[Federal Register Volume 85, Number 177 (Friday, September 11, 2020)]
[Rules and Regulations]
[Pages 56162-56172]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-19753]


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DEPARTMENT OF COMMERCE

International Trade Administration

19 CFR Part 360

[Docket No. 200806-0208]
RIN 0625-AB17


Steel Import Monitoring and Analysis System

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

ACTION: Final rule.

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SUMMARY: In this final rule, U.S. Department of Commerce (Commerce) is 
modifying its regulations pertaining to the Steel Import Monitoring and 
Analysis (SIMA) system to require steel import license applicants to 
identify the country where the steel used in the manufacture of the 
imported steel product was melted and poured (the country of melt and 
pour); clarify how certain import data collected from the licenses will 
be aggregated and reported on the public SIMA monitor; harmonize the 
scope of steel products subject to the SIMA licensing requirement with 
the scope of steel products subject to Section 232 tariffs; extend the 
SIMA system indefinitely by eliminating the regulatory provision 
concerning the duration of the SIMA system; and codify eligibility for 
use of the low-value license for certain steel entries up to $5,000. In 
addition, Commerce is making corresponding changes to the public SIMA 
monitor that do not require regulatory modifications and amending the 
steel import license application to include a new field for the country 
of melt and pour. Finally, Commerce is modernizing the SIMA system, 
including both the online license application platform and the public 
SIMA monitor.

DATES: 
    Effective date: October 13, 2020.
    Applicability date: All licenses requested on or after October 13, 
2020, must meet the requirements of this rule and utilize the online 
license application platform on the new SIMA system website. Licenses 
requested on or before October 9, 2020, must meet the requirements of 
the existing SIMA system and utilize the online license application 
platform on the existing SIMA system website. The existing SIMA system 
website will no longer be operational beginning on October 10, 2020, 
and the new SIMA system website will not be operational until October 
13, 2020. Therefore, no licenses can be obtained via the online license 
application platform from October 10 through October 12, 2020. For 
information on registering for the new SIMA system and obtaining 
licenses manually from October 10 through 12, 2020, see the 
SUPPLEMENTARY INFORMATION.

ADDRESSES: The existing SIMA system website that will be operational 
until October 9, 2020 is https://enforcement.trade.gov/steel/license/. 
From October 10-12, 2020, Commerce will accept manual applications in 
emergency situations identified above to the following email address: 
[email protected].
    The new SIMA system website that will be operational on October 13, 
2020 is https://www.trade.gov/steel. Through this website, potential 
license applicants can register for the new online license application 
platform and apply for licenses. Additionally, the public SIMA monitor 
is also featured on this website.
    More information can be found at https://www.trade.gov/updates-steel-import-licensing. To assist with the transition to the modernized 
SIMA system, Commerce is offering a virtual demonstration of the online 
license application platform for potential license applicants. Commerce 
also is offering a demonstration of the new modernized public SIMA 
monitor, which is available to the general public. Commerce will have a 
limited number of spots available to participate in the demonstrations, 
that will occur prior to the effective date of this rule. For specific 
dates and times of the demonstrations, and to participate in the 
demonstrations, please visit https://www.trade.gov/updates-steel-import-licensing.

[[Page 56163]]


FOR FURTHER INFORMATION CONTACT: Julie Al-Saadawi at (202) 482-1930, 
Brandon Custard (202) 482-1823, or Jessica Link at (202) 482-1411.

SUPPLEMENTARY INFORMATION:

Background

    On May 17, 2019, the United States announced joint understandings 
with Canada and Mexico, respectively, concerning trade in steel covered 
by the action taken pursuant to Section 232 of the Trade Expansion Act 
of 1962, as amended. Among other things, the understandings call for 
the monitoring of steel trade between the United States and Canada and 
Mexico, respectively. Consistent with the joint understandings, and to 
enhance U.S. Government monitoring and analysis of steel imports more 
generally, Commerce published a proposed rule on March 30, 2020 (85 FR 
17515), to enhance its existing SIMA system to allow for the effective 
and timely monitoring of import surges of specific steel products which 
will aid in the prevention of transshipment of steel products.

The SIMA System

    The purpose of the SIMA system is to provide steel producers, steel 
consumers, importers, and the general public with accurate and timely 
information on anticipated imports of certain steel products into the 
United States. Steel import licenses, issued through the online SIMA 
licensing system, are required by U.S. Customs and Border Protection 
(CBP or Customs) for filing entry summary documentation for imports of 
certain steel mill products into the United States.\1\ Through the 
monitoring tool, certain import data collected from the steel licenses 
are aggregated and reported on the public SIMA monitor website on a 
monthly basis, and are refreshed each week. The public SIMA monitor 
provides valuable data regarding certain steel mill imports into the 
United States as early as possible and makes such data available to the 
public approximately five weeks in advance of official U.S. import 
statistics compiled by the United States Census Bureau (Census).
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    \1\ See 19 CFR 12.145.
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    The SIMA system has operated under its current authority since 
March 11, 2005. Prior to that date, authority for steel import 
licensing and monitoring was derived from Presidential Proclamation 
7529 of March 5, 2002 and accompanying memorandum.\2\ Pursuant to 
sections 201 and 203 of the 1974 Trade Act, as amended (19 U.S.C. 2251 
and 2253), Proclamation 7529 implemented safeguard measures with 
respect to certain imported steel products, placing temporary tariffs 
on these steel imports and requiring the Secretary of Commerce to 
establish a system of import licensing to facilitate the monitoring of 
these steel imports. Accordingly, on July 18, 2002, Commerce issued and 
requested public comment on a proposed rule to establish a steel 
licensing system requiring all importers of the covered steel products 
to obtain a license from Commerce prior to completing CBP entry summary 
documentation.\3\ This monitoring tool ensured that the effectiveness 
of the border measure was not undermined by large quantities of imports 
originating from countries that were excluded from the tariffs. On 
December 31, 2002, Commerce issued a final rule implementing the Steel 
Import Licensing and Surge Monitoring program, which was codified at 19 
CFR part 360.\4\
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    \2\ To Facilitate Positive Adjustment to Competition from 
Imports of Certain Steel Products, Proclamation 7529, 67 FR 10553 
(Mar. 7, 2002); Action Under Section 203 of the Trade Act of 1974 
Concerning Certain Steel Products, Memorandum of March 5, 2002, 67 
FR 10593 (Mar. 7, 2002).
    \3\ Steel Import Licensing and Surge Monitoring, Proposed Rule, 
67 FR 47338 (July 18, 2002).
    \4\ Steel Import Licensing and Surge Monitoring, Final Rule, 67 
FR 79845 (Dec. 31, 2002).
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    Subsequently, Presidential Proclamation 7741 of December 4, 2003 
terminated the steel safeguard measures, but directed the Secretary of 
Commerce to continue the monitoring system until the earlier of March 
21, 2005, or such time as the Secretary of Commerce established a 
replacement program.\5\ On December 9, 2003, Commerce published a 
notice stating that the system would continue in effect as described in 
Proclamation 7741 until March 21, 2005.\6\ On August 25, 2004, Commerce 
published an advanced notice of proposed rulemaking soliciting comments 
on whether to continue the SIMA system (formerly known as the Steel 
Import Licensing and Surge Monitoring System) beyond March 21, 2005, 
and whether the system should be modified.\7\
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    \5\ To Provide for the Termination of Action Taken with Regard 
to Imports of Certain Steel Products, Proclamation 7741, 68 FR 68483 
(Dec. 8, 2003).
    \6\ Steel Import Licensing and Surge Monitoring, 68 FR 68594 
(Dec. 9, 2003).
    \7\ Steel Import Monitoring and Analysis System, Advanced Notice 
of Proposed Rulemaking, 69 FR 52211 (Aug. 25, 2004).
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    Commerce determined that there continued to be a need to collect 
import data, and published an interim final rule revising 19 CFR part 
360 to extend the SIMA system for four years under the authority of the 
Census Act of 1930, as amended (the Census Act) (13 U.S.C. 301(a) and 
302), and expand the coverage of the system to include all basic steel 
mill products, while also removing certain downstream steel 
products.\8\ Commerce also provided an exception to the requirement for 
obtaining a unique license for each CBP entry where the total value of 
the covered steel portion of an entry was less than $250 (i.e., the 
low-value license).\9\ Commerce explained that the purpose of the SIMA 
system is to provide statistical data on steel imports entering the 
United States seven weeks earlier than is otherwise publicly available, 
and that the data collected on the licenses are made available to the 
public in an aggregated form weekly after Commerce review.\10\
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    \8\ Steel Import Monitoring and Analysis System, Interim Final 
Rule, 70 FR 12133 (Mar. 11, 2005).
    \9\ Id.
    \10\ Id.
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    On December 5, 2005, Commerce published a final rule that did not 
make any changes to the interim final rule.\11\ However, in light of 
certain comments, Commerce agreed to a discrete change to the SIMA 
system via its public SIMA monitor that did not require regulatory 
changes.\12\
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    \11\ Steel Import Monitoring and Analysis System, Final Rule, 70 
FR 72373 (Dec. 5, 2005).
    \12\ Id.
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    The SIMA system was subsequently extended several times through the 
rulemaking process, with the most recent extension of the SIMA system 
continuing until March 21, 2022.\13\ Therefore, unless further 
extended, the SIMA system is set to expire on March 21, 2022.\14\
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    \13\ See Steel Import Monitoring and Analysis System, Final 
Rule, 74 FR 11474 (Mar. 18, 2009) (extending the SIMA system to 
March 21, 2013); Steel Import Monitoring and Analysis System, Final 
Rule, 78 FR 11090 (Feb. 15, 2013) (extending the SIMA system to 
March 21, 2017); and Steel Import Monitoring and Analysis System, 
Final Rule, 82 FR 1183 (Jan. 5, 2017) (extending the SIMA system to 
March 21, 2022).
    \14\ See 19 CFR 360.105.
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Section 232 Tariffs on Steel Imports

    Presidential Proclamation 9705 of March 8, 2018, which was issued 
pursuant to Section 232 of the Trade Expansion Act of 1962, as amended, 
adjusted imports of steel articles by imposing a 25 percent ad valorem 
tariff on certain steel articles imported from most countries, to 
address the threatened impairment to the national security of the 
United States by such imports from those countries.\15\ Presidential 
Proclamation 9711 of March 22, 2018 amended certain aspects of 
Presidential Proclamation 9705,

[[Page 56164]]

providing for duty exemptions for certain countries, including Canada 
and Mexico, which were to expire on May 1, 2018, unless agreement was 
reached with respect to a satisfactory alternative means to address the 
threatened impairment to the national security of the United States by 
steel imports from those countries.\16\ Presidential Proclamation 9740 
of April 30, 2018, further amended certain aspects of the prior 
proclamations, continuing the duty exemptions for certain countries, 
including Canada and Mexico, until June 1, 2018.\17\ Presidential 
Proclamation 9759 of May 31, 2018, further amended certain aspects of 
the prior proclamations, continuing the duty exemptions for certain 
countries, which did not include Canada and Mexico, on a long-term 
basis.\18\ Presidential Proclamation 9772 of August 10, 2018, 
Presidential Proclamation 9777 of August 29, 2018, and Presidential 
Proclamation 9886 of May 16, 2019, further amended certain aspects of 
prior proclamations.\19\
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    \15\ Adjusting Imports of Steel into the United States, 
Proclamation 9705, 83 FR 11625 (Mar. 15, 2018) (Proclamation 9705).
    \16\ Adjusting Imports of Steel Into the United States, 
Proclamation 9711, 83 FR 13361 (Mar. 28, 2018).
    \17\ Adjusting Imports of Steel Into the United States, 
Proclamation 9740, 83 FR 20683 (May 7, 2018).
    \18\ Adjusting Imports of Steel Into the United States, 
Proclamation 9759, 83 FR 25857 (June 5, 2018).
    \19\ Adjusting Imports of Steel Into the United States, 
Proclamation 9772, 83 FR 40429 (Aug. 15, 2018); Adjusting Imports of 
Steel Into the United States, Proclamation 9777, 83 FR 45025 (Sept. 
4, 2018); Adjusting Imports of Steel Into the United States, 
Proclamation 9886, 84 FR 23421 (May 21, 2019).
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    As a result of the aforementioned proclamations, effective June 1, 
2018, all steel imports from Canada and Mexico were subject to Section 
232 tariffs. However, Presidential Proclamation 9705 provided that any 
country with which the United States has a security relationship is 
welcome to discuss with the United States alternative ways to address 
the threatened impairment of the national security caused by imports of 
steel articles from that country.\20\ Subsequently, on May 17, 2019, 
the United States announced that such discussions had yielded joint 
understandings with Canada and Mexico, respectively, to remove the 
Section 232 tariffs for steel imports from those countries.\21\ As part 
of the joint understandings, the United States and Canada, and the 
United States and Mexico, agreed to implement effective measures to 
prevent the transshipment of steel products made outside of the United 
States, Canada, and Mexico, among other commitments. Additionally, the 
joint understandings allow for the countries to establish an agreed-
upon process for monitoring steel trade between them, and, further, in 
monitoring for surges, to treat products made with steel that is melted 
and poured in North America separately from products that are not. In 
light of the joint understandings, Presidential Proclamation 9894 of 
May 19, 2019, provided that a satisfactory alternative means had been 
agreed upon and, effective May 21, 2019, steel imports from Canada and 
Mexico would no longer be subject to Section 232 tariffs.\22\
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    \20\ See Proclamation 9705, 83 FR at 11626.
    \21\ See Joint Statement by the United States and Canada on 
Section 232 Duties on Steel and Aluminum, dated May 17, 2019, 
available at https://ustr.gov/sites/default/files/Joint_Statement_by_the_United_States_and_Canada.pdf; Joint Statement 
by the United States and Mexico on Section 232 Duties on Steel and 
Aluminum, dated May 17, 2019, available at https://ustr.gov/sites/default/files/Joint_Statement_by_the_United_States_and_Mexico.pdf.
    \22\ Adjusting Imports of Steel Into the United States, 
Proclamation 9894, 84 FR 23987 (May 23, 2019).
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Proposed Rule

    On March 30, 2020, Commerce published a proposed modification of 19 
CFR part 360, which governs the SIMA system.\23\ Commerce received 15 
comments on the Proposed Rule, and we address those comments below. The 
Proposed Rule, comments received, and this final rule can be accessed 
using the Federal eRulemaking portal at http://www.regulations.gov/ 
under Docket Number ITA-2019-0008. After analyzing and carefully 
considering the comments received, we have adopted the modifications 
described below and amended Commerce's regulations accordingly.
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    \23\ Modification of Regulations Regarding the Steel Import 
Monitoring and Analysis System, 85 FR 17515 (March 30, 2020) 
(Proposed Rule). On June 22, 2020, Commerce published a correction 
to the Proposed Rule to clarify CBP requirements for steel imports 
for entry purposes. See Modification of Regulations Regarding the 
Steel Import Monitoring and Analysis System; Correction, 85 FR 37397 
(June 22, 2020).
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Explanation of Regulatory Provisions and Final Modifications

    Commerce amends the SIMA system as discussed below.
    First, the joint understandings described above provide that, in 
monitoring for surges of steel imports, the United States, Canada, and 
Mexico may treat products made with steel that is melted and poured in 
North America separately from products that are not. As discussed 
further above, the SIMA system is a critical trade monitoring program 
which collects timely detailed statistics on anticipated steel imports 
and provides stakeholders with information about import trends in this 
sector in advance of official U.S. import statistics. Under the system, 
importers of certain steel mill products must apply for a steel import 
license through the online SIMA licensing system, which requires the 
name and address of the importer, type of steel product, and country of 
origin of the steel imports, along with additional information. This 
information is detailed at 19 CFR 360.103(c). These licenses are 
required by CBP for filing entry summary documentation for imports of 
certain steel mill products into the United States. The SIMA system 
currently does not collect information with regard to the country where 
the steel used in the manufacture of the imported steel product was 
melted and poured. Therefore, consistent with the joint understandings, 
and to enhance U.S. Government monitoring and analysis of steel imports 
more generally, Commerce is amending the SIMA system to require 
identification of the country where the steel used in the manufacture 
of the imported steel product is melted and poured on the license form 
as an additional requirement to obtain an import license. This is also 
referred to as the ``country of melt and pour.'' Commerce is 
effectuating these changes by amending Sec.  360.103(c) as well as the 
SIMA import license application. Specifically, consistent with the 
Proposed Rule, paragraph (c)(1)(viii) is amended to include reference 
to the country of melt and pour.\24\
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    \24\ Commerce also has made several non-substantive edits to 
paragraph (c)(1) as follows: Remove the requirement for the filer to 
provide a fax number in paragraph (c)(1)(ii); amend paragraphs 
(c)(1)(iii) and (xiv) to include missing semicolons; amend paragraph 
(c)(1)(xii) to include Harmonized Tariff Schedule; and redesignate 
remaining paragraphs as necessary.
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    Additionally, as explained further below, in light of comments in 
response to the Proposed Rule, Commerce is adopting a definition of 
``melt and pour'' to clarify for license applicants how to complete 
this new field. As described above, the joint understandings indicate 
that, in monitoring for surges of steel imports, the United States, 
Canada, and Mexico may treat products made with steel that is melted 
and poured in North America separately from products that are not. The 
joint understandings do not further define country of melt and pour. 
Although a definition was not featured in the Proposed Rule, further 
defining a term that was first identified in the Proposed Rule for 
purposes of the final rule is a logical outgrowth of the rulemaking 
process. In addition, several commenters requested that a definition be 
provided to increase clarity and

[[Page 56165]]

consistency for all potentially regulated entities, and the adopted 
definition relies on the suggested language from commenters. In light 
of this, we believe it is necessary and appropriate to adopt the 
definition in the final rule. Existing paragraph (c)(3) is redesignated 
as paragraph (c)(4), and a newly added paragraph (c)(3) includes the 
adopted definition. The definition also will be added to the SIMA 
import license application instructions.
    Second, various amendments have been made to Sec.  360.104. As 
discussed above, pursuant to existing Sec.  360.104, certain 
information obtained from the steel licenses is aggregated and reported 
on the public SIMA monitor on a monthly basis and are refreshed each 
week. Consistent with the Proposed Rule, and after further 
consideration, Commerce is making minor amendments to Sec.  360.104(a) 
and (b) to align more closely with Commerce's practice of replacing 
outdated license data with official U.S. import statistics compiled by 
the Census, where available. Additionally, to avoid confusion, Commerce 
is amending Sec.  360.104(a) to clarify that aggregate data will be 
reported, as appropriate, by relevant steel mill product ``groupings.'' 
This is a generic term meant to cover both steel mill product 
``categories'' (i.e., at a broader level) and steel mill product 
``groups'' (i.e., at a more specific level), as that terminology is 
currently used in the public SIMA monitor. This differs from the 
Proposed Rule, which misstated the definitions for steel mill product 
group and steel mill product categories.\25\ Further, Commerce is 
clarifying that aggregate data will be reported, as appropriate, by 
country of melt and pour, consistent with the joint understandings. To 
avoid confusion, Commerce has streamlined the language from the 
Proposed Rule on this point. Therefore, Sec.  360.104(a) is amended to 
state that aggregate data will be reported, as appropriate, on a 
monthly basis by country of origin, country of melt and pour, and 
relevant steel mill product groupings, etc. This revised language will 
allow Commerce the flexibility to report aggregate data at a sufficient 
level of detail to enable the public to monitor trends in import data, 
including potential surges and transshipment, while allowing for 
adequate protection of proprietary data. Similarly, Sec.  360.104(b) is 
also amended to clarify that monthly import license data will be 
updated weekly, as appropriate, to allow for the adequate protection of 
proprietary data.
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    \25\ In the Proposed Rule, we inadvertently stated that there 
are five steel mill ``product groups'' which are further broken down 
into 52 specific steel mill ``product categories'' on the public 
SIMA monitor. See 85 FR at 17517 and 17519. This is incorrect. There 
are five steel mill ``product categories'' (i.e., flat, long, pipe 
and tube, semi-finished, and stainless steel products). Under these 
categories, there are currently 53 ``product groups.'' In this final 
rule, as discussed herein, Commerce is increasing the number of 
product groups to 58 on the public SIMA monitor; the five product 
groups on the public SIMA monitor are unchanged.
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    Third, Commerce is expanding the scope of steel products covered by 
the SIMA system so that it covers all steel products subject to Section 
232 tariffs.\26\ A list of the products covered by the SIMA system by 
Harmonized Tariff Schedule (HTS) codes can be obtained on the SIMA 
system website. This will allow for more consistent and complete 
monitoring for surges and transshipment. Commerce is amending Sec.  
360.101(a) to indicate that the products covered by the SIMA system 
will be listed on the website and identified by HTS codes. The HTS 
codes, which are maintained by the U.S. International Trade Commission, 
may be updated periodically to reflect revisions to the codes.
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    \26\ See Proposed Rule, 85 FR at 17520 (providing the eight 
additional HTS codes at Appendix I). To clarify, this covers the 
steel products subject to Section 232 tariffs as announced on March 
15, 2018. See Adjusting Imports of Steel into the United States, 
Proclamation 9705, 83 FR 11625 (Mar. 15, 2018). Although Section 232 
tariffs were recently imposed on steel derivative products, such 
products are not covered by the SIMA system. See Adjusting Imports 
of Derivative Aluminum Articles and Derivative Steel Articles Into 
the United States, Proclamation 9980, 85 FR 5281 (Jan. 29, 2020).
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    Fourth, Commerce is extending the SIMA system indefinitely by 
eliminating the regulatory provision, Sec.  360.105, which makes the 
SIMA system temporary. In the past, Commerce has considered whether to 
extend the SIMA system every four years, which is done under the 
authority of the Census Act (13 U.S.C. 301(a) and 302).\27\ Although 
the SIMA system is not set to expire until March 21, 2022, Commerce is 
extending the system indefinitely given that the program is a well-
established and important trade monitoring tool that has strong support 
from the trade community over its near-twenty year history.\28\ 
Therefore, Commerce is removing and reserving Sec.  360.105 as 
indicated below, and making conforming amendments to Sec.  360.104(a).
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    \27\ See, e.g., Steel Import Monitoring and Analysis System, 
Interim Final Rule, 70 FR 12133, 12134 (``The Department believes 
that the SIMA system is a critical trade monitoring program and is 
extending it for another four years under the authority of the 
Census Act of 1930.'') (Mar. 11, 2005); Steel Import Monitoring and 
Analysis System, Final Rule, 74 FR 11474 (Mar. 18, 2009) (extending 
the SIMA system to March 21, 2013); Steel Import Monitoring and 
Analysis System, Final Rule, 78 FR 11090 (Feb. 15, 2013) (extending 
the SIMA system to March 21, 2017); and Steel Import Monitoring and 
Analysis System, Final Rule, 82 FR 1183 (Jan. 5, 2017) (extending 
the SIMA system to March 21, 2022).
    \28\ See Steel Import Monitoring and Analysis System, Final 
Rule, 78 FR at 11091; Steel Import Monitoring and Analysis System, 
Final Rule, 82 FR at 1184.
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    Fifth, Commerce is amending Sec.  360.103(f) to codify eligibility 
for use of the low-value license for certain steel entries from a $250 
value to a $5,000 value to align with current practice. The low-value 
license is an optional multiple-use license that allows a company to 
apply once for a steel import license and use it on multiple occasions 
for entries of covered steel products with a limited customs value. A 
re-usable low-value license number can be obtained with respect to an 
entry for which the portion covered by the steel licensing requirement 
is less than the limited amount and may be used by those companies 
listed on the license. The low-value license is processed on the SIMA 
system website in the same manner as a typical steel license. 
Commerce's low-value license application form provides that such a 
license may apply to covered steel products with a value of $5,000 or 
less per entry. Accordingly, Commerce is making conforming edits to 
Sec.  360.103(f) to reflect this requirement.
    Beyond the regulatory changes identified above, as a result of the 
comments discussed below, Commerce also will implement the following 
sub-regulatory changes to the public SIMA monitor that do not require 
regulatory modifications: (1) Maintain country of melt and pour license 
data on the public SIMA monitor for a longer period; (2) separate the 
``blooms, billets and slabs'' product group (for both carbon and alloy 
and stainless) into two product groups: ``slab'' and ``other semi-
finished'' product groups; (3) create three new product groups for line 
pipe corresponding to three different diameters of line pipe; and (4) 
create a new product group ``Other Rails and Railroad Accessories'' to 
reflect the inclusion of certain additional HTS codes subject to 
Section 232 tariffs. In light of these changes (that are further 
discussed below), the public SIMA monitor website will reflect the 
increased number of steel product groups from 53 to 58. We are 
implementing these changes on the public SIMA monitor at the same time 
as this final rule.
    Finally, Commerce is modernizing the SIMA system, including both 
the online license application platform and the public SIMA monitor, 
with updated software when the final rule goes into effect. Registered 
users on the existing

[[Page 56166]]

SIMA system must re-register on the new SIMA system to use the new 
online license application platform. In accordance with 19 CFR 360.107, 
when the electronic licensing system is unavailable for an extended 
period of time, parties will be able to obtain licenses manually from 
Commerce via fax during regular business hours. Because October 10 and 
11, 2020, fall over a weekend, and not during regular business hours, 
and because of the additional resources required to process manual 
license applications, Commerce will accept manual license applications 
October 10, 11, and 12 only in emergency situations, i.e., where the 
CBP entry summary must be filed on those dates and the license 
applicant has not previously obtained a license number under the 
existing SIMA system on or before October 9, 2020. Additionally, manual 
license applications must be sent via email, not fax, to the address 
identified in the ADDRESSES section. These restrictions are intended to 
address operational considerations due to COVID-19. See the DATES and 
ADDRESSES sections above for more information.

Response to Comments Received on the Proposed Rule

    Commerce received 15 comments on the proposed rule. Below is a 
summary of the comments, grouped by issue category, followed by 
Commerce's response.

1. Whether To Require SIMA License Applicants To Identify the Country 
Where the Steel Is Melted and Poured

    All commenters who provided a view supported Commerce's proposal 
for adding a field to the license application requiring U.S. importers 
to identify the country where the steel was melted and poured. Some 
commenters opposed allowing an ``unknown'' country option in the melt 
and pour field in the license application, arguing that an ``unknown'' 
option would undermine the utility of the melt and pour data 
collection, and that steel mill test certificates are easy for 
importers and traders to obtain because these documents are generated 
at all stages of the steel supply chain in the normal course of 
business. In contrast, other commenters asserted that many steel 
importers purchase products that have been processed multiple times 
into the supply chain and may not know where the steel they are 
importing was originally melted and poured.
    One commenter requested that Commerce provide a clear definition 
for the country where the steel is melted and poured to assist 
importers in filling out the license application. The commenter also 
recommended that Commerce use language from the joint understandings in 
crafting a definition. Another commenter concurs with the need for a 
precise definition and defines the country where the steel is melted 
and poured as the country ``where raw steel is first produced in a 
steelmaking furnace and then poured into its first solid shape.'' This 
commenter noted that subsequent processing in another country after the 
melting and pouring stage may be significant enough to change the 
country of origin for customs purposes to a different country than the 
one where the steel was first melted and poured. Also, this commenter 
contends that a field for the country of melt and pour should be 
included in the licensing program because much of the value-added and 
investment in the steel manufacturing process takes place in the 
facilities that melt and pour the steel.
    Some commenters requested that the country of melt and pour license 
data be collected at the 10-digit HTS level and then displayed in the 
public SIMA monitor at the 6-digit HTS level, to the extent possible, 
so as to avoid revealing proprietary data but to ensure full 
traceability and prevent transshipment. These commenters argued that 
Commerce's concern that reporting further disaggregated data would 
release proprietary data is ``speculative and would likely never come 
to fruition.'' These commenters also claimed that publicly available 
subscription sources already provide bill of lading data on an 
aggregate basis, making public certain trading patterns, such that 
release of additional data in the public SIMA monitor reflecting these 
similar trading patterns serves only as a further aggregation.
    One commenter states that, consistent with the joint understandings 
with Canada and Mexico, and to enhance the SIMA system generally, 
Commerce should continue to report all license data through the public 
SIMA monitor by country and product group (currently 53), by country 
and product category (defined as flat, long, pipe and tube, and semi-
finished), and at the 6-digit HTS-level. Further, this commenter argues 
that, to the extent any license applicant has concerns regarding 
proprietary information, Commerce should create a means by which that 
applicant can request that data be aggregated at the next product 
level.
    Response: Given commenters' unanimous support, Commerce will amend 
the SIMA system to require import license applicants to identify and 
report the country where the steel is melted and poured as an 
additional requirement to obtaining an import license. Commerce is 
effectuating these changes by amending Sec.  360.103(c) as well as the 
SIMA import license application. As stated above, Commerce believes 
collecting information on the country of melt and pour is consistent 
with the United States' joint understandings with the governments of 
Canada and Mexico and will enhance monitoring of U.S. steel imports. 
Collection of this data will allow for the effective and timely 
monitoring of import surges of specific steel products, which will aid 
in the prevention of transshipment of steel products. We also agree 
with commenters that an option for ``unknown'' in the country of melt 
and pour field on the license application would defeat the purpose of 
this new field. Furthermore, Commerce expects that importers will have 
access to thorough information regarding the product being imported, 
including the mill test certification (which would indicate country of 
melt and pour). Specifically, the mill test certification is currently 
required by CBP for entry purposes, in accordance with 19 CFR 141.89 
and 142.6, and Commerce expects that the mill test certification would 
be included with the standard sales documentation for steel mill 
imports and therefore would be readily available to the importer. 
Commerce therefore agrees with commenters that steel mill test 
certificates are easy for importers and traders to obtain and are 
generated at all stages of the steel supply chain in the normal course 
of business. For these reasons, we disagree with the assertion of 
certain commenters that importers of steel products that have been 
processed multiple times may not have access to information regarding 
the country where the steel they are importing was originally melted 
and poured.
    Additionally, Commerce agrees with certain commenters' 
recommendation that we should provide a clear definition for country of 
melt and pour and have included this definition in revised Sec.  
360.103(c)(3) and the steel license application. We agree that a 
definition for ``country of melt and pour'' would provide clarity and 
certainty to the steel trade community. As discussed above, Commerce 
expects that the mill test certification (that is currently required by 
CBP for entry purposes and readily available to the importer) will 
indicate the country of melt and pour; however, we recognize that mill 
test certifications come in different forms and may utilize different 
terminology. Therefore, we would not expect the precise phrase 
``country of

[[Page 56167]]

melt and pour'' to be explicitly labeled on the mill test 
certification. In light of this, a definition is necessary to provide 
clear guidance to parties as to which information from the mill test 
certification should be relied upon in identifying the country of melt 
and pour for purposes of the steel import license application.
    In crafting a definition for country of melt and pour, we found 
useful language in the Protocol of Amendment to the United States-
Mexico-Canada Agreement (USMCA):

Notwithstanding any other provision of this Agreement, beginning 
seven years after entry into force of this Agreement, for steel to 
be considered as originating under this Article, all steel 
manufacturing processes must occur in one or more of the Parties, 
except for metallurgical processes involving the refinement of steel 
additives. Such processes include the initial melting and mixing and 
continues through the coating stage. This requirement does not apply 
to raw materials used in the steel manufacturing process, including 
steel scrap; iron ore; pig iron; reduced, processed, or pelletized 
iron ore; or raw alloys.\29\
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    \29\ https://ustr.gov/sites/default/files/files/agreements/FTA/USMCA/Protocol-of-Amendments-to-the-United-States-Mexico-Canada-Agreement.pdf.

    We also considered the definition provided by one of the commenters 
for country of melt and pour, which is the country ``where raw steel is 
first produced in a steelmaking furnace and then poured into its first 
solid shape.'' This definition is consistent with the definition 
included in the USMCA Protocol of Amendment, as well as our general 
understanding of the steel industry.\30\ Specifically, it is our 
understanding that the steelmaking process generally follows the same 
pattern, beginning with the initial melting and mixing of the raw steel 
in a liquid state in a steelmaking furnace, that is then poured into a 
solid shape. This first solid shape may take the form of a semi-
finished product (slab, billet, or ingot) or a finished steel mill 
product. Subsequent to this initial melting and pouring process, the 
steel may undergo further processing, including rolling, drawing, 
otherwise finishing, coating, etc. However, all steel imported into the 
United States must be accompanied by the mill test certification from 
the steel mill involved in the initial melt and pour phase. Thus, our 
adopted definition for country of melt and pour described below takes 
into account these various processes and establishes a singular 
definition focusing on the initial melt and pour phase that will be 
well-understood by the steel trade community.
---------------------------------------------------------------------------

    \30\ This general understanding is informed by years of 
administering the SIMA program, involving regular contact with the 
steel industry and other government agencies.
---------------------------------------------------------------------------

    In light of the above, we developed a definition for the country 
where the steel used in the manufacture of the product was melted and 
poured, as provided in revised Sec.  360.103(c)(3). Specifically, the 
license applicant is required to identify the original location where 
the raw steel is (1) first produced in a steel-making furnace in a 
liquid state, and then (2) poured into its first solid shape. Revised 
Sec.  360.103(c)(3) also provides that the first solid state can take 
the form of either a semi-finished product (slab, billets or ingots) or 
a finished steel mill product, and further explains that the location 
of melt and pour is customarily identified on mill test certificates 
that are commonplace in steel production, generated at each stage of 
the production process, and maintained in the ordinary course of 
business. Further, revised Sec.  360.103(c)(3) explains that this 
reporting requirement will not apply to raw materials used in the steel 
manufacturing process (i.e., steel scrap; iron ore; pig iron; reduced, 
processed, or pelletized iron ore; or raw alloys). This definition 
specifically incorporates the language from the Protocol of Amendment 
to the USMCA and the definition suggested by one of the commenters, as 
well as our own experience under the SIMA system. No other definitions 
were proposed by commenters. Additionally, this definition provides 
clear guidance to parties as to which information from the mill test 
certification should be relied upon in identifying the country of melt 
and pour for purposes of the steel import license application.
    With respect to the public SIMA monitor, which aggregates and 
reports certain license data, Commerce will only release or update 
weekly data on the country of melt and pour for each product group (at 
the 6-digit HTS level) if there are sufficient observations for the 
product groups. Commerce releases data on its public SIMA monitor under 
the authority of the Census Act (13 U.S.C. 301(a) and 302) and must 
adhere to Census guidance for the release of data, which requires the 
protection of proprietary data. After collecting the melt and pour 
data, Commerce will determine whether there are sufficient data 
observations to report at a 6-digit product group level without 
disclosing proprietary data. Notably, the public SIMA monitor currently 
divides license data into 53 different product groups (which, as 
described in this final rule, will be increased to 58 product groups). 
In instances where there are few (i.e., less than three) observations 
of certain country of origin/product group combinations, Commerce 
cannot provide this disaggregated data (i.e., product group level) when 
adding the melt and pour data. Further, as stated in revised Sec.  
360.104(a), provision of aggregate data on the public SIMA monitor may 
be revisited at the sub-regulatory level should concerns arise over the 
possible release of proprietary data.
    As stated above, some commenters assert that certain trading 
patterns, which might be revealed by reporting data at the 6-digit HTS 
level on the public SIMA monitor, are already available through 
publicly available subscription sources, which aggregate bill of lading 
information. However, these subscription sources, based on CBP import 
records, do not provide the same level of detail as the public SIMA 
monitor, based on license data (including country of melt and 
pour).\31\ Additionally, CBP import records become available much later 
than the early release of data on the public SIMA monitor. Therefore, 
as stated above, until we collect and conduct an analysis of the melt 
and pour data, Commerce cannot determine whether there will be 
sufficient observations to ensure anonymity to release data at the 6-
digit HTS level in all instances. Further, our adoption of these 
procedures is consistent with the joint understandings and will provide 
the requisite information needed to monitor for import surges and 
potential transshipment, while allowing for the protection of 
proprietary data.
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    \31\ See, e.g., https://www.datamyne.com/us-import-data/.
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2. Whether To Require SIMA License Applicants To Identify Countries 
Where the Steel Was Subsequently Processed Prior to Importation

    Certain commenters requested that the steel license application 
require information on each country where the steel was subsequently 
processed prior to importation. According to the commenters, this 
information is necessary to prevent evasion and circumvention of trade 
remedy measures. One commenter argued that ``extending the country of 
origin reporting requirement to all levels of processing would not be 
unreasonably burdensome.'' One commenter, however, asserted that U.S. 
importers may not know where steel was subsequently processed because 
these importers are far removed from the part of the supply chain that 
has knowledge

[[Page 56168]]

of the country after the steel is melted and poured.
    Response: Commerce, at this time, will not require SIMA license 
applicants to report information on subsequent processing in the 
license application. Unlike the country of melt and pour field 
discussed above, Commerce did not request comments on including a 
subsequent processing \32\ field in the Proposed Rule \33\ and, as a 
result, the public has not been afforded an opportunity to provide 
comments on such a change in the license application. However, Commerce 
has considered the commenters' assertion that collecting data on 
subsequent processing of steel imports in third countries, prior to 
importation into the United States, will assist in monitoring potential 
evasion and circumvention of trade remedy measures.
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    \32\ According to a commenter, subsequent processing could occur 
in two countries before importation into the United States. For 
example, subsequent processing of corrosion resistant steel from 
Country A could take the following two steps: (1) Cold rolling in 
Country B; and (2) coating/finishing in Country C before importation 
into the United States.
    \33\ 85 FR at 17515.
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    Accordingly, Commerce may request public comments on the inclusion 
of a subsequent processing field to SIMA's import license application, 
at a later date.

3. Increasing the Maximum Threshold for Low-Value Licenses To Codify 
Current Practice

    Several commenters raised concerns that if the maximum threshold 
for low-value licenses was raised to $5,000, key data, particularly 
imports from Canada and Mexico, would not be tracked in the SIMA system 
and requested that the maximum threshold be reverted to $250 per 
shipment. According to these commenters, a $5,000 limit for low-value 
licenses might create a transshipment loophole for U.S. steel imports. 
Specifically, the use of low-value licenses on multiple shipments will 
incentivize a U.S. importer (or distributor) to obscure the country of 
origin of steel and also the country where the steel was melted and 
poured by being shipped into the United States via Canada or Mexico. 
One commenter also stated that allowing the exemption level to be 
significantly higher creates loopholes that allow gaming within the 
SIMA system via multi-load and warehousing schemes that lead to 
circumvention. As such, commenters recommended that Commerce conform 
its practice to the existing regulation rather than conforming the 
regulation to existing practice.
    One commenter recommended that to prevent abuse of the low-value 
license exemption, Commerce should adopt a ``formal entry/formal 
license'' operational paradigm. One commenter also requested that 
Commerce collect low-value license information on country of melt and 
pour and all subsequent processing in a third country. This commenter 
also suggested that Commerce limit the use of low-value licenses to a 
single entry and that the number of low-value licenses obtained by a 
single party or affiliates be limited to one per quarter within a 
calendar year.
    Response: As discussed above, Commerce is amending Sec.  360.103(f) 
to reflect that the low-value license threshold is $5,000 per steel 
shipment into the United States, consistent with our existing practice. 
The low-value license threshold has been set at $5,000 since 2010, and 
during this time Commerce has never received any evidence that 
importers use the low-value license to conceal the actual country of 
origin or otherwise evade the regular license requirements. The 
commenters did not provide any such evidence. Increasing the threshold 
to $5,000 merely codifies Commerce's longstanding practice.
    Additionally, Commerce finds that use of the low-value licenses 
substantially reduces the burden to importers of steel shipments 
between $250 and $5,000. To determine the potential burden, we examined 
CBP data for one sample month for steel product entries below $5,000. 
This data indicated that there were approximately 8,000 such entries in 
the sample month (June 2019). Therefore, we estimate that the 
additional burden of requiring importers of entries between $250 to 
$5,000 to switch to regular (i.e., one-time use) licenses would create 
roughly 96,000 more regular licenses per year (8,000/month * 12 months 
= 96,000 more licenses per year) at 10 minutes per license (or 16,000 
hours).\34\ Additionally, based on review of CBP data, we find that 
there would be little improvement in the quality of the data 
collection, as the value of entries covered by the low-value licenses 
($5,000 or less) is very small compared to the average monthly value of 
regular licenses (in May 2020, the average value was $50,000 per 
regular license). That said, Commerce will continue to monitor the use 
of low-value licenses and, if there is evidence that low-value licenses 
are being misused, or any other improper activity related to low-value 
license, we will revisit the threshold maximum of $5,000, and also 
consider other action, as appropriate.
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    \34\ See Proposed Rule, 85 FR at 17518 (describing that, for 
purposes of the Paperwork Reduction Act information collection 
requirements, Commerce estimates that each regular license 
application take less than 10 minutes per response).
---------------------------------------------------------------------------

    Moreover, Commerce does not intend to limit the use of low-value 
licenses to one per quarter for each importer or to collect information 
about country of melt and pour on low-value licenses because low-value 
licenses are, by definition, re-usable licenses. Additionally, we note 
that adding these restrictions to the low-value licenses would obviate 
the intended benefit of these licenses. Specifically, the intent of 
low-value licenses is to reduce the public burden of the steel license 
requirements by allowing an importer to bring in multiple shipments of 
steel at a low-value on a single reusable license. If importers were 
required to create separate, single-use low-value licenses for each 
low-value shipment, this would increase the public burden of the 
license system, without a meaningful benefit in terms of data 
collection.
    Finally, Commerce does not intend to adopt a ``formal entry/formal 
license'' operational paradigm to prevent abuse of the low-value 
license exemption, as suggested by one commenter. Specifically, this 
commenter did not elaborate on how implementing such a paradigm would 
prevent abuse of the low-value license exemption, and, therefore, we 
have not further considered this proposal.

4. Maintain License Data on the Steel Monitor for a Longer Period of 
Time

    Certain commenters requested that Commerce maintain information 
regarding the country of melt and pour on the public SIMA monitor for a 
longer period of time. One commenter asserted that this would allow 
stakeholders to analyze longer trends in steel trade including where 
steel is melted, poured, and processed prior to importation into the 
United States. Commenters suggested compiling this data in a separate 
report on the public SIMA monitor, which only includes license data, 
and requested that Commerce maintain the data indefinitely. One 
commenter also requested that Commerce provide a ``table search'' 
function on the public SIMA monitor to allow the public to construct 
custom tables specifying country of melt and pour, country of 
subsequent processing, and country of origin in addition to other data 
fields.
    Response: Currently, Commerce does not maintain license data on the 
public SIMA monitor once new Census data are released, and license data 
connected with the monthly Census data are only

[[Page 56169]]

available on the public SIMA monitor for two months.\35\ Given that 
melt and pour information will not be replicated in the official Census 
statistics, Commerce will maintain license data regarding the country 
of melt and pour on the public SIMA monitor for a longer period, as a 
separate report. Commerce will maintain the monthly license data for 
the country of melt and pour field up to 12 months and maintain annual 
data afterwards, to the extent possible. Initially, Commerce may not be 
able to include country of melt and pour with the other fields for 
license data on the public SIMA monitor because of concerns regarding 
proprietary data. As mentioned above, in accordance with the Census 
guidelines, Commerce needs to have a minimum number of observations to 
display a piece of data publicly (including the country of melt and 
pour). Therefore, information indicating the country of melt and pour 
will only be reported on the public SIMA monitor once we have the 
minimum observations to display the data publicly without disclosing 
proprietary data.
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    \35\ https://enforcement.trade.gov/steel/license/.
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5. Additional Modifications Proposed by a Commenter

    One commenter proposed modifications to the SIMA licensing system 
and public SIMA monitor, which Commerce did not include in its Proposed 
Rule.\36\ Specifically, this commenter requested that the following 
changes be made to the SIMA system: (1) Reduce the import license 
validity period from 75 days to 15 days to improve reporting accuracy 
and prevent skewing of actual U.S. steel import volumes; (2) license 
holders be required to submit corrections to the data reported on the 
SIMA import license form within 30 days of the date of importation of 
steel products; (3) importers be required to maintain their SIMA 
licenses, both original and corrected, for a period of five years after 
importation; and (4) all license applications require applicants to 
identify whether imported steel products are subject to antidumping 
(AD) and countervailing duty (CVD) orders pursuant to Title VII of the 
Tariff Act of 1930, as amended.
---------------------------------------------------------------------------

    \36\ See Proposed Rule, 85 FR at 17515.
---------------------------------------------------------------------------

    Response: With respect to the first item, Commerce will not adopt 
the commenter's proposed 15-day validity period because reducing the 
validity period from 75 to 15 days would require importers to obtain 
licenses shortly before the date of importation. Although a shorter 
validity period might improve the accuracy of the license information, 
Commerce finds that reducing the license validity period significantly 
would defeat SIMA's main purpose, which is to serve as an early-warning 
system for U.S. imports of steel products. Consistent with this 
purpose, SIMA currently collects two months of license information to 
be displayed on our public SIMA monitor for the public to track import 
trends. If the license validity period was reduced, Commerce would not 
have the necessary license information to accurately report import 
trends on its public SIMA monitor as early as has been the case 
historically. Commerce finds the value of the early data provided in 
the public SIMA monitor outweighs the slight degree of additional 
precision possible by a shortened validity period.
    With respect to the second item, Commerce will not change existing 
practice and require users to submit corrections to licenses within 30 
days of the date of importation. Under existing practice, corrections 
to the SIMA license can be made months after importation, typically 
when CBP performs an audit on individual importers' entries. Thus, 
Commerce has decided not to modify the regulations for the SIMA 
licensing system to implement a time limit requirement for making 
corrections to the license application, to maintain consistency with 
CBP's audit procedures.
    With respect to the third item, Commerce will not implement a 
requirement for U.S. steel importers to maintain steel licenses for 
five years. Although Commerce declines to implement this record-keeping 
requirement for the SIMA system, CBP regulations (i.e., 19 CFR part 
163) require that records for entry declarations be maintained for five 
years. Additionally, Commerce did not request comments on implementing 
this or any other record-keeping requirement in the Proposed Rule,\37\ 
and, as a result, interested parties were not given an opportunity to 
provide public comments on this requirement. However, Commerce may, at 
a later date, request public comment about implementing this 
requirement.
---------------------------------------------------------------------------

    \37\ See Proposed Rule, 85 FR at 17515.
---------------------------------------------------------------------------

    With respect to the fourth item, at this time, Commerce is not 
adding a new field to the license form requiring U.S. importers to 
identify the steel mill products subject to AD/CVD orders. Commerce 
does not disagree with the commenter that making such a change may 
enhance reliability and completeness of the data in the public SIMA 
monitor, with respect to steel products covered by AD/CVD orders. 
Commerce, however, did not request comments on implementing this change 
to the license application in the Proposed Rule,\38\ and, thus, 
interested parties did not have an opportunity to provide public 
comments on this requirement. This is in contrast to the field for 
country of melt and pour that was first identified in the Proposed 
Rule, discussed above. Accordingly, Commerce will not make this change 
to the license application for this final rule. Nonetheless, Commerce 
may, at a later date, request public comment about this requirement.
---------------------------------------------------------------------------

    \38\ See id.
---------------------------------------------------------------------------

6. Amendments to Existing Product Groups on the Public SIMA Monitor

    Several commenters request that Commerce divide the existing 
product group for ``blooms, billets, and slabs'' (also called ``semi-
finished steel'') into at least two separate product groups. The two 
proposed product groups are for slab and ``other semi-finished steel,'' 
which certain commenters suggest will allow a better understanding of 
import trends for these two distinct products. Certain commenters 
specifically proposed that Commerce include HTS 7207.12.0050, 
7207.20.0045, 7224.90.0025, and 7224.90.0055 in the proposed new slab 
product group.
    Response: For the final rule, as suggested by commenters, Commerce 
will divide the ``carbon and alloy blooms, billets, and slabs'' product 
group on the public SIMA monitor into two product groups: ``slab 
(rectangular cross-section with width greater than 4 times the 
thickness)'' and ``other semi-finished'' product groups. Commerce will 
make the same change for the ``stainless blooms, billets, and slabs'' 
product group. While making this change, Commerce also plans to 
separate line pipe into three more specific product groups (i.e., line 
pipe greater than 16 inches in diameter, line pipe less than or equal 
to 16 inches in diameter, and line pipe not specified), which will 
harmonize SIMA data with Census data releases. These changes will also 
help the U.S. industry observe potential evasion or circumvention of 
AD/CVD orders, which the U.S. domestic producers raised as an 
underlying concern in their comments.

7. Harmonizing the Products Subject to SIMA With Those Subject to 
Section 232 Tariffs

    In the Proposed Rule, Commerce proposed adding to the SIMA system 
eight additional HTS codes subject to

[[Page 56170]]

Section 232 tariffs,\39\ which one commenter supports. However, this 
commenter suggests the following two options for reporting these new 
HTS codes in the public SIMA monitor to better account for the rails 
product group: (1) Create a new product group for the eight HTS codes 
in an ``other'' steel product group to ensure continuity of data over 
time; or (2) incorporate the eight HTS codes in the same product groups 
where each HTS subheading (at the 6-digit level) is already 
categorized.
---------------------------------------------------------------------------

    \39\ See Proposed Rule, 85 FR at 17520 (Appendix I).
---------------------------------------------------------------------------

    Response: For this final rule, as stated above, Commerce is 
expanding the scope of steel products covered by the SIMA system so 
that it covers all steel products subject to Section 232 tariffs, i.e., 
the eight additional HTS codes. Additionally, Commerce will adopt some 
of the suggestions raised above for the public SIMA monitor. 
Specifically, for three of these HTS codes,\40\ because they already 
fall within existing 6-digit level HTS subheadings under various 
existing product groups, Commerce intends to include these HTS codes in 
those existing product groups.
---------------------------------------------------------------------------

    \40\ HTS 7217901000, 7222406000, and 7228706000.
---------------------------------------------------------------------------

    Additionally, four of the HTS codes currently fall within 6-digit 
level HTS subheadings under the ``standard rails'' product group. The 
combined total imports for adding these four HTS codes to the 
``standard rails'' product group would increase 2019 imports of this 
group by over 25 percent.\41\ The final HTS code (7302909000) falls 
within the 6-digit level HTS subheading under the ``railroad 
accessories'' product group. However, the import volume last year for 
HTS 7302909000 exceeded the total import volume for the ``railroad 
accessories'' product group. Therefore, Commerce plans to create a new 
product group called ``Other Rails and Railroad Accessories'' in which 
to place these 5 remaining HTS codes on the public SIMA monitor.
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    \41\ https://www.trade.gov/steel.
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8. Indefinitely Extending the SIMA Program

    Most commenters support extending the SIMA licensing program 
indefinitely. Specifically, commenters requested that the SIMA program 
become permanent because unfairly traded imports continue to be an 
ongoing threat to the U.S. industry.
    Response: Given the unanimous support by commenters, Commerce will 
extend the SIMA program indefinitely, as stated above, by removing and 
reserving Sec.  360.105.

Classifications

Executive Order 12866

    The Office of Management and Budget (OMB) has determined that this 
final rule is significant, but not economically significant, for 
purposes of Executive Order 12866.

Executive Order 13771

    This final rule is not subject to Executive Order 13771 because it 
imposes de minimis costs.

Executive Order 13132

    This rule does not contain policies with federalism implications as 
that term is defined in Executive Order 13132.

Paperwork Reduction Act

    This final rule contains collection-of-information requirements 
that have been submitted to the Office of Management and Budget (OMB) 
for approval under the Paperwork Reduction Act (PRA) (OMB Control No. 
0625-0245; Expiration Date: 07/31/2023). Public reporting for this 
collection of information is estimated to be less than ten minutes per 
response, including the time for reviewing instructions and completing 
and reviewing the collection of information.
    The Proposed Rule identified two revisions to the public reporting 
for this collection of information. First, steel import license 
applicants will need to identify the country of melt and pour as an 
additional field on the steel import license application. In this final 
rule, the information collection has been refined to provide the 
regulatory definition of country of melt and pour (as found in 19 CFR 
360.103(c)(3)) in the form instructions. Additionally, commenters 
agreed with the Proposed Rule that this revision will not add any 
additional burden on the public, because the information needed to 
identify the country of melt and pour can be found on the mill test 
certification that is currently required by CBP for entry purposes and 
readily available to the importer. Second, the licensing requirement 
will be expanded to apply to all steel products, including eight 
additional HTS categories in addition to the approximately 780 HTS 
categories currently covered by the SIMA system. No party raised 
concerns regarding the burden hour estimates in the Proposed Rule for 
this revision.
    Notwithstanding any other provision of law, no person is required 
to respond to, nor shall any person be subject to a penalty for failure 
to comply with, a collection of information subject to the Paperwork 
Reduction Act unless that collection displays a currently valid OMB 
Control Number. All currently approved collections of information may 
be viewed at https://www.reginfo.gov/public/jsp/PRA/praDashboard.myjsp.

Regulatory Flexibility Act

    The Chief Counsel for Regulation of the Department of Commerce 
certified to the Chief Counsel for Advocacy of the Small Business 
Administration at the proposed rule stage, that this rule, if adopted, 
would not have a significant economic impact on a substantial number of 
small entities as that term is defined in the Regulatory Flexibility 
Act, 5 U.S.C. 601 et seq. The factual basis for the certification is 
found in the proposed rule and is repeated below. No comments were 
received on the certification or the economic impacts of this action. 
As a result, no final regulatory flexibility analysis is required and 
none was prepared.
    This rule will not have a significant economic impact on a 
substantial number of small entities. This rule, if implemented, would: 
(1) Require import license applicants to additionally identify the 
country where steel used in the manufacture of the imported steel 
product was melted and poured, as defined in this final rule; (2) 
harmonize the scope of SIMA's licensing requirement with the scope of 
steel products subject to Section 232 tariffs; (3) indefinitely extend 
the SIMA system; and (4) to modify the regulations regarding low value 
licenses to align with our current practice. The entities that would be 
impacted by this rule are importers and brokerage companies that import 
steel mill products. These entities are already required to provide 
information, including the name and address of the importer, type of 
steel product, and country of origin of the steel imports, along with 
additional information, to obtain steel import licenses through the 
online SIMA licensing system for filing entry summary documentation 
required by CBP for U.S. imports of steel mill products. Based on 
statistics derived from current license applications, of the 
approximately 562,857 licenses issued each year, Commerce estimates 
that less than two percent of the license applications (approximately 
11,257) would be filed by importers and brokerage companies considered 
to be small entities.
    Based on the current usage of the SIMA system, Commerce does not 
anticipate that these four changes to the SIMA system required under 
this proposed rule will have a significant economic impact on a 
substantial

[[Page 56171]]

number of small entities. Companies are already familiar with the 
licensing of certain steel products under the current system. In most 
cases, brokerage companies will apply for the license on behalf of the 
steel importers. Most brokerage companies that are currently involved 
in filing documentation for importing goods into the United States are 
accustomed to CBP's automated entry filing systems. Today, CBP filings 
are handled electronically. Although steel import license applicants 
will need to identify the country of melt and pour as an additional 
field on the steel import license application pursuant to this final 
rule, this revision will not add any additional burden, because the 
information needed to identify the country of melt and pour can be 
found on the mill test certification that is currently required by CBP 
for entry purposes and readily available to the importer. Therefore, 
the proposed modifications to the license application will not be a 
significant obstacle to any firm. Should an importer or brokerage 
company need to register for an account or apply for a license non-
electronically, a fax/phone option is available at Commerce during 
regular business hours. There is no cost to register for a company-
specific steel license account and no cost to file for the license. 
Each license form is expected to take less than 10 minutes to complete 
and collects much of the same information required on the CBP entry 
summary documentation. The steel import license is the only additional 
U.S. entry requirement that the importers or their representatives must 
fulfill in order to import each covered steel product shipment under 19 
CFR part 360.
    Commerce does not charge fees for licenses. Commerce estimates that 
the likely aggregate license costs incurred by small entities in terms 
of the time to apply for licenses as a result of this proposed rule 
would be less than two percent, or an estimated $37,523.00, of the 
estimated total $1,876,190 cost to all steel importers to process the 
on-line automatic licenses. These calculations are based on an hourly 
pay rate of $20.00 multiplied by the estimated 93,195 total annual 
burden hours. The average cost of a single license is less than $3.33 
based on the estimate that one license requires less than 10 minutes of 
the filer's time.
    Therefore, the Department certifies that the final rule will not 
have a significant economic impact on a substantial number of small 
entities.

List of Subjects in 19 CFR Part 360

    Administrative practice and procedure, Business and industry, 
Imports, Reporting and recordkeeping requirements, Steel.

    Dated: September 1, 2020.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.

    For the reasons stated in the preamble, the Department of Commerce 
amends 19 CFR part 360 as follows:

PART 360--STEEL IMPORT MONITORING AND ANALYSIS SYSTEM

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1. The authority citation for 19 CFR part 360 continues to read as 
follows:

    Authority:  13 U.S.C. 301(a) and 302.


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2. In Sec.  360.101, revise paragraph (a)(1) to read as follows:


Sec.  360.101   Steel import licensing.

    (a) * * *
    (1) All imports of basic steel mill products are subject to the 
import licensing requirements. These products are listed on the Steel 
Import Monitoring and Analysis (SIMA) system website (https://www.trade.gov/steel). Registered users will be able to obtain steel 
import licenses on the SIMA system website. This website contains two 
sections related to import licensing--the online registration system 
and the automatic steel import license issuance system. Information 
gathered from these licenses will be aggregated and posted on the 
import monitoring section of the SIMA system website.
* * * * *

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3. In Sec.  360.103:
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a. Revise paragraphs (c)(1)(ii), (iii), and (xii);
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b. Redesignate paragraphs (c)(1)(xiii) and (xiv) as paragraphs 
(c)(1)(xiv) and (xv);
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c. Add a new paragraph (c)(1)(xiii);
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d. Revise newly redesignated paragraph (c)(1)(xiv);
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e. Redesignate paragraph (c)(3) as paragraph (c)(4);
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f. Add a new paragraph (c)(3); and
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g. Revise paragraph (f).
    The revisions and additions read as follows:


Sec.  360.103   Automatic issuance of import licenses.

* * * * *
    (c) * * *
    (1) * * *
    (ii) Filer contact name, phone number, and email address;
    (iii) Entry type (i.e., Consumption, FTZ);
* * * * *
    (xii) Current Harmonized Tariff Schedule (HTS) number (from 
Chapters 72 or 73);
    (xiii) Country where the steel used in the manufacture of the 
product was melted and poured (see paragraph (c)(3) of this section for 
further instruction);
    (xiv) Quantity (in kilograms); and
* * * * *
    (3)(i) The field in the license application requiring 
identification of the country where the steel used in the manufacture 
of the product was melted and poured (see paragraph (c)(1)(xiii) of 
this section) applies to the original location where the raw steel is:
    (A) First produced in a steel-making furnace in a liquid state; and 
then
    (B) Poured into its first solid shape.
    (ii) The first solid state can take the form of either a semi-
finished product (slab, billets or ingots) or a finished steel mill 
product. The location of melt and pour is customarily identified on 
mill test certificates that are commonplace in steel production, 
generated at each stage of the production process, and maintained in 
the ordinary course of business. The reporting requirement in paragraph 
(c)(1)(xiii) of this section will not apply to raw materials used in 
the steel manufacturing process (i.e., steel scrap; iron ore; pig iron; 
reduced, processed, or pelletized iron ore; or raw alloys).
* * * * *
    (f) Low-value licenses. There is one exception to the requirement 
for obtaining a unique license for each Customs entry. If the total 
value of the covered steel portion of an entry is less than $5,000, 
applicants may apply to Commerce for a low-value license that can be 
used in lieu of a single-entry license for low-value entries.

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4. Revise Sec.  360.104 to read as follows:


Sec.  360.104   Steel import monitoring.

    (a) Commerce will maintain an import monitoring system on the SIMA 
system website that will report certain aggregate information on 
imports of steel mill products obtained from the steel licenses and, 
where available, from the U.S. Census Bureau. Aggregate data will be 
reported, as appropriate, on a monthly basis by country of origin, 
country of melt and pour, and relevant steel mill product groupings, 
etc. and will include import quantity (metric tons), import Customs 
value (U.S. $), and average unit value ($/metric ton). The website will 
also contain certain aggregate data at the 6-digit Harmonized Tariff 
Schedule level and will also present a range of historical data for 
comparison purposes. Provision of aggregate data on the website may be 
revisited should concerns arise over the possible release of 
proprietary data.
    (b) Reported monthly import data will be refreshed each week, as 
appropriate,

[[Page 56172]]

with new data on licenses issued during the previous week. This data 
will also be adjusted periodically for cancelled or unused steel import 
licenses, as appropriate. Additionally, outdated license data will be 
replaced, where available, with information from the U.S. Census 
Bureau.


Sec.  360.105   [Removed and Reserved]

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5. Remove and reserve Sec.  360.105.

[FR Doc. 2020-19753 Filed 9-10-20; 8:45 am]
BILLING CODE 3510-DS-P