[Federal Register Volume 82, Number 124 (Thursday, June 29, 2017)]
[Notices]
[Pages 29479-29481]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-13628]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-533-872]


Finished Carbon Steel Flanges From India: Final Affirmative 
Countervailing Duty Determination

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.

SUMMARY: The Department of Commerce (Department) determines that 
countervailable subsidies are being provided to producers and exporters 
of finished carbon steel flanges (flanges) from India. The period of 
investigation is April 1, 2015, through March 31, 2016.

DATES: Effective June 29, 2017.

FOR FURTHER INFORMATION CONTACT: Emily Maloof or Davina Friedmann, AD/
CVD Operations, Office VI, Enforcement and Compliance, International 
Trade Administration, U.S. Department of Commerce, 1401 Constitution 
Avenue NW., Washington, DC 20230; telephone: (202) 482-5649, or (202) 
482-0698, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On November 29, 2016, the Department published the Preliminary 
Determination in the Federal Register.\1\
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    \1\ See Finished Carbon Steel Flanges from India: Preliminary 
Affirmative Countervailing Duty Determination, 81 FR 85928 (November 
29, 2016) (Preliminary Determination) and accompanying Preliminary 
Decision Memorandum (PDM).
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    A summary of the events that occurred since the Department 
published the Preliminary Determination, as well as a full discussion 
of the issues raised by parties for this final determination, may be 
found in the accompanying Issues and Decision Memorandum.\2\ The Issues 
and Decision Memorandum is a public document, and is on file 
electronically via Enforcement and Compliance's Antidumping and 
Countervailing Duty Centralized Electronic Service System (ACCESS). 
ACCESS is available to registered users at http://access.trade.gov, and 
is available to all parties in the Central Records Unit, room B8024 of 
the main Department of Commerce building. In addition, a complete 
version of the Issues and Decision Memorandum can be accessed directly 
at http://enforcement.trade.gov. The signed and electronic versions of 
the Issues and Decision Memorandum are identical in content.
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    \2\ See Memorandum from Gary Taverman, Deputy Assistant 
Secretary for Antidumping and Countervailing Duty Operations, to 
Ronald K. Lorentzen, Acting Assistant Secretary for Enforcement and 
Compliance ``Decision Memorandum for the Preliminary Affirmative 
Determination: Countervailing Duty Investigation of Finished Carbon 
Steel Flanges from India,'' dated concurrently with this 
determination and hereby adopted by this notice (Issues and Decision 
Memorandum).
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Scope Comments

    In accordance with the Preliminary Determination, the Department 
set aside a period of time for parties to address scope issues in case 
briefs or other written comments on scope issues.\3\ In the Preliminary 
Determination, we did not modify the scope language as it appeared in 
the Initiation Notice.\4\ No interested party submitted scope comments 
in case or rebuttal briefs. However, the scope description that was 
published in the Initiation Notice and in the Preliminary Determination 
contained typographical errors, which have been corrected in the scope 
description provided in Appendix I of this notice.\5\ Other than the 
correction of typographical errors, the scope of this investigation 
remains unchanged for this final determination.
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    \3\ See Preliminary Determination and PDM at ``Scope Comments.''
    \4\ Id.; see also, Finished Carbon Steel Flanges from India: 
Initiation of Countervailing Duty Investigation, 81 FR 49625 (July 
28, 2016) (Initiation Notice).
    \5\ Specifically, the Department incorrectly referenced the ASME 
specifications as ``ASME 816.5 or ASME 816.47 series A or series 
B.'' The corrected scope description properly references these 
specifications at ``ASME B16.5 or ASME B16.47 series A or series 
B.''
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Scope of the Investigation

    The products covered by this investigation are finished carbon 
steel flanges from India. For a complete description of the scope of 
the investigation, see ``Scope of the Investigation,'' in Appendix I of 
this notice.

Analysis of Subsidy Programs and Comments Received

    The subsidy programs under investigation, and the issues raised in 
the case and rebuttal briefs submitted by the parties, are discussed in 
the Issues and Decision Memorandum. A list of the issues that parties 
raised, and to which we responded in the Issues and Decision 
Memorandum, is attached to this notice at Appendix II.

Verification

    The Department conducted verification of the questionnaire 
responses submitted by the Government of India, USK Group, and RNG 
between January 30, and February 10, 2017.\6\
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    \6\ See Memoranda, ``Verification Report of Norma (India) Ltd., 
Uma Shanker Khandelwal & Co., USK Exports Private Limited, and 
Bansidhar Chiranjilal,'' dated March 29, 2017 (USK Group 
Verification Report); ``Verification Report of R.N. Gupta & Co., 
Ltd.,'' dated March 29, 2017 (RNG Verification Report); and 
``Verification Report of the Government of India,'' dated March 29, 
2017 (Government of India Verification Report).
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Use of Adverse Facts Available

    If necessary information is not available on the record, or an 
interested party withholds information, fails to provide requested 
information in a timely manner, significantly impedes a proceeding by 
not providing information, or information provided cannot be verified, 
the Department will apply facts available, pursuant to section 
776(a)(1) & (2) of the Tariff Act of 1930, as amended (the Act). For 
purposes of this final determination, the Department relied, in part, 
on facts available. For USK Group Ltd. (Norma) \7\ and R.N. Gupta & Co. 
(RNG), we are basing certain countervailing duty rates on facts 
otherwise available. Further, because USK Group and RNG did not act to 
the best of their ability in this investigation by not providing 
necessary

[[Page 29480]]

information requested by the Department, we determine that an adverse 
inference in selecting from the facts available is warranted with 
respect to certain countervailable subsidy programs, pursuant to 
section 776(b) of the Act. The Department has, therefore, relied, in 
part, on adverse facts available (AFA) in calculating the subsidy rates 
for both mandatory respondents.
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    \7\ Norma (India) Limited includes its cross-owned affiliates 
USK Exports Private Limited (USK), UMA Shanker Khandelwal & Co. 
(UMA), and Bansidhar Chiranjilal (BDCL) (collectively, USK Group). 
For further discussion, see the accompanying Issues and Decision 
Memorandum.
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    Regarding USK Group, we determine that application of AFA is 
warranted with regard to one lending program for importing capital 
equipment.\8\ Concerning RNG, we determine that the application of AFA 
is warranted with regard to two programs, i.e., capital equipment 
purchases and export financing. Because the Government of India did not 
provide the requested information, as AFA, we find that each of the 
programs meet the financial contribution and specificity criteria 
outlined under sections 771(5)(D) and 771(5A) of the Act, 
respectively.\9\ As AFA, we also find that these subsidy programs 
confer a benefit under section 771(5)(E) of the Act and 19 CFR 351.519.
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    \8\ For further discussion, see USK Group's Final Calculation 
Memorandum.
    \9\ See, e.g., Supercalendered Paper from Canada: Final 
Affirmative Countervailing Duty Determination, 80 FR 63535 (October 
20, 2015), and accompanying IDM at 17-20, 153-154.
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    For further information on the Department's application of AFA, as 
summarized above, see the section titled, ``Use of Facts Otherwise 
Available and Adverse Inferences,'' in the Issues and Decision 
Memorandum.

Changes Since the Preliminary Determination

    Based on our analysis of the comments received from parties and the 
minor corrections presented, as well as additional items discovered at 
verification, we made certain changes to the respondent's subsidy rate 
calculations set forth in the Preliminary Determination. For a 
discussion of these changes, see the Issues and Decision Memorandum and 
the Final Calculation Memoranda.\10\
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    \10\ See Issues and Decision Memorandum; see also Memorandum, 
``Final Determination Calculations for Norma (India) Ltd.,'' dated 
June 23, 2017 (Norma's Final Calculation Memorandum); see also 
Memorandum, ``Final Determination Calculation Memorandum of RNG,'' 
dated June 23, 2017 (RNG's Final Calculation Memorandum).
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Final Determination

    In accordance with section 705(c)(1)(B)(i) of the Act, we 
calculated a rate for each exporter/producer of the subject merchandise 
individually investigated, i.e., Norma (India), Ltd. and R.N. Gupta & 
Co. In accordance with section 705(c)(5)(A) of the Act, for companies 
not individually investigated, we apply an ``all-others'' rate, which 
is normally calculated by weighting the subsidy rates of the individual 
companies selected as mandatory respondents by those companies' exports 
of the subject merchandise to the United States. Under section 
705(c)(5)(A)(i) of the Act, the ``all-others'' rate excludes zero and 
de minimis rates calculated for the exporters and producers 
individually investigated as well as rates based entirely on facts 
otherwise available. Where the rates for the individually investigated 
companies are all zero or de minimis, or determined entirely using 
facts otherwise available, section 705(c)(5)(A)(ii) of the Act 
instructs the Department to establish an ``all-others'' rate using 
``any reasonable method.'' Where the countervailable subsidy rates for 
all of the individually investigated respondents are zero or de minimis 
or are based on total AFA, the Department's practice, pursuant to 
705(c)(5)(A)(ii), is to calculate the all others rate based on a simple 
average of the zero or de minimis margins and the margins based on 
total AFA.
    Pursuant to section 705(c)(5)(A)(i) of the Act, we have calculated 
the ``all-others'' rate using the subsidy rates of the two individually 
investigated respondents. However, we have not calculated the ``all-
others'' rate by weight-averaging the rates because doing so risks 
disclosure of proprietary information. Therefore, consistent with the 
Department's practice,\11\ for the ``all others'' rate, we calculated a 
simple average of the two mandatory respondents' subsidy rates.
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    \11\ See e.g., Countervailing Duty Investigations of Certain 
Amorphous Silica Fabric from the People's Republic of China: Final 
Affirmative Determination, 82 FR 8405 (January 25, 2016).
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    The final subsidy rates are as follows:
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    \12\ As discussed in the Preliminary Determination, the 
Department found the following companies to be cross-owned with 
Norma (India), Ltd.: Uma Shanker Khandelwal & Co. (UMA), USK Exports 
Private Limited (USK), and Bansidhar Chiranjilal (BDCL).

------------------------------------------------------------------------
                                                           Subsidy rate
                    Exporter/producer                        (percent)
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Norma (India), Ltd \12\.................................            5.66
R.N. Gupta & Co.........................................            9.11
All-Others..............................................            7.39
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Disclosure

    We will disclose the calculations performed within five days of the 
date of publication of this notice to parties in this proceeding in 
accordance with 19 CFR 351.224(b).

Continuation of Suspension of Liquidation

    As a result of our Preliminary Determination, and pursuant to 
section 703(d) of the Act, we instructed U.S. Customs and Border 
Protection (CBP) to suspend liquidation of any entries of merchandise 
under consideration from India that were entered or withdrawn from 
warehouse, for consumption, on or after November 29, 2016, which is the 
publication date in the Federal Register of the Preliminary 
Determination. Therefore, in accordance with section 703(d) of the Act, 
we issued instructions to CBP to suspend liquidation of all entries of 
steel flanges from India that are entered, or withdrawn from warehouse, 
for consumption, on or after November 29, 2017 through March 28, 2017. 
Additionally, we instructed CBP to discontinue the suspension of 
liquidation for countervailing duty purposes for subject merchandise 
entered, or withdrawn from warehouse, on or after March 29, 2017 in 
accordance with section 703(d)(3) of the Act.
    If the U.S. International Trade Commission (ITC) issues a final 
affirmative injury determination, we will issue a countervailing duty 
order, instruct CBP to reinstate suspension of liquidation under 
section 706(a) of the Act, and will require a cash deposit of estimated 
countervailing duties for such entries of subject merchandise in the 
amounts indicated above. If the ITC determines that material injury, or 
threat of material injury, does not exist, this proceeding will be 
terminated and all estimated duties deposited as a result of the 
suspension of liquidation will be refunded or canceled.

U.S. International Trade Commission Notification

    In accordance with section 705(d) of the Act, we will notify the 
U.S. International Trade Commission (ITC) of our determination. In 
addition, we are making available to the ITC all non-privileged and 
non-proprietary information related to this investigation. 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 Acting 
Assistant Secretary for Enforcement and Compliance.

Notification Regarding Administrative Protective Orders

    This notice serves as a reminder to parties subject to an 
administrative

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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 
the return or 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.

Notification to Interested Parties

    This determination is issued and published pursuant to sections 
705(d) and 777(i)(1) of the Act and 19 CFR 351.210.

    Dated: June 23, 2017
Ronald K. Lorentzen,
Acting Assistant Secretary for Enforcement and Compliance .

Appendix I

Scope of the Investigation

    The scope of this investigation covers finished carbon steel 
flanges. Finished carbon steel flanges differ from unfinished carbon 
steel flanges (also known as carbon steel flange forgings) in that 
they have undergone further processing after forging, including, but 
not limited to, beveling, bore threading, center or step boring, 
face machining, taper boring, machining ends or surfaces, drilling 
bolt holes, and/or deburring or shot blasting. Any one of these 
post-forging processes suffices to render the forging into a 
finished carbon steel flange for purposes of this investigation. 
However, mere heat treatment of a carbon steel flange forging 
(without any other further processing after forging) does not render 
the forging into a finished carbon steel flange for purposes of this 
investigation.
    While these finished carbon steel flanges are generally 
manufactured to specification ASME B16.5 or ASME B16.47 series A or 
series B, the scope is not limited to flanges produced under those 
specifications. All types of finished carbon steel flanges are 
included in the scope regardless of pipe size (which may or may not 
be expressed in inches of nominal pipe size), pressure class 
(usually, but not necessarily, expressed in pounds of pressure, 
e.g., 150, 300, 400, 600, 900, 1500, 2500, etc.), type of face 
(e.g., flat face, full face, raised face, etc.), configuration 
(e.g., weld neck, slip on, socket weld, lap joint, threaded, etc.), 
wall thickness (usually, but not necessarily, expressed in inches), 
normalization, or whether or not heat treated. These carbon steel 
flanges either meet or exceed the requirements of the ASTM A105, 
ASTM A694, ASTM A181, ASTM A350 and ASTM A707 standards (or 
comparable foreign specifications). The scope includes any flanges 
produced to the above-referenced ASTM standards as currently stated 
or as may be amended. The term ``carbon steel'' under this scope is 
steel in which: (a) Iron predominates, by weight, over each of the 
other contained elements: (b) The carbon content is 2 percent or 
less, by weight; and (c) none of the elements listed below exceeds 
the quantity, by weight, as indicated:
    (i) 0.87 percent of aluminum;
    (ii) 0.0105 percent of boron;
    (iii) 10.10 percent of chromium;
    (iv) 1.55 percent of columbium;
    (v) 3.10 percent of copper;
    (vi) 0.38 percent of lead;
    (vii) 3.04 percent of manganese;
    (viii) 2.05 percent of molybdenum;
    (ix) 20.15 percent of nickel;
    (x) 1.55 percent of niobium;
    (xi) 0.20 percent of nitrogen;
    (xii) 0.21 percent of phosphorus;
    (xiii) 3.10 percent of silicon;
    (xiv) 0.21 percent of sulfur;
    (xv) 1.05 percent of titanium;
    (xvi) 4.06 percent of tungsten;
    (xvii) 0.53 percent of vanadium; or
    (xviii) 0.015 percent of zirconium.
    Finished carbon steel flanges are currently classified under 
subheadings 7307.91.5010 and 7307.91.5050 of the Harmonized Tariff 
Schedule of the United States (HTSUS). They may also be entered 
under HTSUS subheadings 7307.91.5030 and 7307.91.5070. The HTSUS 
subheadings are provided for convenience and customs purposes; the 
written description of the scope is dispositive.

Appendix II

List of Topics Discussed in the Issues and Decision Memorandum

I. Summary
II. Background
III. Period of Investigation
IV. Scope Comments
V. Scope of the Investigation
VI. Subsidies Valuation Information
VII. Benchmarks and Interest Rates
VIII. Use of Facts Otherwise Available and Adverse Inferences
IX. Analysis of Programs
    A. Programs Determined to be Countervailable
    B. Programs Determined to be Not Used
X. Discussion of the Issues
    Comment 1: Whether the Department Should Have Rejected the 
Government of India's Supplemental Questionnaire Response
    Comment 2: Whether the Duty Drawback (DDB) Program Provides a 
Countervailable Subsidy
    Comment 3: Whether R.N. Gupta & Co., Ltd. (RNG) and USK Group 
Should Report Duty Export Pass Book (DEPB) Licenses During the 
Average Useful Life (AUL) Period Prior to the Period of 
Investigation (POI)
    Comment 4: Whether USK Group and RNG Received Benefits from 
Certain Government of India Majority-Owned Banks
    Comment 5: Whether the Export Promotion of Capital Goods Scheme 
(EPCGS) Provides a Countervailable Subsidy and Whether the EPCGS 
Used the Correct Denominator for the Benefit Calculation of 
Respondents
    Comment 6: Whether to Apply Adverse Facts Available (AFA) to 
Norma's AUL Sales Data
    Comment 7: Whether to Apply AFA to RNG's Unaffiliated Indian 
Suppliers of Subject Merchandise
    Comment 8: Whether to Countervail Funds Received by RNG Under 
the Focus Product Scheme (FPS) During the POI
XI. Recommendation

[FR Doc. 2017-13628 Filed 6-28-17; 8:45 am]
 BILLING CODE 3510-DS-P