation for Brazil, the Department 
treated USIMINAS and COSIPA as affiliated parties and collapsed these 
entities. See Notice of Final Determination of Sales at Less Than Fair 
Value: Certain Cold-Rolled Flat-Rolled Carbon-Quality Steel Products 
from Brazil, 65 FR 5554, 5562 (Feb. 4, 2000). In the Preliminary 
Determination, the Department stated that it treated these companies as 
affiliated producers. Neither USIMINAS nor COSIPA commented on our 
treatment of them as affiliated producers. Therefore, we have continued 
to treat USIMINAS and COSIPA as a single entity and to calculate a 
single margin for them.

Analysis of Comments Received

    All issues raised in the case briefs by parties to this proceeding 
and to which we have responded are listed in the Appendix to this 
notice and addressed in the Decision Memorandum, which is 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 of the main Commerce Building. In addition, a complete 
version of the Decision Memorandum can be accessed directly on the Web 
at http://ia.ita.doc.gov/frn/index.html. 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 to the margin calculations. For a discussion of these changes, 
see the ``Margin Calculations'' section of the Decision Memorandum.

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 records, production records, and 
original source documents provided by the respondent.

Continuation of Suspension of Liquidation

    In accordance with section 735(c)(1)(B)(ii) of the Act, we are 
directing the Customs Service to continue to suspend liquidation of all 
entries of subject merchandise from Brazil that are entered, or 
withdrawn from warehouse, for consumption on or after May 9, 2002, the 
date of publication of the preliminary determination in the Federal 
Register.
    In the companion countervailing duty investigation we have found 
the existence of export subsidies with respect to USIMINAS/COSIPA. 
Section 772(c)(1)(C) of the Act directs the Department to increase 
export price or constructed export price by the amount of the 
countervailing duty ``imposed'' on the subject merchandise ``to offset 
an export subsidy'' in an administrative review. The basic economic 
theory underlying this provision is that in parallel antidumping and 
countervailing duty investigations, if the Department finds that a 
respondent received the benefits of an export subsidy program, it is 
presumed the subsidy contributed to lower-priced sales of subject 
merchandise in the United States market by the amount of any such 
export subsidy. Thus, the subsidy and dumping are presumed to be 
related, and the assessment of duties against both would in effect be 
``double-application'' or imposing two duties against the same 
situation. Therefore, Congress, through section 772(c)(1)(C) of the 
Act, indicated that the Department should factor the subsidy into the 
antidumping calculations to prevent this ``double-application'' of 
duties.
    We believe the economic theory implicit in section 772(c)(1)(C) of 
the Act should also generally apply to our cash deposit calculations in 
an investigation. The calculations underlying cash deposit rates 
resulting from an initial investigation are essentially equivalent to 
those determined in administrative reviews leading to the assessment of 
antidumping duties. Congress has indicated, in effect, that no dumping 
exists if the export subsidies calculated in a countervailing duty 
proceeding are equal to or greater than the calculated dumping margin. 
The Department believes that this is true regardless if such a result 
appears in an administrative review or in an investigation. Therefore, 
an affirmative dumping determination accompanied by customs 
instructions which call for the suspension of liquidation and the 
collection of zero cash deposit rates would be inconsistent with the 
logic and intent of the law. If the Department's calculations in an 
investigation result in a zero cash deposit rate, then in reality, 
there exists no dumping upon which an affirmative determination could 
be based as to that particular respondent.
    The Department has determined in its Final Affirmative 
Countervailing Duty Determination: Certain Cold-Rolled Carbon Steel 
Flat Products from Brazil (issued concurrently) that the product under 
investigation benefitted from export subsidies. Consistent with our 
longstanding practice, where the product under investigation is also 
subject to a concurrent countervailing duty investigation, we instruct 
the Customs Service to require a cash deposit or posting of a bond 
equal to the weighted-average amount by which the normal value exceeds 
the export price, as indicated below, minus the amount of the 
countervailing duty determined to offset an export subsidy. See, e.g., 
Notice of Antidumping Duty Order: Stainless Steel Wire Rod From Italy, 
63 FR 49327 (September 15, 1998) and Notice of Final Determination of 
Sales at Less Than Fair Value: Polyethylene Terephthalate Film, Sheet, 
and Strip From India, 67 FR 34899 (May 16, 2002). Accordingly, for cash 
deposit purposes we are subtracting from USIMINAS/COSIPA's cash deposit 
rate that portion of the rate attributable to the export subsidies 
found in the affirmative countervailing duty determination for this 
respondent (i.e., 3.35 percent). After the adjustment for the cash 
deposit rate attributed to export subsidies, the resulting cash deposit 
rate for USIMINAS/COSIPA will be 30.53 percent. This rate will be 
applied only in the event that an order in the companion countervailing 
duty case is issued.\1\
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    \1\ Because suspension of liquidation in the companion 
countervailing duty investigation is currently discontinued and will 
not be resumed unless and until the Department issues a 
countervailing duty order, the antidumping cash deposit rate is the 
calculated weighted-average dumping margin of 33.88 percent. If an 
order is issued in the companion countervailing duty investigation, 
suspension of liquidation in the countervailing duty investigation 
will resume. If an order is also issued in this antidumping duty 
investigation, the Department will issue antidumping duty cash 
deposit instructions requiring a cash deposit equal to the 
antidumping margin calculated for USIMINAS/COSPIPA less the export 
subsidy rate calculated for USIMINAS/COSIPA in the companion 
countervailing duty investigation.
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    The Customs Service shall continue to require a cash deposit or 
posting of a bond equal to the estimated amount by which the normal 
value exceeds the U.S. price as shown below. This

[[Page 62136]]

suspension-of-liquidation instruction will remain in effect until 
further notice.

Final Determination Margins

    We determine that the following percentage weighted-average margins 
exist:

------------------------------------------------------------------------
                                                                Margin
                   Manufacturer/exporter                      (percent)
------------------------------------------------------------------------
Usinas Siderurgicas de Minas Gerais and Companhia..........        33.88
Siderurgica Paulista.......................................
                                                            ------------
  All Others...............................................        33.88
------------------------------------------------------------------------

    In accordance with section 735(c)(5)(A), we have based the ``all 
others'' rate on the dumping margin found for the sole producer/
exporter investigated in this proceeding, USIMINAS/COSIPA.

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 duty 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 notice serves as the only reminder to parties subject to 
administrative protective order (APO) of their responsibility 
concerning the disposition of proprietary information disclosed under 
APO in accordance with 19 CFR 351.305(a)(3). Timely written 
notification of return/destruction of APO materials or conversion to 
judicial protective order is hereby requested. Failure to comply with 
the regulations and the terms of an APO is a sanctionable violation.
    We are issuing and publishing this determination and notice in 
accordance with sections 735(d) and 777(i) of the Act.

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

Appendix--Issues in the Decision Memorandum

1. Use of Facts Available
2. Treatment of PIS and COFINS Taxes in Normal Value
3. Treatment of PIS and COFINS Taxes in the Cost of Production
4. Arm's-Length Test
5. Calculation of the Overall Dumping Margin
6. Upward Billing Adjustments
7. Downward Billing Adjustments
8. ICMS and IPI taxes
9. Discounts
10. Home Market Inland Freight Expenses for COSIPA
11. Foreign Inland Freight Expenses for COSIPA
12. Home Market Inland Freight Expenses and Foreign Inland Freight 
Expenses for USIMINAS
13. Foreign Brokerage and Handling Expenses
14. Credit Expenses for USIMINAS
15. Credit Expenses for COSIPA
16. Warranties vs. Rebates for USIMINAS
17. Warranty Expenses for COSIPA
18. Technical Service Expenses
19. Use of Facts Available to Determine USIMINAS's Cost of 
Production
20. Inclusion of Non-POI Costs in the Cost of Production
21. Reported Scrap Credit Values
22. Depreciation of Temporarily Idled Assets
23. Amortization of Goodwill
24. Exclusion of Financial Gains and Losses on Receivables from 
Financial Expenses

[FR Doc. 02-24800 Filed 10-2-02; 8:45 am]
BILLING CODE 3510-DS-P