[Federal Register Volume 84, Number 39 (Wednesday, February 27, 2019)]
[Notices]
[Pages 6369-6372]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-03318]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
International Trade Administration
[C-580-898]
Large Diameter Welded Pipe From the Republic of Korea: Final
Affirmative Countervailing Duty Determination
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (Commerce) determines that
countervailable subsidies are being provided to producers and exporters
of large diameter welded pipe (welded pipe) from the Republic of Korea
(Korea). For information on the estimated subsidy rates, see the
``Final Determination'' section of this notice.
DATES: Applicable February 27, 2019.
FOR FURTHER INFORMATION CONTACT: George Ayache or Robert Palmer, AD/CVD
Operations, Office VIII, Enforcement and Compliance, International
Trade Administration, U.S. Department of Commerce, 1401 Constitution
Avenue NW, Washington, DC 20230; telephone: (202) 482-2623 or (202)
482-9068, respectively.
SUPPLEMENTARY INFORMATION:
Background
The petitioners in this investigation are American Cast Iron Pipe
Company, Berg Steel Pipe Corp./Berg Spiral Pipe Corp, Dura-Bond
Industries, Skyline Steel, Stupp Corporation, Greens Bayou Pipe Mill,
LP, JSW Steel (USA) Inc., and Trinity Products LLC (collectively, the
petitioners). In addition to the Government of Korea (GOK), the
mandatory respondents in this investigation are Husteel Co., Ltd.
(Husteel), Hyundai Steel Company (Hyundai Steel), and SeAH Steel
Corporation (SeAH Steel).
The events that occurred since Commerce published the Preliminary
Determination \1\ on June 29, 2018, are
[[Page 6370]]
discussed in the Issues and Decision Memorandum, which is hereby
adopted by this notice.\2\ The Issues and Decision Memorandum also
details the changes we made since the Preliminary Determination to the
subsidy rates calculated for the mandatory respondents and all other
producers/exporters. 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/frn/index.html. The signed and electronic versions of the Issues and
Decision Memorandum are identical in content.
---------------------------------------------------------------------------
\1\ See Large Diameter Welded Pipe from India: Preliminary
Affirmative Countervailing Duty Determination and Alignment of Final
Determination with Final Antidumping Duty Determination, 83 FR 30690
(June 29, 2018) (Preliminary Determination), and accompanying
Preliminary Decision Memorandum.
\2\ See Memorandum, ``Large Diameter Welded Pipe from Korea:
Issues and Decision Memorandum for the Final Affirmative
Determination of the Countervailing Duty Investigation,'' dated
concurrently with this determination (Issues and Decision
Memorandum).
---------------------------------------------------------------------------
Commerce exercised its discretion to toll all deadlines affected by
the partial federal government closure from December 22, 2018, through
the resumption of operations on January 29, 2019.\3\ If the new
deadline falls on a non-business day, in accordance with Commerce's
practice, the deadline will become the next business day. The revised
deadline for the final determination of this investigation is now
February 19, 2019.
---------------------------------------------------------------------------
\3\ See Memorandum to the Record from Gary Taverman, Deputy
Assistant Secretary for Antidumping and Countervailing Duty
Operations, performing the non-exclusive functions and duties of the
Assistant Secretary for Enforcement and Compliance, ``Deadlines
Affected by the Partial Shutdown of the Federal Government,'' dated
January 28, 2019. All deadlines in this segment of the proceeding
have been extended by 40 days.
---------------------------------------------------------------------------
Period of Investigation
The period of investigation is January 1, 2017, through December
31, 2017.
Scope of the Investigation
The product covered by this investigation is welded pipe from
Korea. For a full description of the scope of this investigation, see
the ``Scope of the Investigation'' in Appendix I of this notice.
Scope Comments
During the course of this investigation and the concurrent less-
than-fair-value investigations of large diameter welded pipe from
Canada, Greece, Korea, the People's Republic of China (China) and
Turkey, and the concurrent countervailing duty (CVD) investigations of
large diameter welded pipe from China, India, Korea and Turkey,
Commerce received scope comments from interested parties. Commerce
issued a Preliminary Scope Decision Memorandum \4\ to address these
comments. In the Preliminary Determination, Commerce set aside a period
of time for parties to address scope issues in scope case and rebuttal
briefs.\5\ No interested parties submitted comments regarding the
Preliminary Scope Decision Memorandum. Therefore, for this final
determination, the scope of this investigation remains unchanged from
that published in the Preliminary Determination.
---------------------------------------------------------------------------
\4\ See Memorandum, ``Scope Comments Decision Memorandum for the
Preliminary Determinations,'' dated June 19, 2018 (Preliminary Scope
Decision Memorandum).
\5\ See Large Diameter Welded Pipe from the Republic of Korea:
Preliminary Determination of Sales at Less than Fair Value and
Postponement of Final Determination, 83 FR 43651 (August 27, 2018).
---------------------------------------------------------------------------
Analysis of Subsidy Programs and Comments Received
The subsidy programs under investigation and the issues raised in
the case and rebuttal briefs by parties in this investigation 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.
Methodology
Commerce conducted this investigation in accordance with section
701 of the Tariff Act of 1930, as amended (the Act). For each of the
subsidy programs found countervailable, Commerce determines that there
is a subsidy, i.e. , a financial contribution by an ``authority'' that
gives rise to a benefit to the recipient, and that the subsidy is
specific.\6\ For a full description of the methodology underlying our
final determination, see the Issues and Decision Memorandum.
---------------------------------------------------------------------------
\6\ See sections 771(5)(B) and (D) of the Act regarding
financial contribution; section 771(5)(E) of the Act regarding
benefit; and section 771(5A) of the Act regarding specificity.
---------------------------------------------------------------------------
In making these findings, Commerce relied, in part, on facts
available. Further, because one or more respondents did not act to the
best of their ability to respond to Commerce's requests for
information, an adverse inference was drawn, where appropriate, in
selecting from among the facts otherwise available.\7\ For further
information, see ``Use of Facts Otherwise Available and Adverse
Inferences'' in the Issues and Decision Memorandum.
---------------------------------------------------------------------------
\7\ See sections 776(a),(b), and 782(d) of the Act.
---------------------------------------------------------------------------
Verification
As provided in section 782(i) of the Act, during September 2018,
Commerce verified the subsidy information reported by the GOK, Husteel,
Hyundai Steel, and SeAH Steel. We used standard verification
procedures, including an examination of relevant accounting records and
original source documents provided by the respondents.\8\
---------------------------------------------------------------------------
\8\ See Memoranda, ``Verification of the Questionnaire Responses
of the Government of Korea,'' ``Verification of the Questionnaire
Responses of Husteel Co., Ltd.,'' ``Verification of the
Questionnaire Responses of Hyundai Corporation,'' ``Verification of
the Questionnaire Responses of Hyundai Steel Company,'' and
``Verification of the Questionnaire Responses of SeAH Steel
Corporation and ESAB SeAH Corporation,'' all dated October 26, 2018.
---------------------------------------------------------------------------
Changes Since the Preliminary Determination
Based on our review and analysis of the comments received from
parties, verification, and the minor corrections presented at
verification, we made certain changes to the respondents' subsidy rate
calculations. As a result of these changes, Commerce has also revised
the ``all-others'' rate. For a discussion of these changes, see the
Issues and Decision Memorandum.
Final Determination
In accordance with section 705(c)(l)(B)(i) of the Act, we
calculated a rate for Husteel and Hyundai Steel, two producers/
exporters of subject merchandise selected for individual examination in
this investigation. Commerce assigned a rate based entirely on facts
otherwise available with adverse inferences pursuant to section 776 of
the Act to SeAH Steel.
Section 705(c)(5)(A) of the Act provides that in the final
determination, Commerce shall determine an estimated all-others rate
for companies not individually examined. This rate shall be an amount
equal to the weighted average of the estimated subsidy rates
established for those companies individually examined, excluding any
zero and de minimis rates and any rates based entirely under section
776 of the Act. 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 Commerce to establish an all-others rate using ``any
reasonable method.'' According to section 705(c)(5)(A)(ii) of
[[Page 6371]]
the Act, one such ``reasonable method'' includes ``averaging the
weighted average countervailable subsidy rates determined for the
exporters and producers individually investigated.'' Here, the
countervailable subsidy rates for all of the individually investigated
respondents are zero or de minimis or are based on adverse facts
available (AFA). Therefore, consistent with section 705(c)(5)(A)(ii) of
the Act, we have averaged the rates of the three individually
investigated respondents to establish the estimated all others rate.
This approach is also consistent with our practice in other
investigations.\9\
---------------------------------------------------------------------------
\9\ See, e.g., Countervailing Duty Investigation of Certain
Corrosion-Resistant Steel Products from Italy: Final Affirmative
Determination and Final Affirmative Critical Circumstances, in Part,
81 FR 35326, 35327 (June 2, 2016).
---------------------------------------------------------------------------
Commerce determines the total estimated net countervailable subsidy
rates to be:
------------------------------------------------------------------------
Subsidy rate
Company (percent)
------------------------------------------------------------------------
Husteel Co., Ltd........................................ * 0.01
Hyundai Steel Company................................... * 0.44
SeAH Steel Corporation.................................. 27.42
All-Others Rate......................................... 9.29
------------------------------------------------------------------------
* (de minimis).
Disclosure
Commerce 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)(1)(B) and (d)(2) of the Act, Commerce instructed U.S.
Customs and Border Protection (CBP) to suspend liquidation of entries
of subject merchandise as described in the scope of the investigation
section entered, or withdrawn from warehouse, for consumption on or
after the date of publication of the Preliminary Determination in the
Federal Register , except for Husteel and Hyundai Steel.\10\ In
accordance with section 703(d) of the Act, we issued instructions to
CBP to discontinue the suspension of liquidation for CVD purposes for
subject merchandise entered, or withdrawn from warehouse, on or after
October 26, 2018, but to continue the suspension of liquidation of all
entries from June 29, 2018, through October 25, 2018.
---------------------------------------------------------------------------
\10\ See Preliminary Determination, 83 FR at 30694. Because the
rates for Husteel and Hyundai Steel were zero or de minimis in the
Preliminary Determination, Commerce did not suspend entries of
merchandise from these companies.
---------------------------------------------------------------------------
If the U.S. International Trade Commission (ITC) issues a final
affirmative injury determination, we will issue a CVD order, reinstate
the suspension of liquidation under section 706(a) of the Act, and
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 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, Commerce will notify
the ITC of its 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 Assistant Secretary for Enforcement and Compliance.
Because the final determination in this proceeding is affirmative,
in accordance with section 705(b) of the Act, the ITC will make its
final determination as to whether the domestic industry in the United
States is materially injured, or threatened with material injury, by
reason of imports of welded pipe from Korea no later than 45 days after
our final determination. If the ITC determines that material injury or
threat of material injury does not exist, the proceeding will be
terminated and all cash deposits will be refunded. If the ITC
determines that such injury does exist, Commerce will issue a CVD order
directing CBP to assess, upon further instruction by Commerce,
countervailing duties on all imports of the subject merchandise, other
than those produced and exported by Husteel and Hyundai Steel because
their rates are de minimis , that are entered, or withdrawn from
warehouse, for consumption on or after the effective date of the
suspension of liquidation, as discussed above in the ``Continuation of
Suspension of Liquidation'' section.
Notification Regarding Administrative Protective Orders
In the event that the ITC issues a 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). Timely written notification of the return/destruction of
APO materials or conversion to judicial 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 determination is issued and published pursuant to sections
705(d) and 777(i) of the Act.
Dated: February 19, 2019
Gary Taverman,
Deputy Assistant Secretary for Antidumping and Countervailing Duty
Operations, performing the non-exclusive functions and duties of the
Assistant Secretary for Enforcement and Compliance.
Appendix I
Scope of the Investigation
The merchandise covered by this investigation is welded carbon
and alloy steel pipe (including stainless steel pipe), more than
406.4 mm (16 inches) in nominal outside diameter (large diameter
welded pipe), regardless of wall thickness, length, surface finish,
grade, end finish, or stenciling. Large diameter welded pipe may be
used to transport oil, gas, slurry, steam, or other fluids, liquids,
or gases. It may also be used for structural purposes, including,
but not limited to, piling. Specifically, not included is large
diameter welded pipe produced only to specifications of the American
Water Works Association (AWWA) for water and sewage pipe.
Large diameter welded pipe used to transport oil, gas, or
natural gas liquids is normally produced to the American Petroleum
Institute (API) specification 5L. Large diameter welded pipe may
also be produced to American Society for Testing and Materials
(ASTM) standards A500, A252, or A53, or other relevant domestic
specifications, grades and/or standards. Large diameter welded pipe
can be produced to comparable foreign specifications, grades and/or
standards or to proprietary specifications, grades and/or standards,
or can be non-graded material. All pipe meeting the physical
description set forth above is covered by the scope of this
investigation, whether or not produced according to a particular
standard.
Subject merchandise also includes large diameter welded pipe
that has been further processed in a third country, including but
not limited to coating, painting, notching, beveling, cutting,
punching, welding, or any other processing that would not otherwise
remove the merchandise from the scope of the investigation if
performed in the country of manufacture of the in-scope large
diameter welded pipe.
The large diameter welded pipe that is subject to this
investigation is currently classifiable in the Harmonized Tariff
Schedule of the United States (HTSUS) under
[[Page 6372]]
subheadings 7305.11.1030, 7305.11.1060, 7305.11.5000, 7305.12.1030,
7305.12.1060, 7305.12.5000, 7305.19.1030, 7305.19.1060,
7305.19.5000, 7305.31.4000, 7305.31.6010, 7305.31.6090, 7305.39.1000
and 7305.39.5000. While the HTSUS subheadings are provided for
convenience and customs purposes, the written description of the
scope of this investigation is dispositive.
Appendix II
List of Topics Discussed in the Issues and Decision Memorandum
I. Summary
II. Background
III. Use of Facts Otherwise Available and Adverse Inferences
IV. Subsidies Valuation
V. Analysis of Programs
VI. Analysis of Comments
Comment 1: Application of Adverse Facts Available (AFA) to SeAH
Steel for Unreported Affiliates
Comment 2: Application of AFA to SeAH Steel for SPP Pipe
Comment 3: Whether the Demand Response Resources (DRR) Program
is Countervailable
Comment 4: Whether Tax Credits under Restriction of Special
Taxation Act (RSTA) Articles 25(2), 25(3), and 26 Are
Countervailable
Comment 5: Whether a Benefit Exists in the Modal Shift Program
VII. Recommendation
[FR Doc. 2019-03318 Filed 2-26-19; 8:45 am]
BILLING CODE 3510-DS-P