[Federal Register Volume 68, Number 53 (Wednesday, March 19, 2003)]
[Notices]
[Pages 13267-13270]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-6480]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-580-835]


Final Results and Partial Rescission of Countervailing Duty 
Administrative Review: Stainless Steel Sheet and Strip From the 
Republic of Korea

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

ACTION: Notice of final results of countervailing duty administrative 
review.

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SUMMARY: On September 10, 2002, the Department of Commerce (the 
Department) published in the Federal Register its preliminary results 
and partial rescission of administrative review of the countervailing 
duty order on stainless steel sheet and strip from the Republic of 
Korea for the period January 1, 2000 through December 31, 2000 (67 FR 
57395) (Preliminary Results). The Department has now completed this 
administrative review in accordance with section 751(a) of the Tariff 
Act of 1930, as amended (the Act).
    Based on information received since the Preliminary Results and our 
analysis of the comments received, the Department has revised the net 
subsidy rate for Inchon Iron and Steel Co. (Inchon) The final net 
subsidy rate for the reviewed company is listed below in the section 
entitled ``Final Results of Review.''

EFFECTIVE DATE: March 19, 2003.

FOR FURTHER INFORMATION CONTACT: Tipten Troidl or Carrie Farley, Office 
of AD/CVD Enforcement VI, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
2786.

SUPPLEMENTARY INFORMATION:

Background

    Pursuant to 19 CFR 351.213(b), this review covers only those 
producers or exporters of the subject merchandise for which a review 
was specifically requested. Accordingly, this review covers Inchon. 
This review covers the period January 1, 2000 through December 31, 2000 
and eighteen (18) programs.
    On August 6, 1999, the Department published in the Federal Register 
the countervailing duty order on stainless steel sheet and strip in 
coils from the Republic of Korea. See Amended Final Determination: 
Stainless Steel Sheet and Strip in Coils from the Republic of Korea; 
and Notice of Countervailing Duty Orders: Stainless Steel Sheet and 
Strip from France, Italy and the Republic of Korea, 64 FR 42923 (August 
6, 1999). In addition, we published the Amended Final Results of 
Countervailing Duty Administrative Review: Stainless Steel Sheet and 
Strip in Coils from the Republic of Korea, 67 FR 8229 (February 22, 
2002) and published the Final Results and Partial Rescission of 
Countervailing Duty Administrative Review: Stainless Steel Sheet and 
Strip in Coils from the Republic of Korea, 67 FR 1964 (January 15, 
2002) and the accompanying Issues and Decision Memorandum (January 8, 
2002).

Rescission of Sammi Steel Co., Ltd. (Sammi)

    As noted in the Preliminary Results, Sammi did not export subject 
merchandise to the U.S. during the POR, and the Department preliminary 
found that Sammi and Inchon were not cross-owned. See 67 FR 57398. 
Therefore, the Department intended to rescind the administrative review 
for Sammi. As discussed in the Decision Memorandum, we affirm our 
decision from the Preliminary Results and are rescinding the review for 
Sammi.
    We published the Preliminary Results of the instant administrative 
review in the Federal Register on September 10, 2002 (67 FR 57395). We 
invited interested parties to comment on the results. On January 10, 
2003, we received case briefs from petitioners and respondents. On 
January 17, 2003, we received rebuttal briefs from petitioners and 
respondents.

Scope of the Review

    For purposes of this review, the products covered are certain 
stainless steel sheet and strip in coils. Stainless steel is an alloy 
steel containing, by weight, 1.2 percent or less of carbon and 10.5 
percent or more of chromium, with or without other elements. The 
subject sheet and strip is a flat-rolled product in coils that is 
greater than 9.5 mm in width and less than 4.75 mm in thickness, and 
that is annealed or otherwise heat treated and pickled or otherwise 
descaled. The subject sheet and strip may also be further processed 
(e.g., cold-rolled, polished, aluminized, coated, etc.) provided that 
it maintains the specific dimensions of sheet and strip following such 
processing.
    The merchandise subject to this review is classified in the 
Harmonized Tariff Schedule of the United States (HTSUS) at subheadings: 
7219.13.00.30, 7219.13.00.50, 7219.13.00.70, 7219.13.00.80, 
7219.14.00.30, 7219.14.00.65, 7219.14.00.90, 7219.32.00.05, 
7219.32.00.20, 7219.32.00.25, 7219.32.00.35, 7219.32.00.36, 
7219.32.00.38, 7219.32.00.42, 7219.32.00.44, 7219.33.00.05, 
7219.33.00.20, 7219.33.00.25, 7219.33.00.35, 7219.33.00.36, 
7219.33.00.38, 7219.33.00.42, 7219.33.00.44, 7219.34.00.05, 
7219.34.00.20, 7219.34.00.25, 7219.34.00.30, 7219.34.00.35, 
7219.35.00.05, 7219.35.00.15, 7219.35.00.30,

[[Page 13268]]

7219.35.00.35, 7219.90.00.10, 7219.90.00.20, 7219.90.00.25, 
7219.90.00.60, 7219.90.00.80, 7220.12.10.00, 7220.12.50.00, 
7220.20.10.10, 7220.20.10.15, 7220.20.10.60, 7220.20.10.80, 
7220.20.60.05, 7220.20.60.10, 7220.20.60.15, 7220.20.60.60, 
7220.20.60.80, 7220.20.70.05, 7220.20.70.10, 7220.20.70.15, 
7220.20.70.60, 7220.20.70.80, 7220.20.80.00, 7220.20.90.30, 
7220.20.90.60, 7220.90.00.10, 7220.90.00.15, 7220.90.00.60, and 
7220.90.00.80. Although the HTS subheadings are provided for 
convenience and Customs purposes, the Department's written description 
of the merchandise is dispositive.
    Excluded from the scope of this order are the following: (1) Sheet 
and strip that is not annealed or otherwise heat treated and pickled or 
otherwise descaled, (2) sheet and strip that is cut to length, (3) 
plate (i.e., flat-rolled stainless steel products of a thickness of 
4.75 mm or more), (4) flat wire (i.e., cold-rolled sections, with a 
prepared edge, rectangular in shape, of a width of not more than 9.5 
mm), and (5) razor blade steel. Razor blade steel is a flat rolled 
product of stainless steel, not further worked than cold-rolled (cold-
reduced), in coils, of a width of not more than 23 mm and a thickness 
of 0.266 mm or less, containing, by weight, 12.5 to 14.5 percent 
chromium, and certified at the time of entry to be used in the 
manufacture of razor blades. See Chapter 72 of the HTSUS, ``Additional 
U.S. Note'' 1(d).
    The Department has determined that certain specialty stainless 
steel products are also excluded from the scope of this order. These 
excluded products are described below:
    Flapper valve steel is defined as stainless steel strip in coils 
containing, by weight, between 0.37 and 0.43 percent carbon, between 
1.15 and 1.35 percent molybdenum, and between 0.20 and 0.80 percent 
manganese. This steel also contains, by weight, phosphorus of 0.025 
percent or less, silicon of between 0.20 and 0.50 percent, and sulfur 
of 0.020 percent or less. The product is manufactured by means of 
vacuum arc remelting, with inclusion controls for sulphide of no more 
than 0.04 percent and for oxide of no more than 0.05 percent. Flapper 
valve steel has a tensile strength of between 210 and 300 ksi, yield 
strength of between 170 and 270 ksi, plus or minus 8 ksi, and a 
hardness (Hv) of between 460 and 590. Flapper valve steel is most 
commonly used to produce specialty flapper valves in compressors.
    Also excluded is a product referred to as suspension foil, a 
specialty steel product used in the manufacture of suspension 
assemblies for computer disk drives. Suspension foil is described as 
302/304 grade or 202 grade stainless steel of a thickness between 14 
and 127 microns, with a thickness tolerance of plus-or-minus 2.01 
microns, and surface glossiness of 200 to 700 percent Gs. Suspension 
foil must be supplied in coil widths of not more than 407 mm, and with 
a mass of 225 kg or less. Roll marks may only be visible on one side, 
with no scratches of measurable depth. The material must exhibit 
residual stresses of 2 mm maximum deflection, and flatness of 1.6 mm 
over 685 mm length.
    Certain stainless steel foil for automotive catalytic converters is 
also excluded from the scope of this order. This stainless steel strip 
in coils is a specialty foil with a thickness of between 20 and 110 
microns used to produce a metallic substrate with a honeycomb structure 
for use in automotive catalytic converters. The steel contains, by 
weight, carbon of no more than 0.030 percent, silicon of no more than 
1.0 percent, manganese of no more than 1.0 percent, chromium of between 
19 and 22 percent, aluminum of no less than 5.0 percent, phosphorus of 
no more than 0.045 percent, sulfur of no more than 0.03 percent, 
lanthanum of between 0.002 and 0.05 percent, and total rare earth 
elements of more than 0.06 percent, with the balance iron.
    Permanent magnet iron-chromium-cobalt alloy stainless strip is also 
excluded from the scope of this order. This ductile stainless steel 
strip contains, by weight, 26 to 30 percent chromium, and 7 to 10 
percent cobalt, with the remainder of iron, in widths 228.6 mm or less, 
and a thickness between 0.127 and 1.270 mm. It exhibits magnetic 
remanence between 9,000 and 12,000 gauss, and a coercivity of between 
50 and 300 oersteds. This product is most commonly used in electronic 
sensors and is currently available under proprietary trade names such 
as ``Arnokrome III.'' \1\
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    \1\ ``Arnokrome III'' is a trademark of the Arnold Engineering 
Company.
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    Certain electrical resistance alloy steel is also excluded from the 
scope of this order. This product is defined as a non-magnetic 
stainless steel manufactured to American Society of Testing and 
Materials (ASTM) specification B344 and containing, by weight, 36 
percent nickel, 18 percent chromium, and 46 percent iron, and is most 
notable for its resistance to high temperature corrosion. It has a 
melting point of 1390 degrees Celsius and displays a creep rupture 
limit of 4 kilograms per square millimeter at 1000 degrees Celsius. 
This steel is most commonly used in the production of heating ribbons 
for circuit breakers and industrial furnaces, and in rheostats for 
railway locomotives. The product is currently available under 
proprietary trade names such as ``Gilphy 36.'' \2\
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    \2\ ``Gilphy 36'' is a trademark of Imphy, S.A.
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    Certain martensitic precipitation-hardenable stainless steel is 
also excluded from the scope of this order. This high-strength, ductile 
stainless steel product is designated under the Unified Numbering 
System (UNS) as S45500-grade steel, and contains, by weight, 11 to 13 
percent chromium, and 7 to 10 percent nickel. Carbon, manganese, 
silicon and molybdenum each comprise, by weight, 0.05 percent or less, 
with phosphorus and sulfur each comprising, by weight, 0.03 percent or 
less. This steel has copper, niobium, and titanium added to achieve 
aging, and will exhibit yield strengths as high as 1700 Mpa and 
ultimate tensile strengths as high as 1750 Mpa after aging, with 
elongation percentages of 3 percent or less in 50 mm. It is generally 
provided in thicknesses between 0.635 and 0.787 mm, and in widths of 
25.4 mm. This product is most commonly used in the manufacture of 
television tubes and is currently available under proprietary trade 
names such as ``Durphynox 17.'' \3\
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    \3\ ``Durphynox 17'' is a trademark of Imphy, S.A.
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    Finally, three specialty stainless steels typically used in certain 
industrial blades and surgical and medical instruments are also 
excluded from the scope of this order. These include stainless steel 
strip in coils used in the production of textile cutting tools (e.g., 
carpet knives).\4\ This steel is similar to ASTM grade 440F, but 
containing, by weight, 0.5 to 0.7 percent of molybdenum. The steel also 
contains, by weight, carbon of between 1.0 and 1.1 percent, sulfur of 
0.020 percent or less, and includes between 0.20 and 0.30 percent 
copper and between 0.20 and 0.50 percent cobalt. This steel is sold 
under proprietary names such as ``GIN4 HI-C.'' The second excluded 
stainless steel strip in coils is similar to AISI 420-J2 and contains, 
by weight, carbon of between 0.62 and 0.70 percent, silicon of between 
0.20 and 0.50 percent, manganese of between 0.45 and 0.80 percent, 
phosphorus of no more than 0.025 percent and sulfur of no more than 
0.020 percent. This steel has a carbide density on average of 100 
carbide particles per square micron. An

[[Page 13269]]

example of this product is ``GIN5'' steel. The third specialty steel 
has a chemical composition similar to AISI 420 F, with carbon of 
between 0.37 and 0.43 percent, molybdenum of between 1.15 and 1.35 
percent, but lower manganese of between 0.20 and 0.80 percent, 
phosphorus of no more than 0.025 percent, silicon of between 0.20 and 
0.50 percent, and sulfur of no more than 0.020 percent. This product is 
supplied with a hardness of more than Hv 500 guaranteed after customer 
processing, and is supplied as, for example, ``GIN6.''
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    \4\ This list of uses is illustrative and provided for 
descriptive purposes only.
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Analysis of Comments Received

    All issues raised in the case and rebuttal briefs by parties to 
this review are addressed in the ``Issues and Decision Memorandum: 
Final Results and Partial Rescission of Countervailing Duty 
Administrative Review: Stainless Steel Sheet and Strip from the 
Republic of Korea'' (Decision Memorandum) dated March 10, 2003, which 
is hereby adopted by this notice. A list of 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. Parties can find 
a complete discussion of all issues raised in this review and the 
corresponding recommendations in this public memorandum, which is on 
file 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 Registe Notices.'' The paper copy and electronic version of 
the Decision Memorandum are identical in content.

Final Results of Review

    In accordance with section 705(c)(1)(B)(i) of the Act, we 
calculated an ad valorem subsidy rate for Inchon. For the period 
January 1, 2000 through December 31, 2000, we determine the net subsidy 
for Inchon to be 3.79 percent ad valorem.
    We will instruct the Customs Service (``Customs'') to assess 
countervailing duties as indicated above. The Department will instruct 
Customs to collect cash deposits of estimated countervailing duties in 
the percentage detailed above of the f.o.b. invoice prices on all 
shipments of the subject merchandise from the producers/exporters under 
review, entered, or withdrawn from warehouse, for consumption on or 
after the date of publication of the final results of this 
administrative review. As of April 1, 2001, Inchon, changed its name to 
INI. Thus, for all of Inchon's shipments of the subject merchandise 
from the producers/exporters under review, entered, or withdrawn from 
warehouse, for consumption on or after April 1, 2001, we will instruct 
customs to assign Inchon's cash deposit to INI.
    Because the URAA replaced the general rule in favor of a country-
wide rate with a general rule in favor of individual rates for 
investigated and reviewed companies, the procedures for establishing 
countervailing duty rates, including those for non-reviewed companies, 
are now essentially the same as those in antidumping cases, except as 
provided for in section 777A(e)(2) of the Act. The requested review 
will normally cover only those companies specifically named. See 19 CFR 
351.213(b). Pursuant to 19 CFR 351.212(c), for all companies for which 
a review was not requested, duties must be assessed at the cash deposit 
rate, and cash deposits must continue to be collected, at the rate 
previously ordered. As such, the countervailing duty cash deposit rate 
applicable to a company can no longer change, except pursuant to a 
request for a review of that company. See Federal-Mogul Corporation and 
The Torrington Company v. United States, 822 F. Supp. 782 (CIT 1993) 
and Floral Trade Council v. United States, 822 F. Supp. 766 (CIT 1993). 
Therefore, the cash deposit rates for all companies except those 
covered by this review will be unchanged by the results of this review.
    We will instruct Customs to continue to collect cash deposits for 
non-reviewed companies at the most recent company-specific or country-
wide rate applicable to the company. As of April 1, 2002, Sammi changed 
its name to BNG. Thus, for all of Sammi's shipments of the subject 
merchandise from the producers/exporters under review, entered, or 
withdrawn from warehouse, for consumption on or after April 1, 2002, we 
will instruct customs to assign Sammi's cash deposit rate to BNG. 
Accordingly, the cash deposit rates that will be applied to non-
reviewed companies covered by this order will be the rate for that 
company established in the most recently completed administrative 
proceeding conducted under the URAA. If such a review has not been 
conducted, the rate established in the most recently completed 
administrative proceeding pursuant to the statutory provisions that 
were in effect prior to the URAA amendments is applicable. See 
Stainless Steel Sheet and Strip in Coils from the Republic of Korea: 
Amended Final Results of Countervailing Duty Administrative Review, 67 
FR 8229 (February 22, 2002). This rate shall apply to all non-reviewed 
companies until a review of a company assigned this rate is requested. 
In addition, for the period January 1, 2000 through December 31, 2000, 
the assessment rates applicable to all non-reviewed companies covered 
by this order are the cash deposit rates in effect at the time of 
entry.
    This notice also serves as a final reminder to importers of their 
responsibility under 19 CFR 351.402(f) to file a certificate regarding 
the reimbursement of duties prior to liquidation of the relevant 
entries during this review period.
    This notice serves as a 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.
    This administrative review and notice are issued and published in 
accordance with section 751(a)(1) of the Act.

    Dated: March 10, 2003.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.

Appendix I--Issues and Decision Memorandum

I. Methodology and Background Information
    A. Rescission of Samm Steel Co., Ltd. (Sammi)
    B. Program-wide Change
    C. Name Changes
    1. Inchon Iron and Steel Co. (Inchon) to INI
    2. Sammi to BNG
II. Subsidies Valuation Information
    A. Allocation Period
    B. Benchmarks for Loans and Discount Rates
    C. Attribution
    1. Cross-ownership of Inchon and Sammi
    2. Treatment of Subsidies Received by Trading Companies
    D. Untimely Subsidy Allegation
III. Analysis of Programs
    A. Programs Determined to Confer Subsidies
    1. The GOK's Direction of Credit
    2. Article 16 of the Tax Exemption and Reduction Control Act 
(TERCL): Reserve for Export Loss
    3. Article 17 of TERCL: Reserve for Overseas Market Development
    4. Technical Development Fund Under Restriction of Special 
Taxation (RSTA) Article 9, formerly TERCL 8
    5. Asset Revaluation TERCL Article 56(2)
    6. Electricity Discounts under the Requested Loan Adjustment 
Program (RLA)
    7. POSCO's Provision of Steel Inputs for Less than Adequate 
Remuneration

[[Page 13270]]

    8. Tax Credit for Investments on Productivity Improvement 
Facilities under RSTA Article 24
    9. Inchon's Local Tax Exemption
    B. Programs Determined to Be Not Used
    1. Investment Tax Credits under RSTA Articles 10, 18, 26, 27 and 
71 of TERCL
    2. Loans from the National Agricultural Cooperation Federation
    3. Tax Incentives for Highly-Advanced Technology Businesses 
under the Foreign Investment and Foreign Capital Inducement Act
    4. Reserve for Investment under Article 43-5 of TERCL
    5. Export Insurance Rates Provided by the Korean Export 
Insurance Corporation
    6. Special Depreciation of Assets on Foreign Exchange Earnings
    7. Excessive Duty Drawback
    8. Short-Term Export Financing
    9. Export Industry Facility Loans
IV. Total AD Valorem Rate
V. Analysis of Comments
    Comment 1: Rescission of Sammi from the Final Results
    Comment 2: Sammi's name change to BNG
    Comment 3: Cross-ownership between Inchon and Sammi
    Comment 4: Debt-for-equity swap received by Kangwon
    Comment 5: Tax Subsidies received by Inchon
    Comment 6: Calculation Revision for Inchon's Long-term Loans
    Comment 7: Sammi's debt forgiveness from KAMCO
    Comment 8: Loan Benchmark Rates
    Comment 9: GOK's control of POSCO
    Comment 10: Program-wide change: POSCO's privatization
    Comment 11: POSCO's Provision of Hot-Rolled Coil (HRC) for Less 
than Adequate Remuneration
    Comment 12: POSCO's purchase of Sammi's Changwon Facility for 
More than Adequate Remuneration
    Comment 13: Adjustments to Import Prices

[FR Doc. 03-6480 Filed 3-18-03; 8:45 am]
BILLING CODE 3510-DS-P