[Federal Register Volume 68, Number 172 (Friday, September 5, 2003)]
[Notices]
[Pages 52747-52749]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-22662]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-122-846]
[C-122-848]


Final Affirmative Countervailing Duty Determinations: Certain 
Durum Wheat and Hard Red Spring Wheat from Canada

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

ACTION: Notice of Final Affirmative Countervailing Duty Determinations: 
Certain Durum Wheat and Hard Red Spring Wheat from Canada.

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SUMMARY: The Department of Commerce has made final determinations that 
countervailable subsidies are being provided to certain producers and 
exporters of certain durum wheat and hard red spring wheat from Canada. 
For information on the estimated countervailing duty rates, please see 
the ``Suspension of Liquidation'' section, below.

EFFECTIVE DATE: September 5, 2003.

FOR FURTHER INFORMATION CONTACT: Audrey Twyman, Stephen Cho, or Daniel 
Alexy, Office of Antidumping/Countervailing Duty Enforcement, Group 1, 
Import Administration, U.S. Department of Commerce, Room 3099, 14th 
Street and Constitution Avenue, NW, Washington, DC 20230; telephone 
(202) 482-3534, (202) 482-3798 and (202) 482-1540, respectively.

SUPPLEMENTARY INFORMATION:

Petitioners

    The petitioners in these investigations are the North Dakota Wheat 
Commission (hard red spring wheat), United States Durum Growers 
Association (durum wheat), and the Durum Growers Trade Action Committee 
(durum wheat) (collectively, the ``petitioners'').

Period of Investigations

    The period for which we are measuring subsidies is August 1, 2001 
to July 31, 2002, which coincides with the fiscal year of the Canadian 
Wheat

[[Page 52748]]

Board (``CWB''), the sole responding exporter. See 19 CFR Sec.  
351.204(b)(2).

Case History

    The following events have occurred since the publication of the 
preliminary determinations in the Federal Register on March 10, 2003. 
See Preliminary Affirmative Countervailing Duty Determinations and 
Alignment of Final Countervailing Duty Determinations with Final 
Antidumping Duty Determinations: Certain Durum Wheat and Hard Red 
Spring Wheat from Canada, (68 FR 11374) (``Preliminary 
Determinations'').
    On March 17, 2003, the petitioners submitted ministerial error 
allegations relating to the Preliminary Determinations. The Department 
of Commerce ('the Department'') addressed these ministerial allegations 
in the April 1, 2003, memorandum to Susan Kuhbach entitled 
``Ministerial Error Allegations for Preliminary Determination,'' which 
is on file in the Department's Central Records Unit in Room B-099 of 
the main Department building (``CRU''). The Department sent out 
supplemental questionnaires to the Government of Canada (``GOC'') and 
the CWB on March 18, 2003 and received responses to these supplemental 
questionnaires between March 27 and April 14, 2003. On May 5, 2003, the 
Department issued a memorandum entitled ``Preliminary Determination for 
the Initial Payment Guarantee Program'' in which the Department 
preliminarily determined that the GOC's guarantee of the CWB's initial 
payment to producers does not confer a measurable subsidy on hard red 
spring or durum wheat. See May 5, 2003, memorandum to Acting Assistant 
Secretary Joseph A. Spetrini from Deputy Assistant Secretary Jeffrey 
May which is on file in the CRU. The Department's Preliminary 
Determinations had not addressed this new subsidy allegation raised by 
the petitioners.
    On May 16, 2003, the CWB requested an extension of the final 
determinations for the dumping and countervailing duty investigations, 
therefore the Department published a Notice of Postponement of Final 
Antidumping Determinations and Extension of Provisional Measures and 
Postponement of Final Countervailing Duty Determinations: Certain Durum 
Wheat and Hard Red Spring Wheat from Canada, (68 FR 35381) on June 13, 
2003.
    The Department conducted verifications of the questionnaire 
responses submitted by the GOC, the provincial governments (e.g., the 
Government of Alberta (``GOA'') and the Government of Saskatchewan 
(``GOS'')), and the CWB from May 5 through May 14, 2003 in Canada. We 
received case briefs from the GOC, GOA, GOS, CWB and the petitioners 
between June 20 to 23, 2003. These same parties submitted rebuttal 
briefs between June 27 to June 30, 2003. We held a hearing in these 
investigations on July 8, 2003.

Scope of Investigations

    For purposes of these investigations, the products covered are (1) 
durum wheat and (2) hard red spring wheat.

1. Durum Wheat

    Imports covered by this investigation are all varieties of durum 
wheat from Canada. This includes, but is not limited to, a variety 
commonly referred to as Canada Western Amber Durum. The merchandise 
subject to this investigation is currently classifiable under the 
following Harmonized Tariff Schedule of the United States (``HTSUS'') 
subheadings: 1001.10.00.10, 1001.10.00.91, 1001.10.00.92, 
1001.10.00.95, 1001.10.00.96, and 1001.10.00.99. Although the HTSUS 
subheadings are provided for convenience and customs purposes, our 
written description of the scope of this proceeding is dispositive.

2. Hard Red Spring Wheat

    Imports covered by this investigation are all varieties of hard red 
spring wheat from Canada. This includes, but is not limited to, 
varieties commonly referred to as Canada Western Red Spring, Canada 
Western Extra Strong, and Canada Prairie Spring Red. The merchandise 
subject to this investigation is currently classifiable under the 
following HTSUS subheadings: 1001.90.10.00, 1001.90.20.05, 
1001.90.20.11, 1001.90.20.12, 1001.90.20.13, 1001.90.20.14, 
1001.90.20.16, 1001.90.20.19, 1001.90.20.21, 1001.90.20.22, 
1001.90.20.23, 1001.90.20.24, 1001.90.20.26, 1001.90.20.29, 
1001.90.20.35, and 1001.90.20.96. This investigation does not cover 
imports of wheat that enter under the subheadings 1001.90.10.00 and 
1001.90.20.96 that are not classifiable as hard red spring wheat. 
Although the HTSUS subheadings are provided for convenience and customs 
purposes, our written description of the scope of this proceeding is 
dispositive.

Scope Comments

    Since the Department's Preliminary Determinations, we have received 
several requests for exclusions from and clarifications of the scope of 
these investigations. On April 24, 2003, Montana Flour & Grains and 
Kamut International requested that the Department exclude Khorasan 
wheat from the scope of these investigations. The GOC made the same 
request on July 31, 2003. On June 27, 2003, the Organic Trade 
Association requested that the Department exclude organically produced 
wheat from the scope of these investigations. On July 29, 2003, 
Cargill, Incorporated (``Cargill'') requested that the Department 
clarify the scope of these investigations and specifically exclude from 
the scope Canadian Eastern Soft Red Winter Wheat and Canadian Eastern 
Hard Red Winter Wheat. On July 30, 2003, the petitioners submitted 
comments on all but the Cargill submission, and also raised an 
additional issue concerning Canadian feed wheat. We have considered 
these requests and the comments from interested parties. We have 
determined that organically grown wheat is covered by the scope of 
these investigations and that the scope of the hard red spring 
investigation should be clarified by adding the following language to 
the scope: ``This investigation does not cover imports of wheat that 
enter under the subheadings 1001.90.10.00 and 1001.90.20.96 that are 
not classifiable as hard red spring wheat.'' For a complete discussion 
of these scope issues, see the August 28, 2003, Scope Exclusion and 
Clarification Requests: Khorasan Wheat, Organic Wheat, Canadian Eastern 
Soft Red Winter Wheat, Canadian Eastern Hard Red Winter Wheat, and 
Canadian Feed Wheat memorandum, 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 Tariff Act of 1930, as amended (``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 
November 25, 2002, the ITC transmitted to the Department its 
preliminary determinations finding that there is a reasonable 
indication that an industry in the United States is being materially 
injured by reason of imports from Canada of durum and hard red spring 
wheat. See Durum and Hard Red Spring Wheat from Canada, 67 FR 71589 
(December 2, 2002).

Analysis of Comments Received

    All issues raised in the case and rebuttal briefs by parties to 
these investigations are addressed in the ``Issues and Decision 
Memorandum for the Final Countervailing Duty

[[Page 52749]]

Determinations of the Investigations of Certain Durum Wheat and Hard 
Red Spring Wheat from Canada'' from Jeffrey May, Deputy Assistant 
Secretary, Import Administration, to James J. Jochum, Assistant 
Secretary for Import Administration, dated August 28, 2003, (``Decision 
Memorandum''), which is hereby adopted by this notice. Attached to this 
notice as an Appendix 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 these investigations 
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://www.ia.ita.doc.gov/frn/summary/list.htm under the heading ``Canada.'' 
The paper copy and electronic version of the Decision Memorandum are 
identical in content.

Suspension of Liquidation

    In accordance with section 705(c)(1)(B)(i) of the Act, we have 
calculated an individual net subsidy rate for each manufacturer of the 
subject merchandise. In accordance with sections 777A(e)(2)(B) and 
705(c)(5)(A) of the Act, we have set the ``all others'' rate as CWB's 
rate, because it is the only exporter/manufacturer investigated. We 
determine the total estimated net subsidy rate for the CWB and ``all 
others'' to be:

----------------------------------------------------------------------------------------------------------------
                                                                 Net Subsidy Rate (Hard  Net Subsidy Rate (Durum
                     Exporter/Manufacturer                         Red Spring Wheat)              Wheat)
----------------------------------------------------------------------------------------------------------------
Canadian Wheat Board..........................................             5.29 percent             5.29 percent
All Others....................................................             5.29 percent             5.29 percent
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    As a result of our Preliminary Determinations and pursuant to 
section 705(c)(1)(B)(ii) of the Act, we instructed the U.S. Bureau of 
Customs and Border Protection (``BCBP'') to suspend liquidation of all 
entries of durum wheat and hard red spring wheat from Canada which were 
entered or withdrawn from warehouse, for consumption on or after March 
10, 2003, the date of the publication of the Preliminary Determinations 
in the Federal Register. In accordance with section 703(d) of the Act, 
we instructed the BCBP to discontinue the suspension of liquidation for 
subject merchandise for countervailing duty purposes entered on or 
after July 8, 2003, but to continue the suspension of liquidation of 
entries made from March 10, 2003, through July 7, 2003.
    We will issue countervailing duty orders and reinstate the 
suspension of liquidation under section 706(a) of the Act if ITC issues 
final affirmative injury determinations, and will 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, these 
proceedings 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 have notified the 
ITC of our determinations. In addition, we are making available to the 
ITC all non-privileged and non-proprietary information related to these 
investigations. 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 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.
    These determinations are published pursuant to sections 703(f) and 
777(i) of the Act.

    Dated: August 28, 2003.
James J. Jochum,
Assistant Secretary for Import Administration.

APPENDIX

List of Comments and Issues in the Decision Memorandum

Comment 1: The Department Should Treat the Government-Leased Railcars 
Differently from the Government-Owned Railcars.
Comment 2: The Provision of Government-Owned and Leased Railcars is 
Tied to Non-U.S. Markets.
Comment 3: The Provision of Rail Cars Does Not Result in an Indirect 
Subsidy to the CWB.
Comment 4: Countervailablility of Subsidies Given to Third Party 
Service Providers.
Comment 5: The Governments' Entrustment or Direction of the Railways to 
Provide Rail Service.
Comment 6: The Provision of Government-Owned and Leased Railcar Confers 
No Benefit.
Comment 7: Measurement of Benefit from the Government-Provided 
Railcars.
Comment 8: The Revenue Cap Does Confer a Benefit.
Comment 9: The Rail Freight Revenue Cap Does Not Provide a Financial 
Contribution.
Comment 10: The Department Should Determine That the Revenue Cap Does 
Not Provide a Financial Contribution Because It is Consistent With 
Market Principles.
Comment 11: The Benefit of the Revenue Cap Extends to All CWB 
Shipments, Including Shipments to the United States.
Comment 12: The Closure Fee for Grain Dependent Branch Lines Confers a 
Financial Contribution.
Comment 13: Impact of the Lending and Initial Payment Guarantees on the 
CWB's Cost of Borrowing.
Comment 14: The Benchmark.
Comment 15: The Borrowing Guarantee is Tied to Non-U.S. Markets.
Comment 16: The Department's Analysis of the Initial Payment Guarantee 
is Based on Incomplete and Inaccurate Data.
[FR Doc. 03-22662 Filed 9-4-03; 8:45 am]
BILLING CODE 3510-DS-S