[Federal Register Volume 69, Number 242 (Friday, December 17, 2004)]
[Notices]
[Pages 75513-75515]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E4-3711]


-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

International Trade Administration

[C-580-835]


Stainless Steel Sheet and Strip in Coils from the Republic of 
Korea: Final Results of Expedited Sunset Review of Countervailing Duty 
Order

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: The Department of Commerce (``the Department'') initiated a 
sunset review of the countervailing duty (``CVD'') order on stainless 
steel sheet and strip in coils from the Republic of Korea (``Korea''). 
See Initiation of Five-Year (``Sunset'') Reviews, 69 FR 30874 (June 1, 
2004). On the basis of a notice of intent to participate, an adequate 
substantive response filed on behalf of domestic interested parties, 
and inadequate substantive responses filed by respondent interested 
parties, the Department conducted an expedited sunset review. In 
conducting this sunset review, the Department finds that revocation of 
the CVD order is likely to lead to continuation or recurrence of a 
countervailable subsidy. The net countervailable subsidy is identified 
in the ``Final Results of Review'' section of this notice

EFFECTIVE DATE: December 17, 2004.

FOR FURTHER INFORMATION CONTACT: Martha V. Douthit, Office of Policy, 
Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue, NW., 
Washington, DC 20230; telephone: (202) 482-5050.

SUPPLEMENTARY INFORMATION:

Scope of the Order

    The merchandise subject to this order is 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 (i.e., cold-rolled, polished, 
aluminized, coated, etc.) provided that it maintains the specific 
dimensions of sheet and strip following such processing.
    The subject merchandise is currently classifiable in the Harmonized 
Tariff Schedule of the United States (``HTS'') at subheadings: 
7219.13.00.31, 7219.13.00.51, 7219.13.00.71, 7219.13.00.81, 
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, 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.\1\
---------------------------------------------------------------------------

    \1\ See Chapter 72 of the HTSUS, ``Additional U.S. Note'' 1(d).
---------------------------------------------------------------------------

    In response to comments by interested parties, 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 sulfide 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 for 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

[[Page 75514]]

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.''\2\
---------------------------------------------------------------------------

    \2\ ``Arnokrome III'' is a trademark of the Arnold Engineering 
Company.
---------------------------------------------------------------------------

    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.''\3\
---------------------------------------------------------------------------

    \3\''``Gilphy 36'' is a trademark of Imphy, S.A.
---------------------------------------------------------------------------

    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.''\4\
---------------------------------------------------------------------------

    \4\``Durphynox 17'' is a trademark of Imphy, S.A.
---------------------------------------------------------------------------

    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 (i.e., 
carpet knives).\5\ 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. 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 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.''\6\
---------------------------------------------------------------------------

    \5\ This list of uses is illustrative and provided for 
descriptive purposes only.
    \6\ ``GIN4 Mo'', ``GIN5'' and ``GIN6'' are the proprietary 
grades of Hitachi Metals America, Ltd.
---------------------------------------------------------------------------

Background

    On June 1, 2004, the Department initiated a sunset review of the 
CVD order on SSSS from Korea pursuant to section 751(c) of the Tariff 
Act of 1930, as amended (``the Act''). See Initiation of Five-Year 
(``Sunset'') Reviews, 69 FR 30874 (June 1, 2004). The Department 
received a ``Notice of Intent to Participate'' from the domestic 
interested parties Allegheny Ludlum Corporation, Nucor Corporation, 
United Steelworkers of America (AFL-CIO/CLC), Local 3303 United Auto 
Workers (formerly the Butler Armco Independent Union, and the 
Zanesville Armco Independent Organization, Inc., (collectively ``the 
domestic interested parties'') within the deadline specified in section 
351.218(d)(1)(I) of the Department's regulations (``Sunset 
Regulations''). The domestic interested parties claimed interested 
party status under sections 771(9)(C) and (D) of the Act. We received a 
complete substantive responses from the domestic interested parties 
within the 30-day deadline specified in 19 CFR 351.218(d)(3)(i). In 
addition, we received a complete substantive response from INI Steel 
Company (``INI''), formerly Inchon Iron and Steel Company, Ltd., and 
BNG Steel Company (``BNG''), formerly Sammi Steel Co., Ltd. (``Sammi'') 
(collectively, ``respondent interested parties''), within the 30-day 
deadline specified in 19 CFR 351.218(d)(3)(i).
    On July 21, 2004, the Department determined that respondent 
interested parties response constituted an inadequate response to the 
notice of initiation.\7\ See Memorandum for Ronald K. Lorentzen, Re: 
Stainless Steel Sheet and Strip from South Korea, Adequacy of 
Respondent Interested Parties' Response to the Notice of Initiation ( 
July 21, 2004). The Department notified the ITC of inadequate 
respondent responses to the notice of initiation, and conducted an 
expedited sunset review of this antidumping duty order. See Letter to 
ITC, Inadequate Respondent Response, July 21, 2004, pursuant to 
sections 751(c)(3)(B) of the Act and 19 CFR 351.218(e)(1)(ii)(c)(2).
    The final results of this sunset review was originally scheduled 
for September 29, 2004; however, the Department extended the final 
results until November 15, 2004. See Notice of Extension of Time Limit 
for the Final Results of Sunset Reviews of Antidumping and 
Countervailing Duty Orders: Stainless Steel Sheet and Strip

[[Page 75515]]

in Coils from Germany, Italy, Japan, Korea, Taiwan and the United 
Kingdom.
---------------------------------------------------------------------------

    \7\ A complete substantive response was submitted to the 
Department on behalf of respondents INI Steel Company and BNG Steel 
Company, however, in accordance with section 351.218(d)(3)(v) of the 
Department's regulations, information is required to be filed by the 
foreign government in a CVD sunset review. In this CVD proceeding 
the Government of Korea did not respond to the Department's notice 
of initiation. Pursuant to section 351.218(e)(1)(ii)(C) of the 
Department's regulations, the Department conducted an expedited 
sunset review under section 751(c)(3)(B) of the Act.
---------------------------------------------------------------------------

Analysis of Comments Received

    All issues raised in this case are addressed in the ``Issues and 
Decision Memorandum'' (``Decision Memo'') from Ronald K. Lorentzen, 
Acting Director, Office of Policy, Import Administration, to James J. 
Jochum, Assistant Secretary for Import Administration, dated December 
10, 2004, which is hereby adopted by this notice. The issues discussed 
in the Decision Memo include the likelihood of continuation or 
recurrence of dumping and the magnitude of the margin likely to prevail 
if the order were to be revoked. 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 Memo can be 
accessed directly on the Web at http://ia.ita.doc.gov/frn, under the 
heading ``December 2004.'' The paper copy and electronic version of the 
Decision Memo are identical in content.

Final Results of Review

    The Department determines that revocation of the CVD order on SSSS 
from Korea is likely to lead to continuation or recurrence of 
countervailable subsidies at the following net subsidy rates:

------------------------------------------------------------------------
                                                       Net Subsidy Rate
          Manufacturers/Producers/Exporters                (percent)
------------------------------------------------------------------------
INI/BNG.............................................                0.54
Dai Yang Metal Company..............................                0.67
Taihan..............................................                4.64
All Others..........................................                0.63
------------------------------------------------------------------------

Nature of the Subsidy

    Consistent with section 752(a)(6) of the Act, the Department will 
provide to the ITC information concerning the nature of the subsidy, 
and whether the subsidy is a subsidy described in Article 3 or Article 
6.1 of the Subsidies Agreement. Because some programs not falling 
within the definition of an export subsidy under Article 3.1(a) of the 
Subsidies Agreement could be found to be inconsistent with Article 6 if 
the net countervailable subsidy exceeds five percent (as measured in 
accordance with Annex IV of the Subsidies Agreement), we are providing 
the ITC with program descriptions in our Decision Memo. We note that as 
of January 1, 2000, Article 6.1 has ceased to apply (see Article 31 of 
the Subsidies Agreement).
    This notice also serves as the only reminder to parties subject to 
administrative protective orders (``APO'') of their responsibility 
concerning the return of destruction of proprietary information 
disclosed under APO in accordance with 19 CFR 351.305. Timely 
notification of the return or destruction of APO materials or 
conversion to jusicial protective order is hereby requested. Failure to 
comply with the regulations and terms of an APO is a violation which is 
subject to sanction.
    This five-year (``sunset'') review and notice are in accordance 
with sections 751(c), 752, and 777(i)(1) of the Act.

    Dated: December 10, 2004.
James J. Jochum,
Assistant Secretary for Import Administration.
[FR Doc. E4-3711 Filed 12-16-04; 8:45 am]
Billing Code 3510-DS-S