[Federal Register Volume 67, Number 214 (Tuesday, November 5, 2002)]
[Notices]
[Pages 67388-67392]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-28217]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-122-839]


Final Results and Partial Recission of Countervailing Duty 
Expedited Reviews: Certain Softwood Lumber Products From Canada

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

ACTION: Notice of final results of countervailing duty expedited 
reviews.

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SUMMARY: On August 14, 2002, the Department of Commerce (the 
Department) published in the Federal Register its preliminary results 
of 18 expedited reviews of the countervailing duty order on certain 
softwood lumber products from Canada for the period April 1, 2000 
through March 31, 2001. See Preliminary Results of Countervailing Duty 
Expedited Reviews: Certain Softwood Lumber Products from Canada, 67 FR 
52945 (August 14, 2002) (Preliminary Results). Based on our analysis of 
additional information, we have made changes to the estimated net 
subsidy rates. Therefore, these final results differ from the 
preliminary results. For information on estimated net subsidies, please 
see the ``Final Results of Reviews'' section of this notice. In 
accordance with these final results of reviews, we will instruct the 
U.S. Customs Service (Customs) to amend the cash deposit for each 
reviewed company as detailed in the ``Final Results of Reviews'' 
section of this notice. In addition, the Department has rescinded 
expedited reviews with regard to Western Commercial Millwork Inc.

EFFECTIVE DATE: November 5, 2002.

[[Page 67389]]


FOR FURTHER INFORMATION CONTACT: Maria MacKay or Gayle Longest, Office 
of AD/CVD Enforcement VI, Group II, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, NW., Washington, DC 20230; telephone: 
(202) 482-1775 or (202) 482-3338.

SUPPLEMENTARY INFORMATION:

Applicable Statute

    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 (URAA). In addition, unless otherwise 
indicated, all citations to the Department's regulations are to the 
regulations codified at 19 C.F.R. Part 351 (2002).

Background

    On May 22, 2002, the Department published in the Federal Register 
its amended final affirmative countervailing duty determination and 
countervailing duty order on certain softwood lumber products (subject 
merchandise) from Canada (67 FR 36068), as corrected (67 FR 37775, May 
30, 2002). On July 17, 2002, the Department published a Notice of 
Initiation of Expedited Reviews which covered 73 companies that filed 
complete and timely applications. (See Notice of Initiation of 
Expedited Reviews of the Countervailing duty Order: Certain Softwood 
Lumber Products from Canada, (67 FR 46955) (July 17, 2002) (Notice of 
Initiation).)
    As explained in the Notice of Initiation, we segregated the 73 
applicants into two groups. Group 1 consists of 45 companies that 
obtain the majority of their wood (over 50 percent of their inputs) 
from the United States, the Maritime Provinces, Canadian private lands, 
and Canadian companies excluded from the order, as well as companies 
that source less than a majority of their wood from these sources and 
do not have tenure. Group 2 includes 28 companies that source less than 
a majority of their wood from these sources and have acquired Crown 
timber through their own tenure contracts.
    In our review of the applications in Group 1, we noted that, in 
order to conduct our analysis, we required only minimal supplemental 
data for 24 of the 45 companies. The other Group 1 companies required 
additional information and more extensive analysis. Rather than 
delaying the process to provide all Group 1 companies the opportunity 
to submit the necessary information, we issued a short questionnaire to 
the 24 companies requiring only minimal information and set a short 
deadline for the response. Of the 24 companies, 18 were able to supply 
the information by the deadline. We completed our preliminary analysis 
of those 18 companies, using the Group 1 methodology (see 
``Methodology'' section below). See Preliminary Results. Two of these 
companies subsequently requested a pass-through analysis: Les Bois 
d'Oeuvre Beaudoin & Gauthier Inc. and Meunier Lumber Company Ltd. Three 
other companies were verified subsequent to the preliminary results of 
expedited reviews: Interbois Inc., Les Moulures Jacomau 2000, Inc., and 
Richard Lutes Cedar, Inc. We are providing those three companies and 
petitioners with an opportunity to comment on the verification reports, 
as explained in the ``Verification'' section of this notice. Therefore, 
this notice includes the final results for 13 of the 18 companies that 
were included in the Preliminary Results. We are continuing to process 
the other applications in Groups 1 and 2, and will be issuing 
additional questionnaires shortly. We received comments and rebuttal 
comments on the Preliminary Results, on September 6, 2002 and September 
18, 2002, respectively, from petitioners and several respondents.

Partial Recission

    On July 25, 2002, Olav Haavaldsrud Timber Company Limited (Olav 
Haavaldsrud) and Western Commercial Millwork withdrew their requests 
for review. On August 26, 2002, Olav Haavaldsrud requested that the 
Department reinstate its June 21, 2002, request for expedited review. 
On August 28, 2002, petitioners filed comments objecting to the 
reinstatement. The Department considered the arguments presented by 
Olav Haavaldsrud and petitioners, and decided that reinstatement of 
Olav Haavaldsrud in this expedited review proceeding is inappropriate. 
See Letter to Elliot J. Feldman from Melissa G. Skinner, Director, 
Office of CVD/AD Enforcement VI, Re: Expedited Review of Countervailing 
Duty Order on Certain Softwood Lumber Products from Canada--Olav 
Haavaldsrud Timber Company dated September 18, 2002.
    On October 11, 2002, the GOC filed a submission urging the 
Department to reconsider the request for reinstatement filed by Olav 
Haavaldsrud. In the GOC's view, acceptance of Olav Haavaldsrud's 
request is required as a matter of procedural fairness. The GOC states 
that, as Olav Haavaldsrud detrimentally relied on the Department's 
statements, the Department should apply equitable tolling principles 
and accept Olav Haavaldsrud's request for reinstatement.
    In response to the GOC, we note that the Department never, at any 
point in the expedited reviews, foreclosed consideration of arm's 
length issues, including in the cover letter to the questionnaire dated 
July 22, 2002 (cited by the GOC). Nevertheless, we understand that Olav 
Haavaldsrud may have misinterpreted that cover letter. Consequently, we 
are granting this company's request for reinstatement. However, we are 
granting the recission request of Western Commercial Millwork.
    This notice includes the final results of review for the following 
13 companies:

Bois Daaquam Inc.
Bois Omega Lt[eacute]e
City Lumber Sales & Services Limited
Herridge Sawmills Ltd.
J. A. Fontaine et fils Inc.
Jointfor (3207021 Canada Inc.)
Les Produits Forestiers Dube Inc
Lonestar Lumber Inc.
Maibec Industries, Inc.
Materiaux Blanchet Inc.
MF Bernard Inc.
Scierie Nord-Sud Inc.
Scierie West-Brome Inc.

Scope of the Reviews

    The products covered by this order are softwood lumber, flooring 
and siding (softwood lumber products). Softwood lumber products include 
all products classified under headings 4407.1000, 4409.1010, 4409.1090, 
and 4409.1020, respectively, of the Harmonized Tariff Schedule of the 
United States (HTSUS), and any softwood lumber, flooring and siding 
described below. These softwood lumber products include:
    (1) Coniferous wood, sawn or chipped lengthwise, sliced or peeled, 
whether or not planed, sanded or finger-jointed, of a thickness 
exceeding six millimeters;
    (2) Coniferous wood siding (including strips and friezes for 
parquet flooring, not assembled) continuously shaped (tongued, grooved, 
rabbeted, chamfered, v-jointed, beaded, molded, rounded or the like) 
along any of its edges or faces, whether or not planed, sanded or 
finger-jointed;
    (3) Other coniferous wood (including strips and friezes for parquet 
flooring, not assembled) continuously shaped (tongued, grooved, 
rabbeted, chamfered, v-jointed, beaded, molded, rounded or the like) 
along any of its edges or faces (other than wood moldings and wood 
dowel rods) whether or not planed, sanded or finger-jointed; and

[[Page 67390]]

    (4) Coniferous wood flooring (including strips and friezes for 
parquet flooring, not assembled) continuously shaped (tongued, grooved, 
rabbeted, chamfered, v-jointed, beaded, molded, rounded or the like) 
along any of its edges or faces, whether or not planed, sanded or 
finger-jointed.
    Although the HTSUS subheadings are provided for convenience and 
Customs purposes, the written description of the merchandise subject to 
this order is dispositive.
    As specifically stated in the Issues and Decision Memorandum 
accompanying the Notice of Final Determination of Sales at Less Than 
Fair Value: Certain Softwood Lumber Products from Canada, 67 FR 15539 
(April 2, 2002) (see comment 53, item D, page 116, and comment 57, item 
B-7, page 126), available at http://www.ia.ita.doc.gov, drilled and 
notched lumber and angle cut lumber are covered by the scope of this 
order.
    The following softwood lumber products are excluded from the scope 
of this order provided they meet the specified requirements detailed 
below:
    (1) Stringers (pallet components used for runners): if they have at 
least two notches on the side, positioned at equal distance from the 
center, to properly accommodate forklift blades, properly classified 
under HTSUS 4421.90.98.40.
    (2) Box-spring frame kits: if they contain the following wooden 
pieces--two side rails, two end (or top) rails and varying numbers of 
slats. The side rails and the end rails should be radius-cut at both 
ends. The kits should be individually packaged, they should contain the 
exact number of wooden components needed to make a particular box 
spring frame, with no further processing required. None of the 
components exceeds 1'' in actual thickness or 83'' in length.
    (3) Radius-cut box-spring-frame components, not exceeding 1'' in 
actual thickness or 83'' in length, ready for assembly without further 
processing. The radius cuts must be present on both ends of the boards 
and must be substantial cuts so as to completely round one corner.
    (4) Fence pickets requiring no further processing and properly 
classified under HTSUS heading 4421.90.70, 1'' or less in actual 
thickness, up to 8'' wide, 6' or less in length, and have finials or 
decorative cuttings that clearly identify them as fence pickets. In the 
case of dog-eared fence pickets, the corners of the boards should be 
cut off so as to remove pieces of wood in the shape of isosceles right 
angle triangles with sides measuring \3/4\ inch or more.
    (5) U.S. origin lumber shipped to Canada for minor processing and 
imported into the United States, is excluded from the scope of this 
order if the following conditions are met: (1) The processing occurring 
in Canada is limited to kiln-drying, planing to create smooth-to-size 
board, and sanding, and (2) if the importer establishes to Customs' 
satisfaction that the lumber is of U.S. origin.
    (6) Softwood lumber products contained in single family home 
packages or kits, \1\ regardless of tariff classification, are excluded 
from the scope of this order if the importer certifies to items 6 A, B, 
C, D, and requirement 6 E is met:
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    \1\ To ensure administrability, we clarified the language of 
exclusion number 6 to require an importer certification and to 
permit single or multiple entries on multiple days as well as 
instructing importers to retain and make available for inspection 
specific documentation in support of each entry.
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    A. The imported home package or kit constitutes a full package of 
the number of wooden pieces specified in the plan, design or blueprint 
necessary to produce a home of at least 700 square feet produced to a 
specified plan, design or blueprint.
    B. The package or kit must contain all necessary internal and 
external doors and windows, nails, screws, glue, sub floor, sheathing, 
beams, posts, connectors, and if included in the purchase contract, 
decking, trim, drywall and roof shingles specified in the plan, design 
or blueprint.
    C. Prior to importation, the package or kit must be sold to a 
retailer of complete home packages or kits pursuant to a valid purchase 
contract referencing the particular home design plan or blueprint, and 
signed by a customer not affiliated with the importer.
    D. Softwood lumber products entered as part of a single family home 
package or kit, whether in a single entry or multiple entries on 
multiple days, will be used solely for the construction of the single 
family home specified by the home design matching the entry.
    E. For each entry, the following documentation must be retained by 
the importer and made available to the U.S. Customs Service upon 
request:
    i. A copy of the appropriate home design, plan, or blueprint 
matching the entry;
    ii. A purchase contract from a retailer of home kits or packages 
signed by a customer not affiliated with the importer;
    iii. A listing of inventory of all parts of the package or kit 
being entered that conforms to the home design package being entered;
    iv. In the case of multiple shipments on the same contract, all 
items listed in E(iii) which are included in the present shipment shall 
be identified as well.
    Lumber products that the Customs Service may classify as stringers, 
radius cut box-spring-frame components, and fence pickets, not 
conforming to the above requirements, as well as truss components, 
pallet components, and door and window frame parts, are covered under 
the scope of this order and may be classified under HTSUS subheadings 
4418.90.45.90 , 4421.90.70.40, and 4421.90.97.40.
    Finally, as clarified throughout the course of the investigation, 
the following products, previously identified as Group A, remain 
outside the scope of this order. They are:
    1. Trusses and truss kits, properly classified under HTSUS 4418.90;
    2. I-joist beams;
    3. Assembled box spring frames;
    4. Pallets and pallet kits, properly classified under HTSUS 
4415.20;
    5. Garage doors;
    6. Edge-glued wood, properly classified under HTSUS item 
4421.90.98.40;
    7. Properly classified complete door frames;
    8. Properly classified complete window frames;
    9. Properly classified furniture.

Verification

    The Department verified three companies from September 30, 2002, 
through October 3, 2002. The companies verified during this time period 
were Interbois, Inc., Les Moulures Jacomau 2000, Inc., and Richard 
Lutes Cedar. Because we want to provide those companies and petitioners 
with an opportunity to comment on the verification reports, and we want 
to maintain the schedule for conducting these expedited review 
proceedings, we are not at this time issuing the final results for 
these three companies. Instead, their final results will be included in 
the next notice of final results of expedited reviews. In addition, we 
note that, in the underlying investigation, the Department verified 
Bois Daaquam Inc., Bois Omega Lt[eacute]e, J. A. Fontaine et fils Inc., 
Les Produits Forestiers Dube Inc., Maibec Industries, Inc., Materiaux 
Blanchet Inc., Scierie Nord-Sud Inc., and Scierie West-Brome Inc.

Methodology

    These final results include: (a) Companies that obtain the majority 
of their wood (over 50 percent of their inputs) from the United States, 
the Maritime Provinces, Canadian private

[[Page 67391]]

lands, and/or Canadian companies excluded from the order, and (b) 
companies that source less than a majority of their wood from these 
sources and do not have tenure. We calculated company-specific rates 
based on the methodology described in the notice of preliminary 
results. To obtain the company-specific stumpage benefit, we multiplied 
the quantity of Crown logs and the quantity of lumber inputs (except 
for those specified below) by the province-specific stumpage benefit 
calculated in the underlying investigation, i.e., the average per-unit 
differential between the calculated adjusted stumpage fee for the 
relevant province and the appropriate benchmark for that province. For 
those provinces, such as British Columbia and Ontario, for which we 
calculated more than one per-unit benefit in the investigation, we 
calculated one province-wide per-unit benefit by weight-averaging the 
previously calculated values by the corresponding volumes of harvested 
softwood. As indicated in the Notice of Initiation, we have not 
attributed a benefit to (1) logs or lumber acquired from the Maritime 
Provinces, if accompanied by the appropriate certification, (2) logs or 
lumber of U.S. origin, (3) lumber produced by mills excluded in the 
investigation, or (4) logs from Canadian private land. We divided the 
stumpage benefit by the appropriate value of the company's sales to 
determine the company's estimated subsidy rate from stumpage and then 
added any benefit from other programs to obtain the cash deposit rate 
for the company.

Analysis of Comments Received

    The issues raised in the case briefs by parties to these expedited 
reviews are addressed in the ``Issues and Decision Memorandum'' 
(Decision Memorandum), dated concurrently with this notice, which is 
hereby adopted by this notice. As noted in the Decision Memorandum, we 
are addressing in these final results those issues that are of a 
general nature or that specifically affect these 13 reviews. Other 
issues, related for instance to pass-through analysis or Group 2 
methodology, will be addressed in the context of subsequent reviews. A 
list of the issues which parties have raised, and to which we have 
responded, all of which are in the Decision Memorandum, is attached to 
this notice as Appendix I. The Decision Memorandum is on file in the 
Central Records Unit in room B-099 of the Main Commerce Building. In 
addition, a complete version of 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.

Changes Since the Preliminary Results

    We amended data for MF Bernard based on submissions of factual 
information dated September 3, 2002.

Final Results of Review

    We have calculated an individual subsidy rate for each producer/
exporter subject to these expedited reviews. For the period April 1, 
2000 to March 31, 2001, we determine the net subsidy to be as follows:

------------------------------------------------------------------------
                                                            Net subsidy
            Net subsidies--producer/exporter                 rate  (in
                                                             percent)
------------------------------------------------------------------------
Bois Daaquam Inc........................................            2.99
Bois Omega Lt[eacute]e..................................            3.10
City Lumber Sales & Services Limited....................            6.60
Herridge Sawmills Ltd...................................            4.91
J. A. Fontaine et fils Inc..............................            3.28
Jointfor (3207021 Canada Inc............................            1.96
Les Produits Forestiers Dube Inc........................            1.39
Lonestar Lumber Inc.....................................           13.42
Maibec Industries, Inc..................................            1.98
Materiaux Blanchet Inc..................................           10.32
MF Bernard Inc..........................................            3.69
Scierie Nord-Sud Inc....................................            2.22
Scierie West-Brome Inc..................................            1.16
------------------------------------------------------------------------

    We will instruct Customs to collect cash deposits of estimated 
countervailing duties in the amounts indicated above of the f.o.b. 
invoice price on all shipments of the subject merchandise produced by 
the reviewed companies, entered, or withdrawn from warehouse, for 
consumption on or after the date of publication of the final results of 
these reviews.
    This notice covers only those 13 companies that we have 
specifically identified herein. We will instruct Customs to continue 
collecting cash deposits for all non-reviewed companies at the cash 
deposit rates established in the amended final determination on 
softwood lumber from Canada, 67 FR 36070 (May 22, 2002).
    These expedited reviews and notice are issued and published in 
accordance with section 751(a)(1) and 777(I)(1) of the Act (19 U.S.C. 
1675(a)(1) and 19 U.S.C. 1677(f)(I)).

    Dated: October 31, 2002.
Faryar Shirzad,
Assistant Secretary for Import Administration.

Appendix 1

General Issues

Comment 1 Whether the Department should exclude companies from the 
CVD order as a result of expedited reviews
Comment 2 Whether the Department should verify all companies subject 
to expedited reviews
Comment 3 Whether the Department should allow companies purchasing 
inputs in arm's length transactions to request expedited reviews
Comment 4 Whether companies should be afforded the opportunity to 
self select the methodology to apply in the expedited review

Procedural Issues

Comment 1 Whether the timeline adopted by the Department for 
requesting rescission of an expedited review is in accordance with 
law
Comment 2 Whether the final results of expedited reviews should be 
issued sequentially or concurrently for all companies in Round 1
Comment 3 Whether non-compliant submissions should be removed from 
the record and companies that did not supply all documentation 
requested by the Department should be ejected from the process

Methodological Issues

Comment 1 Expedited reviews may result in a diminishment of subsidy 
offset notwithstanding the intent of the Department to adjust the 
country-wide rate
Comment 2 Whether the Department should collect full information on 
cross-owned and affiliated entities
Comment 3 Whether non-subject softwood lumber products should be 
included in the company-specific subsidy calculations
Comment 4 Whether the same stumpage benefit should apply to logs and 
lumber
Comment 5 Whether the Department may lawfully recalculate the 
country-wide cash deposit rate by deducting the alleged benefit to 
and sales by the companies receiving individual rates from the 
country-wide calculation
Comment 6 Whether logs purchased from excluded companies and lumber 
produced from private forest timber should be excluded from the 
volume of subsidized inputs
Comment 7 Whether the Department should adopt a standardized 
conversion factor to convert board feet into cubic meters for lumber 
input
Comment 8 Whether the Department should calculate mill-specific 
rates

Company Specific Issues

Comment 1 Bois Daquaam Inc.
Comment 2 City Lumber Sales and Services Limited
Comment 3 Herridge Sawmills Ltd.

[[Page 67392]]

Comment 4 Jointfor
Comment 5 Lonestar Lumber
Comment 6 Maibec Industries Inc.
[FR Doc. 02-28217 Filed 11-4-02; 8:45 am]
BILLING CODE 3510-DS-P