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Code · REGISTER · 2007-09-10 · Import Administration, International Trade Administration, Department of Commerce · Notices

Notices. Notice of appeal

38,769 words·~176 min read·/register/2007/09/10/07-4416·

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BILLING CODE 3410-11-M DEPARTMENT OF COMMERCE International Trade Administration (A-580-816) Certain Corrosion-Resistant Carbon Steel Flat Products from the Republic of Korea: Notice of Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review AGENCY: Import Administration, International Trade Administration, Department of Commerce. SUMMARY: In response to requests from petitioners, 1 the Department of Commerce (the Department) is conducting the thirteenth administrative review of the antidumping order on corrosion-resistant carbon steel flat products
(CORE)from Korea. This review covers three manufacturers and exporters (collectively, the respondents) of the subject merchandise: Dongbu Steel Co., Ltd., (Dongbu); Hyundai HYSCO (HYSCO); and Union Steel Manufacturing Co., Ltd. (Union). The period of review
(POR)is August 1, 2005, through July 31, 2006. We preliminarily determine that during the POR, Dongbu, HYSCO, and Union made sales of subject merchandise at less than normal value (NV). In addition, we are preliminary rescinding this review with respect to Pohang Iron & Steel Company, Ltd. (POSCO) and Pohang Coated Steel Co., Ltd. (POCOS) (collectively, the POSCO Group), as a result of petitioners timely withdrawal of its review request. If these preliminary results are adopted in the final results of this administrative review, we will instruct U.S. Customs and Border Protection
(CBP)to assess antidumping duties on all appropriate entries of subject merchandise during the POR. 1 Petitioners are the United States Steel Corporation (U.S. Steel) and Mittal Steel USA ISG, Inc. (Mittal Steel USA). EFFECTIVE DATE: September 10, 2007 FOR FURTHER INFORMATION CONTACT: Jolanta Lawska or George McMahon (Union), Preeti Tolani (Dongbu), and Victoria Cho or Christopher Hargett (HYSCO), AD/CVD Operations, Office 3, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone:
(202)482-8362,
(202)482-1167,
(202)482-0395,
(202)482-5075 and
(202)482-4161, respectively. SUPPLEMENTARY INFORMATION: Background On August 19, 1993, the Department published the antidumping order on CORE from Korea. *See Antidumping Duty Orders on Certain Cold-Rolled Carbon Steel Flat Products and Certain Corrosion-Resistant Carbon Steel Flat Products from Korea* , 58 FR 44159 (August 19, 1993) (Orders on Certain Steel from Korea). On August 1, 2006, we published in the **Federal Register** the *Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity To Request Administrative Review* , 71 FR 43441 (August 1, 2006). On August 31, 2006, respondents and petitioners requested a review of Dongbu, HYSCO, the POSCO Group, and Union. The Department initiated this review on September 29, 2006. *See Initiation of Antidumping and Countervailing Duty Administrative Reviews* , 71 FR 57465 (September 29, 2006). During the most recently completed segments of the proceeding in which Dongbu, HYSCO, the POSCO Group, and Union participated, the Department disregarded sales below the cost of production
(COP)that failed the cost test. 2 Therefore, pursuant to section 773(b)(2)(A)(ii) of the Tariff Act of 1930, as amended (the Act), we had reasonable grounds to believe or suspect that sales by these companies of the foreign like product under consideration for the determination of NV in this review were made at prices below the COP. We instructed Dongbu, HYSCO, the POSCO Group, and Union to respond to sections A-D of the initial questionnaire, 3 which we issued on September 13, 2006. 2 *Certain Corrosion-Resistant Carbon Steel Flat Products from the Republic of Korea: Notice of Preliminary Results of Antidumping Duty Administrative Review* , 71 FR 53370, 53375 (September 11, 2006) ( *Preliminary Results of the 12th Review of CORE from Korea); Notice of Final Results of the Twelfth Administrative Review of the Antidumping Duty Order on Certain Corrosion-Resistant Carbon Steel Flat Products from the Republic of Korea* , 72 FR 13086 (March 20, 2007) and accompanying *Issues and Decisions Memorandum; and Certain Corrosion-Resistant Carbon Steel Flat Products from the Republic of Korea; Notice of Amended Final Results of the Twelfth Administrative Review* , 72 FR 20815 (April 26, 2007). 3 Section A: Organization, Accounting Practices, Markets and Merchandise Section B: Comparison Market Sales Section C: Sales to the United States Section D: Cost of Production and Constructed Value On December 28, 2006, the petitioners timely withdrew their request for an administrative review of the POSCO Group. Thus, we are preliminary rescinding the request for review of the antidumping order for the POSCO Group. On April 19, 2007, the Department published a notice extending the time period for issuing the preliminary results of the thirteenth administrative review from May 3, 2007, to August 31, 2007. *See Corrosion-Resistant Carbon Steel Flat Products from Korea: Extension of Time Limits for the Preliminary Results of Antidumping Duty Administrative Review* , 72 FR 19688 (April 19, 2007). Rescission of Administrative Review for the POSCO Group As provided in 19 CFR 351.213(d)(1), “[t]he Secretary will rescind an administrative review under this section, in whole or in part, if a party that requested a review withdraws the request within 90 days of the date of publication of notice of initiation of the requested review.” The petitioners withdrew their request for an administrative review within 90 days of the date of publication of the notice of initiation of the instant administrative review and no other party requested an administrative review of the POSCO Group. Therefore, the Department is rescinding the administrative review with respect to the POSCO Group. Dongbu On November 10, 2006, Dongbu submitted its section A response to the initial questionnaire. On November 20, 2006, Dongbu submitted its sections B-D response to the initial questionnaire. On February 9, 2007, Dongbu submitted its supplemental questionnaire responses for sections A-C. Dongbu submitted its responses to the Department's three section D supplemental questionnaires on March 12, 2007, March 26, 2007, and April 19, 2007, respectively. Union On November 13, 2006, Union submitted its section A response to the initial questionnaire. On November 20, 2006, Union submitted its sections B-C response to the initial questionnaire. Union submitted its responses to the Department's three section A-C supplemental questionnaires on February 2, 2007, April 16, 2007 and June 1, 2007, respectively. HYSCO On November 3, 2006, HYSCO submitted its section A response to the Department's initial questionnaire. On November 22, 2006, HYSCO submitted its section B-D response to the Department's initial questionnaire. HYSCO submitted its responses to the Department's three section A-D supplemental questionnaires on January 29, 2007, February 20, 2007, and May 24, 2007, respectively. Verification The Department conducted the sales verification of Dongbu and HYSCO, from June 18 through 29, 2007, and Union from July 23 through 27, 2007, in Seoul, South Korea. The Department conducted the cost verification of HYSCO in Seoul, South Korea, from July 31 through August 4, 2007. The Department will conduct the cost verification of Dongbu and Union in Seoul, South Korea, after these preliminary results. Period of Review The POR covered by this review is August 1, 2005, through July 31, 2006. Scope of the Order This order covers flat-rolled carbon steel products, of rectangular shape, either clad, plated, or coated with corrosion-resistant metals such as zinc, aluminum, or zinc-, aluminum-, nickel- or iron-based alloys, whether or not corrugated or painted, varnished or coated with plastics or other nonmetallic substances in addition to the metallic coating, in coils (whether or not in successively superimposed layers) and of a width of 0.5 inch or greater, or in straight lengths which, if of a thickness less than 4.75 millimeters, are of a width of 0.5 inch or greater and which measures at least 10 times the thickness or if of a thickness of 4.75 millimeters or more are of a width which exceeds 150 millimeters and measures at least twice the thickness, as currently classifiable in the Harmonized Tariff Schedule of the United States (HTSUS) under item numbers 7210.30.0030, 7210.30.0060, 7210.41.0000, 7210.49.0030, 7210.49.0090, 7210.49.0091, 7210.49.0095, 7210.61.0000, 7210.69.0000, 7210.70.6030, 7210.70.6060, 7210.70.6090, 7210.90.1000, 7210.90.6000, 7210.90.9000, 7212.20.0000, 7212.30.1030, 7212.30.1090, 7212.30.3000, 7212.30.5000, 7212.40.1000, 7212.40.5000, 7212.50.0000, 7212.60.0000, 7215.90.1000, 7215.90.3000, 7215.90.5000, 7217.20.1500, 7217.30.1530, 7217.30.1560, 7217.90.1000, 7217.90.5030, 7217.90.5060, and 7217.90.5090. Included in the order are flat-rolled products of non-rectangular cross-section where such cross-section is achieved subsequent to the rolling process including products which have been beveled or rounded at the edges (i.e., products which have been “worked after rolling”). Excluded from this order are flat-rolled steel products either plated or coated with tin, lead, chromium, chromium oxides, both tin and lead (“terne plate”), or both chromium and chromium oxides (“tin-free steel”), whether or not painted, varnished or coated with plastics or other nonmetallic substances in addition to the metallic coating. Also excluded from this order are clad products in straight lengths of 0.1875 inch or more in composite thickness and of a width which exceeds 150 millimeters and measures at least twice the thickness. Also excluded from this order are certain clad stainless flat-rolled products, which are three-layered corrosion-resistant carbon steel flat-rolled products less than 4.75 millimeters in composite thickness that consist of a carbon steel flat-rolled product clad on both sides with stainless steel in a 20%-60%-20% ratio. These HTSUS item numbers are provided for convenience and customs purposes. The written descriptions remain dispositive. Product Comparisons In accordance with section 771(16) of the Act, we considered all CORE products produced by the respondents, covered by the scope of the order, and sold in the home market during the POR to be foreign like products for the purpose of determining appropriate product comparisons to CORE sold in the United States. Where there were no sales in the ordinary course of trade of identical merchandise in the home market to compare to U.S. sales, we compared U.S. sales to the next most similar foreign like product on the basis of the characteristics listed in Appendix V of the Department's antidumping questionnaire. In making the product comparisons, we matched foreign like products based on the Appendix V physical characteristics reported by each respondent. Where sales were made in the home market on a different weight basis from the U.S. market (theoretical versus actual weight), we converted all quantities to the same weight basis, using the conversion factors supplied by the respondents, before making our fair-value comparisons. Normal Value Comparisons To determine whether sales of CORE by the respondents to the United States were made at less than NV, we compared the Export Price
(EP)or Constructed Export Price
(CEP)to the NV, as described in the “Export Price/Constructed Export Price” and “Normal Value” sections of this notice. In accordance with section 777A(d)(2) of the Act, we calculated monthly weighted-average prices for NV and compared these to individual U.S. transactions. Export Price/Constructed Export Price We calculated the price of U.S. sales based on CEP, in accordance with section 772(b) of the Act, which defines the term “constructed export price” as “the price at which the subject merchandise is first sold (or agreed to be sold) in the United States before or after the date of importation by or for the account of the producer or exporter of such merchandise or by a seller affiliated with the producer or exporter, to a purchaser not affiliated with the producer or exporter, as adjusted under subsections
(c)and (d)” of this section. In contrast, section 772(a) of the Act defines “export price” as “the price at which the subject merchandise is first sold (or agreed to be sold) before the date of importation by the producer or exporter of the subject merchandise outside of the United States to an unaffiliated purchaser in the United States or to an unaffiliated purchaser for exportation to the United States, as adjusted under subsection (c)” of this section. In determining whether to classify U.S. sales as either EP or CEP sales, the Department must examine the totality of the circumstances surrounding the U.S. sales process, and assess where the reviewed sales or agreements of sale were made for purposes of section 772(b) of the Act. In the instant case, the record establishes that the sales were made in the United States after importation. Dongbu's, HYSCO's, and Union's affiliates in the United States
(1)took title to the subject merchandise and
(2)invoiced and received payment from the unaffiliated U.S. customers for their sales of the subject merchandise to those U.S. customers. Thus, the Department has determined that these U.S. sales should be classified as CEP transactions under section 772(b) of the Act. For Dongbu, HYSCO, and Union, we calculated CEP based on packed prices to unaffiliated customers in the United States. Where appropriate, we made deductions from the starting price for foreign inland freight, foreign inland insurance, foreign brokerage and handling, international freight, marine insurance, U.S. warehousing expenses, U.S. wharfage, U.S. inland freight, U.S. brokerage and handling, loading expenses, other U.S. transportation expenses, U.S. customs duties, commissions, credit expenses, letter of credit expenses, warranty expenses, other direct selling expenses, inventory carrying costs incurred in the United States, and other indirect selling expenses in the country of manufacture and the United States associated with economic activity in the United States. Pursuant to section 772(d)(3) of the Act, we made an adjustment for CEP profit. Where appropriate, we added interest revenue to the gross unit price. Consistent with the Department's normal practice, for Union we added the reported duty drawback to the gross unit price. We did so in accordance with the Department's long-standing test, which requires that:
(1)the import duty and rebate be directly linked to, and dependent upon, one another; and
(2)the company claiming the adjustment demonstrate that there were sufficient imports of imported raw materials to account for the duty drawback received on the exports of the manufactured product. HYSCO's Sales of Subject Merchandise that were Further Manufactured and Sold as Non-Subject Merchandise in the United States In its Section A questionnaire response and on September 27, 2006, HYSCO requested that the Department exclude certain POR sales of subject merchandise imported by its wholly owned U.S. subsidiary, HYSCO America Company (HAC), that were further manufactured after importation and sold as non-subject merchandise in the United States, citing “the extreme difficulty in calculating CEP for these sales through HAC.” The Department issued several supplemental questionnaires to HYSCO regarding these HAC CEP sales. Section 772(e) of the Act provides that when the value added in the United States by an affiliated party is likely to exceed substantially the value of the subject merchandise, the Department shall use one of the following prices to determine CEP if there is a sufficient quantity of sales to provide a reasonable basis of comparison and the use of such sales is appropriate:
(1)The price of identical subject merchandise sold by the exporter or producer to an unaffiliated person; or
(2)The price of other subject merchandise sold by the exporter or producer to an unaffiliated person. Our analysis showed that the value added by the affiliated party to the subject merchandise after importation in the United States was significantly greater than the 65 percent threshold we use in determining whether the value added in the United States by an affiliated party substantially exceeds the value of the subject merchandise. *See* 19 CFR 351.402 (c)(2). We then considered whether there were sales of identical subject merchandise or other subject merchandise sold in sufficient quantities by the exporter or producer to an unaffiliated person that could provide a reasonable basis of comparison. In addition to the sales to HAC that were further manufactured, HYSCO also had CEP sales of similar, but not identical, subject merchandise to unaffiliated customers in the United States in back-to-back transactions through another HYSCO affiliate in the United States, Hyundai HYSCO USA (“HHU”). Decisions as to the appropriate methodology for determining CEP for sales involving further manufacturing generally must be made on a case-by-case basis. In this instance, the quantity of sales of identical or other subject merchandise to an unaffiliated person is relatively small. However, another reasonable method for determining CEP for the HAC CEP sales is not evident. In this case, the value added after importation is very large and the further manufacturing very complex. Therefore, similar to our practice in other cases, see, e.g., *Certain Hot-Rolled Carbon Steel Flat Products from the Netherlands; Final Results of Antidumping Duty Administrative Reviews* , 72 FR 28676 (May 22, 2007), we relied on HYSCO's other sales of similar merchandise to unaffiliated parties in the United States as the basis for calculating CEP on HYSCO's sales through HAC. Although we have relied on a relatively small quantity of sales, as under the circumstances here this is the most reasonable methodology, we will continue to assess whether such quantities provide an adequate basis for our dumping analysis in other cases. Therefore, in this and future reviews we will reexamine the appropriate methodology to use when presented with similar circumstances. Normal Value Based on a comparison of the aggregate quantity of home market and U.S. sales, we determined that the quantity of the foreign like product sold in the exporting country was sufficient to permit a proper comparison with the sales of the subject merchandise to the United States, pursuant to section 773(a) of the Act. Therefore, in accordance with section 773(a)(1)(B)(i) of the Act, we based NV on the price at which the foreign like product was first sold for consumption in the home market, in the usual commercial quantities and in the ordinary course of trade. Where appropriate, we deducted rebates, discounts, inland freight (offset, where applicable, by freight revenue), inland insurance, and packing. Additionally, we made adjustments to NV, where appropriate, for credit expenses, warranty expenses, post-sale warehousing, and differences in weight basis. We also made adjustments, where appropriate, for home market indirect selling expenses and inventory carrying costs to offset U.S. commissions. We also increased NV by U.S. packing costs in accordance with section 773(a)(6)(A) of the Act. We made adjustments to NV for differences in cost attributable to differences in physical characteristics of the merchandise, pursuant to section 773(a)(6)(C)(ii) of the Act. For purposes of calculating NV, section 771(16) of the Act defines “foreign like product” as merchandise which is either
(1)identical or
(2)similar to the merchandise sold in the United States. When there are no identical products sold in the home market, the products which are most similar to the product sold in the United States are identified. For the non-identical or most similar products which are identified based on the Department's product matching criteria, an adjustment is made to the home market sales price to account for the actual physical differences between the products sold in the United States and the home market or third country market. See 19 CFR 351.411 and section 773(a)(6)(C)(ii) of the Act. Level of Trade In accordance with section 773(a)(1)(B) of the Act, we determined NV based on sales in the comparison market at the same level of trade
(LOT)as the CEP sales, to the extent practicable. When there were no sales at the same LOT, we compared U.S. sales to comparison market sales at a different LOT. Pursuant to 19 CFR 351.412, to determine whether CEP sales and NV sales were at different LOTs, we examine stages in the marketing process and selling functions along the chain of distribution between the producer and the unaffiliated (or arm's-length) customers. If the comparison market sales are at a different LOT and the differences affect price comparability, as manifested in a pattern of consistent price differences between sales at different LOTs in the country in which NV is determined, we will make an LOT adjustment under section 773(a)(7)(A) of the Act. For CEP sales, if the NV LOT is at a more advanced stage of distribution than the CEP LOT and the data available do not provide an appropriate basis to determine an LOT adjustment, we will grant a CEP offset, as provided in section 773(a)(7)(B) of the Act. *See Notice of Final Determination of Sales at Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate from South Africa* , 62 FR 61731, 61732-33 (November 19, 1997). We did not make an LOT adjustment under 19 CFR 351.412(e) because, as there was only one home market LOT for each respondent, we were unable to identify a pattern of consistent price differences attributable to differences in LOTs ( *see* 19 CFR 351.412(d)). Under 19 CFR 351.412(f), we are preliminarily granting a CEP offset for Dongbu, HYSCO, and Union because the NV for each company is at a more advanced LOT than the LOT for their U.S. CEP sales. For a detailed description of our LOT methodology and a summary of company-specific LOT findings for these preliminary results, *see* the August 31, 2007, *Calculation Memorandum for Dongbu Steel Co., Ltd.; Calculation Memorandum for Hyundai HYSCO* ; and *Calculation Memorandum for Union Steel Manufacturing Co., Ltd.* , of which the public versions are on file in the Central Records Unit (CRU), Import Administration, Washington, DC, HCHB Building, Room B-099. Cost of Production A. Calculation of COP We are investigating COP for Dongbu, HYSCO, and Union because during the most recently completed segments of the proceeding in which Dongbu, HYSCO, and Union participated, the Department found and disregarded sales that failed the cost test. We calculated a company-specific COP for Dongbu, HYSCO, and Union based on the sum of each respondent's cost of materials and fabrication for the foreign like product, plus amounts for home-market selling expenses, selling, general and administrative expenses (SG&A), and packing costs in accordance with section 773(b)(3) of the Act. We relied on Dongbu's, HYSCO's, and Union's information as submitted. In accordance with section 773(b)(3) of the Act, we calculated COP based on the sum of the respondents' cost of materials and fabrication for the foreign like product, plus amounts for general and administrative (G&A) expenses and interest expenses. We relied on the COP information provided by Dongbu in its questionnaire responses, except for the following instances where the information was not appropriately quantified or valued: 1. We adjusted Dongbu's reported cost of manufacturing
(COM)to appropriately value the claimed scrap offset. 2. We revised the reported G&A expense ratio to exclude certain items of exchange gains and losses. In addition, we adjusted the denominator used to calculate the G&A expense ratio for the adjustment made above. For further discussion of these adjustments, *see* the Memorandum to Neal Halper entitled, *Cost of Production and Constructed Value Adjustments for the Preliminary Results—Dongbu Steel Co., Ltd.* , dated August 30, 2007. B. Test of Home-Market Prices In determining whether to disregard home market sales made at prices below the COP, as required under sections 773(b)(1)(A) and
(B)of the Act, we compared the weighted-average COP figures to home market sales of the foreign like product and we examined whether
(1)within an extended period of time, such sales were made in substantial quantities, and
(2)such sales were made at prices which permitted the recovery of all costs within a reasonable period of time. On a product-specific basis, we compared the COP to the home market prices (not including VAT), less any applicable movement charges, discounts, and rebates. C. Results of COP Test Pursuant to section 773(b)(1) of the Act, we may disregard below-COP sales in the determination of NV if these sales have been made within an extended period of time in substantial quantities and were not at prices which permit recovery of all costs within a reasonable period of time. Where 20 percent or more of a respondent's sales of a given product during the POR were at prices less than the COP for at least six months of the POR, we determined that sales of that model were made in “substantial quantities” within an extended period of time, in accordance with sections 773(b)(2)(B) and
(C)of the Act. Where prices of a respondent's sales of a given product were below the per-unit COP at the time of sale and below the weighted-average per-unit costs for the POR, we determined that sales were not at prices which would permit recovery of all costs within a reasonable period of time, in accordance with section 773(b)(2)(D) of the Act. In such cases, we disregarded the below-cost sales in accordance with section 773(b)(1) of the Act. Pursuant to section 773(b)(2)(C) of the Act, where less than 20 percent of a respondent's sales of a given product were at prices less than the COP, we did not disregard any below-cost sales of that product because we determined that the below-cost sales were not made in “substantial quantities.” We tested and identified below-cost home market sales for Dongbu, HYSCO, and Union. We disregarded individual below-cost sales of a given product and used the remaining sales as the basis for determining NV, in accordance with section 773(b)(1) of the Act. *See* the August 31, 2007, *Calculation Memorandum for Dongbu Steel Co., Ltd.; Calculation Memorandum for Hyundai HYSCO* ; and *Calculation Memorandum for Union Steel Manufacturing Co., Ltd* . Arm's-Length Sales Dongbu and HYSCO also reported that they made sales in the home market to affiliated parties. The Department calculates NV based on a sale to an affiliated party only if it is satisfied that the price to the affiliated party is comparable to the price at which sales are made to parties not affiliated with the producer or exporter, *i.e.* , sales at arm's length. *See* 19 CFR 351.403(c). To test whether these sales were made at arm's length, we compared the starting prices of sales to affiliated and unaffiliated customers net of all movement charges, direct selling expenses, discounts and packing. In accordance with the Department's current practice, if the prices charged to an affiliated party were, on average, between 98 and 102 percent of the prices charged to unaffiliated parties for merchandise identical or most similar to that sold to the affiliated party, we considered the sales to be at arm's-length prices. *See Notice of Preliminary Results and Partial Rescission of Antidumping Duty Administrative: Ninth Administrative Review of the Antidumping Duty Order on Certain Pasta from Italy* , 71 FR 45017, 45020 (August 8, 2006); 19 CFR 351.403(c). Conversely, where we found sales to the affiliated party that did not pass the arm's-length test, all sales to that affiliated party have been excluded from the NV calculation. *See Antidumping Proceedings: Affiliated Party Sales in the Ordinary Course of Trade* , 67 69186, 69187 (November 15, 2002). Currency Conversion For purposes of these preliminary results, we made currency conversions in accordance with section 773A(a) of the Act, based on the official exchange rates published by the Federal Reserve Bank. Preliminary Results of the Review As a result of this review, we preliminarily find that the following weighted-average dumping margins exist: Producer/Manufacturer Weighted-Average Margin Dongbu 4.96 % HYSCO 0.51 % Union 4.35 % The Department will disclose calculations performed within five days of the date of publication of this notice to the parties of this proceeding in accordance with 19 CFR 351.224(b). Interested parties may submit case briefs and/or written comments no later than 30 days after the date of publication of these preliminary results of review. *See* 19 CFR 351.309(c)(ii). Rebuttal briefs are limited to issues raised in such briefs or comments and may be filed no later than five days after the time limit for filing the case briefs or comments. *See* 19 CFR 351.309(d). Parties submitting arguments in this proceeding are requested to submit with the argument: 1) a statement of the issue, 2) a brief summary of the argument, and 3) a table of authorities. Case and rebuttal briefs and comments must be served on interested parties in accordance with 19 CFR 351.303(f). Further, parties submitting written comments are requested to provide the Department with an additional copy of the public version of any such comments on a diskette. An interested party may request a hearing within 30 days of publication of these preliminary results. *See* 19 CFR 351.310(c). Any hearing, if requested, ordinarily will be held two days after the due date of the rebuttal briefs. The Department will issue the final results of this administrative review, which will include the results of its analysis of issues raised in any such comments, or at a hearing, if requested, within 120 days of publication of these preliminary results. Assessment Rate Upon completion of this administrative review, the Department shall determine, and CBP shall assess, antidumping duties on all appropriate entries, in accordance with 19 CFR 351.212. The Department intends to issue assessment instructions to CBP 15 days after the date of publication of the final results of this review. The Department clarified its “automatic assessment” regulation on May 6, 2003. *See Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties* , 68 FR 23954 (May 6, 2003) ( *Assessment Policy Notice* ). This clarification will apply to entries of subject merchandise during the POR produced by companies included in these final results of review for which the reviewed companies did not know that the merchandise they sold to the intermediary ( *e.g.* , a reseller, trading company, or exporter) was destined for the United States. In such instances, we will instruct CBP to liquidate unreviewed entries at the “All Others” rate if there is no rate for the intermediary involved in the transaction. *See Assessment Policy Notice* for a full discussion of this clarification. Cash Deposit Requirements To calculate the cash deposit rate for each producer and/or exporter included in this administrative review, we divided the total dumping margins for each company by the total net value for that company's sales during the review period. The following deposit rates will be effective upon publication of the final results of this administrative review for all shipments of CORE for Korea entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided by section 751(a)(2)(C) of the Act:
(1)The cash deposit rates for the companies listed above will be the rates established in the final results of this review, except if the rate is less than 0.5 percent and, therefore, *de minimis* , the cash deposit will be zero;
(2)for previously reviewed or investigated companies not listed above, the cash deposit rate will continue to be the company-specific rate published for the most recent final results in which that manufacturer or exporter participated;
(3)if the exporter is not a firm covered in these reviews, a prior review, or the original less-than-fair-value
(LTFV)investigation, but the manufacturer is, the cash deposit rate will be the rate established for the most recent final results for the manufacturer of the merchandise; and
(4)if neither the exporter nor the manufacturer is a firm covered in these or any previous review conducted by the Department, the cash deposit rate will be 17.70 percent, the “All Others” rate established in the LTFV. *See Orders on Certain Steel from Korea* . These cash deposit requirements, when imposed, shall remain in effect until further notice. Notification to Importers This notice serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties. These preliminary results of review are issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Act. Dated: August 31, 2007. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E7-17756 Filed 9-7-07; 8:45 am] BILLING CODE 3510-DS-S DEPARTMENT OF COMMERCE International Trade Administration A-570-886 Polyethylene Retail Carrier Bags from the People's Republic of China: Preliminary Results of Antidumping Duty Administrative Review and Partial Rescission of Review AGENCY: Import Administration, International Trade Administration, Department of Commerce. SUMMARY: In response to a request from the Polyethylene Retail Carrier Bag Committee, 1 which represents domestic producers of polyethylene retail carrier bags, and individual requests from certain manufacturers/exporters of subject merchandise located in the People's Republic of China (“PRC”), the Department of Commerce (“the Department”) is conducting an administrative review of the antidumping duty order on polyethylene retail carrier bags (“PRCBs”) from the PRC. The Department has reviewed shipments of subject merchandise made by Dongguan Nozawa Plastics Products Co., Ltd. and United Power Packaging, Ltd. (collectively, “Nozawa”), and Rally Plastics Co., Ltd. (“Rally”), during the period August 1, 2005, through July 31, 2006. 1 Consisting of Hilex Poly Company, LLC and the Superbag Corporation (collectively, “the petitioners”). We preliminarily find that Nozawa and Rally made U.S. sales below normal value (“NV”) during the period of review (“POR”). The preliminary results are listed below in the section entitled “Preliminary Results of Review.” If these preliminary results are adopted in our final results, we will instruct U.S. Customs and Border Protection (“CBP”) to assess the *ad valorem* margins against the entered value of each entry of the subject merchandise during the POR. EFFECTIVE DATE: September 10, 2007. FOR FURTHER INFORMATION CONTACT: Maisha Cryor, Zev Primor or Karine Gziryan, AD/CVD Operations, Office 4, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone:
(202)482-5831,
(202)482-4114, and
(202)482-4081, respectively. SUPPLEMENTARY INFORMATION: Background On August 9, 2004, the Department published the antidumping duty order on PRCBs from the PRC. *See Antidumping Duty Order: Polyethylene Retail Carrier Bags From the People's Republic of China* , 69 FR 48201 (August 9, 2004). On August 1, 2006, the Department notified interested parties of the opportunity to request an administrative review of this antidumping duty order. *See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request an Administrative Review* ; 71 FR 43441 (August 1, 2006). In accordance with 19 CFR 351.213(b), from August 11, 2006, through August 29, 2006, the Department received letters from the following companies in which each company requested that the Department conduct an administrative review of its sales to the United States made during the POR: Chun Hing Plastic Packaging Mfy. Ltd. and Chun Yip Plastic Bag Factory (collectively, “Chun Hing”); Crown Polyethylene Products (Int'l) Ltd. (“Crown”); Heng Rong Plastic Products Co., Ltd. (“Heng Rong”); Nozawa; Rally; and Samson Plastic Manufactory Co., Ltd. (“Samson”). On August 31, 2006, in accordance with 19 CFR 351.213(b), the petitioners requested that the Department conduct an administrative review of Rally's sales of subject merchandise to the United States made during the POR. On September 29, 2006, the Department initiated an antidumping duty administrative review covering Chun Hing, Crown, Heng Rong, Nozawa, Rally, and Samson. *See Initiation of Antidumping and Countervailing Duty Administrative Reviews* , 71 FR 57465 (September 29, 2006) (“ *Initiation Notice* ”). The petitioners, on October 30, 2006, requested that the Department determine whether antidumping duties have been absorbed by the companies subject to the review. On November 20, 2006, Heng Rong notified the Department that it was withdrawing its request for administrative review. On November 20, 2006, the Department issued a quantity and value (“Q&V”) questionnaire, and a separate rate application/certification, to all of the manufacturers/exporters noted above. Crown withdrew its request for review on November 28, 2006. The Department received responses to the Q&V questionnaire from Chun Hing, Samson, and Rally on December 4, 2007, and from Nozawa on December 8, 2007. Based upon these responses, the Department selected Nozawa and Rally as mandatory respondents in this administrative review on December 19, 2006. On that same day, the Department issued the standard non-market economy (“NME”) antidumping duty questionnaire to Nozawa and Rally. On January 19, 2007, the Department received separate rate applications from Chun Hing and Samson. The Department issued a supplemental questionnaire to Chun Hing and Samson concerning their separate rate applications on February 15, 2007. Between January and July 2007, Nozawa and Rally submitted responses to the Department's original and supplemental questionnaires covering sections A, C, D, and E of the standard NME antidumping duty questionnaire. 2 The petitioners submitted comments on Rally's methodology for allocating its consumption of inputs on August 13, 2007, and Rally submitted rebuttal comments on August 20, 2007. 2 Section A of the NME questionnaire requests general information concerning a company's corporate structure and business practices, the merchandise under investigation that it sells, and the manner in which it sells that merchandise in all of its markets. Section C requests a complete listing of U.S. sales. Section D requests information on the factors of production of the merchandise sold in or to the United States. Section E requests information on further manufacturing. Period of Review The POR for this administrative review is August 1, 2005, through July 31, 2006. Scope of the Order The merchandise subject to this antidumping duty order is PRCBs, which may be referred to as t-shirt sacks, merchandise bags, grocery bags, or checkout bags. The subject merchandise is defined as non-sealable sacks and bags with handles (including drawstrings), without zippers or integral extruded closures, with or without gussets, with or without printing, of polyethylene film having a thickness no greater than 0.035 inch (0.889 mm) and no less than 0.00035 inch (0.00889 mm), and with no length or width shorter than 6 inches (15.24 cm) or longer than 40 inches (101.6 cm). The depth of the bag may be shorter than 6 inches but not longer than 40 inches (101.6 cm). PRCBs are typically provided without any consumer packaging and free of charge by retail establishments, *e.g.* , grocery, drug, convenience, department, specialty retail, discount stores, and restaurants, to their customers to package and carry their purchased products. The scope of the investigation excludes
(1)polyethylene bags that are not printed with logos or store names and that are closeable with drawstrings made of polyethylene film and
(2)polyethylene bags that are packed in consumer packaging with printing that refers to specific end-uses other than packaging and carrying merchandise from retail establishments, *e.g.* , garbage bags, lawn bags, trash-can liners. Imports of the subject merchandise are currently classifiable under statistical category 3923.21.0085 of the Harmonized Tariff Schedule of the United States (“HTSUS”). 3 This subheading may also cover products that are outside the scope of this investigation. Furthermore, although the HTSUS subheading is provided for convenience and customs purposes, our written description of the scope of this order is dispositive. 3 Until July 1, 2005, these products were classifiable under HTSUS 3923.21.0090 (Sacks and bags of polymers of ethylene, other). *See* Harmonized Tariff Schedule of the United States (2005)—Supplement 1 Annotated for Statistical Reporting Purposes Change Record—17th Edition—Supplement 1, available at *http://hotdocs.usitc.gov/docs/tata/hts/bychapter/0510/0510chgs.pdf.* Partial Rescission of Review In accordance with 19 CFR 351.213(d)(1), we are rescinding this administrative review with respect to Heng Rong and Crown. As noted above, on November 20 and 28, 2006, Heng Rong and Crown, respectively, withdrew their requests for an administrative review. Since these requests to withdraw from the review were filed within 90 days of the *Initiation Notice* , and no other party requested an administrative review of U.S. sales made by either company, the Department is rescinding the review with respect to Heng Rong and Crown. Partial Preliminary Rescission of Review Samson reported that it had three sales during the POR. However, according to the entry summary information provided by Samson, all of these sales entered the United States after the POR. See Samson's January 19, 2007, separate rate application response at page 4 and Exhibit 1. The Department confirmed with Samson that it had no sales of subject merchandise that entered the United States during the POR. *See* Memorandum from Mark Manning, Program Manager, to the File, “Entries Of Subject Merchandise Made by Samson,” dated August 30, 2007. The Department's practice, supported by substantial precedent, requires that there be entries during the POR upon which to assess antidumping duties, to conduct an administrative review. *See* , *e.g.* , *Certain Cut-To-Length Carbon-Quality Steel Plate Products From Italy: Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review* , 71 FR 11178 (March 6, 2006) and *Certain Cut-to-Length Carbon-Quality Steel Plate Products From Italy: Final Results and Partial Rescission of Antidumping Duty Administrative Review* , 71 FR 39299 (July 12, 2006) (unchanged in final results). Pursuant to 19 CFR 351.213(d)(3), the Department will rescind an administrative review in whole or only with respect to a particular exporter or producer if we conclude that during the period of review there were “no entries, exports, or sales of the subject merchandise.” Since Samson confirmed that it did not enter subject merchandise into the United States during the POR, there are no entries to assess. Therefore, in accordance with 19 CFR 351.213(d)(3), we are preliminarily rescinding the administrative review with respect to Samson. Duty Absorption On October 30, 2006, the petitioners requested that the Department determine whether antidumping duties had been absorbed for U.S. sales of PRCBs made during the POR by Chun Hing, Crown, Nozawa, Heng Rong, Rally, and Samson. Section 751(a)(4) of the Tariff Act of 1930, as amended (“the Act”), provides for the Department, if requested, to determine during an administrative review initiated two or four years after publication of the order, whether antidumping duties have been absorbed by a foreign producer or exporter, if the subject merchandise is sold in the United States through an affiliated importer. As noted above, we have rescinded the review for Crown and Heng Rong, and preliminarily rescinded for Samson, thus making the petitioner's request with respect to these companies moot. In addition, Rally and Chun Hing did not sell subject merchandise in the United States through an affiliated importer. Thus, according to section 751(a)(4) of the Act, we did not investigate whether Rally and Chun Hing absorbed duties. In this case, only Nozawa sold subject merchandise in the United States through an affiliated importer. Because the antidumping duty order underlying this review was issued in 2004, and this review was initiated in 2006, we are conducting a duty absorption investigation in this segment of the proceeding. In determining whether the antidumping duties have been absorbed by the respondent, we presume the duties will be absorbed for those sales that have been made at less than NV. This presumption can be rebutted with evidence ( *e.g.* , an agreement between the affiliated importer and unaffiliated purchaser) that the unaffiliated purchaser will pay the full duty ultimately assessed on the subject merchandise. *See, e.g.* , *Certain Stainless Steel Butt-Weld Pipe Fittings From Taiwan: Preliminary Results of Antidumping Duty Administrative Review and Notice of Intent to Rescind in Part* , 70 FR 39735, 39737 (July 11, 2005), *Notice of Final Results and Final Rescission in Part of Antidumping Duty Administrative Review: Certain Stainless Steel Butt-Weld Pipe Fittings From Taiwan* , 70 FR 73727 (December 13, 2005) (unchanged in final results). Prior to these preliminary results, the Department asked Nozawa to provide evidence to demonstrate that its unaffiliated U.S. purchasers will pay any antidumping duties ultimately assessed on entries of subject merchandise. Nozawa did not respond to the Department's request. *See* Memorandum from Mark Manning, Program Manager, Ad/CVD Operations, Office 4, to the File, regarding “Nozawa's Response to Request for Duty Absorption Information,” dated August 16, 2007. Accordingly, based on the information on the record, we cannot conclude that the unaffiliated purchasers in the United States will pay the ultimately assessed duties. Because Nozawa did not rebut the duty-absorption presumption with evidence that its unaffiliated U.S. purchasers will pay the full duty ultimately assessed on the subject merchandise, we preliminarily find that antidumping duties have been absorbed by Nozawa on all U.S. sales made through its affiliated importers. NME Country Status In every case conducted by the Department involving the PRC, the PRC has been treated as an NME country. In accordance with section 771(18)(C)(i) of the Act, any determination that a foreign country is an NME country shall remain in effect until revoked by the administering authority. *See Brake Rotors From the People's Republic of China: Final Results and Partial Rescission of the 2004/2005 Administrative Review and Notice of Rescission of 2004/2005 New Shipper Review* , 71 FR 66304 (November 14, 2006). None of the parties to this proceeding have contested such treatment. Accordingly, we calculated NV in accordance with section 773(c) of the Act, which applies to NME countries. Separate Rates A designation of a country as an NME remains in effect until it is revoked by the Department. *See* section 771(18)(C) of the Act. Accordingly, there is a rebuttable presumption that all companies within the PRC are subject to government control and, thus, should be assessed a single antidumping duty rate. It is the Department's standard policy to assign all exporters of the merchandise subject to review in NME countries a single rate unless an exporter can affirmatively demonstrate an absence of government control, both in law ( *de jure* ) and in fact ( *de facto* ), with respect to exports. To establish whether a company is sufficiently independent to be entitled to a separate, company-specific rate, the Department analyzes each exporting entity in an NME country under the test established in the *Final Determination of Sales at Less than Fair Value: Sparklers from the People's Republic of China* , 56 FR 20588 (May 6, 1991), as amplified by the *Notice of Final Determination of Sales at Less Than Fair Value: Silicon Carbide from the People's Republic of China* , 59 FR 22585 (May 2, 1994). The Department's separate-rate test determines whether the exporters are independent from government control and does not consider, in general, macroeconomic/border-type controls, *e.g.* , export licenses, quotas, and minimum export prices, particularly if these controls are imposed to prevent dumping. The test focuses, rather, on controls over the investment, pricing, and output decision-making process at the individual firm level. *See, e.g.* , *Notice of Final Determination of Sales at Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate From Ukraine* , 62 FR 61754, 61757 (November 19, 1997); and *Tapered Roller Bearings and Parts Thereof, Finished and Unfinished, From the People's Republic of China; Final Results of Antidumping Administrative Review* , 62 FR 61276, 61279 (November 17, 1997). Chun Hing, Nozawa, and Rally provided company-specific separate-rate information and stated that the standards for the assignment of separate rates have been met because they are privately-owned trading companies incorporated and based in Hong Kong. *See* Chun Hing's January 19, 2007, separate-rate application response at 17; Nozawa's March 16, 2007, response at A2; Rally's March 12, 2007, response at A2-A3. Because each of these companies is foreign owned, it is not necessary to undertake additional separate-rates analysis for the Department to determine that the export activities of Chun Hing, Nozawa, and Rally are independent from the PRC government's control. Accordingly, Chun Hing, Nozawa, and Rally are eligible for a separate rate. *See, e.g.* , *Brake Rotors From the People's Republic of China: Preliminary Results of the Tenth New Shipper Review* , 69 FR 30875, 30876 (June 1, 2004), *Brake Rotors From the People's Republic of China: Final Results of the Tenth New Shipper Review* , 69 FR 52228 (August 25, 2004) (unchanged in the final results) (“ * Brake Rotors 10 th NSR * ”); *Notice of Final Determination of Sales at Less Than Fair Value: Creatine Monohydrate From the People's Republic of China* , 64 FR 71104 (December 20, 1999); and *Notice of Final Determination of Sales at Less Than Fair Value: Bicycles From the People's Republic of China* , 61 FR 19026, 19027 (April 30, 1996). The Department calculated company-specific dumping margins for Nozawa and Rally, and assigned Chun Hing a dumping margin equal to the weighted-average of the dumping margins calculated for Nozawa and Rally. Surrogate Country and Factors On March 6, 2007, we issued to interested parties a list of possible surrogate market economy countries and invited parties to
(1)comment on the suitability of the countries for use in this administrative review and the level of PRCBs production in those countries, and
(2)submit publicly available information from those countries to use in valuing the factors of production (“FOPs”) used by the respondents to produce PRCBs. On April 3, 2007, the petitioners submitted information for the Department to consider in valuing the FOPs. Also on April 3, 2007, and June 18, 2007, Rally submitted information for the Department to consider in valuing the FOPs. All surrogate value data submitted by interested parties were from Indian sources. On May 31, 2007, the Department selected India as the surrogate market economy country for this administrative review. Surrogate Country When the Department analyzes imports from an NME country, section 773(c)(1) of the Act directs it to base NV, in most circumstances, on the NME producer's FOPs, valued in a surrogate market economy country or countries considered to be appropriate by the Department. In accordance with section 773(c)(4) of the Act, in valuing the FOPs, the Department shall utilize, to the extent possible, the prices or costs of FOPs in one or more market economy countries that are:
(1)at a level of economic development comparable to that of the NME country; and
(2)significant producers of comparable merchandise. On December 21, 2006, the Office of Policy issued a memorandum identifying India as being at a level of economic development comparable to the PRC for the POR. *See* Memorandum from Ron Lorentzen, Director, Office of Policy to Mark Manning, Program Manager, AD/CVD Operations, Office 4, “Administrative Review of Polyethylene Retail Carrier Bags from the People's Republic of China: Request for a List of Surrogate Countries,” dated December 21, 2006. In the Department's March 6, 2007, letter to interested parties requesting surrogate country and surrogate value comments, the Department noted that India is among the countries comparable to the PRC in terms of overall economic development. In addition, based on publicly available information placed on the record ( *i.e.* , export data), India is a significant producer of the subject merchandise. *See* Memorandum from Zev Primor, Senior International Trade Compliance Analyst, through Mark Manning, Program Manager, to Abdelali Elouaradia, Office Director, “Antidumping Administrative Review of Polyethylene Retail Carrier Bags from the People's Republic of China: Selection of a Surrogate Country,” dated May 31, 2007. Furthermore, we note that India has been the primary surrogate country in past segments of this case, and both Rally and the petitioners submitted surrogate values based on Indian data that are contemporaneous to the POR, which gives further credence to the use of India as a surrogate country. The sources of the surrogate factor values are discussed under the “Normal Value” section below and in the Memorandum from Zev Primor, Senior International Trade Compliance Analyst, through Mark Manning, Program Manager, to the File, “Surrogate Values for the Preliminary Results,” dated August 31, 2007 (“Surrogate Values Memorandum”). Normal Value Comparisons To determine whether Nozawa's and Rally's sales of the subject merchandise to the United States were made at a price below NV, we compared their U.S. price to NV, as described in the “U.S. Price” and “Normal Value” sections of this notice. U.S. Price A. Export Price In accordance with section 772(a) of the Act, we calculated the export price (“EP”) for sales to the United States by Rally and certain sales by Nozawa because the first sale to an unaffiliated party was made before the date of importation and the use of constructed EP (“CEP”) was not otherwise warranted. We calculated EP for Nozawa and Rally based on the prices to unaffiliated purchasers in the United States. For Nozawa, in accordance with section 772(c) of the Act, we first added gross unit price adjustments and then deducted from the price to unaffiliated purchasers, where appropriate, foreign inland freight, brokerage and handling, international freight, and marine insurance. See Memorandum from Zev Primor, Senior International Trade Compliance Analyst, to the File, “Analysis for the Preliminary Results of the 2005-2006 Administrative Review of Polyethylene Retail Carrier Bags from the People's Republic of China: Dongguan Nozawa Plastic Products Co., Ltd., and United Power Packaging Ltd.,” dated August 31, 2007 (“Nozawa Preliminary Analysis Memorandum”). For Rally, also in accordance with section 772(c) of the Act, we first added gross unit price adjustments and then deducted from the price to unaffiliated purchasers, where appropriate, foreign inland freight, brokerage and handling, international freight, and marine insurance. *See* Memorandum from Maisha Cryor, Senior International Trade Compliance Analyst, to the File, regarding “Analysis Memorandum for the Preliminary Results of Rally Plastics Co., Ltd.,” dated August 31, 2007 (“Rally Preliminary Analysis Memorandum”). B. Constructed Export Price In accordance with section 772(b) of the Act, CEP is the price at which the subject merchandise is first sold (or agreed to be sold) in the United States before or after the date of importation by or for the account of the producer or exporter of such merchandise or by a seller affiliated with the producer or exporter, to a purchaser not affiliated with the producer or exporter, as adjusted under sections 772(c) and
(d)of the Act. In accordance with section 772(b) of the Act, we used CEP for certain of Nozawa's sales because Nozawa sold its subject merchandise to its affiliated companies in the United States Kal Pac Corporation (“Kal Pac”) and Packaging Solutions, Inc. (“PSI”), which, in turn, made the first sales of subject merchandise to unaffiliated U.S. customers. In addition, Nozawa reported that PSI made sales of subject merchandise which it further manufactured in the United States. We added twelve types of miscellaneous revenue to the gross unit price. *See* Nozawa Preliminary Analysis Memorandum at 2. In accordance with section 772(c)(2) of the Act, we made deductions from Nozawa's starting price for early payment discounts, rebates, foreign inland freight from the plant to the port of exportation, international freight, marine insurance, brokerage and handling, U.S. devanning expense, U.S. duty, inland freight from the warehouse to the unaffiliated U.S. customer, and commissions. Where foreign movement expenses or international movement expenses were provided by NME service providers or paid for in an NME currency, we valued these services using surrogate values. *See* Surrogate Values Memorandum at Attachment VII.. For those expenses that were provided by a market economy provider and paid for in market economy currency, we deducted the actual expenses incurred. *See* Nozawa Preliminary Analysis Memorandum at 2. In accordance with section 772(d)(1) of the Act, the Department additionally deducted credit expenses, inventory carrying costs, and U.S. indirect selling expenses from the U.S. price, all of which relate to commercial activity in the United States. We calculated Nozawa's credit expenses and inventory carrying costs based on the Federal Reserve short-term rate because Nozawa reported that neither Kal Pac nor PSI had short-term borrowings during the POR. We also deducted an amount for further-manufacturing costs, where applicable, in accordance with section 772(d)(2) of the Act. To calculate the cost of further manufacturing in the United States, we relied on PSI's reported cost of materials, labor, overhead, general and administrative expenses, and financial expenses of the further manufactured materials. In addition, we deducted CEP profit in accordance with sections 772(d)(3) and 772(f) of the Act. C. Surrogate Values for Expenses Incurred in the PRC for U.S. Sales Nozawa and Rally reported that for certain U.S. sales, foreign inland freight was provided by an NME vendor or paid for using an NME currency. In such instances, we based the deduction of these charges on surrogate values. We valued foreign inland freight with the surrogate value for truck freight. For foreign brokerage and handling as well as international freight, Nozawa and Rally reported using market economy vendors and stated that these expenses were paid for in a market economy currency. Where movement services were provided by a market economy vendor and paid for in a market economy currency, we deducted the actual cost per kilogram of the freight. *See* Surrogate Values Memorandum at Attachment IX. Normal Value 1. Methodology Section 773(c)(1)(B) of the Act provides that the Department shall determine the NV using an FOP methodology if the merchandise is exported from an NME and the information does not permit the calculation of NV using home-market prices, third-country prices, or constructed value under section 773(a) of the Act. The Department bases NV on the FOPs because the presence of government controls on various aspects of NMEs renders price comparisons and the calculation of production costs invalid under the Department's normal methodologies. The FOPs for PRCBs include:
(1)quantities of raw materials employed;
(2)hours of labor required;
(3)amounts of energy and other utilities consumed;
(4)representative capital and selling costs; and
(5)packing materials. We used the FOPs reported by respondents for materials, energy, labor, by-products, and packing. In accordance with 19 CFR 351.408(c)(1), when a producer sources an input from a market-economy country and pays for it in a market-economy currency, the Department will normally value the factor using the actual price paid for the input. *See* 19 CFR 351.408(c)(1); *see also Lasko Metal Products v. United States* , 43 F.3d 1442, 1445-1446 (Fed. Cir. 1994) (affirming the Department's use of market-based prices to value certain FOPs). Where a portion of the input is purchased from a market-economy supplier and the remainder from an NME supplier, the Department will normally use the price paid for the inputs sourced from market-economy suppliers to value all of the input, provided the volume of the market-economy inputs as a share of total purchases from all sources is “meaningful.” *See Antidumping Duties; Countervailing Duties; Final rule* , 62 FR 27296, 27366 (May 19, 1997); *Shakeproof v. United States* , 268 F.3d 1376, 1382 (Fed. Cir. 2001). *See also* 19 CFR 351.408(c)(1). 2. Factor Methodology During the POR, Nozawa did not produce certain types of merchandise that were sold during the POR. Consequently, the original FOP database filed by Nozawa did not contain factors of production for those control numbers (“CONNUMs”) sold but not produced by Nozawa during this POR. Because the vast majority of the CONNUMs sold by Nozawa were produced during this POR or the prior POR, Nozawa also submitted on the record of this review the FOP database from the prior review ( *i.e.* , the first administrative review). In addition, Nozawa submitted an FOP database incorporating the FOPs for all CONNUMs sold during the POR, using both production data from this and the prior POR. Therefore, for purposes of factor valuation, the Department is using the FOP database incorporating all CONNUMs sold during the POR. We note that certain FOP data were based on similar CONNUMs where the product was not produced in either this or the prior POR. The Department reviewed Nozawa's identification of the most similar matches for the CONNUMs sold but not produced during the first or second POR. In doing so, we determined the product characteristics which have the most significant impact on the cost of materials and then compared all product characteristics of the actual CONNUMS to the product characteristics of the proposed matching CONNUMs. We found that Nozawa's proposed matches were identical in the most significant product characteristics and had some insignificant differences in other characteristics. Therefore, we accepted Nozawa's assignment of the most similar CONNUMs for those products sold but not produced during the POR. *See* Nozawa Preliminary Analysis Memorandum, at 3. With respect to Rally, we note that certain bag types produced by Rally contain certain attachments ( *e.g.* , plastic handles, plastic drawstring). Rally asserts that it reported its FOPs using an allocation methodology that assigns the consumption of the materials used to produce the attachments equally across all products. In a supplemental questionnaire, the Department asked Rally to allocate its consumption of materials used to produce these attachments to those CONNUMs that actually incorporate these items. *See* the Department's May 27, 2007, section D supplemental questionnaire, at question 54.d. Rally replied that its accounting system does not track costs at this level and they could not report the FOPs in the manner requested by the Department. However, Rally claims that its material FOPs are based on a reasonable allocation methodology. *See* Rally's June 6, 2007, supplemental section D response at 23. The Department has analyzed Rally's reported sales and consumption data and has made the following determinations. We find that, on an aggregate basis, as would be expected, Rally's total quantity of inputs consumed to produce all subject merchandise sold in the U.S. market during the POR is greater than the total weight of all finished subject merchandise sold in the U.S. market during the POR. *See* Rally Preliminary Analysis Memorandum. However, on a CONNUM-specific level, we find that the total quantity of inputs consumed is less than the total finished weight for many CONNUMs, the vast majority of which have attachments. *Id* . Thus, Rally's inability to allocate the materials consumed for the attachments to the CONNUMs that actually have attachments has distorted the reported FOPs. In order to correct this distortion for the relevant CONNUMs, the Department increased the total reported materials weight by the appropriate percentage so that the revised input material weight is equal to the finished weight of the CONNUM, plus Rally's average yield loss percentage. *Id* . The Department will continue to examine this issue for the final results and will allow Rally one last opportunity to provide alternative methods of allocating its FOPs. 2. Factors of Production Valuation In accordance with section 773(c) of the Act, we calculated NV based on the FOPs reported by respondents for the POR. To calculate NV, we multiplied the reported per-unit factor-consumption rates by publicly available surrogate values. In selecting the surrogate values, we considered the quality, specificity, and contemporaneity of the data. Except as noted below, we valued raw material inputs using the weighted-average unit import values derived from the Monthly Statistics of the Foreign Trade of India, as published by the Directorate General of Commercial Intelligence and Statistics of the Ministry of Commerce and Industry, Government of India in the World Trade Atlas, available at *http://www.gtis.com/wta.htm* (“WTA”). For those surrogate values based upon Indian import statistics, we disregarded prices which we have reason to believe or suspect may be subsidized. We have reason to believe or suspect that prices of inputs from Indonesia, South Korea, and Thailand may have been subsidized. We have found in other proceedings that these countries maintain broadly available, non-industry-specific export subsidies and, therefore, it is reasonable to infer that all exports to all markets from these countries may be subsidized. *See Notice of Final Determination of Sales at Less Than Fair Value and Negative Final Determination of Critical Circumstances: Certain Color Television Receivers From the People's Republic of China* , 69 FR 20594 (April 16, 2004) and accompanying Issues and Decision Memorandum at Comment 7; *see also Certain Cut-to-Length Carbon Steel Plate from Romania: Notice of Final Results and Final Partial Rescission of Antidumping Duty Administrative Review* , 70 FR 12651 (March 15, 2005) and accompanying Issues and Decision Memorandum at Comment 4. The legislative history provides that in making its determination as to whether input values may be subsidized, the Department is not required to conduct a formal investigation; rather, Congress directed the Department to base its decision on information that is available to it at the time it makes its determination. *See* H.R. Rep. 100-576, at 590 (1988), reprinted in 1988 U.S.C.C.A.N. 1547, 1623-24. Therefore, based on the information currently available, we have not used prices from these countries in calculating the surrogate values based on Indian import data. We have also disregarded Indian import data from countries that the Department has previously determined to be NME countries, as well as imports originating from “unspecified” countries because the Department could not be certain that they were not from either an NME or a country with generally available export subsidies. *See Notice of Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination: Chlorinated Isocyanurates From the People's Republic of China* , 69 FR 75294, 75300 (December 16, 2004), *Notice of Final Determination of Sales at Less Than Fair Value: Chlorinated Isocyanurates From the People's Republic of China* , 70 FR 24502 (May 10, 2005) (unchanged in the final results). For a comprehensive list of the sources and data used to determine the surrogate vales for the FOPs, by-products, and the surrogate financial ratios for factory overhead, selling, general and administrative expenses (“SG&A”), and profit, *see* Surrogate Values Memorandum at Attachments I and IX. Where appropriate, we adjusted the Indian import prices by including freight costs to make them delivered prices. Specifically, we added to the Indian import prices a surrogate freight cost using the shorter of the reported distance from the domestic supplier to the factory of production or the distance from the nearest seaport to the factory of production where appropriate. This adjustment is in accordance with the Court of Appeals for the Federal Circuit's decision in *Sigma Corp. v. United States* , 117 F.3d 1401, 1407-1408 (Fed. Cir. 1997). Where we did not use Indian import data as the basis of the surrogate value, we calculated inland freight based on the reported distance from the supplier to the factory. We used the freight rates obtained from www.infreight.com to value truck freight. *See* Surrogate Values Memorandum at Attachment VIII. It is the Department's practice to calculate price index adjustors to inflate or deflate, as appropriate, surrogate values that are not contemporaneous with the POR using the wholesale price index for the subject country. *See Certain Preserved Mushrooms from the People's Republic of China: Final Results of the Antidumping Duty New Shipper Review* , 71 FR 66910 (November 17, 2006). Therefore, where publicly available information contemporaneous with the POR could not be obtained, surrogate values were adjusted using the Wholesale Price Index for India, as published in the *International Financial Statistics* of the International Monetary Fund. To value electricity, we used the 2000 electricity price data from International Energy Agency, Energy Prices and Taxes—Quarterly Statistics (First Quarter 2003), adjusted for inflation. *See* Surrogate Values Memorandum at Attachment V. For direct labor, indirect labor, and packing labor, consistent with 19 CFR 351.408(c)(3), we used the PRC regression-based wage rate as reported on Import Administration's web site. *See* Expected Wages of Selected NME Countries (revised November 2005) (available at *http://ia.ita.doc.gov/wages* ). The source of these wage rate data on the Import Administration's website is the Yearbook of Labour Statistics 2003, ILO, (Geneva: 2003), Chapter 5B: Wages in Manufacturing. The years of the reported wage rates range from 2003 through 2004. Because this regression-based wage rate does not separate the labor rates into different skill levels or types of labor, we have applied the same wage rate to all skill levels and types of labor reported by each respondent. *See* Surrogate Value Memorandum at Attachment VI. To value factory overhead, SG&A, and profit values, we used information from Smitabh Intercon Limited; M/S Carry Print (India) Private Limited; Kuloday Plastomers Private Limited; Sangeeta Poly Pack Private Limited; and A.P. Polyplast Private Limited for the fiscal year ending March 31, 2006. From this information, we were able to determine factory overhead as a percentage of the total raw materials, labor and energy (“ML&E”) costs; SG&A as a percentage of ML&E plus overhead ( *i.e.* , cost of manufacture); and profit as a percentage of the cost of manufacture plus SG&A. *See* Surrogate Values Memorandum at Attachment VII. For packing materials, we used the per-kilogram values obtained from the WTA and made adjustments to account for freight costs incurred between the PRC supplier and Rally's plant. *See* Surrogate Values Memorandum at Attachment II. Currency Conversion We made currency conversions into U.S. dollars, in accordance with section 773A(a) of the Act, based on the exchange rates in effect on the dates of the U.S. sales, as certified by the Federal Reserve Bank. Preliminary Results of the Review The Department has determined that the following preliminary dumping margins exist for the period August 1, 2005, through July 31, 2006: Polyethylene Retail Carrier Bags from the PRC Manufacturer/Exporter Weighted-Average Margin (Percent) Chun Hing Plastic Packaging Mfy. Ltd. and Chun Yip Plastic Bag Factory 13.35 Dongguan Nozawa Plastics Products Co., Ltd. and United Power Packaging, Ltd. 2.54 Rally Plastics Co., Ltd. 31.71 Disclosure The Department will disclose calculations performed for these preliminary results to the parties within five days of the date of publication of this notice in accordance with 19 CFR 351.224(b). Interested parties may submit case briefs and/or written comments no later than 30 days after the date of publication of these preliminary results of review. *See* 19 CFR 351.309(c)(1)(ii). Interested parties may submit publicly available information to value factors no later than 20 days after the date of publication of these preliminary results of review. *See* 19 CFR 351.301(c)(3)(ii). Rebuttal briefs and rebuttals to written comments, limited to issues raised in such briefs or comments, may be filed no later than five days after the time limit for filing the case briefs. *See* 19 CFR 351.309(d). The Department requests that parties submitting written comments also provide the Department with an additional copy of those comments on diskette. Any interested party may request a hearing within 30 days of publication of these preliminary results. *See* 19 CFR 351.310(c). Requests should contain the following information:
(1)the party's name, address, and telephone number;
(2)the number of participants; and
(3)a list of the issues to be discussed. Oral presentations will be limited to issues raised in the briefs. If we receive a request for a hearing, we intend to hold the hearing seven days after the deadline for submission of the rebuttal briefs at the U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230. The Department intends to issue the final results of this administrative review, which will include the results of its analysis of issues raised in any such comments, within 120 days of publication of these preliminary results, pursuant to section 751(a)(3)(A) of the Act. Assessment Rates Upon issuance of the final results, the Department will determine, and U.S. Customs and Border Protection (“CBP”) shall assess, antidumping duties on all appropriate entries. The Department intends to issue assessment instructions to CBP 15 days after the date of publication of the final results of review. If these preliminary results are adopted in our final results of review, the Department shall determine, and CBP shall assess, antidumping duties on all appropriate entries. Pursuant to 19 CFR 351.212(b)(1), we will calculate importer-specific (or customer-specific) *ad valorem* or, where the entered value was not known by the respondent, per-unit duty assessment rates based on the ratio of the total amount of the dumping margins calculated for the examined sales to the total entered value, or total quantity, of those same sales. We will instruct CBP to assess antidumping duties on all appropriate entries covered by this review if any importer-specific or customer-specific assessment rate calculated in the final results of this review is above *de minimis* . Cash Deposit Requirements The following cash deposit requirements will be effective upon publication of the final results of the administrative review for shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results, as provided by section 751(a)(2)(C) of the Act:
(1)for subject merchandise exported by Chun Hing, Nozawa, and Rally, the cash-deposit rate will be that established in the final results of review (except, if the rate is zero or *de minimis* , no cash deposit will be required);
(2)for previously reviewed or investigated companies not listed above that have separate rates, the cash-deposit rate will continue to be the company-specific rate published for the most recent period;
(3)for all other PRC exporters of subject merchandise, which have not been found to be entitled to a separate rate, the cash-deposit rate will be PRC-wide rate of 77.57 percent;
(4)for all non-PRC exporters of subject merchandise, the cash-deposit rate will be the rate applicable to the PRC exporter that supplied that exporter. These deposit requirements, when imposed, shall remain in effect until further notice. Notification to Importers This notice also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties. This administrative review and this notice are in accordance with sections 751(a)(1) and 777(i) of the Act, 19 CFR 351.213, and 19 CFR 351.221(b)(4). Dated: August 31, 2007. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E7-17751 Filed 9-7-07; 8:45 am] BILLING CODE 3510-DS-S DEPARTMENT OF COMMERCE International Trade Administration (A-533-810) Notice of Final Results and Final Partial Rescission of Antidumping Duty Administrative Review: Stainless Steel Bar from India AGENCY: Import Administration, International Trade Administration, Department of Commerce. SUMMARY: On March 7, 2007, the Department of Commerce published the preliminary results of the administrative review of the antidumping duty order on stainless steel bar from India. The period of review is February 1, 2005, through January 31, 2006. This review covers sales of stainless steel bar from India with respect to eight producers/exporters. We provided interested parties with an opportunity to comment on the preliminary results of this review. We have noted the changes made since the preliminary results below in the “Changes Since the Preliminary Results” section, below. The final results are listed below in the “Final Results of Review” section. EFFECTIVE DATE: September 10, 2007. FOR FURTHER INFORMATION CONTACT: Scott Holland or Brandon Farlander, AD/CVD Operations, Office 1, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington DC 20230; telephone
(202)482-1279 and
(202)482-0182, respectively. SUPPLEMENTARY INFORMATION: Background On March 7, 2007, the Department of Commerce (“the Department”) published *Notice of Preliminary Results of Antidumping Duty Administrative Review, Intent to Rescind and Partial Rescission of Antidumping Duty Administrative Review: Stainless Steel Bar from India* , 72 FR 10151 (March 7, 2007) (“ *Preliminary Results* ”) in the **Federal Register** . On March 14, 2007, we issued a supplemental questionnaire to respondent Bhansali Bright Bars Pvt. Ltd (“Bhansali”) to correct information contained in the initial questionnaire responses. On March 28, 2007, we received a timely response to this questionnaire from Bhansali. On April 5, 2007, we met with counsel for Carpenter Technology Corporation, Crucible Specialty Metals, a division of Crucible Materials Corporation, Electralloy Company, North American Stainless, Universal Stainless, and Valbruna Slater Stainless (collectively, the “petitioners”) to discuss the review-specific average rate applied at the *Preliminary Results* to the respondents that were not selected for individual examination in the review by the Department. 1 1 For the *Preliminary Results* , the Department applied the review-specific, average rate to the following respondents: Isibars Limited, Grand Foundry, Ltd., Sindia Steels Limited, Snowdrop Trading Pvt. Ltd., Facor Steels, Ltd., and Mukand Ltd. *See* the *Preliminary Results* at 10157. On May 19, 2007, Bhansali submitted a listing of pre-verification corrections to its home market sales listing. On July 5, 2007, the Department published in the **Federal Register** an extension of the time limit for the final results in the antidumping duty administrative review to no later than September 4, 2007, in accordance with 751(a)(3)(A) of the Tariff Act of 1930, as amended (“the Act”). *See Stainless Steel Bar from India: Extension of Time Limit for the Final Results of the Antidumping Duty Administrative Review* , 72 FR 36668 (July 5, 2007). On July 24, 2007, we notified interested parties that comments on the *Preliminary Results* were due on July 31, 2007, and rebuttal comments were due on August 10, 2007. *See Memorandum to the File, “Briefing Schedule for Comments on the Preliminary Results in the 2005/2006 Antidumping Duty Administrative Review of Stainless Steel Bar from India* ,” dated July 24, 2007. On July 25, 2007, we requested that Bhansali and Venus submit revised sales and cost listings to the Department. We received revised home market sales listings from Venus, and revised sales and cost listings from Bhansali in August 2007. On July 31, 2007, we received case briefs from the petitioners and Bhansali. On August 2, 2007, we rejected Bhansali's case brief, in accordance with 19 CFR 351.302(d)(i) of the Department's regulations, because it contained new and untimely filed information. On August 4, 2007, we received a revised case brief from Bhansali. On August 6, 2007, we received a rebuttal brief from Bhansali. On August 10, 2007, the petitioners and interested parties Facor Steels, Ltd. (“Facor”) and Mukand Ltd. (“Mukand”) filed rebuttal briefs. We did not receive comments from Venus. The Department did not receive a request for a public hearing from interested parties. Scope of the Order Imports covered by the order are shipments of stainless steel bar (“SSB”). SSB means articles of stainless steel in straight lengths that have been either hot-rolled, forged, turned, cold-drawn, cold-rolled or otherwise cold-finished, or ground, having a uniform solid cross section along their whole length in the shape of circles, segments of circles, ovals, rectangles (including squares), triangles, hexagons, octagons, or other convex polygons. SSB includes cold-finished SSBs that are turned or ground in straight lengths, whether produced from hot-rolled bar or from straightened and cut rod or wire, and reinforcing bars that have indentations, ribs, grooves, or other deformations produced during the rolling process. Except as specified above, the term does not include stainless steel semi-finished products, cut-to-length flat-rolled products ( *i.e.* , cut-to-length rolled products which if less than 4.75 mm in thickness have a width measuring at least 10 times the thickness, or if 4.75 mm or more in thickness having a width which exceeds 150 mm and measures at least twice the thickness), wire ( *i.e.* , cold-formed products in coils, of any uniform solid cross section along their whole length, which do not conform to the definition of flat-rolled products), and angles, shapes, and sections. The SSB subject to these reviews is currently classifiable under subheadings 7222.11.00.05, 7222.11.00.50, 7222.19.00.05, 7222.19.00.50, 7222.20.00.05, 7222.20.00.45, 7222.20.00.75, and 7222.30.00.00 of the *Harmonized Tariff Schedule of the United States* (“HTSUS”). Although the HTSUS subheadings are provided for convenience and customs purposes, our written description of the scope of the order is dispositive. On May 23, 2005, the Department issued a final scope ruling that SSB manufactured in the United Arab Emirates out of stainless steel wire rod from India is not subject to the scope of this order. *See* Memorandum from Team to Barbara E. Tillman, “ *Antidumping Duty Orders on Stainless Steel Bar from India and Stainless Steel Wire Rod from India: Final Scope Ruling* ,” dated May 23, 2005, which is on file in the Central Records Unit (“CRU”) located in room B-099 of the main Department building. *See also Notice of Scope Rulings* , 70 FR 55110 (September 20, 2005). Verification As provided in section 782(i) of the Act, we conducted verification of the sales information contained in the questionnaire responses submitted by respondent Venus Wire Industries Pvt. Ltd. (“Venus”) in Mumbai, India, in May 2007. The Department reported its findings on July 24, 2007. *See* Memorandum to the File, “ *Verification of the Sales Responses of Venus Wire Industries Pvt. Ltd. in the 2005/2006 Antidumping Duty Administrative Review of Stainless Steel Bar from India* ,” (“Verification Report—Venus”) dated July 24, 2007. We also conducted verification of the sales and cost information contained in the questionnaire responses submitted by Bhansali in May 2007. The Department reported its findings on July 24, 2007. *See* Memorandum to the File, “ *Verification of the Sales and Cost Responses of Bhansali Bright Bars Pvt. Ltd. in the 2005/2006 Antidumping Duty Administrative Review of Stainless Steel Bar from India,” (“Verification Report—Bhansali* ”) dated July 24, 2007. These reports are on file in the Central Records Unit in room B-099 of the main Department building (“CRU”). Period of Review The period of review (“POR”) is February 1, 2005, through January 31, 2006. Partial Rescission of Review In the *Preliminary Results* , the Department preliminarily rescinded this review with respect to Akai Asian (“Akai”), Atlas Stainless (“Atlas”) and Meltroll Engineering Pvt. Ltd. (“Meltroll”) pursuant to 19 CFR 351.213(d)(3). The Department confirmed that Akai, Atlas, and Meltroll did not ship subject merchandise to the United States during the POR using U.S. Customs and Border Protection (“CBP”) data. We did not receive comments on this issue. Therefore, pursuant to 19 CFR 351.213(d)(3), and consistent with the *Preliminary Results* , we are rescinding this review with respect to Akai, Atlas, and Meltroll. Affiliation As explained in the *Preliminary Results* , we have determined that Venus and its exporter Precision Metals are affiliated within the meaning of section 771(33) of the Act, and also that the two companies should be treated as a single entity for the purposes of this administrative review. Therefore, we find that Venus and Precision Metals should receive a single antidumping duty rate. *See* Memorandum from Scott Holland to Susan H. Kuhbach, Senior Office Director, “ *Relationship of Venus Wire Industries Pvt., Ltd. and Precision Metals* ,” dated February 28, 2007, which is on file in the CRU in room B-099 of the main Department building. Analysis of Comments Received All issues raised in the case and rebuttal briefs by parties to this review are addressed in the September 4, 2007, *Issues and Decision Memorandum for the 2005/2006 Antidumping Duty Administrative Review of Stainless Steel Bar from India (“Decision Memorandum”* ), which is hereby adopted by this notice. Attached to this notice as an appendix is a list of the issues which parties have raised and to which we have responded in the *Decision Memorandum* . Parties can find a complete discussion of all issues raised in this review and the corresponding recommendations in this public memorandum, which is on file in the Department's CRU. In addition, a complete version of the *Decision Memorandum* can be accessed directly on the Web at http://ia.ita.doc.gov/frn. The paper copy and electronic version of the *Decision Memorandum* are identical in content. Changes Since the Preliminary Results Based on our findings at verification, and analysis of comments received, we have made adjustments to the preliminary results calculations for Bhansali and Venus. Brief descriptions of the company-specific changes are discussed below. Bhansali Based upon the information obtained at verification, we are deducting billing adjustments from the gross unit price on certain home market sales. We are also reducing billing adjustments for the portion attributable to taxes included in the invoice price. We are deducting from U.S. gross unit price the per-unit certificate of origin expenses incurred on export sales. We are using the cost information provided by Bhansali in its March 28, 2007, submission for certain products that did not have cost data in the *Preliminary Results* . Venus We are using Venus' revised home market sales listing submitted on August 13, 2007, which included the verified recalculated credit expenses. Results of the COP Test Pursuant to section 773(b)(2)(C)(i) of the Act, where less than 20 percent of sales of a given product were at prices less than the COP, we did not disregard any below-cost sales of that product because we determined that the below-cost sales were not made in “substantial quantities.” Where 20 percent or more of a respondent's sales of a given product during the POR were at prices less than the COP, we determined such sales to have been made in “substantial quantities.” *See* section 773(b)(2)(C) of the Act. The sales were made within an extended period of time in accordance with section 773(b)(2)(B) of the Act, because we examined below-cost sales occurring during the entire POR. In such cases, because we compared prices to POR-average costs, we also determined that such sales were not made at prices which would permit recovery of all costs within a reasonable period of time, in accordance with section 773(b)(2)(D) of the Act. For Bhansali and Venus, we found that, for certain products, more than 20 percent of comparison market sales were at prices less than the COP and, thus, the below-cost sales were made within an extended period of time in substantial quantities. In addition, these sales were made at prices that did not provide for the recovery of costs within a reasonable period of time. Therefore, we excluded these sales and used the remaining sales, if any, as the basis for determining NV, in accordance with section 773(b)(1) of the Act. Final Results of Review As a result of our review, we determine that the following weighted-average margins exist for the period February 1, 2005, through January 31, 2006: Exporter/Manufacturer Margin Bhansali Bright Bars Pvt. Ltd. 2.01 Venus Wire Industries Pvt. Ltd. 0.03 ( *de minimis* ) Review-Specific Average Rate Applicable to the Following Companies: 2 Isibars Limited Grand Foundry, Ltd. Sindia Steels Limited Snowdrop Trading Pvt. Ltd. Facor Steels, Ltd. Mukand Ltd 2.01 2 This rate is based on the weighted average of the margins calculated for those companies selected for individual review, excluding *de minimis* margins or margins based entirely on AFA. Assessment Rates The Department shall determine, and CBP shall assess, antidumping duties on all appropriate entries. Pursuant to 19 CFR 351.212(b)(1), for all sales made by respondents for which they have reported the importer of record and the entered value of the U.S. sales, we have calculated importer-specific assessment rates based on the ratio of the total amount of antidumping duties calculated for the examined sales to the total entered value of those sales. Where the respondents did not report the entered value for U.S. sales, we have calculated importer-specific assessment rates for the merchandise in question by aggregating the dumping margins calculated for all U.S. sales to each importer and dividing this amount by the total quantity of those sales. To determine whether the duty assessment rates were *de minimis* , in accordance with the requirement set forth in 19 CFR 351.106(c)(2), we calculated importer-specific *ad valorem* rates based on the estimated entered value. Where the assessment rate is above *de minimis* , we will instruct CBP to assess duties on all entries of subject merchandise by that importer. Pursuant to 19 CFR 351.106(c)(2), we will instruct CBP to liquidate without regard to antidumping duties any entries for which the assessment rate is *de minimis (i.e.* , less than 0.50 percent). The Department clarified its “automatic assessment” regulation on May 6, 2003. *See Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties* , 68 FR 23954 (May 6, 2003). This clarification applies to entries of subject merchandise during the POR produced by the respondent for which it did not know its merchandise was destined for the United States. In such instances, we will instruct CBP to liquidate unreviewed entries at the all-others rate if there is no rate for the intermediate company(ies) involved in the transaction. For a full discussion of this clarification, *see Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties* , 68 FR 23954 (May 6, 2003). For those companies for which this review is rescinded, antidumping duties shall be assessed at rates equal to the cash deposit of estimated antidumping duties required at the time of entry, or withdrawal from warehouse, for consumption, in accordance with 19 CFR 351.212(c)(1)(i). For the companies requesting a review, but not selected for examination and calculation of individual rates, we calculated a weighted-average assessment rate based on all importer-specific assessment rates excluding any which are zero, *de minimis* or determined entirely on adverse facts available. *See Notice of Final Results of Antidumping Duty Administrative Review: Certain Softwood Lumber Products from Canada* , 70 FR 73437, 73440 (December 12, 2005). The Department intends to issue assessment instructions to CBP 15 days after the date of publication of these final results of review. Cash Deposit Rates The following antidumping duty deposits will be required on all shipments of SSB from India entered, or withdrawn from warehouse, for consumption, effective on or after the publication date of these final results of administrative review, as provided by section 751(a)(1) of the Act:
(1)the cash deposit rates for the reviewed company will be the rate listed above (except no cash deposit will be required if a company's weighted-average margin is *de minimis* ;
(2)for merchandise exported by manufacturers or exporters not covered in this review but covered in the original less-than-fair-value investigation or a previous review, the cash deposit rate will continue to be the most recent rate published in the final determination or final results for which the manufacturer or exporter received an individual rate;
(3)if the exporter is not a firm covered in this review, the previous review, or the original investigation, but the manufacturer is, the cash deposit rate will be the rate established for the most recent period for the manufacturer of the merchandise; and
(4)if neither the exporter nor the manufacturer is a firm covered in this or any previous reviews, the cash deposit rate will be 12.45 percent, the “all others” rate established in the less than fair value investigation. *See Stainless Steel Bar from India; Final Determination of Sales at Less Than Fair Value* , 59 FR 66915 (December 28, 1994). These cash deposit requirements shall remain in effect until publication of the final results of the next administrative review. Notification to Importers This notice serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of doubled antidumping duties. Notification Regarding Administrative Protective Orders This notice also serves as a reminder to parties subject to administrative protective orders (“APOs”) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305, which continues to govern business proprietary information in this segment of the proceeding. 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. We are issuing and publishing these results of review in accordance with sections 751(a)(1) and 777(i)(1) of the Act. Dated: September 4, 2007. David M. Spooner, Assistant Secretary for Import Administration. APPENDIX I List of Comments in the Decision Memorandum General Comments *Comment 1:* Application of Review-Specific Rate to Non-Reviewed Companies *Comment 2:* Treatment of Sales Made Above Normal Value Comments Relating to Bhansali Bright Bars Pvt. Ltd. *Comment 3:* Treatment of DEPB Application Charges *Comment 4:* Comment on Verification: Correct Payment Date *Comment 5:* Comment on Verification: Correct Gross Unit Price *Comment 6:* Inclusion of Implied Interest on Non-Interest Bearing Loans *Comment 7:* Calculation of Home Market Imputed Credit Expenses *Comment 8:* Treatment of Billing Adjustments Comments Relating to Venus Wire Industries Pvt. Ltd. *Comment 9:* Calculation of Home Market Imputed Credit Expenses [FR Doc. E7-17749 Filed 9-7-07; 8:45 am] BILLING CODE 3510-DS-S DEPARTMENT OF COMMERCE International Trade Administration A-489-807 Notice of Preliminary Results of New Shipper Review of the Antidumping Duty Order on Certain Steel Concrete Reinforcing Bars from Turkey AGENCY: Import Administration, International Trade Administration, Department of Commerce. SUMMARY: In response to a request by Ege Celik Endustrisi Sanayi ve Ticaret A.S., a producer of subject merchandise, and its affiliated export trading company, Ege Dis Ticaret A.S. (collectively “Ege Celik”), the Department of Commerce (the Department) is conducting a new shipper review of the antidumping duty order on certain steel concrete reinforcing bars (rebar) from Turkey for the period April 1, 2006, through September 30, 2006. We preliminarily determine that, during the period of review (POR), Ege Celik did not sell the subject merchandise at less than normal value (NV). If the preliminary results are adopted in our final results of administrative review, we will instruct U.S. Customs and Border Protection
(CBP)to assess antidumping duties on all appropriate entries covered by this review if the importer-specific assessment rate calculated in the final results of this review is above *de minimis* ( *i.e.* , at or above 0.50 percent). Interested parties are invited to comment on these preliminary results. The final results will issued 90 days after the date of issuance of these preliminary results, unless extended. EFFECTIVE DATE: September 10, 2007. FOR FURTHER INFORMATION CONTACT: Irina Itkin, AD/CVD Operations, Office 2, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone:
(202)482-0656. SUPPLEMENTARY INFORMATION: Background On October 6, 2006, in accordance with 19 CFR 351.214(c), the Department received a timely request from Ege Celik for a new shipper review of the antidumping duty order on rebar from Turkey. On November 7, 2006, the Department found that the request for review with respect to Ege Celik met all of the regulatory requirements set forth in 19 CFR 351.214(b) and initiated an antidumping duty new shipper review covering the period April 1, 2006, through September 30, 2006. *See Notice of Initiation of New Shipper Antidumping Duty Review: Certain Steel Concrete Reinforcing Bars from Turkey* , 71 FR 66503 (Nov. 15, 2006). We issued the antidumping duty questionnaire to Ege Celik in November 2006. Ege Celik submitted a response to this questionnaire in December 2006. In January 2007, we issued a supplemental questionnaire to Ege Celik. Ege Celik responded to this supplemental questionnaire in the same month. Also in January 2007, the domestic interested parties requested that the Department initiate a sales-below-cost investigation of Ege Celik. After analyzing this request, we initiated a sales-below-cost investigation for Ege Celik in February 2007. *See* the Memorandum to James Maeder from The Team entitled, “Petitioners' Allegation of Sales Below the Cost of Production for Ege Celik Endustrisi Sanayi Ve Ticaret A.S. and Ege Dis Ticaret A.S. (Ege Celik Cost Allegation Memo), dated February 26, 2007. In February 2007, the domestic interested parties alleged that Ege Celik was engaged in anti-competitive practices in the home and U.S. markets during the POR, as evidenced by a 2005 finding by the Turkish Government Competition Board (Competition Board). As a result, the domestic industry requested that the Department determine that Ege Celik is affiliated with all Turkish rebar producers named in the Competition Board report and rescind the new shipper review for it on the basis of this affiliation finding. In February and March 2007, we received comments from Ege Celik on these allegations, as well as reply comments from the domestic industry. For further discussion, see the “Turkish Government Competition Board Finding” section below. In March 2007, the Department published an extension of the time period for issuing the preliminary results of this review by an additional 120 days, or until September 4, 2007, in accordance with section 751(a)(2)(B)(iv) of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.214(i)(2). *See Certain Steel Concrete Reinforcing Bars from Turkey; Notice of Extension of Time Limit for Preliminary Results of Antidumping Duty New Shipper Review* , 72 FR 13747 (Mar. 23, 2007). Also in March 2007, we issued an additional supplemental questionnaire to Ege Celik. Ege Celik submitted a response to this questionnaire, as well as a response to the cost of production
(COP)questionnaire, in April 2007. In April 2007, the domestic interested parties submitted a second report by the Competition Board, which they allege: 1) demonstrates that several rebar producers/exporters were engaged in close supplier relationships; and 2) should be relied upon by the Department to make a finding that Ege Celik and other rebar producers/exporters are affiliated. We issued supplemental COP questionnaires in May and June 2007 and received responses in June 2007. Sales and cost verifications of Ege Celik were conducted in June and July 2007. Scope of the Order The product covered by this order is all stock deformed steel concrete reinforcing bars sold in straight lengths and coils. This includes all hot-rolled deformed rebar rolled from billet steel, rail steel, axle steel, or low-alloy steel. It excludes
(i)plain round rebar,
(ii)rebar that a processor has further worked or fabricated, and
(iii)all coated rebar. Deformed rebar is currently classifiable under subheadings 7213.10.000 and 7214.20.000 of the *Harmonized Tariff Schedule of the United States* (HTSUS). The HTSUS subheadings are provided for convenience and customs purposes. The written description of the scope of this proceeding is dispositive. Period of Review The POR is April 1, 2006, through September 30, 2006. Bona Fide Sale Analysis For the reasons stated below, we preliminarily find that Ege Celik's reported U.S. sale during the POR is a *bona fide* sale, as required by 19 CFR 351.214(b)(2)(iv)(c), based on the totality of the facts on the record. Specifically, we find that the price reported for Ege Celik's rebar sale was similar to the average unit value of U.S. imports of comparable rebar from Turkey during the POR. We also find that the quantity of the sale was within the range of shipment sizes of comparable goods exported from Turkey during the POR. *See* the Memorandum from Brianne Riker to the File entitled, “Placing Information from the 2005-2006 Administrative Review on Rebar from Turkey on the Record of the New Shipper Review on Rebar from Turkey for Ege Celik Endustrisi Sanayi ve Ticaret A.S./Ege Dis Ticaret A.S.,” dated July 13, 2007. Finally, we considered whether the importer involved in this transaction is an actual commercial entity, and we found no reason to doubt the legitimacy of the importing party involved in this new shipper review. *See* the Memorandum to James Maeder from Irina Itkin entitled, “Analysis of Ege Celik Endustrisi Sanayi ve Ticaret A.S./Ege Dis Ticaret A.S.'s *Bona Fides* As A New Shipper in the New Shipper Review of Certain Steel Concrete Reinforcing Bars from Turkey,” dated September 4, 2007, for further discussion of our price and quantity analysis. Therefore, for the reasons mentioned above, the Department preliminarily finds that Ege Celik's sole U.S. sale during the POR was a *bona fide* commercial transaction. Turkish Government Competition Board Finding On February 1, 2007, the domestic interested parties submitted a report by the Turkish Government Competition Board regarding the Turkish steel industry. The domestic interested parties argue that this report demonstrates that Ege Celik engaged in anti-competitive behavior prior to and during the POR by colluding with other rebar producers/exporters to manipulate home market and export prices and to suppress costs. The domestic interested parties assert that the Department should collapse all Turkish rebar producers into a single entity and find that Ege Celik does not qualify as a new shipper because of affiliation with other rebar producers/exporters. The domestic interested parties further contend that the Department should, as a result, rescind the initiation of the new shipper review for Ege Celik. However, in the event that the Department continues to conduct this new shipper review, the domestic interested parties argue that the Department should find that a particular market situation, a fictitious market, or sales outside the course of ordinary trade exist and not use home market sales as a basis for NV. In addition, on April 9, 2007, the domestic interested parties submitted a second report by the Competition Board, which they allege: 1) demonstrates that several rebar producers/exporters were engaged in close supplier relationships; and 2) should be relied upon by the Department to make a finding that Ege Celik and other rebar producers/exporters are affiliated. Ege Celik has objected to the Department's acceptance of these submissions because: 1) it is inappropriate to consider antitrust findings in the context of an antidumping duty proceeding; 2) the Competition Board's ruling is not final, as it is under appeal in the Turkish judicial system; and 3) the Competition Board's decision and evidence should not be considered in the current POR because it relates to a prior period of time. Ege Celik did not submit arguments regarding the domestic interested parties' April 9, 2007, submission. We have not relied on the evidence or conclusions in the Board's report as the basis for any findings in this review. Rather, we have investigated whether the facts during the POR would cause us to dismiss reported home market prices or costs within the confines of U.S. antidumping duty law and regulations. Based on Ege Celik's responses to our questions on this topic and our verification of these responses, as well as our findings with respect to the content, and context, of meetings held by the Turkish Iron and Steel Producers' Association during the POR, we have preliminarily concluded that: 1) Ege Celik is not affiliated with other producers of rebar and is therefore entitled to this new shipper review; and 2) there is no evidence that Ege Celik's home market sales prices were not competitively set during the POR, and as such these prices are useable for purposes of our margin analysis. For further discussion, see the August 31, 2007, Memorandum from Shawn Thompson, Irina Itkin, and Brianne Riker to David M. Spooner, entitled “Preliminary Finding on Issues Related to the Turkish Government Competition Board's Reports in Certain Steel Concrete Reinforcing Bars from Turkey” and the July 9, 2007, Memorandum to the File from Irina Itkin and Nichole Zink entitled “Verification of the Sales Response of Ege Celik Endustrisi Sanayi Ve Ticaret A.S./Ege Dis Ticaret A.S. (Ege Celik) in the Antidumping Duty New Shipper Review of Certain Concrete Steel Reinforcing Bars from Turkey.” Comparisons to Normal Value To determine whether Ege Celik's sale of rebar from Turkey was made in the United States at less than NV, we compared the export price
(EP)to the NV, as described in the “Normal Value” section of this notice. When making this comparison in accordance with section 771(16) of the Act, we considered all products sold in the home market as described in the “Scope of the Order” section of this notice, above, that were in the ordinary course of trade for purposes of determining an appropriate product comparison to the U.S. sale. Where there were no sales of identical merchandise in the home market made in the ordinary course of trade, we compared the U.S. sale to sales of the most similar foreign like product made in the ordinary course of trade based on the characteristics listed in sections B and C of our antidumping questionnaire. Product Comparisons In accordance with section 771(16) of the Act, we first attempted to compare products produced by Ege Celik and sold in the U.S. and home markets that were identical with respect to the following characteristics: form, grade, size, and industry standard specification. Where there were no home market sales of foreign like product that were identical in these respects to the merchandise sold in the United States, we compared U.S. products with the most similar merchandise sold in the home market based on the characteristics listed above, in that order of priority. Export Price We used EP methodology for Ege Celik's U.S. sale, in accordance with section 772(a) of the Act, because the subject merchandise was sold directly to the first unaffiliated purchaser in the United States prior to importation, and constructed export price methodology was not otherwise warranted based on the facts of record. Regarding U.S. date of sale, Ege Celik argued that we should use contract date as the date of sale for its U.S. sale. The Department's regulations at 19 CFR 351.401(i) state that the Department will normally use the date of invoice as the date of sale, unless a different date better reflects the date on which the material terms of sale are established. We have analyzed the data on the record and preliminarily find that the material terms of sale were set at the contract date, given that the terms did not change prior to invoicing. Further, because this is the first time that the Department is conducting a review of Ege Celik, there is no prior evidence on the record that the terms of sale were changeable after the contract date. Therefore, in accordance with our practice, we preliminarily find that the appropriate U.S. date of sale is the contract date. *See Certain Steel Concrete Reinforcing Bars from Turkey; Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review* , 71 FR 26455, 26458 (May 5, 2006) ( *04-05 Preliminary Results* ), unchanged in the final results. We based EP on the packed price to the first unaffiliated purchaser in the United States. We made deductions from the starting price for foreign inland freight expenses, foreign brokerage and handling expenses, inspection fees, ocean freight expenses (offset by freight commission revenue), U.S. customs duties, U.S. brokerage and handling expenses, and customs bond fees, in accordance with section 772(c)(2)(A) of the Act. Additionally, we added to the starting price an amount for duty drawback pursuant to section 772(c)(1)(B) of the Act. Normal Value A. Home Market Viability and Selection of Comparison Markets In order to determine whether there is a sufficient volume of sales in the home market to serve as a viable basis for calculating NV ( *i.e.* , the aggregate volume of home market sales of the foreign like product is five percent or more of the aggregate volume of U.S. sales), we compared the volume of Ege Celik's home market sales of the foreign like product to the volume of its U.S. sale of subject merchandise, in accordance with section 773(a)(1)(C) of the Act. Based on this comparison, we determined that Ege Celik had a viable home market during the POR. Consequently, we based NV on home market sales. In accordance with our practice, we excluded home market sales of non-prime merchandise made by Ege Celik during the POR from our preliminary analysis based on the limited quantity of such sales in the home market and the fact that no such sales were made to the United States during the POR. *See* , *e.g.* , *04-05 Preliminary Results* , 71 FR at 26459, unchanged in the final results; *Certain Steel Concrete Reinforcing Bars from Turkey; Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review and Notice of Intent To Revoke in Part* , 70 FR 23990, 23993 (May 6, 2005), unchanged in the final results; *Certain Steel Concrete Reinforcing Bars From Turkey; Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review and Notice of Intent Not To Revoke in Part* , 69 FR 25066, 25066 (May 5, 2004), unchanged in the final results; and *Certain Steel Concrete Reinforcing Bars from Turkey; Preliminary Results of Antidumping Duty Administrative Review and Notice of Intent Not to Revoke in Part* , 68 FR 23972 (May 6, 2003), unchanged in the final results. B. Cost of Production Analysis Pursuant to section 773(b)(2)(A)(i) of the Act, there were reasonable grounds to believe or suspect that Ege Celik made home market sales at prices below its COP in this review because of information contained in the cost allegation properly filed by the domestic interested parties. As a result, the Department initiated an investigation to determine whether Ege Celik made home market sales during the POR at prices below its COP. *See* the “Ege Celik Cost Allegation Memo.” 1. Calculation of COP In accordance with section 773(b)(3) of the Act, we calculated COP based on the sum of Ege Celik's cost of materials and fabrication for the foreign like product, plus amounts for general and administrative (G&A) expenses and interest expenses. *See* the “Test of Home Market Sales Prices” section below for treatment of home market selling expenses. We relied on the COP information provided by Ege Celik in its questionnaire responses, except for the following instances where the information was not appropriately quantified or valued: 1) We disallowed an adjustment to the total cost of manufacturing for packing materials that had been returned to the warehouse. 2) We added an amount for duty drawback to the total cost of manufacturing. 3) We adjusted the numerator of the G&A expense calculation to include the revenue from the sale of fixed assets. 4) We adjusted the denominator of the G&A and financial expense calculations to exclude packing expenses which had been reported in the home market and U.S. sales listings. 5) We revised the financial expense ratio based on the fiscal year 2006 audited consolidated financial statements. For further discussion, see the Memorandum from Trinette Boyd to Neal Halper entitled, “Cost of Production and Constructed Value Calculation Adjustments for the Preliminary Results in the New Shipper Review—Ege Celik Endustrisi Sanayi ve Ticaret A.S./Ege Dis Ticaret A.S.,” dated September 4, 2007. 2. Test of Home Market Sales Prices We compared the weighted-average COP figures to home market prices of the foreign like product, as required under section 773(b) of the Act, to determine whether these sales had been made at prices below the COP. On a product-specific basis, we compared the COP to home market prices, less any applicable movement charges, selling expenses, and packing expenses. In determining whether to disregard home market sales made at prices below the COP, we examined whether such sales were made: 1) in substantial quantities within an extended period of time; and 2) at prices which permitted the recovery of all costs within a reasonable period of time. *See* sections 773(b)(1)(A) and
(B)of the Act. 3. Results of the COP Test Pursuant to section 773(b)(2)(C)(i) of the Act, where less than 20 percent of Ege Celik's sales of a given product were at prices less than the COP, we did not disregard any below-cost sales of that product because we determined that the below-cost sales were not made in “substantial quantities.” Where 20 percent or more of Ege Celik's sales of a given product were at prices below the COP, we determined that sales of that model were made in “substantial quantities” within an extended period of time (as defined in section 773(b)(2)(B) of the Act), in accordance with section 773(b)(2)(C)(i) of the Act. In such cases, we also determined that such sales were not made at prices which would permit recovery of all costs within a reasonable period of time, in accordance with section 773(b)(2)(D) of the Act. Therefore, for purposes of this new shipper review, we disregarded these below-cost sales for Ege Celik and used the remaining sales as the basis for determining NV, in accordance with section 773(a)(1) of the Act. C. Level of Trade In accordance with section 773(a)(1)(B) of the Act, to the extent practicable, we determine NV based on sales in the comparison market at the same level of trade
(LOT)as EP. The NV LOT is that of the starting-price sales in the comparison market or, when NV is based on constructed value, that of the sales from which we derive selling expenses, G&A expenses, and profit. For EP, the U.S. LOT is also the level of the starting-price sale, which is usually from the exporter to the unaffiliated U.S. customer. To determine whether NV sales are at a different LOT than EP sales, we examine stages in the marketing process and selling functions along the chain of distribution between the producer and the unaffiliated customer. If the comparison-market sales are at a different LOT and the difference affects price comparability, as manifested in a pattern of consistent price differences between the sales on which NV is based and comparison-market sales at the LOT of the export transaction, we make an LOT adjustment under section 773(a)(7)(A) of the Act. Ege Celik claimed that it sold rebar at a single LOT in its home and U.S. markets. Specifically, Ege Celik reported that it only made sales to one customer category ( *i.e.* , trading companies) through one channel of distribution in the home market and identical selling functions were performed for all sales. After analyzing the data on the record with respect to these functions, we find that the Ege Celik made all sales at a single marketing stage ( *i.e.* , one LOT) in the home market. Further, because Ege Celik only reported one U.S. sale during the POR, we find that there is a single marketing stage ( *i.e.* , one LOT) in the U.S. market. Although Ege Celik provided certain additional services related to freight and brokerage and handling for its U.S. sale and not home market sales, we did not find these differences to be material selling function distinctions significant enough to warrant a separate LOT. Therefore, we find that the home market sales and U.S. sales were made at the same LOT. Accordingly, we determined that no LOT adjustment is warranted. D. Calculation of Normal Value We based NV on the starting prices to home market customers. Pursuant to section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410(b), we made circumstance-of-sale adjustments for exporter association fees, bank charges, and credit expenses. We deducted home market packing costs and added U.S. packing costs, in accordance with section 773(a)(6) of the Act. Where appropriate, we made an adjustment to NV to account for differences in physical characteristics of the merchandise, in accordance with section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411(a). We based this adjustment on the difference in the variable costs of manufacturing for the foreign like product and subject merchandise. *See* 19 CFR 351.411(b). Currency Conversion We made currency conversions into U.S. dollars pursuant to section 773A(a) of the Act and 19 CFR 351.415. Although the Department's preferred source for daily exchange rates is the Federal Reserve Bank, the Federal Reserve Bank does not track or publish exchange rates for the New Turkish Lira. Therefore, we made currency conversions based on exchange rates from the Dow Jones Reuters Business Interactive LLC (trading as Factiva). Preliminary Results of New Shipper Review As a result of our review, we preliminarily determine that the following percentage margin exists for Ege Celik for the period April 1, 2006, through September 30, 2006: Manufacturer/Producer/Exporter Margin Percentage Ege Celik Endustrisi Sanayi ve Ticaret A.S./Ege Dis Ticaret A.S. 0.00 Disclosure and Public Hearing The Department will disclose to parties the calculations performed in connection with these preliminary results within five days of the date of publication of this notice. *See* 19 CFR 351.224(b). Pursuant to 19 CFR 351.309, interested parties may submit cases briefs not later than 30 days after the date of publication of this notice. Rebuttal briefs, limited to issues raised in the case briefs, may be filed not later than 5 days after the deadline for filing the case briefs. Parties who submit case briefs or rebuttal briefs in this proceeding are requested to submit with each argument: 1) a statement of the issue; 2) a brief summary of the argument; and 3) a table of authorities. Interested parties who wish to request a hearing or to participate if one is requested must submit a written request to the Assistant Secretary for Import Administration, Room B-099, within 30 days of the date of publication of this notice. Requests should contain: 1) the party's name, address and telephone number; 2) the number of participants; and 3) a list of issues to be discussed. *See* 19 CFR 351.310(c). Issues raised in the hearing will be limited to those raised in the respective case briefs. The Department will issue the final results of this review, including the results of its analysis of issues raised in any written briefs, within 90 days of publication of these preliminary results. Assessment Rate Upon completion of the new shipper review, the Department shall determine, and CBP shall assess, antidumping duties on all appropriate entries, in accordance with 19 CFR 351.212. The Department intends to issue appraisement instructions for Ege Celik directly to CBP 15 days after the date of publication of the final results of this new shipper review. Pursuant to 19 CFR 351.212(b)(1), because we have the reported entered value of Ege Celik's U.S. sale, we have calculated an importer-specific assessment rate based on the ratio of the total amount of antidumping duties calculated for the examined sale to the total entered value of that sale. We will instruct CBP to assess antidumping duties on all appropriate entries covered by this review if the importer-specific assessment rate calculated in the final results of this review is above *de minimis* ( *i.e.* , at or above 0.50 percent). Pursuant to 19 CFR 351.106(c)(2), we will instruct CBP to liquidate without regard to antidumping duties any entries for which the assessment rate is *de minimis* ( *i.e.* , less than 0.50 percent). *See* 19 CFR 351.106(c)(1). The final results of this review shall be the basis for the assessment of antidumping duties on entries of merchandise covered by the final results of this review and for future deposits of estimated duties, where applicable. The Department clarified its “automatic assessment” regulation on May 6, 2003 (68 FR 23954). This clarification applies to entries of subject merchandise during the POR produced by companies included in these preliminary results of review for which the reviewed companies did not know their merchandise was destined for the United States. In such instances, we will instruct CBP to liquidate unreviewed entries at the All-Others rate if there is no rate for the intermediate company(ies) involved in the transaction. For a full discussion of this clarification, see *Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties* , 68 FR 23954 (May 6, 2003). Cash Deposit Requirements The following cash deposit requirements will be effective for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of the new shipper review, as provided by section 751(a)(2)(C) of the Act: 1) the cash deposit rate for Ege Celik ( *i.e.* , for subject merchandise both manufactured and exported by Ege Celik) will be that established in the final results of this review, except if the rate is less than 0.50 percent, and therefore, *de minimis* within the meaning of 19 CFR 351.106(c)(1), in which case the cash deposit rate will be zero; 2) for previously reviewed or investigated companies not participating in this review, the cash deposit rate will continue to be the company-specific rate published for the most recent period; 3) if the exporter is not a firm covered in these reviews or the original less-than-fair-value
(LTFV)investigation, but the manufacturer is, the cash deposit rate will be the rate established for the most recent period for the manufacturer of the merchandise; and 4) the cash deposit rate for all other manufacturers or exporters will continue to be 16.06 percent, the All-Others rate established in the LTFV investigation. These requirements, when imposed, shall remain in effect until further notice. Notification to Importers This notice serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties. This new shipper review is issued and published in accordance with sections 751(a)(2)(B)(iv) and 777(i)(1) of the Act, as well as 19 CFR 351.214(i). Dated: September 4, 2007. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E7-17758 Filed 9-7-07; 8:45 am] BILLING CODE 3510-DS-S DEPARTMENT OF COMMERCE International Trade Administration (C-580-818) Corrosion-Resistant Carbon Steel Flat Products from the Republic of Korea: Preliminary Results of Countervailing Duty Administrative Review AGENCY: Import Administration, International Trade Administration, Department of Commerce. SUMMARY: The Department of Commerce (the Department) is conducting an administrative review of the countervailing duty
(CVD)order on corrosion-resistant carbon steel flat products from the Republic of Korea (Korea) for the period of review
(POR)January 1, 2005, through December 31, 2005. For information on the net subsidy for each of the reviewed companies, see the “Preliminary Results of Review” section of this notice. Interested parties are invited to comment on these preliminary results. (See the “Public Comment” section of this notice). EFFECTIVE DATE: September 10, 2007. FOR FURTHER INFORMATION CONTACT: Robert Copyak or Gayle Longest, AD/CVD Operations, Office 3, Import Administration, U.S. Department of Commerce, Room 4014, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone:
(202)482-2209 or
(202)482-3338, respectively. SUPPLEMENTARY INFORMATION: Background On August 17, 1993, the Department published in the **Federal Register** the CVD order on corrosion-resistant carbon steel flat products from Korea. *See Countervailing Duty Orders and Amendments to Final Affirmative Countervailing Duty Determinations: Certain Steel Products from Korea* , 58 FR 43752 (August 17, 1993). On August 1, 2006, the Department published a notice of opportunity to request an administrative review of this CVD order. *See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review* , 71 FR 43441 (August 1, 2006). On August 31, 2006, we received a timely request for review from Pohang Iron and Steel Co. Ltd. (POSCO) and Dongbu Steel Co., Ltd. (Dongbu). On September 29, 2006, the Department published a notice of initiation of the administrative review of the CVD order on corrosion-resistant carbon steel flat products from Korea covering the POR January 1, 2005, through December 31, 2005. *See Initiation of Antidumping and Countervailing Duty Administrative Reviews* , 71 FR 57465 (September 29, 2006). On October 16, 2006, the Department sent its initial questionnaire to POSCO, Dongbu, and the Government of Korea (GOK). On December 21, 2006, the Department received questionnaire responses from POSCO, Pohang Steel Co., Ltd. (POCOS, a production affiliate of POSCO), POSCO Steel Service & Sales Co., Ltd. (POSTEEL, a trading company for POSCO), 1 Dongbu, and the GOK. On March 30, 2007, we issued supplemental questionnaires to POSCO and the GOK. On April 16, 2007, we received the responses to these supplemental questionnaires. 1 In these preliminary results, unless otherwise stated, we use POSCO to collectively refer to POSCO, POCOS, and POSTEEL. On May 9, 2007, the Department published in the **Federal Register** a notice of extension of the time period for issuing the preliminary results. See Corrosion-Resistant Carbon Steel Flat Products from the Republic of Korea: Extension of Time Limit for Preliminary Results of Countervailing Duty Administrative Review, 72 FR 26338 (May 9, 2007). In accordance with 19 CFR 351.213(b), this review covers only those producers or exporters for which a review was specifically requested. The companies subject to this review are POSCO (and its affiliates POCOS and POSTEEL) and Dongbu. Affiliated Companies In the present administrative review, record evidence indicates that POCOS is a majority-owned production affiliate of POSCO. Under 19 CFR 351.525(b)(6)(iii), if the firm that received a subsidy is a holding company, including a parent company with its own operations, the Department will attribute the subsidy to the consolidated sales of the holding company and its subsidiaries. Thus, we attributed subsidies received by POCOS to POSCO and its subsidiaries, net of intra-company sales. Dongbu reported that it is the only member of the Dongbu group in Korea that was involved with the sale of subject merchandise to the United States. Scope of Order Products covered by this order are certain corrosion-resistant carbon steel flat products from Korea. These products include flat-rolled carbon steel products, of rectangular shape, either clad, plated, or coated with corrosion-resistant metals such as zinc, aluminum, or zinc-, aluminum-, nickel- or iron- based alloys, whether or not corrugated or painted, varnished or coated with plastics or other nonmetallic substances in addition to the metallic coating, in coils (whether or not in successively superimposed layers) and of a width of 0.5 inch or greater, or in straight lengths which, if of a thickness less than 4.75 millimeters, are of a width of 0.5 inch or greater and which measures at least 10 times the thickness or if of a thickness of 4.75 millimeters or more are of a width which exceeds 150 millimeters and measures at least twice the thickness. The merchandise subject to this order is currently classifiable in the *Harmonized Tariff Schedule of the United States* (HTSUS) at subheadings: 7210.30.0000, 7210.31.0000, 7210.39.0000, 7210.41.0000, 7210.49.0030, 7210.49.0090, 7210.60.0000, 7210.61.0000, 7210.69.0000, 7210.70.6030, 7210.70.6060, 7210.70.6090, 7210.90.1000, 7210.90.6000, 7210.90.9000, 7212.20.0000, 7212.21.0000, 7212.29.0000, 7212.30.1030, 7212.30.1090, 7212.30.3000, 7212.30.5000, 7212.40.1000, 7212.40.5000, 7212.50.0000, 7212.60.0000, 7215.90.1000, 7215.9030, 7215.90.5000, 7217.12.1000, 7217.13.1000, 7217.19.1000, 7217.19.5000, 7217.20.1500, 7217.22.5000, 7217.23.5000, 7217.29.1000, 7217.29.5000, 7217.30.15.0000, 7217.32.5000, 7217.33.5000, 7217.39.1000, 7217.39.5000, 7217.90.1000 and 7217.90.5000. Although the HTSUS subheadings are provided for convenience and customs purposes, the Department's written description of the merchandise is dispositive. Average Useful Life Under 19 CFR 351.524(d)(2), we will presume the allocation period for non-recurring subsidies to be the average useful life
(AUL)of renewable physical assets for the industry concerned as listed in the Internal Revenue Service's
(IRS)1997 Class Life Asset Depreciation Range System, as updated by the Department of the Treasury. The presumption will apply unless a party claims and establishes that the IRS tables do not reasonably reflect the company-specific AUL or the country-wide AUL for the industry under examination and that the difference between the company-specific and/or country-wide AUL and the AUL from the IRS table is significant. According to the IRS Tables, the AUL of the steel industry is 15 years. No interested party challenged the 15-year AUL derived from the IRS tables. Thus, in this review, we have allocated, where applicable, all of the non-recurring subsidies provided to the producers/exporters of subject merchandise over a 15-year AUL. Subsidies Valuation Information A.Benchmarks for Short-Term Financing For those programs requiring the application of a won-denominated, short-term interest rate benchmark, in accordance with 19 CFR 351.505(a)(2)(iv), we used as our benchmark an annual average company-specific weighted-average interest rate for commercial won-denominated loans outstanding during the POR. Where no such benchmark instruments are available, we used national average lending rates for the POR, as reported in the International Monetary Fund's
(IMF)*International Financial Statistics Yearbook* . This approach is in accordance with 19 CFR 351.505(a)(3)(ii) and the Department's practice. See, e.g., Final *Affirmative Countervailing Duty Determination: Structural Steel Beams From the Republic of Korea* , 65 FR 41051 (July 3, 2000) ( *H Beams Investigation* ), and the accompanying Issues and Decision Memorandum ( *H Beams Decision Memorandum* ), at “Benchmarks for Short-Term Financing.” B. Benchmark for Long-Term Loans Issued Through 2005 During the POR, POSCO and Dongbu had outstanding long-term won-denominated and foreign-currency denominated loans from government-owned banks and Korean commercial banks. Based on our findings on this issue in prior investigations and administrative reviews, we are using the following benchmarks to calculate the subsidies attributable to respondents' countervailable long-term loans obtained though 2005:
(1)For countervailable, foreign-currency denominated loans, pursuant to 19 CFR 351.505(a)(2), and consistent with our past practice, our preference is to use the company-specific, weighted-average foreign currency-denominated interest rates on the company's loans from foreign bank branches in Korea, foreign securities, and direct foreign loans outstanding during the POR. *See, e.g., Final Affirmative Countervailing Duty Determination: Stainless Steel Sheet and Strip in Coils from the Republic of Korea* , 64 FR 30636, 30640 (June 8, 1999). Where no such benchmark instruments are available, and consistent with 19 CFR 351.505(a)(3)(ii), as well as our practice, we relied on the national average lending rates as reported by the IMF's *International Financial Statistics Yearbook* . *See, e.g., Final Results and Partial Rescission of Countervailing Duty Administrative Review: Stainless Steel Sheet and Strip in Coils from the Republic of Korea* , 69 FR 2113 (January 14, 2004), and the accompanying Issues and Decision Memorandum, at “Subsidies Valuation Information; B. Benchmarks for Long-Term Loans and Discount Rates.”
(2)For countervailable, won-denominated, long-term loans, our practice is to use the company-specific corporate bond rate on the company's public and private bonds, as we determined that the GOK did not control the Korean domestic bond market after 1991 and that domestic bonds may serve as an appropriate benchmark interest rate. *See, e.g., Final Negative Countervailing Duty Determination: Stainless Steel Plate in Coils from the Republic of Korea* , 64 FR 15530, 15531 (March 31, 1999) ( *Plate in Coils Investigation* ); *see also* 19 CFR 351.505(a)(2)(ii). Where no such benchmark instruments are available, we used the national average of the yields on three-year corporate bonds, as reported by the Bank of Korea (BOK), consistent with 19 CFR 351.505(a)(3)(ii). We note that the use of the three-year corporate bond rate from the BOK follows the approach taken in the *Plate in Coils Investigation* , in which we determined that, absent company-specific interest rate information, the corporate bond rate is the best indicator of a market rate for won-denominated long-term loans in Korea. *See Plate in Coils Investigation* , 64 FR at 15531; *see also* 19 CFR 351.505(a)(3)(ii). In accordance with 19 CFR 351.505(a)(2)(i), our benchmarks take into consideration the structure of the government-provided loans. For countervailable fixed-rate loans, pursuant to 19 CFR 351.505(a)(2)(iii), we used benchmark rates issued in the same year that the government loans were issued. For countervailable variable-rate loans outstanding during the POR, pursuant to 19 CFR 351.505(a)(5)(i), our preference is to use the interest rates of variable-rate lending instruments issued during the year in which the government loans were issued. Where such benchmark instruments are unavailable, we used interest rates from debt instruments issued during the POR as our benchmark, as such rates better reflect a variable interest rate that would be in effect during the POR. This approach is in accordance with the Department's practice. * See, e.g., Final Results and Partial Rescission of Countervailing Duty Administrative Review: Stainless Steel Sheet and Strip From the Republic of Korea * , 68 FR 13267 (March 19, 2003), and accompanying Issues and Decision Memorandum, at Comment 8; *see also* 19 CFR 351.505(a)(5)(ii). C. Benchmark Discount Rates Certain programs examined in this administrative review require the allocation of won-denominated benefits over time. Thus, we have employed the allocation methodology described under 19 CFR 351.524(d). Pursuant to 19 CFR 351.524(d)(3)(i), we based our discount rate on data for the year in which the government agreed to provide the subsidy. Under 19 CFR 351.524(d)(3)(i)(A), our preference is to use the cost of long-term, fixed-rate loans of the firm in question. 2 Thus, where available, we used company-specific corporate bond rates on public and private bonds. *See, e.g., Plate in Coils Investigation* , 64 FR at 15531. Where no such benchmark instruments are available, pursuant to 19 CFR 351.524(d)(3)(i)(B), we used the national average of the yields on three-year corporate bonds, as reported by the BOK, because we have determined that the GOK did not control the Korean domestic bond market after 1991. 2 Pursuant to 19 CFR 351.505(a)(2)(ii), a “commercial loan” is defined as a loan taken out by the firm from a commercial lending institution or a debt instrument issued by the firm in a commercial market. Because we have determined that the GOK controlled and directed lending, we are unable to use the cost of loans for discount rate purposes. However, as explained above, we determined that the GOK did not control the Korean domestic bond market after 1991. I. Program Preliminarily Determined to Confer Subsidies A. The GOK's Direction of Credit 1. Loans Received Through 2005 In the most recently completed CVD proceeding involving Korea, the Department reaffirmed earlier determinations that the GOK controlled and directed lending to Korean steel producers through 2005. *See Final Results of Countervailing Duty Administrative Review: Certain Cut-to-Length Carbon-Quality Steel Plate from Republic of Korea* , 72 FR 38565 (July 13, 2007) ( *2005 CTL Plate Final Results* ), and accompanying Issues and Decision Memorandum, at “GOK's Direction of Credit” ( *2005 CTL Plate Decision Memorandum* ). In addition, in that review, the Department noted that neither the respondent nor the GOK provided any new information that would warrant a change in the Department's determination. Finding that the GOK did not act to the best of its ability, the Department employed an adverse inference and determined that the GOK continued its direction-of-credit policies with respect to the Korean steel industry for the period 2002 through 2005. *Id* . During the POR, POSCO and Dongbu had outstanding loans that were received prior to and/or during the 2005 period. As in the prior proceedings, we asked the GOK for information pertaining to the GOK's direction-of-credit policies through 2005. The GOK did not provide any new information that would warrant a departure from these prior findings, stating instead that: “The Department has consistently found that long-term loans received by the steel industry were the result of GOK direction, despite the GOK's repeated objections and demonstrations to the contrary. While the GOK strongly disagrees with the Department's position, the legal costs to further contest this issue in the current review overshadow any possible benefit to the participating Korean companies.” See the GOK's Questionnaire Response, at 8 (December 21, 2006). Because the GOK withheld the requested information on its lending policies, the Department does not have the necessary information on the record to determine whether the GOK has continued its direction-of-credit policies with respect to the Korean steel industry through 2005; therefore, the Department must base its determination on facts otherwise available. See Section 776(a)(2)(A) of the Tariff Act of 1930, as amended (the Act). Section 776(b) of the Act further provides that the Department may use an adverse inference in applying the facts otherwise available when a party has failed to cooperate by not acting to the best of its ability to comply with a request for information. Section 776(b) of the Act also authorizes the Department to use as adverse facts available
(AFA)information derived from the petition, the final determination in the investigation, a previous administrative review, or other information placed on the record. For the reasons discussed below, we determine that, in accordance with sections 776(a)(2) and 776(b) of the Act, the use of AFA is appropriate for the final results for the determination of direction of credit for loans received through 2005. In this case, the GOK refused to supply requested information that was in its possession, even though the GOK had provided similar information in prior proceedings. *See, e.g., Final Affirmative Countervailing Duty Determination: Certain Cut-to-Length Carbon-Quality Steel Plate from the Republic of Korea* , 64 FR 73176, 73178-180 (December 29, 1999) ( *CTL Plate Investigation* ). Therefore, consistent with section 776(a)(2)(A) and
(B)of the Act, we find that the GOK did not act to the best of its ability in this case and, therefore, we are employing an adverse inference in selecting from among the facts otherwise available. As AFA, we find that the GOK's direction-of-credit policies for the steel industry continued through 2005. Accordingly, the GOK's direction-of-credit policies with respect to the Korean steel industry provide a financial contribution in the form of the provision of loans pursuant to section 771(5)(D)(i) of the Act, confer a benefit in the amount of the difference between the amount that firm paid for the countervailable loan and the amount the firm would pay on a comparable commercial loan within the meaning of section 771(5)(E)(ii) of the Act, and are specific pursuant to section 771(5A)(D)(iii) of the Act because they are limited to the steel industry. Therefore, we find that lending to Korean steel producers from domestic banks and government-owned banks through 2005 is countervailable. Thus, any loans received by Korean steel producers through 2005 from domestic banks and government-owned banks that were outstanding during the POR are countervailable, to the extent that the interest amount paid on the loan is less than what would have been paid on a comparable commercial loan. The Department's decision to rely on adverse inferences when lacking a response from the GOK regarding the direction-of-credit issue, as it applies to the Korean steel industry, is also in accordance with its practice. *See 2005 CTL Plate Decision Memorandum* at “GOK's Direction of Credit.” 2. Calculation of the Benefit and Net Subsidy Rate Under the Direction of Credit Program In accordance with 19 CFR 351.505(c)(2) and (4), we calculated the benefit for each fixed- and variable-rate loan received from GOK-owned or -controlled banks to be the difference between the actual amount of interest paid on the directed loan during the POR and the amount of interest that would have been paid during the POR at the benchmark interest rate. We conducted our benefit calculations using the benchmark interest rates described in the “Subsidies Valuation Information” section above. For foreign currency-denominated loans, we converted the benefits into Korean won using exchange rates obtained from the BOK. We then summed the benefits from each company's long-term fixed-rate and variable-rate won-denominated loans. To calculate the net subsidy rate, we divided the companies' total benefits by their respective total f.o.b. sales values during the POR, as this program is not tied to exports or a particular product. In calculating the net subsidy rate for POSCO, we removed from the denominator sales made between affiliated parties. 3 On this basis, we preliminarily determine the net subsidy rate under the direction of credit program to be less than 0.005 percent *ad valorem* for POSCO and 0.05 percent *ad valorem* for Dongbu. 3 For POSCO, we also removed intra-company sales from the denominators of the net subsidy rate calculations of the other programs found countervailable in these preliminary results. This step was not necessary for Dongbu. B. Asset Revaluation Under Article 56(2) of the Tax Reduction and Exemption Control Act (TERCL) Under Article 56(2) of the TERCL, the GOK permitted companies that made an initial public offering between January 1, 1987, and December 31, 1990, to revalue their assets at a rate higher than the 25 percent required of most other companies under the Asset Revaluation Act. The Department has previously found this program to be countervailable. For example, in the *CTL Plate Investigation* , the Department determined that this program was de facto specific under section 771(5A)(D)(iii) of the Act because the actual recipients of the subsidy were limited in number and the basic metal industry was a dominant user of this program. *See CTL Plate Investigation* , 64 FR at 73182-183. We also determined that a financial contribution was provided in the form of tax revenue foregone pursuant to section 771(5)(D)(ii) of the Act. Id. The Department further determined that a benefit was conferred within the meaning of section 771(5)(E) of the Act on those companies that were able to revalue their assets under TERCL Article 56(2) because the revaluation resulted in participants paying fewer taxes than they would otherwise pay absent the program. *Id* . No new information, evidence of changed circumstances, or comments from interested parties were presented in this review to warrant any reconsideration of the countervailability of this program. The benefit from this program is the difference that the revaluation of depreciable assets has on a company's tax liability each year. Evidence on the record indicates that, in 1989, POSCO made an asset revaluation that increased its depreciation expense. Dongbu reported that it did not use this program during the POR. To calculate the benefit to POSCO, we took the additional depreciation listed in the tax return filed during the POR, which resulted from the company's asset revaluation, and multiplied that amount by the tax rate applicable to that tax return. We then divided the resulting benefit by POSCO's total f.o.b. sales. On this basis, we preliminarily determine the net countervailable subsidy to be 0.02 percent *ad valorem* for POSCO. This program was not used by Dongbu. C. Research and Development (R&D) Grants Under the Industrial Development Act
(IDA)The GOK, through the Ministry of Commerce, Industry, and Energy (MOCIE), provides R&D grants to support numerous projects pursuant to the IDA, including technology for core materials, components, engineering systems, and resource technology. The IDA is designed to foster the development of efficient technology for industrial development. To participate in this program a company may:
(1)perform its own R&D project,
(2)participate through the Korea New Iron and Steel Technology Research Association (KNISTRA), which is an association of steel companies established for the development of new iron and steel technology, and/or
(3)participate in another company's R&D project and share R&D costs, along with funds received from the GOK. To be eligible to participate in this program, the applicant must meet the qualifications set forth in the basic plan and must perform R&D as set forth under the Notice of Industrial Basic Technology Development. If the R&D project is not successful, the company must repay the full amount. In the *H Beams Investigation* , the Department determined that through KNISTRA the Korean steel industry receives funding specific to the steel industry. Therefore, given the nature of KNISTRA, the Department found projects under KNISTRA to be specific. *See Preliminary Negative Countervailing Duty Determination and Alignment of Final Countervailing Duty Determination With Final Antidumping Duty Determination: Structural Steel Beams From the Republic of Korea* , 64 FR 69731, 69740 (December 14, 1999) (unchanged in final results), *H Beams Decision Memorandum* , at “R&D Grants Under The Korea New Iron & Steel Technology Research Association (KNISTRA).” Further, we found that the grants constituted a financial contribution under section 771(5)(D)(i) of the Act in the form of a grant, and bestowed a benefit under section 771(5)(E) of the Act in the amount of the grant. *Id* . No new factual information or evidence of changed circumstances has been provided to the Department with respect to this program. Therefore, we preliminarily determine that this program is *de jure* specific within the meaning of section 771(5A)(D)(i) of the Act and constitutes a financial contribution and confers a benefit under sections 771(5)(D)(i) and 771(5)(E) of the Act, respectively. Dongbu reported that it did not use the program during the POR. POSCO reported receiving grants through KNISTRA during the POR; however, it claims that the research grants it received under the program are tied to non-subject merchandise. Upon review of the information submitted by the GOK and POSCO, we preliminarily determine that certain grants are tied to non-subject merchandise, and thus, we did not include these grants in our benefit calculations. See the GOK's December 21, 2006, Questionnaire Response, at Exhibit G-6. However, POSCO also reported receiving certain other grants related to a production process that can be used for an input into the production of subject merchandise. *See* POSCO's December 21, 2006, Questionnaire Response, at Exhibit 6. *See Preliminary Results of Countervailing Duty Administrative Review: Corrosion-Resistant Carbon Steel Flat Products from the Republic of Korea* , 71 FR 53413, 53417 (September 11, 2006) ( *Preliminary Results of CORE from Korea (2004)* ) (unchanged final results, 71 FR 119 (January 3, 2007)). Under 19 CFR 351.525(b)(5), if a subsidy is tied to the production or sale of a particular product, the Department will attribute the subsidy only to that product. But, under sub-paragraph (ii), if a subsidy is tied to the production of an input product, then the Department will attribute the subsidy to both the input and downstream products produced by a corporation, where the input is primarily dedicated to downstream products. Accordingly, we have attributed the grant related to a production process that can be used as an input into the production of subject merchandise to POSCO's total sales. To determine the benefit from the grants that POSCO received through KNISTRA, we calculated the GOK's contribution for each R&D project. Next, in accordance with 19 CFR 351.524(b)(2), we determined whether to allocate the non-recurring benefit from the grants over POSCO's AUL by dividing the approved amount by POSCO's total sales in the year of approval. Because the approved amounts were less than 0.5 percent of POSCO's total sales in the year of receipt, we expensed the grants to the year of receipt. Next, to calculate the net subsidy rate, we divided the portion of the benefit allocated to the POR by POSCO's total f.o.b. sales during the POR. On this basis, we preliminarily determine POSCO's net subsidy rate under this program to be 0.01 percent *ad valorem* . D. Exemption of VAT on Imports of Anthracite Coal Under Article 106 of Restriction of Special Taxation Act (RSTA), imports of anthracite coal are exempt from the value added tax (VAT). In the *Cold-Rolled Investigation* , we determined that the program is de jure specific to the steel industry under section 771(5A)(D)(i) of the Act, as the items allowed to be imported without paying VAT are limited to the production of steel products. *See Final Affirmative Countervailing Duty Determination: Certain Cold-Rolled Carbon Steel Flat Products From the Republic of Korea* , 67 FR 62102 (October 3, 2002) ( *Cold-Rolled Investigation* ), and accompanying Issues and Decision Memorandum ( *Cold-Rolled Decision Memorandum* ), at “Exemption of VAT on Imports of Anthracite Coal.” We also determined that the VAT exemptions under the program constitute a financial contribution under section 771(5)(D)(ii) of the Act, as the GOK is not collecting revenue otherwise due, and that the exemptions confer a benefit under section 771(5)(E) of the Act equal to the amount of the VAT that would have otherwise been paid if not for the exemption. No new information, evidence of changed circumstances, or comments from interested parties were presented in this review to warrant any reconsideration of the countervailability of this program. Therefore, we preliminarily determine that this program is *de jure* specific within the meaning of section 771(5A)(D)(i) of the Act because it is limited to the steel industry, constitutes a financial contribution in the form of foregone revenue under section 771(5)(D)(ii) of the Act, and confers a benefit in the amount of the revenue foregone within the meaning of 771(5)(E) of the Act. Dongbu reported that it did not use the program during the POR. POSCO imported anthracite coal during the POR and, therefore, received a benefit in the amount of the VAT that it would have otherwise paid if not for the exemption. To determine POSCO's benefit from the VAT exemption on these imports, we calculated the amount of VAT that would have been due absent the program on the total value of anthracite coal POSCO imported during the POR. We then divided the amount of this tax benefit by POSCO's total f.o.b. sales. Based on this methodology, we preliminarily determine that POSCO received a countervailable subsidy of 0.05 percent *ad valorem* . E. GOK Infrastructure Investment at Kwangyang Bay Through 1991 In *Steel Products from Korea* , the Department investigated the GOK's infrastructure investments at Kwangyang Bay over the period 1983-1991. We determined that the GOK's provision of infrastructure at Kwangyang Bay was countervailable because POSCO was the predominant user of the GOK's investments. *See Final Affirmative Countervailing Duty Determination and Final Negative Critical Circumstance Determinations: Certain Steel Products from Korea* , 58 FR 37338, 37346 (July 9, 1993) ( *Steel Products from Korea* ). Dongbu did not use this program. Consistent with section 771(5A)(D)(iii) of the Act, the Department has held that a countervailable subsidy exists when benefits under a program are provided, or are required to be provided, in law or in fact, to a specific enterprise or industry or group of enterprises or industries. *See, e.g., Steel Products from Korea* , 58 FR at 37346; and *Preliminary Results of CORE from Korea (2004)* , 71 FR 53418. No new factual information or evidence of changed circumstances has been provided to the Department with respect to the GOK's infrastructure investments at Kwangyang Bay over the period 1983-1991. Therefore, we preliminarily determine the infrastructure investments the GOK provided to POSCO are *de facto* specific within the meaning of section 771(5A)(D)(iii)(II) of the Act. Further, we preliminarily determine that the infrastructure investments constitute a financial contribution in the form of a grant, pursuant to section 771(5)(D)(i) of the Act, and confer a benefit in the amount of the grant within the meaning of section 771(5)(E) of the Act. To determine the benefit from the GOK's investments to POSCO during the POR, we utilized the approach adopted in prior proceedings. *See, e.g., CTL Plate Investigation* , 64 FR at 73180. In measuring the benefit from this program, we treated the GOK's costs of constructing the infrastructure at Kwangyang Bay as untied, non-recurring grants in each year in which the costs were incurred. To calculate the benefit conferred during the POR, we applied the Department's standard grant methodology and allocated the GOK's infrastructure investments over a 15-year allocation period. See the “Average Useful Life” section, above. Using the 15-year allocation period, POSCO is still receiving benefits under this program from the GOK investments made during the year 1991. To calculate the benefit from these grants, we used as our discount rate the rate describe above in the “Subsidies Valuation Information” section. We then divided this total benefit attributable to the POR by POSCO's total f.o.b. sales for the POR. On this basis, we preliminarily determine POSCO's net countervailable subsidy rate to be 0.01 percent *ad valorem* for the POR. F. Other Subsidies Related to Operations at Asan Bay: Provision of Land and Exemption of Port Fees Under Harbor Act 1.Provision of Land As explained in the *Cold-Rolled Investigation* , the GOK's overall development plan is published every 10 years and describes the nationwide land development goals and plans for the balanced development of the country. Under these plans, the Ministry of Construction and Transportation (MOCAT) prepares and updates its Asan Bay Area Broad Development Plan. *See Cold-Rolled Decision Memorandum* , at “Provision of Land at Asan Bay.” The Korea Land Development Corporation (Koland) is a government investment corporation that is responsible for purchasing, developing, and selling land in the industrial sites. *Id* . In the *Cold-Rolled Investigation* , we verified that the GOK, in setting the price per square meter for land at the Kodai industrial estate, removed the 10 percent profit component from the price charged to Dongbu. Id. In the *Cold-Rolled Investigation* , we further explained that companies purchasing land at Asan Bay must make payments on the purchase and development of the land before the final settlement. However, in the case of Dongbu, we found that the GOK provided an adjustment to Dongbu's final payment to account for “interest earned” by the company for the pre-payments. *Id* . POSCO reported that it did not use this program. In the *Cold-Rolled Investigation* , we determined that the price discount and the adjustment of Dongbu's final payment to account for “interest earned” by the company on its pre-payments were countervailable subsidies. Specifically, the Department determined that they were specific under section 771(5A)(D)(iii)(I) of the Act, as they were limited to Dongbu. *Id* . Further, the Department found the price discount and the price adjustment for “interest earned” constituted financial contributions in the form of grants under section 771(5)(D)(i) of the Act and conferred benefits in the amount of grants within the meaning of section 771(5)(E) of the Act. *Id* . No new information, evidence of changed circumstances, or comments from interested parties were presented in this review to warrant any reconsideration of the countervailability of this program. Therefore, we preliminarily determine that this program is de facto specific within the meaning of section 771(5A)(D)(iii)(I) of the Act because it is limited to Dongbu, constitutes a financial contribution in the form of grants under sections 771(5)(D)(i), and confers a benefit in the amount of the price discount and the price adjustment within the meaning of 771(5)(E) of the Act. Consistent with the *Cold-Rolled Investigation* , we have treated the land price discount and the interest earned refund as non-recurring subsidies. Id. In accordance with 19 CFR 351.524(b)(2), because the grant amounts were more than 0.5 percent of the company's total sales in the year of receipt, we applied the Department's standard grant methodology, as described under 19 CFR 351.524(d)(1), and allocated the subsidies over a 15-year allocation period. See the “Average Useful Life” section, above. To calculate the benefit from these grants, we used as our discount rate the rates describe above in the “Subsidies Valuation Information” section. We then summed the benefits received by Dongbu during the POR. We calculated the net subsidy rate by dividing the total benefit attributable to the POR by Dongbu's total f.o.b. sales for the POR. On this basis, we determine a net countervailable subsidy rate for Dongbu of 0.19 percent *ad valorem* for the POR. 2. Exemption of Port Fees Under Harbor Act Under the Harbor Act, companies are allowed to construct infrastructure facilities at Korean ports; however, these facilities must be deeded back to the government. Because the ownership of these facilities reverts to the government, the government compensates private parties for the construction of these infrastructure facilities. Because a company must transfer to the government its infrastructure investment, under the Harbor Act, the GOK grants the company free usage of the facility and the right to collect fees from other users of the facility for a limited period of time. Once a company has recovered its cost of constructing the infrastructure, the company must pay the same usage fees as other users of the infrastructure. In the *Cold-Rolled Investigation* , the Department found that Dongbu received free use of harbor facilities at Asan Bay based upon both its construction of a port facility as well as a road that the company built from its plant to its port. *See Cold-Rolled Decision Memorandum* , at “Dongbu's Excessive Exemptions under the Harbor Act.” The Department also determined that Dongbu received an exemption of harbor fees for a period of almost 70 years under this program. *See id* . In the *Cold-Rolled Investigation* , the Department found the exemption from the fees to be a countervailable subsidy. No new information of changed circumstances, or comments from interested parties were presented in this review to warrant any reconsideration of the countervailability of this program. Thus, we preliminarily determine that the program is countervailable and is specific under section 771(5A)(D)(iii)(I) of the Act because the excessive exemption period of 70 years is limited to Dongbu. Moreover, we preliminarily determine that the GOK is foregoing revenue that it would otherwise collect by allowing Dongbu to be exempt from port charges for up to 70 years and, thus, the program constitutes a financial contribution within the meaning of section 771(5)(D)(ii) of the Act. Further, we preliminarily determine that the exemptions confer a benefit under section 771(5)(E) of the Act. In the *Cold-Rolled Investigation* , the Department treated the program as a recurring subsidy and determined that the benefit is equal to the average yearly amount of harbor fee exemptions provided to Dongbu. *Id* . For purposes of these preliminary results, we have employed the same benefit calculation. To calculate the net subsidy rate, we divided the average yearly amount of exemptions by Dongbu's total f.o.b. sales for the POR. On this basis, we preliminarily determine that Dongbu's net subsidy rate under this program is 0.02 percent *ad valorem* . G. Short-Term Export Financing The Korean Export Import Bank (KEXIM) supplies two types of short-term loans for exporting companies, short-term trade financing and comprehensive export financing. KEXIM provides short-term loans to Korean exporters who manufacture export goods under export contracts. The loans are provided up to the amount of the bill of exchange or contracted amount less any amount already received. For comprehensive export financing loans, KEXIM supplies short-term loans to any small or medium-sized company, or any large company that is not included in the five largest conglomerates based on their comprehensive export performance. To obtain the loans, companies must report their export performance periodically to KEXIM for review. Comprehensive export financing loans cover from 50 to 90 percent of the company's export performance; however, the maximum loan amount is restricted to 30 billion won. In *Steel Products from Korea* , the Department determined that the GOK's short-term export financing program was countervailable. *See Steel Products from Korea* , 58 FR at 37350; *see also* , *Cold-Rolled Decision Memorandum* , at “Short-Term Export Financing.” No new information, evidence of changed circumstances, or comments from interested parties were presented in this review to warrant any reconsideration of the countervailability of this program. Therefore, we continue to find this program countervailable. Specifically, we preliminarily determine that the program is specific, pursuant to section 771(5A)(B) of the Act, because receipt of the financing is contingent upon exporting. In addition, we preliminarily determine that the export financing constitutes a financial contribution in the form of a loan within the meaning of section 771(D)(i) of the Act and confers a benefit within the meaning of section 771(E)(ii) of the Act. POCOS, POSCO's affiliate, and Dongbu reported using short-term export financing during the POR. Pursuant to 19 CFR 351.505(a)(1), to calculate the benefit under this program, we compared the amount of interest paid under the program to the amount of interest that would have been paid on a comparable commercial loan. As our benchmark, we used the short-term interest rates discussed above in the “Subsidies Valuation Information” section. To calculate the net subsidy rate, we divided the benefit by the f.o.b. value of the respective company's total exports. On this basis, we determine the net subsidy rate for POSCO and Dongbu to be 0.01 percent *ad valorem* . II. Program Preliminarily Determined Not to Confer a Benefit During the POR A. Reserve for Research and Manpower Development Fund Under RSTA Article 9 (Formerly Article 8 of TERCL) On December 28, 1998, the TERCL was replaced by the Tax Reduction and Exemption Control Act (RSTA). Pursuant to this change in law, TERCL Article 8 is now identified as RSTA Article 9. Apart from the name change, the operation of RSTA Article 9 is the same as the previous TERCL Article 8 and its Enforcement Decree. This program allows a company operating in manufacturing or mining, or in a business prescribed by the Presidential Decree, to appropriate reserve funds to cover expenses related to the development or innovation of technology. These reserve funds are included in the company's losses and reduce the amount of taxes paid by the company. Under this program, capital goods companies and capital intensive companies can establish a reserve of five percent of total revenue, while companies in all other industries are only allowed to establish a three- percent reserve. In a prior segment of this proceeding, we determined that this program is specific under section 771(5A)(D) of the Act because the capital goods industry is allowed to claim a larger tax reserve under this program than all other manufacturers. *See Preliminary Results of CORE from Korea (2004)* , 71 FR 53419. We also determined that this program provides a financial contribution within the meaning of section 771(5)(D)(ii) of the Act in the form of revenue forgone and that it provides benefit under section 771(5)(E) of the Act to the extent that companies in the capital goods industry, which includes steel manufacturers, pay less in taxes than they would absent the program. *Id* . In the *Preliminary Results of CORE from Korea (2004)* , we continued to find the program countervailable, but found that the companies under investigation only contributed to the reserve at the lower three-percent rate. Therefore, we found no countervailable benefit because the companies contributed at the lower rate, which was available to any Korean company. *Id* . No new information, or evidence of changed circumstances, was presented in this review to warrant reconsideration of the approaches adopted in the *Preliminary Results of CORE from Korea (2004)* . In this administrative review, POSCO and POCOS each reported contributing to the reserve at the three-percent rate during the POR. We continue to find this program to be potentially countervailable. However, as each company contributed to the reserve at the lower three-percent rate, and in light of the Department's approach in the *Preliminary Results of CORE from Korea (2004)* , we preliminarily determine that no countervailable benefits were conferred under this program during the POR. Dongbu reported that it did not use this program during the POR. III. Programs Preliminarily Determined To Be Not Used A. Reserve for Investment (Special Cases of Tax for Balanced Development Among Areas Under TERCL Articles 41-45) B. Electricity Discounts Under the Requested Loan Adjustment
(RLA)Program C. Electricity Discounts Under the Emergency Load Reductions
(ELR)Program D. Export Industry Facility Loans
(EIFL)and Specialty Facility Loans E. Reserve for Overseas Market Development Under TERCL Article 17 F. Equipment Investment to Promote Worker's Welfare Under TERCL Article 88 G. Emergency Load Reduction Program H. Local Tax Exemption on Land Outside of a Metropolitan Area I. Excessive Duty Drawback J. Private Capital Inducement Act
(PCIA)K. Social Indirect Capital Investment Reserve Funds (Art. 28) L. Energy-Savings Facilities Investment Reserve Funds (Art. 29) M. Scrap Reserve Fund N. Special Depreciation of Assets on Foreign Exchange Earnings O. Export Insurance Rates Provided by the Korean Export Insurance Corporation P. Loans from the National Agricultural Cooperation Federation Q. Tax Incentives for Highly Advanced Technology Businesses Under the Foreign Investment and Foreign Capital Inducement Act Preliminary Results of Review In accordance with 19 CFR 351.221(b)(4)(i), we calculated an individual subsidy rate for each of the producer/exporters subject to this administrative review. For the period January 1, 2005, through December 31, 2005, we preliminarily determine the net subsidy rate for POSCO to be 0.10 percent *ad valorem* and for Dongbu to be 0.27 percent *ad valorem* , both of which are *de minimis* . *See* 19 CFR 351.106(c)(1). The Department intends to issue assessment instructions to U.S. Customs and Border Protection (“CBP”) 15 days after the date of publication of the final results of this review. If the final results remain the same as these preliminary results, the Department will instruct CBP to liquidate without regard to countervailing duties all shipments of subject merchandise produced by POSCO and Dongbu, entered, or withdrawn from warehouse, for consumption from January 1, 2005, through December 31, 2005. The Department will also instruct CBP not to collect cash deposits of estimated countervailing duties on shipments of the subject merchandise produced by POSCO and Dongbu, entered, or withdrawn from warehouse, for consumption on or after the date of publication of the final results of this review. We will instruct CBP to continue to collect cash deposits for non-reviewed companies at the most recent company-specific or country-wide rate applicable to the company. Accordingly, the cash deposit rates that will be applied to companies covered by this order, but not examined in this review, are those established in the most recently completed administrative proceeding for each company. These rates shall apply to all non-reviewed companies until a review of a company assigned these rates is requested. Public Comment Pursuant to 19 CFR 351.224(b), the Department will disclose to parties to the proceeding any calculations performed in connection with these preliminary results within five days after the date of the public announcement of this notice. Pursuant to 19 CFR 351.309, interested parties may submit written comments in response to these preliminary results. Unless otherwise indicated by the Department, case briefs must be submitted within 30 days after the publication of these preliminary results. *See* 19 CFR 351.309(c)(1)(ii). Rebuttal briefs, which are limited to arguments raised in case briefs, must be submitted no later than five days after the time limit for filing case briefs, unless otherwise specified by the Department. *See* 19 CFR 351.309(d)(1). Parties who submit argument in this proceeding are requested to submit with the argument:
(1)a statement of the issue; and
(2)a brief summary of the argument. Parties submitting case and/or rebuttal briefs are requested to provide the Department copies of the public version on disk. Case and rebuttal briefs must be served on interested parties in accordance with 19 CFR 351.303(f). Also, pursuant to 19 CFR 351.310(c), within 30 days of the date of publication of this notice, interested parties may request a public hearing on arguments to be raised in the case and rebuttal briefs. Unless the Secretary specifies otherwise, the hearing, if requested, will be held two days after the date for submission of rebuttal briefs. Representatives of parties to the proceeding may request disclosure of proprietary information under administrative protective order no later than 10 days after the representative's client or employer becomes a party to the proceeding, but in no event later than the date the case briefs, under 19 CFR 351.309(c)(ii), are due. The Department will publish the final results of this administrative review, including the results of its analysis of issues raised in any case or rebuttal brief or at a hearing. These preliminary results of review are issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.221(b)(4). Dated: August 31, 2007. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E7-17746 Filed 9-7-07; 8:45 am] BILLING CODE 3510-DS-S DEPARTMENT OF COMMERCE International Trade Administration C-580-851 Dynamic Random Access Memory Semiconductors from the Republic of Korea: Preliminary Results of Countervailing Duty Administrative Review AGENCY: Import Administration, International Trade Administration, Department of Commerce. SUMMARY: The Department of Commerce is conducting an administrative review of the countervailing duty order on dynamic random access memory semiconductors from the Republic of Korea for the period January 1, 2005, through December 31, 2005. We preliminarily find that Hynix Semiconductor, Inc. received countervailable subsidies during the period of review. If these preliminary results are adopted in our final results of this review, we will instruct U.S. Customs and Border Protection (“CBP”) to assess countervailing duties as detailed in the “Preliminary Results of Review” section of this notice. Interested parties are invited to comment on these preliminary results. *See* the “Public Comment” section of this notice. EFFECTIVE DATE: September 10, 2007. FOR FURTHER INFORMATION CONTACT: David Neubacher or Shane Subler, Office of Antidumping/Countervailing Duty Operations, Office 1, Import Administration, International Trade Administration, U.S. Department of Commerce, Room 3069, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone:
(202)482-5823 and
(202)482-0189, respectively. SUPPLEMENTARY INFORMATION: Background On August 11, 2003, the Department of Commerce (“the Department”) published a countervailing duty order on dynamic random access memory semiconductors (“DRAMS”) from the Republic of Korea (“ROK”). *See Notice of Countervailing Duty Order: Dynamic Random Access Memory Semiconductors from the Republic of Korea* , 68 FR 47546 (August 11, 2003) (“CVD Order”). On August 1, 2006, the Department published a notice of “Opportunity to Request Administrative Review” for this countervailing duty order. *See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity To Request Administrative Review* , 71 FR 43441 (August 1, 2006). On August 30, 2006, we received a request for review from the petitioner, Micron Technology, Inc. (“Micron”). On August 31, 2006, we received a request for review from Hynix Semiconductor, Inc. (“Hynix”). In accordance with 19 CFR 351.221(c)(1)(i) (2004), we published a notice of initiation of the review on September 29, 2006. *See Initiation of Antidumping and Countervailing Duty Administrative Reviews* , 71 FR 57465 (September 29, 2006) (“ *Initiation Notice* ”). On October 18, 2006, we issued countervailing duty questionnaires to the Government of the Republic of Korea (“GOK”) and Hynix. We received responses to these questionnaires on November 21, 2006. On April 24, 2007, we issued supplemental questionnaires to the GOK and Hynix. We received responses to these supplemental questionnaires on May 15, 2007. We issued additional supplemental questionnaires to the GOK and Hynix on July 2, 2007, and received responses on July 16, 2007. We received new subsidy allegations from Micron on December 11, 2006. 1 On March 28, 2007, we initiated an investigation of one of the two new subsidies that Micron alleged in this administrative review. In addition, we stated our intention to examine the timing of the benefit of a previously countervailed debt-to-equity swap (“DES”) for the preliminary results. *See* Third Countervailing Duty Administrative Review: Dynamic Random Access Memory Semiconductors from Korea: New Subsidy Allegations Memorandum (March 28, 2007) (“New Subsidy Allegations—DOC Memorandum”), available in the Central Records Unit (“CRU”), Room B-099 of the main Department building. 1 *See* submission from Micron to the Department, Re: Dynamic Random Access Memory Semiconductors From South Korea/Petitioner's New Subsidies Allegation And New Issues Presented (December 11, 2006) (“New Subsidy Allegations”). On April 19, 2007, we published a postponement of the preliminary results in this review until August 31, 2007. *See Dynamic Random Access Memory Semiconductors from the Republic of Korea: Extension of Time Limit for Preliminary Results of the Countervailing Duty Review* , 72 FR 19694 (April 19, 2007). Scope of the Order The products covered by this order are DRAMS from the ROK, whether assembled or unassembled. Assembled DRAMS include all package types. Unassembled DRAMS include processed wafers, uncut die, and cut die. Processed wafers fabricated in the ROK, but assembled into finished semiconductors outside the ROK are also included in the scope. Processed wafers fabricated outside the ROK and assembled into finished semiconductors in the ROK are not included in the scope. The scope of this order additionally includes memory modules containing DRAMS from the ROK. A memory module is a collection of DRAMS, the sole function of which is memory. Memory modules include single in-line processing modules, single in-line memory modules, dual in-line memory modules, small outline dual in-line memory modules, Rambus in-line memory modules, and memory cards or other collections of DRAMS, whether unmounted or mounted on a circuit board. Modules that contain other parts that are needed to support the function of memory are covered. Only those modules that contain additional items which alter the function of the module to something other than memory, such as video graphics adapter boards and cards, are not included in the scope. This order also covers future DRAMS module types. The scope of this order additionally includes, but is not limited to, video random access memory and synchronous graphics random access memory, as well as various types of DRAMS, including fast page-mode, extended data-out, burst extended data-out, synchronous dynamic RAM, Rambus DRAM, and Double Data Rate DRAM. The scope also includes any future density, packaging, or assembling of DRAMS. Also included in the scope of this order are removable memory modules placed on motherboards, with or without a central processing unit, unless the importer of the motherboards certifies with CBP that neither it, nor a party related to it or under contract to it, will remove the modules from the motherboards after importation. The scope of this order does not include DRAMS or memory modules that are re-imported for repair or replacement. The DRAMS subject to this order are currently classifiable under subheadings 8542.21.8005 and 8542.21.8020 through 8542.21.8030 of the Harmonized Tariff Schedule of the United States (“HTSUS”). The memory modules containing DRAMS from the ROK, described above, are currently classifiable under subheadings 8473.30.10.40 or 8473.30.10.80 of the HTSUS. Removable memory modules placed on motherboards are classifiable under subheadings 8471.50.0085, 8517.30.5000, 8517.50.1000, 8517.50.5000, 8517.50.9000, 8517.90.3400, 8517.90.3600, 8517.90.3800, 8517.90.4400, and 8543.89.9600 of the HTSUS. Although the HTSUS subheadings are provided for convenience and customs purposes, the Department's written description of the scope of this order remains dispositive. Scope Rulings On December 29, 2004, the Department received a request from Cisco Systems, Inc. (“Cisco”), to determine whether removable memory modules placed on motherboards that are imported for repair or refurbishment are within the scope of the *CVD Order* . The Department initiated a scope inquiry pursuant to 19 CFR 351.225(e) on February 4, 2005. On January 12, 2006, the Department issued a final scope ruling, finding that removable memory modules placed on motherboards that are imported for repair or refurbishment are not within the scope of the CVD Order provided that the importer certifies that it will destroy any memory modules that are removed for repair or refurbishment. *See* Final Scope Ruling Memorandum from Stephen J. Claeys to David M. Spooner, dated January 12, 2006. Period of Review The period for which we are measuring subsidies, *i.e.* , the period of review (“POR”), is January 1, 2005, through December 31, 2005. Changes in Ownership Effective June 30, 2003, the Department adopted a new methodology for analyzing privatizations in the countervailing duty context. *See Notice of Final Modification of Agency Practice Under Section 123 of the Uruguay Round Agreements Act* , 68 FR 37125 (June 23, 2003) (“ *Modification Notice* ”). The Department's new methodology is based on a rebuttable “baseline” presumption that non-recurring, allocable subsidies continue to benefit the subsidy recipient throughout the allocation period (which normally corresponds to the average useful life (“AUL”) of the recipient's assets). However, an interested party may rebut this baseline presumption by demonstrating that, during the allocation period, a change in ownership occurred in which the former owner sold all or substantially all of a company or its assets, retaining no control of the company or its assets, and that the sale was an arm's-length transaction for fair market value. Hynix's ownership changed during the AUL period as a result of debt-to-equity conversions in October 2001 and December 2002, and various asset sales. However, during the current administrative review, Hynix has not rebutted the Department's baseline presumption that the non-recurring, allocable subsidies received prior to the equity conversions and asset sales continue to benefit the company throughout the allocation period. *See* Hynix's November 21, 2006, supplemental questionnaire response at page 10; *see also Dynamic Random Access Memory Semiconductors from the Republic of Korea: Preliminary Results of Countervailing Duty Administrative Review* , 71 FR 46192, 46193 (August 11, 2006) (“ *AR2 Preliminary Results* ”). Subsidies Valuation Information Allocation Period Pursuant to 19 CFR 351.524(b), non-recurring subsidies are allocated over a period corresponding to the AUL of the renewable physical assets used to produce the subject merchandise. Section 351.524(d)(2) of the Department's regulations creates a rebuttable presumption that the AUL will be taken from the U.S. Internal Revenue Service's 1977 Class Life Asset Depreciation Range System (the “IRS Tables”). For DRAMS, the IRS Tables prescribe an AUL of five years. During this review, none of the interested parties disputed this allocation period. Therefore, we continue to allocate non-recurring benefits over the five-year AUL. Discount Rates and Benchmarks for Loans For loans that we found countervailable in the investigation or in the first two administrative reviews, and which continued to be outstanding during the POR, we have used the benchmarks from the first and second administrative reviews. These benchmarks are described below. Long-term Rates For long-term, won-denominated loans originating in 1986 through 1995, we used the average interest rate for three-year corporate bonds as reported by the Bank of Korea (“BOK”) or the International Monetary Fund (“IMF”). For long-term won-denominated loans originating in 1996 through 1999, we used annual weighted-averages of the rates on Hynix's corporate bonds, which were not specifically related to any countervailable financing. We did not use the rates on Hynix's corporate bonds for 2000-2003 for any calculations because Hynix either did not obtain bonds or obtained bonds through countervailable debt restructurings during those years. For U.S. dollar-denominated loans, we relied on the lending rates as reported in the IMF's *International Financial Statistics Yearbook* . For the years in which we previously determined Hynix to be uncreditworthy (2000 through 2003), we used the formula described in 19 CFR 351.505(a)(3)(iii) to determine the benchmark interest rate. For the probability of default by an uncreditworthy company, we used the average cumulative default rates reported for the Caa- to C- rated category of companies as published in Moody's Investors Service, “Historical Default Rates of Corporate Bond Issuers, 1920-1997” (February 1998). For the probability of default by a creditworthy company, we used the cumulative default rates for investment grade bonds as published in Moody's Investors Service: “Statistical Tables of Default Rates and Recovery Rates” (February 1998). For the commercial interest rates charged to creditworthy borrowers, we used the rates for won-denominated corporate bonds as reported by the BOK and the U.S. dollar lending rates published by the IMF for each year. Short-term Rates Consistent with the methodology used in the first and second administrative reviews, we used the money market rates as reported in the IMF's International Financial Statistics Yearbook for short-term interest rates. For countries (or currencies) for which a money market rate was not reported, we used the lending rate from the same source. Analysis of Programs I. Programs Previously Determined to Confer Subsidies We examined the following programs determined to confer subsidies in the investigation and first two administrative reviews and preliminarily find that Hynix continued to receive benefits under these programs during the POR. A. GOK Entrustment or Direction Prior to 2004 In the investigation, the Department determined that the GOK entrusted or directed creditor banks to participate in financial restructuring programs, and to provide credit and other funds to Hynix, in order to assist Hynix through its financial difficulties. The financial assistance provided to Hynix by its creditors took various forms, including new loans, convertible and other bonds, extensions of maturities and interest rate reductions on existing debt (which we treated as new loans), Documents Against Acceptance (“D/A”) financing, usance financing, overdraft lines of credit, debt forgiveness, and debt-for-equity swaps. The Department determined that these were financial contributions that constituted countervailable subsidies during the period of investigation. In the first and second administrative reviews, the Department found that the GOK continued to entrust or direct Hynix's creditors to provide financial assistance to Hynix throughout 2002 and 2003. The financial assistance provided to Hynix during this period included the December 2002 DES and the extensions of maturities and/or interest rate deductions on existing debt. In an administrative review, we do not revisit past findings unless new factual information or evidence of changed circumstances has been placed on the record of the proceeding that would compel us to reconsider those findings. *See, e.g., Certain Pasta from Italy: Preliminary Results and Partial Rescission of Seventh Countervailing Duty Administrative Review* , 69 FR 45676 (July 30, 2004), unchanged in *Certain Pasta From Italy: Final Results of Seventh Countervailing Duty Administrative Review* , 69 FR 70657 (December 7, 2004). With the exception of the 2002 DES discussed below, no such new information regarding the financial contributions described above has been presented in this review. Thus, we preliminarily find that a re-examination of the Department's findings in the investigation, first administrative review, and second administrative review with respect to the debt forgiveness, 2001 DES, loans, and extensions of maturities and/or interest rate deductions on existing debt is unwarranted. With respect to the DES that Hynix recorded in 2002, however, we are revisiting the findings of the previous administrative reviews based on new factual information placed on the record by the petitioner. *See* New Subsidy Allegations at page 8. In the first administrative review, the Department found that Hynix received a benefit from its December 2002 restructuring and associated DES in 2002. *See Dynamic Random Access Memory Semiconductors from the Republic of Korea: Final Results of Countervailing Duty Administrative Review* , 71 FR 14174 (March 21, 2006), and accompanying Issues and Decision Memorandum at Comment 13, pages 73-77 (“ *AR1 Decision Memorandum* ”). In the New Subsidy Allegations, in pre-preliminary comments dated August 7, 2007, and in follow-up comments dated August 24, 2007, Micron requested that the Department reallocate the benefit stream from the DES over the five-year period beginning in 2003. 2 2 *See* New Subsidy Allegations at pages 1-25; *see also* submission from Micron to the Department, Re: Dynamic Random Access Memory Semiconductors from South Korea: Petitioner's Pre-Preliminary Comments (August 7, 2007), at pages 1-9; *see also* submission from Micron to the Department, Re: Dynamic Random Access Memory Semiconductors from South Korea: Petitioner's Reply In Support Of Its Pre-Preliminary Comments (August 24, 2007). Citing new information on the record, Micron contends that Hynix's creditors continued to treat their claims owed by Hynix as debt as of the end of 2002, which contrasted with Hynix's treatment of the DES as a capital adjustment on its 2002 financial statements. Contesting Hynix's assertion that the Department measures subsidies in terms of benefit to the recipient, Micron contends that the issue with Hynix's DES concerns timing, not benefit. Furthermore, Micron argues that Korean accounting standards and the Korean tax authority required Hynix to account for the DES as a 2003 event. Also, citing new record evidence, Micron argues that shareholder approval of the capital reduction was not “pro forma.” As support for its contention that Hynix's board could have rejected the recommendations of Hynix's Creditors' Council, Micron notes that Hynix's board rejected a creditors' recommendation in April 2002 to sell the company to Micron. Finally, Micron argues that the Department should reconsider the legal significance it granted to Hynix's accounting treatment in light of its treatment of debt-to-equity swaps in previous cases such as *GOES from Italy* . 3 3 *See Final Affirmative Countervailing Duty Determination: Grain-Oriented Electrical Steel from Italy* , 59 FR 18357, 18360-66 (April 18, 1994) ( *“GOES from Italy”* ). In submissions dated January 5, 2007, and August 14, 2007, Hynix contends that the Department's treatment of the DES in the first administrative review was consistent with its treatment of another DES during the original investigation, with its regulations at 19 CFR 351.507(b), and with its benefit-to-recipient standard. 4 Hynix also rejects the significance of the new information on the record. First, Hynix argues that the Korean accounting standard cited by Micron did not exist at the time of the DES. Second, Hynix claims the tax standards cited by Micron related to a convertible bond transaction, not a DES. Third, Hynix argues that creditors' treatment of the claims as debt at the end of 2002 is irrelevant because the Department measures subsidies in terms of benefits to the recipient. Finally, Hynix states that the Department already considered information about minority shareholder opposition to the capital reduction and Hynix's accounting treatment in the first administrative review. 4 *See* submission from Hynix to the Department, Re: Dynamic Random Access Memory Semiconductors from Korea: Response to Micron's New Subsidies Allegation and New Issues Presented (January 5, 2007), at pages 1-7; *see also* submission from Hynix to the Department, Re: Dynamic Random Access Memory Semiconductors from Korea: Rebuttal of Hynix Semiconductor Inc. and the Government of Korea to Micron's Pre-Preliminary Comments (August 14, 2007), at pages 1-3. We preliminarily find, consistent with our decision in the first administrative review, that Hynix received the benefit from the December 2002 restructuring and the associated DES in 2002. On page 77 of the AR1 Decision Memorandum, the Department stated, Although these events might be significant in other instances, we find that the facts of this case deem these events pro forma. Instead, the Creditors' Council's approval on December 30, 2002, is the singular factor in effectuating the restructuring. This is because the Creditors' Council controlled Hynix and because those creditors were entrusted or directed by the GOK to carry out the December 2002 restructuring. Furthermore, in the *Investigation Decision Memorandum* , 5 we stated the following with regard to a separately countervailed DES: 5 *See Final Affirmative Countervailing Duty Determination: Dynamic Random Access Memory Semiconductors from the Republic of Korea* , 68 FR 37122 (June 23, 2003), and accompanying Issues and Decision Memorandum at Comment 11, pages 95-96 ( *“Investigation Decision Memorandum”* ). In accordance with 19 CFR 351.507(b), the receipt of benefit occurs on the date on which the firm received the equity infusion. Because Hynix recognized the equity infusion in its 2001 audited financial statement and the convertible bonds that were agreed to and issued carried an obligation to convert as of June 1, 2002, we find that the date on which Hynix received the equity infusion occurred in 2001. We preliminarily find that the new record information cited by Micron does not warrant reversal of our conclusion from the *AR1 Decision Memorandum* that the Creditors' Council controlled Hynix with respect to the restructuring and was entrusted or directed by the GOK to carry out the restructuring. Although Micron cited new factual information to demonstrate that Hynix's board of directors does not automatically approve all recommendations by creditors, we preliminarily find that the circumstances behind Hynix's 2002 restructuring and those behind the potential sale of the company are not comparable. Furthermore, we preliminarily find that the new information cited by Micron does not warrant reversal of our conclusion from the *Investigation Decision Memorandum* that the receipt of benefit resulting from a DES occurs on the date on which a firm receives the equity infusion, as recognized on the firm's audited financial statements. The fact that certain Hynix creditors continued to treat the amounts as debt after December 2002 does not outweigh the evidence that Hynix received a benefit in 2002, when it recorded the transaction as a capital adjustment. Focusing on when the recipient formally recorded the capital infusion in its books is in accordance with our regulatory provision that we will consider the benefit to have been received “on the date on which the firm received the equity infusion.” *See* 19 CFR 351.507(b). The Department's regulation does not direct us to examine the date on which the provider of the financial contribution considered the equity infusion to be complete. Further, with respect to Korean accounting standards, we note that the statement principally relied upon by Micron was not in effect at the time of the December 2002 restructuring. Additionally, even if Hynix *should* not have recognized the benefit until 2003, this does not mean that it did not, in fact, receive the benefit in 2002. Therefore, we are including in our benefit calculation the financial contributions countervailed in the investigation, the first administrative review, and the second administrative review: bonds, debt-to-equity swaps, debt forgiveness, and long-term debt outstanding during the POR. In calculating the benefit, we have followed the same methodology used in the first and second administrative reviews. Because we found Hynix to be unequityworthy at the time of the debt-for-equity swaps in 2001 and 2002, we have treated the full amount swapped as grants and allocated the benefit over the five-year AUL. *See* 19 CFR 351.507(a)(6) and (c). We used a discount rate that reflects our finding that Hynix was uncreditworthy at the time of the debt-to-equity conversions. For the loans, we have followed the methodology described at 19 CFR 351.505(c) using the benchmarks described in the “Subsidies Valuation Information” section of this notice. We divided the total benefits from the various financial contributions by Hynix's POR sales to calculate a countervailable subsidy rate of 23.73 percent *ad valorem* for the POR. B. Operation G-7/HAN Program Implemented under the Framework on Science and Technology Act, the Operation G-7/HAN Program (“G-7/HAN Program”) began in 1992 and ended in 2001. The purpose of this program was to raise the GOK's technology standards to the level of the G-7 countries. The Department found that the G7/HAN Program ended in 2001. *See Investigation Decision Memorandum* at 25. However, during the POR, Hynix had outstanding interest-free loans that it had previously received under this program. *See* Hynix's November 21, 2006, questionnaire response at page 16 and Exhibit 12. We found that the Operation G-7/Han Program provided countervailable subsidies in the investigation. No interested party provided new evidence that would lead us to reconsider our earlier finding. Therefore, we have calculated a benefit for these loans. To calculate the benefit of these loans during the POR, we compared the interest actually paid on the loans during the POR to what Hynix would have paid under the benchmark described in the “Subsidy Valuation Information” section of this notice. Next, we divided the total benefit by Hynix's total sales of subject merchandise for the POR to calculate the countervailable subsidy. On this basis, we preliminarily determine that countervailable benefits of .05 percent *ad valorem* existed for Hynix. C. 21st Century Frontier R&D Program The 21st Century Frontier R&D Program (“21st Century Program”) was established in 1999 with a structure and governing regulatory framework similar to those of the G-7/HAN Program, and for a similar purpose, *i.e.* , to promote greater competitiveness in science and technology. The 21st Century Program provides long-term interest-free loans in the form of matching funds. Repayment of program funds is made in the form of “technology usance fees” upon completion of the project, pursuant to a schedule established under a technology execution, or implementation contract. Hynix reported that it had loans from the 21st Century Program outstanding during the POR. *See* Hynix's November 21, 2006, questionnaire response at page 17 and Exhibit 12. In the investigation, we determined that this program conferred a countervailable benefit on Hynix. No interested party provided new evidence that would lead us to reconsider our earlier finding. Therefore, we have calculated a benefit for these loans. To calculate the benefit of these loans during the POR, we compared the interest actually paid on the loans during the POR to what Hynix would have paid under the benchmark described in the “Subsidy Valuation Information” section of this notice. We then divided the total benefit by Hynix's total sales in the POR to calculate the countervailable subsidy rate. On this basis, we calculated a preliminarily subsidy rate of zero *ad valorem* for this program. Because the rate is *de minimis* , we did not include this program in our preliminary net countervailing duty rate, which is consistent with our past practice. *See, e.g., Notice of Preliminary Results of Countervailing Duty Review: Certain Softwood Lumber Products from Canada* , 70 FR 33088, 33091 (June 7, 2005). II. New Subsidy Allegation—Import Duty Reduction Program for Certain Factory Automation Items On page 63 of its New Subsidy Allegations, Micron stated that Article 95(1).4 of the Korean Customs Act provides for import duty reductions on imports of “machines, instruments and facilities (including the constituent machines and tools) and key parts designated by the Ordinance of the Ministry of Finance and Economy (“MOFE”) for a factory automatization applying machines, electronics or data processing techniques.” Micron alleged that this program has been used by the GOK as a policy tool to support investments in capital goods by Korea's major strategic industries, including the semiconductor industry. According to Micron, nearly 20% of the items designated by MOFE as eligible for reduced import duties were directly related to semiconductor production. To the extent these items were not already subject to duty reduction or elimination through operation of the Information Technology Agreement or other preferential tariff programs, Micron argued that Hynix benefitted significantly from this program, particularly in 2005. We initiated a review of this program in the New Subsidy Allegations—DOC Memorandum. 6 On January 17, 2007, the GOK submitted a list of the companies that received duty reductions under the program between 2002 and 2005. 7 In supplemental questionnaires issued to the GOK on April 24, 2007, and July 2, 2007, we requested information on the general background of the program, the industries and imported products eligible for the program, the translated names of the recipients and industries using the program, and the amount of the duty savings. The GOK provided this information in responses dated May 15, 2007, 8 and July 16, 2007. 9 6 *See* New Subsidy Allegations—DOC Memorandum at pages 6-8. 7 See submission from the GOK to the Department, Re: Dynamic Random Access Memory Semiconductors from Korea: Response to Micron's New Subsidies Allegation and New Issues Presented (January 17, 2007), at Exhibit 2. 8 *See* submission from the GOK to the Department, Re: Dynamic Random Access Memory Semiconductors from Korea: Response of the Government of Korea to the Department of Commerce's First Supplemental Questionnaire (May 15, 2007). 9 *See* submission from the GOK to the Department, Re: Dynamic Random Access Memory Semiconductors from Korea: Response of the Government of Korea to the Department of Commerce's Second Supplemental Questionnaire (July 16, 2007). Based on our analysis of the GOK's submissions, we preliminarily find that the Import Duty Reduction Program provided a countervailable subsidy to Hynix during the POR. Specifically, we determine that the import duty reductions provide a financial contribution in the form of revenue forgone by the GOK and a benefit in the amount of the duty savings. See section 771(5)(D)(ii) of the Act and 19 CFR 351.510(a). Regarding specificity, information submitted by the GOK shows that the import duty reductions under the program are available to any company importing factory automation equipment eligible for the duty reduction. Therefore, there is no basis to find this program de jure specific under section 771(5A)(D)(i) of the Act. However, we have gone on to review usage data submitted by the GOK and preliminarily find that Hynix received a disproportionately large amount of the subsidy. See Third Countervailing Duty Administrative Review: Dynamic Random Access Memory Semiconductors from Korea: Analysis Memorandum for Business Proprietary Information on Korean Import Duty Reduction Program (August 31, 2007). Therefore, we preliminarily find that the Import Duty Reduction Program is *de facto* specific under section 771(5A)(D)(iii)(III) of the Act. To calculate the benefit, we divided the total duty savings Hynix received by Hynix's total sales during the POR. On this basis, we preliminarily determine the countervailable subsidy to be .04 percent during the POR. III. Programs Previously Found Not to Have Been Used or Provided No Benefits We preliminarily determine that the following programs were not used during the POR: A. Short-Term Export Financing B. Reserve for Research and Human Resources Development (formerly Technological Development Reserve) (Article 9 of RSTA / formerly, Article 8 of TERCL) C. Tax Credit for Investment in Facilities for Productivity Enhancement (Article 24 of RSTA /Article 25 of TERCL) D. Tax Credit for Investment in Facilities for Special Purposes (Article 25 of RSTA) E. Reserve for Overseas Market Development (formerly, Article 17 of TERCL) F. Reserve for Export Loss (formerly, Article 16 of TERCL) G. Tax Exemption for Foreign Technicians (Article 18 of RSTA) H. Reduction of Tax Regarding the Movement of a Factory That Has Been Operated for More Than Five Years (Article 71 of RSTA) I. Tax Reductions or Exemption on Foreign Investments under Article 9 of the Foreign Investment Promotion Act (“FIPA”)/ FIPA (Formerly Foreign Capital Inducement Law) J. Duty Drawback on Non-Physically Incorporated Items and Excessive Loss Rates K. Export Insurance L. Electricity Discounts Under the RLA Program M. Import Duty Reduction for Cutting Edge Products *See* Hynix's November 21, 2006, questionnaire response at pages 21-22 and the GOK's November 21, 2006, questionnaire response at pages 12-13. In the first administrative review, the Department found that “any benefits provided to Hynix under the System IC 2010 Project are tied to non-subject merchandise” and, therefore, that “Hynix did not receive any countervailable benefits under this program during the POR,” in accordance with 19 CFR 351.525(b)(5). *See AR1 Decision Memorandum* at page 15. No new information has been provided with respect to this program. Therefore, we preliminarily find that Hynix did not receive any countervailing benefits from the System IC 2010 Project during the POR. Preliminary Results of Review In accordance with 19 CFR 351.221(b)(4)(i), we calculated an individual subsidy rate for Hynix Semiconductor, Inc., the producer/exporter covered by this administrative review. We preliminarily determine that the total estimated net countervailable subsidy rate for Hynix for calendar year 2005 is 23.82 percent *ad valorem* . If these preliminary results are adopted in our final results of this review, fifteen days after publication of the final results of this review the Department will instruct CBP to liquidate shipments of DRAMS by Hynix entered or withdrawn from warehouse, for consumption from January 1, 2005, through December 31, 2005, at 23.82 percent *ad valorem* of the F.O.B. invoice price. The Department will also instruct CBP to collect cash deposits of estimated countervailing duties at 23.82 percent *ad valorem* of the F.O.B. invoice price on all shipments of the subject merchandise from Hynix, entered, or withdrawn from warehouse, for consumption on or after the date of publication of the final results of this administrative review. We will instruct CBP to continue to collect cash deposits for non-reviewed companies covered by this order at the most recent company-specific rate applicable to the company. Accordingly, the cash deposit rate that will be applied to non-reviewed companies covered by this order will be the rate for that company established in the investigation. *See Notice of Amended Final Affirmative Countervailing Duty Determination: Dynamic Random Access Memory Semiconductors from the Republic of Korea* , 68 FR 44290 (July 28, 2003). The “all others” rate shall apply to all non-reviewed companies until a review of a company assigned this rate is requested. The Department has previously excluded Samsung Electronics Co., Ltd. from this order. *Id* . On August 13, 2007, Hynix requested that the Department adjust the deposit rate to more accurately reflect CVD liability. Hynix asserts that the record of this proceeding demonstrates a substantial change to and termination of known non-recurring subsidy benefit streams in 2005 and 2006, as well as termination of the program related to GOK entrustment or direction prior to 2004. Citing 19 CFR 351.526, Hynix claims that the Department has regulations involving program-wide changes that allow it to adjust the deposit rate, as well as the discretion to effect changes in the deposit rate where circumstances do not fit the more formal program-wide change criteria. 10 Hynix asserts that under 19 CFR 351.526, the Department may make an adjustment to the CVD deposit rate where: 1) the Department determines that a program-wide change has occurred, which encompasses any change effectuated by an official act not limited to an individual firm or firms; and 2) the Department is able to measure the change in the amount of the countervailable subsidies provided under the program in question. Hynix alleges that the facts of this case, even if they do not technically fit all aspects of 19 CFR 351.526, are sufficient to warrant a deposit rate adjustment because an unadjusted CVD deposit rate will not remotely reflect anticipated CVD liability. 10 *See Stainless Steel Sheet and Strip in Coils from France: Final Results of Countervailing Duty Administrative Review* , 68 FR 53963 (September 15, 2003), and accompanying *Issues and Decision Memorandum at Comment 3; and Low Enriched Uranium from Germany, the Netherlands, and the United Kingdom: Final Results of Countervailing Duty Administrative Reviews* , 69 FR 40869 (July 7, 2004), and accompanying Issues and Decision Memorandum at Comment 3. Hynix notes that the Department, under 19 CFR 351.526, will only refrain from such adjustments in cases when residual benefits may continue under the terminated program or when a substitute program has been introduced. Hynix asserts, however, that the Department has departed from this narrow rule in certain instances. Citing the *Pure Magnesium Decision Memorandum* , 11 Hynix argues that the Department has departed from the narrower rule when the only event at issue was the termination of a known subsidy benefit stream during the POR. Hynix claims that there is no statutory bar to further development of the exception, and that the Department has the discretion to draw distinctions on a case-specific basis and to adjust the deposit rate where necessary. 11 *See Pure Magnesium and Alloy Magnesium from Canada: Final Results of Countervailing Duty Administrative Review* , 70 FR 54367 (September 14, 2005), and accompanying Issues and Decision Memorandum at Comment 2 ( *“Pure Magnesium Decision Memorandum”* ). On August 21, 2007, petitioner submitted a letter objecting to Hynix's request. Petitioner objects for the following reasons: 1) the letter was too late for the Department to consider; 2) as Hynix admits, the facts do not fit all aspects of 19 CFR 351.526, and the Department has previously found that expiration of benefits from a non-recurring subsidy does not qualify as a program wide change; 12 3) even in cases cited by Hynix where the Department reduced the cash deposit rate to reflect the expiration of non-recurring subsidies, the amortization period ended during the POR, and the Department has made clear that where the benefit is set to expire after the end of the POR, no adjustment to the cash deposit is necessary; 13 and 4) Hynix's argument is premised on the assumption that the Department will not revise the allocation period for the 2003 bailout. 12 *See Carbon and Ally Steel Wire Rod from Canada: Final Affirmative Countervailing Duty Determination* , 67 FR 55813 (August 30, 2002), and accompanying Issues and Decision Memorandum at Comment 11. 13 *See Pure Magnesium Decision Memorandum* at Comment 2. We disagree with Hynix that the cash deposit rate should be revised for expiry of the program related to GOK entrustment or direction prior to 2004. It is the Department's general practice to adjust cash deposit rates to reflect the expected discontinuation of future subsidy benefits only where it has been demonstrated that a program-wide change has occurred, pursuant to 19 CFR 351.526. As we stated in the *Pure Magnesium Decision Memorandum* at Comment 2, the Department only provided a narrowly circumscribed exception to this general practice in light of certain, specific conditions; namely, the information needed to make the adjustment was derived entirely from the POR and the expiry of the subsidy meant the expected countervailing duty rate for entries subject to the deposit rate set in that review was *de minimis* . These circumstances do not apply in this review. Therefore, the rationale for the limited exception in prior cases is not met in this review. Accordingly, we are not revising the cash deposit rate for expiry of the program related to GOK entrustment or direction prior to 2004. Public Comment Interested parties may submit written arguments in case briefs within 30 days of the date of publication of this notice. Rebuttal briefs, limited to issues raised in case briefs, may be filed not later than five days after the date of filing the case briefs. Parties who submit briefs in this proceeding should provide a summary of the arguments not to exceed five pages and a table of statutes, regulations, and cases cited. Copies of case briefs and rebuttal briefs must be served on interested parties in accordance with 19 CFR 351.303(f). Interested parties may request a hearing within 30 days after the date of publication of this notice. Unless otherwise specified, the hearing, if requested, will be held two days after the scheduled date for submission of rebuttal briefs. The Department will publish a notice of the final results of this administrative review within 120 days from the publication of these preliminary results. We are issuing and publishing these results in accordance with sections 751(a)(1) and 777(i)(1) of the Act. Dated: August 31, 2007. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E7-17759 Filed 9-7-07; 8:45 am] BILLING CODE 3510-DS-S DEPARTMENT OF COMMERCE International Trade Administration (C-570-917) Laminated Woven Sacks from the People's Republic of China: Postponement of Preliminary Determination in the Countervailing Duty Investigation AGENCY: Import Administration, International Trade Administration, Department of Commerce. EFFECTIVE DATE: September 10, 2007. FOR FURTHER INFORMATION CONTACT: Mark Hoadley or Jack Zhao, AD/CVD Operations, Office 6, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone:
(202)482-3148 and
(202)482-1396, respectively. SUPPLEMENTARY INFORMATION: Background On July 18, 2007, the Department of Commerce (Department) initiated the countervailing duty investigation of laminated woven sacks
(LWS)from the People's Republic of China. *See Laminated Woven Sacks from the People's Republic of China: Initiation of Countervailing Duty Investigation* , 72 FR 40839 (July 25, 2007). Currently, the preliminary determination is due no later than September 21, 2007. Postponement of Due Date for Preliminary Determination On August 23, 2007, Bancroft Bag, Inc., Coating Excellence International, Inc., Hood Packaging Corporation, Mid-America Packaging, LLC, and Polytex Fibers Corporation (collectively, petitioners), submitted a letter requesting that the Department postpone the preliminary determination of the countervailing duty investigation of LWS from the People's Republic of China by 65 days. Under section 703(c)(1)(A) of the Tariff Act of 1930, as amended (the Act), the Department may extend the period for reaching a preliminary determination in a countervailing duty investigation until not later than the 130th day after the date on which the administering authority initiates an investigation if the petitioner makes a timely request for an extension of the period within which the determination must be made under section 703(b) of the Act. Pursuant to section 351.205(e) of the Department's regulations, the petitioners' request for postponement of the preliminary determination was made 25 days or more before the scheduled date of the preliminary determination. Accordingly, we are extending the due date for the preliminary determination by 65 days to November 25, 2007. Because November 25, 2007 is a Sunday, the Department will issue the preliminary determination no later than November 26, 2007. This notice is issued and published pursuant to section 703(c)(2) of the Act. Dated: August 31, 2007. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E7-17747 Filed 9-7-07; 8:45 am] BILLING CODE 3510-DS-S DEPARTMENT OF COMMERCE International Trade Administration (C-580-835) Stainless Steel Sheet and Strip in Coils from the Republic of Korea: Preliminary Results of Countervailing Duty Administrative Review AGENCY: Import Administration, International Trade Administration, Department of Commerce. SUMMARY: The Department of Commerce (the Department) is conducting an administrative review of the countervailing duty
(CVD)order on stainless steel sheet and strip in coils from the Republic of Korea (Korea) for the period January 1, 2005, through December 31, 2005. We preliminarily find that the net subsidy rate for the producer/exporter under review is *de minimis* . See the “Preliminary Results of Review” section of this notice. Interested parties are invited to comment on these preliminary results. ( *See* the “Public Comment” section of this notice). EFFECTIVE DATE: September 10, 2007. FOR FURTHER INFORMATION CONTACT: Preeti Tolani or Robert Copyak, AD/CVD Operations, Office 3, Import Administration, U.S. Department of Commerce, Room 4014, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone:
(202)482-0395 or
(202)482-2209, respectively. SUPPLEMENTARY INFORMATION: Background On August 6, 1999, the Department published in the **Federal Register** the CVD order on stainless steel sheet and strip in coils from Korea. *See Amended Final Determination: Stainless Steel Sheet and Strip in Coils from the Republic of Korea; and Notice of Countervailing Duty Orders: Stainless Steel Sheet and Strip from France, Italy and the Republic of Korea* , 64 FR 42923 (August 6, 1999). On August 1, 2006, the Department published a notice of opportunity to request an administrative review of this CVD order. *See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review* , 71 FR 43441 (August 1, 2006). On August 8, 2006, we received a timely request for review from Dai Yang Metal Co., Ltd. (DMC). On September 29, 2006, the Department published a notice of initiation of the administrative review of the CVD order on stainless steel sheet and strip in coils from Korea covering the period of review
(POR)January 1, 2005, through December 31, 2005. *See Initiation of Antidumping and Countervailing Duty Administrative Reviews* , 71 FR 57465 (September 29, 2006). On September 27, 2006, the Department sent questionnaires to DMC and the Government of Korea (GOK). On November 30, 2006, the Department received questionnaire responses from DMC and the GOK. On February 12, 2007, DMC and the GOK submitted responses to the Department's January 29, 2007, supplemental questionnaires. On May 9, 2007, the Department published in the **Federal Register** an extension of the preliminary results deadline. *See Stainless Steel Sheet and Strip from the Republic of Korea: Extension of Time Limit for Preliminary Results of Countervailing Duty Administrative Review* , 72 FR 26338. In accordance with 19 CFR 351.213(b), this review covers only those producers or exporters for which a review was specifically requested. The only company subject to this review is DMC. Scope of Order The products subject to this order are certain stainless steel sheet and strip in coils. Stainless steel is an alloy steel containing, by weight, 1.2 percent or less of carbon and 10.5 percent or more of chromium, with or without other elements. The subject sheet and strip is a flat-rolled product in coils that is greater than 9.5 mm in width and less than 4.75 mm in thickness and that is annealed or otherwise heat treated and pickled or otherwise descaled. The subject sheet and strip may also be further processed ( *e.g.* , cold-rolled, polished, aluminized, coated), provided that it maintains the specific dimensions of sheet and strip following such processing. The merchandise subject to this order is currently classifiable in the *Harmonized Tariff Schedule of the United States* (HTSUS) at subheadings: 7219.13.00.30, 7219.13.00.50, 7219.13.00.70, 7219.13.00.80, 7219.14.00.30, 7219.14.00.65, 7219.14.00.90, 7219.32.00.05, 7219.32.00.20, 7219.32.00.25, 7219.32.00.35, 7219.32.00.36, 7219.32.00.38, 7219.32.00.42, 7219.32.00.44, 7219.33.00.05, 7219.33.00.20, 7219.33.00.25, 7219.33.00.35, 7219.33.00.36, 7219.33.00.38, 7219.33.00.42, 7219.33.00.44, 7219.34.00.05, 7219.34.00.20, 7219.34.00.25, 7219.34.00.30, 7219.34.00.35, 7219.35.00.05, 7219.35.00.15, 7219.35.00.30, 7219.35.00.35, 7219.90.00.10, 7219.90.00.20, 7219.90.00.25, 7219.90.00.60, 7219.90.00.80, 7220.12.10.00, 7220.12.50.00, 7220.20.10.10, 7220.20.10.15, 7220.20.10.60, 7220.20.10.80, 7220.20.60.05, 7220.20.60.10, 7220.20.60.15, 7220.20.60.60, 7220.20.60.80, 7220.20.70.05, 7220.20.70.10, 7220.20.70.15, 7220.20.70.60, 7220.20.70.80, 7220.20.80.00, 7220.20.90.30, 7220.20.90.60, 7220.90.00.10, 7220.90.00.15, 7220.90.00.60, and 7220.90.00.80. Although the HTSUS subheadings are provided for convenience and customs purposes, the Department's written description of the merchandise is dispositive. Excluded from the scope of this order are the following:
(1)sheet and strip that is not annealed or otherwise heat treated and pickled or otherwise descaled,
(2)sheet and strip that is cut to length,
(3)plate ( *i.e.* , flat-rolled stainless steel products of a thickness of 4.75 mm or more),
(4)flat wire ( *i.e.* , cold-rolled sections, with a prepared edge, rectangular in shape, of a width of not more than 9.5 mm), and
(5)razor blade steel. Razor blade steel is a flat rolled product of stainless steel, not further worked than cold-rolled (cold-reduced), in coils, of a width of not more than 23 mm and a thickness of 0.266 mm or less, containing, by weight, 12.5 to 14.5 percent chromium, and certified at the time of entry to be used in the manufacture of razor blades. *See* Chapter 72 of the HTSUS, “Additional U.S. Note” 1(d). The Department has determined that certain specialty stainless steel products are also excluded from the scope of this order. These excluded products are described below: Flapper valve steel is defined as stainless steel strip in coils containing, by weight, between 0.37 and 0.43 percent carbon, between 1.15 and 1.35 percent molybdenum, and between 0.20 and 0.80 percent manganese. This steel also contains, by weight, phosphorus of 0.025 percent or less, silicon of between 0.20 and 0.50 percent, and sulfur of 0.020 percent or less. The product is manufactured by means of vacuum arc remelting, with inclusion controls for sulphide of no more than 0.04 percent and for oxide of no more than 0.05 percent. Flapper valve steel has a tensile strength of between 210 and 300 ksi, yield strength of between 170 and 270 ksi, plus or minus 8 ksi, and a hardness
(Hv)of between 460 and 590. Flapper valve steel is most commonly used to produce specialty flapper valves in compressors. Also excluded is a product referred to as suspension foil, a specialty steel product used in the manufacture of suspension assemblies for computer disk drives. Suspension foil is described as 302/304 grade or 202 grade stainless steel of a thickness between 14 and 127 microns, with a thickness tolerance of plus-or-minus 2.01 microns, and surface glossiness of 200 to 700 percent Gs. Suspension foil must be supplied in coil widths of not more than 407 mm, and with a mass of 225 kg or less. Roll marks may only be visible on one side, with no scratches of measurable depth. The material must exhibit residual stresses of 2 mm maximum deflection, and flatness of 1.6 mm over 685 mm length. Certain stainless steel foil for automotive catalytic converters is also excluded from the scope of this order. This stainless steel strip in coils is a specialty foil with a thickness of between 20 and 110 microns used to produce a metallic substrate with a honeycomb structure for use in automotive catalytic converters. The steel contains, by weight, carbon of no more than 0.030 percent, silicon of no more than 1.0 percent, manganese of no more than 1.0 percent, chromium of between 19 and 22 percent, aluminum of no less than 5.0 percent, phosphorus of no more than 0.045 percent, sulfur of no more than 0.03 percent, lanthanum of between 0.002 and 0.05 percent, and total rare earth elements of more than 0.06 percent, with the balance iron. Permanent magnet iron-chromium-cobalt alloy stainless strip is also excluded from the scope of this order. This ductile stainless steel strip contains, by weight, 26 to 30 percent chromium, and 7 to 10 percent cobalt, with the remainder of iron, in widths 228.6 mm or less, and a thickness between 0.127 and 1.270 mm. It exhibits magnetic remanence between 9,000 and 12,000 gauss, and a coercivity of between 50 and 300 oersteds. This product is most commonly used in electronic sensors and is currently available under proprietary trade names such as “Arnokrome III.” 1 1 “Arnokrome III” is a trademark of the Arnold Engineering Company. Certain electrical resistance alloy steel is also excluded from the scope of this order. This product is defined as a non-magnetic stainless steel manufactured to American Society of Testing and Materials
(ASTM)specification B344 and containing, by weight, 36 percent nickel, 18 percent chromium, and 46 percent iron, and is most notable for its resistance to high temperature corrosion. It has a melting point of 1390 degrees Celsius and displays a creep rupture limit of 4 kilograms per square millimeter at 1000 degrees Celsius. This steel is most commonly used in the production of heating ribbons for circuit breakers and industrial furnaces, and in rheostats for railway locomotives. The product is currently available under proprietary trade names such as “Gilphy 36.” 2 2 “Gilphy 36” is a trademark of Imphy, S.A. Certain martensitic precipitation-hardenable stainless steel is also excluded from the scope of this order. This high-strength, ductile stainless steel product is designated under the Unified Numbering System
(UNS)as S45500-grade steel, and contains, by weight, 11 to 13 percent chromium and 7 to 10 percent nickel. Carbon, manganese, silicon and molybdenum each comprise, by weight, 0.05 percent or less, with phosphorus and sulfur each comprising, by weight, 0.03 percent or less. This steel has copper, niobium, and titanium added to achieve aging, and will exhibit yield strengths as high as 1700 Mpa and ultimate tensile strengths as high as 1750 Mpa after aging, with elongation percentages of 3 percent or less in 50 mm. It is generally provided in thicknesses between 0.635 and 0.787 mm, and in widths of 25.4 mm. This product is most commonly used in the manufacture of television tubes and is currently available under proprietary trade names such as “Durphynox 17.” 3 3 “Durphynox 17” is a trademark of Imphy, S.A. Finally, three specialty stainless steels typically used in certain industrial blades and surgical and medical instruments are also excluded from the scope of this order. These include stainless steel strip in coils used in the production of textile cutting tools ( *e.g.* , carpet knives). 4 This steel is similar to ASTM grade 440F, but containing, by weight, 0.5 to 0.7 percent of molybdenum. The steel also contains, by weight, carbon of between 1.0 and 1.1 percent, sulfur of 0.020 percent or less and includes between 0.20 and 0.30 percent copper and between 0.20 and 0.50 percent cobalt. This steel is sold under proprietary names such as “GIN4 HI-C.” The second excluded stainless steel strip in coils is similar to AISI 420-J2 and contains, by weight, carbon of between 0.62 and 0.70 percent, silicon of between 0.20 and 0.50 percent, manganese of between 0.45 and 0.80 percent, phosphorus of no more than 0.025 percent and sulfur of no more than 0.020 percent. This steel has a carbide density on average of 100 carbide particles per square micron. An example of this product is “GIN5” steel. The third specialty steel has a chemical composition similar to AISI 420 F, with carbon of between 0.37 and 0.43 percent, molybdenum of between 1.15 and 1.35 percent, but lower manganese of between 0.20 and 0.80 percent, phosphorus of no mor than 0.025 percent, silicon of between 0.20 and 0.50 percent, and sulfur of no more than 0.020 percent. This product is supplied with a hardness of more than Hv 500 guaranteed after customer processing, and is supplied as, for example, “GIN6.” 4 This list of uses is illustrative and provided for descriptive purposes only. Subsidies Valuation Information *Benchmark for Long-Term Loans issued through 2005* : During the POR, DMC had both won-denominated and foreign currency-denominated long-term loans outstanding which it received from government-owned banks and Korean commercial banks. Based on our findings on this issue in prior investigations and reviews, we are using the following benchmarks to calculate the subsidies attributable to respondent's long-term loans obtained in the years 1991 through 2005:
(1)For countervailable foreign currency-denominated loans, pursuant to 19 CFR 351.505(a)(2)(i), and consistent with our practice to date, our preference is to use the company-specific weighted-average foreign currency-denominated interest rates on the company's loans from foreign bank branches in Korea, foreign securities, and direct foreign loans received after April 1992. *See Final Affirmative Countervailing Duty Determination: Stainless Steel Sheet and Strip in Coils from the Republic of Korea* , 64 FR 30636, 30642 (June 8, 1999). *See also Final Negative Countervailing Duty Determination: Stainless Steel Plate in Coils from the Republic of Korea* , 64 FR 15530, 15533 (March 31, 1999) ( *Plate in Coils* ). For variable-rate loans outstanding during the POR, pursuant to 19 CFR 351.505(a)(2)(i), our preference is to use, as the benchmark, an interest rate of a variable-rate lending instrument issued during the POR; and for long-term fixed-rate loans, pursuant to 19 CFR 351.505(a)(2)(iii), our preference is to use a benchmark rate issued in the same year that the loan was issued. However, no such benchmark instruments were available, and consistent with our methodology in the prior administrative review, we relied on the lending rates as reported by the IMF's *International Financial Statistics Yearbook* . *See Final Results of Countervailing Duty Administrative Review: Stainless Steel Sheet and Strip in Coils from the Republic of Korea* , 72 FR 120 (January 3, 2007).
(2)For countervailable won-denominated long-term loans, our practice is to use the company-specific corporate bond rate on the company's public and private bonds, as we determined that the GOK did not control the Korean domestic bond market after 1991, and that domestic bonds may serve as an appropriate benchmark interest rate. *See Plate in Coils* , 64 FR at 15531. Where unavailable, we use the national average of the yields on three-year corporate bonds, as reported by the Bank of Korea (BOK). We note that the use of the three-year corporate bond rate from the BOK follows the approach taken in *Plate in Coils* , in which we determined that, absent company-specific interest rate information, the corporate bond rate is the best indicator of a market rate for won-denominated long-term loans in Korea. *Id* . I. Program Preliminarily Determined to Confer Subsidies The GOK's Direction of Credit 1. Loans Received through 2005 In the most recently completed CVD proceeding involving Korea, the Department reaffirmed earlier determinations that the GOK controlled and directed lending to Korean steel producers through year 2005. *See Notice of Final Results of Countervailing Duty Administrative Review: Certain Cut-to-Length Carbon-Quality Steel Plate from Korea* , 72 FR 38565 (July 13, 2007) ( *2005 CTL Plate Final Results* ). In addition, in that review, the Department noted that neither the respondent nor the GOK provided any new information that would warrant a change in the Department's determination. Finding that the GOK did not act to the best of its ability, the Department employed an adverse inference and determined that the GOK continued its direction-of-credit policies with respect to the Korean steel industry for the period 2002 through 2005. *Id* . During the POR, DMC had outstanding loans that were received prior to and/or during the 2005 period. As in the prior proceedings, we asked the GOK for information pertaining to the GOK's direction-of-credit policies through 2005. The GOK did not provide any new or additional information that would warrant a departure from these prior findings, stating instead that: the Government of Korea continues to believe that the evidence demonstrates that there has been no direction of credit to the Korean steel industry. Nevertheless, the Department has consistently found that long-term loans received by Korean steel producers were the result of the Korean Government's direction, despite the Government's repeated submission of evidence to the contrary. . . . Consequently, in this review, the Government will not contest the Department's findings on direction of long-term loans. Because the GOK withheld the requested information on its lending policies, the Department does not have the necessary information on the record to determine whether the GOK has continued its direction-of-credit policies with respect to the Korean steel industry through 2005; therefore, the Department must base its determination on facts otherwise available. *See* section 776(a)(2)(A) of the Tariff Act of 1930, as amended (the Act). Section 776(b) of the Act further provides that the Department may use an adverse inference in applying the facts otherwise available when a party has failed to cooperate by not acting to the best of its ability to comply with a request for information. Section 776(b) of the Act also authorizes the Department to use as adverse facts available
(AFA)information derived from the petition, the final determination, a previous administrative review, or other information placed on the record. For the reasons discussed below, we determine that, in accordance with sections 776(a)(2) and 776(b) of the Act, the use of AFA is appropriate for the preliminary results for the determination of direction of credit for loans received through 2005. In this case, the GOK refused to supply requested information that was in its possession, even though the GOK had provided similar information in prior proceedings. *See* , *e.g.* , *Final Affirmative Countervailing Duty Determination: Certain Cut-to-Length Carbon-Quality Steel Plate from the Republic of Korea* , 64 FR 73176, 73178 (December 29, 1999). Therefore, consistent with sections 776(a)(2)(A) and 776(b) of the Act, we find that the GOK did not act to the best of its ability and, therefore, we are employing an adverse inference in selecting from among the facts otherwise available. As AFA, we find that the GOK's direction-of-credit policies for the steel industry continued through 2005. As noted above, the GOK's direction-of-credit policies with respect to the Korean steel industry provide a financial contribution, confer a benefit, and are specific, pursuant to sections 771(5)(D)(i), 771(5)(E)(ii), and 771(5A)(D)(iii) of the Act, respectively. Therefore, we find that lending to Korean steel producers from domestic banks and government-owned banks through 2005 is countervailable. Thus, any loans received by Korean steel producers through 2005 from domestic banks and government-owned banks that were outstanding during the POR are countervailable, to the extent that the interest amount paid on the loan is less than what would have been paid on a comparable commercial loan. The Department's decision to rely on adverse inferences when lacking a response from the GOK regarding the direction of credit issue, as it applies to the Korean steel industry, is in accordance with its practice. *See 2005 CTL Plate Final Results* . 2. Calculation of the Benefit and Net Subsidy Rate Under the Direction of Credit Program In accordance with 19 CFR 351.505(c)(2) and (4), we calculated the benefit for each fixed- and variable-rate loan received from GOK-owned or -controlled banks to be the difference between the actual amount of interest paid on the directed loan during the POR and the amount of interest that would have been paid during the POR at the benchmark interest rate. We conducted our benefit calculations using the benchmark interest rates described in the “Subsidies Valuation Information” section above. For foreign currency-denominated loans, we converted the benefits into Korean won using exchange rates obtained from the BOK or, where BOK rates were not available, from other publicly available sources. We then summed the benefits from each company's long-term fixed-rate and variable-rate won-denominated loans. To calculate the net subsidy rate, we divided DMC's total benefit by its total f.o.b. sales values during the POR, as this program is not tied to exports or a particular product. On this basis, we preliminarily determine the net subsidy rate to be 0.03 percent *ad valorem* for DMC. II. Programs Preliminarily Determined To Be Not Used A. Investment Tax Credits under RSTA Articles 11, 24, 25 and TERCL Articles 24 and 71 B. Reserve for Export Loss under Article 16 of TERCL C. Reserve for Overseas Market Development under Article 17 of TERCL D. Asset Revaluation under Article 56(2) of TERCL E. Equipment Investment to Promote Worker's Welfare under Article 88 of TERCL F. Special Cases of Tax for Balanced Development Among Areas under Articles 41-45 of TERCL G. Requested Loan Adjustment Program H. Emergency Load Reduction Program I. Export Industry Facility Loan J. Special Facility Loans K. Energy Saving Facility Program L. Research and Development Grants M. Local Tax Exemption on Land Outside of Metropolitan Area N. Short-Term Export Financing O. Exemption of VAT on Imports of Anthracite Coal P. Excessive Duty Drawback Q. Special Depreciation of Assets on Foreign Exchange Earnings R. Export Insurance Rates Provided by the Korean Export Insurance Corporation S. Loans from the National Agricultural Cooperation Federation T. Tax Incentives for Highly Advanced Technology Businesses under the Foreign Investment and Foreign Capital Inducement Act III. Programs Preliminarily Determined To Be Not Countervailable A. Tax Credit for Improving Enterprise's Bill System under Article 7-2 of RSTA B. Tax Credit for Equipment to Promote Worker's Welfare under Article 94 of RSTA C. Tax Deduction for Boosting Employment under Article 30-4 of RSTA Preliminary Results of Review In accordance with 19 CFR 351.221(b)(4)(i), we calculated an individual subsidy rate for the producer/exporter subject to this administrative review. For the period January 1, 2005, through December 31, 2005, we preliminarily determine the net subsidy for DMC to be 0.03 percent *ad valorem* , which is *de minimis* . *See* 19 CFR 351.106(c)(1). The Department intends to issue assessment instructions to U.S. Customs and Border Protection (“CBP”) 15 days after the date of publication of the final results of this review. If the final results remain the same as these preliminary results, the Department will instruct CBP to liquidate without regard to countervailing duties all shipments of subject merchandise produced by DMC, entered, or withdrawn from warehouse, for consumption from January 1, 2005, through December 31, 2005. The Department will also instruct CBP not to collect cash deposits of estimated countervailing duties on shipments of the subject merchandise produced by DMC and Dongbu, entered, or withdrawn from warehouse, for consumption on or after the date of publication of the final results of this review. If the final results of this review remain the same as these preliminary results, the Department intends to instruct U.S. Customs and Border Protection (CBP), 15 days after the date of publication of the final results, to liquidate shipments of certain stainless steel sheet and strip in coils from DMC, entered, or withdrawn from warehouse, for consumption from January 1, 2005, through December 31, 2005, without regard to countervailing duties. Also, the Department intends to instruct CBP not to collect deposits of estimated countervailing duties on shipments of certain stainless steel sheet and strip in coils from DMC, entered, or withdrawn from warehouse, for consumption on or after the publication of the final results of this administrative review. The Department will issue appropriate instructions directly to CBP within 15 days of the final results of this review. We will instruct CBP to continue to collect cash deposits for non-reviewed companies at the most recent company-specific or country-wide rate applicable to the company. Accordingly, the cash deposit rates that will be applied to companies covered by this order, but not examined in this review, are those established in the most recently completed administrative proceeding for each company. These rates shall apply to all non-reviewed companies until a review of a company assigned these rates is requested. Public Comment Pursuant to 19 CFR 351.224(b), the Department will disclose to parties to the proceeding any calculations performed in connection with these preliminary results within five days after the date of the public announcement of this notice. Pursuant to 19 CFR 351.309, interested parties may submit written comments in response to these preliminary results. Unless otherwise indicated by the Department, case briefs must be submitted within 30 days after the publication of these preliminary results. Rebuttal briefs, which are limited to arguments raised in case briefs, must be submitted no later than five days after the time limit for filing case briefs, unless otherwise specified by the Department. Parties who submit arguments in this proceeding are requested to submit with the argument:
(1)a statement of the issue, and
(2)a brief summary of the argument. Parties submitting case and/or rebuttal briefs are requested to provide the Department copies of the public version on disk. Case and rebuttal briefs must be served on interested parties in accordance with 19 CFR 351.303(f). Also, pursuant to 19 CFR 351.310, within 30 days of the date of publication of this notice, interested parties may request a public hearing on arguments to be raised in the case and rebuttal briefs. Unless the Secretary specifies otherwise, the hearing, if requested, will be held two days after the date for submission of rebuttal briefs. Representatives of parties to the proceeding may request disclosure of proprietary information under administrative protective order no later than 10 days after the representative's client or employer becomes a party to the proceeding, but in no event later than the date the case briefs, under 19 CFR 351.309(c)(ii), are due. The Department will publish the final results of this administrative review, including the results of its analysis of issues raised in any case or rebuttal brief or at a hearing. These preliminary results of review are issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.221(b)(4). Dated: August 31, 2007. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E7-17748 Filed 9-7-07; 8:45 am] BILLING CODE 3510-DS-S DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration Federal Consistency Appeal by AES Sparrows Point LNG, LLC and Mid-Atlantic Express, L.L.C. AGENCY: National Oceanic and Atmospheric Administration (NOAA), Department of Commerce (Commerce). ACTION: Notice of appeal. SUMMARY: This announcement provides notice that AES Sparrows Point LNG, LLC and Mid-Atlantic Express, L.L.C. (collectively, “AES”) have filed an administrative appeal with the Department of Commerce asking that the Secretary override the State of Maryland's objection to AES's proposed LNG terminal in Baltimore County, Maryland. ADDRESSES: Materials from the appeal record will be available at the NOAA Office of the General Counsel for Ocean Services, 1305 East-West Highway, Room 6111, Silver Spring, MD 20910 and on the following Web site: *http://www.ogc.doc.gov/czma.htm.* FOR FURTHER INFORMATION CONTACT: Odin Smith, Attorney-Advisor, NOAA Office of the General Counsel, 301-713-7392. SUPPLEMENTARY INFORMATION: I. Notice of Appeal AES has filed a notice of appeal with the Secretary of Commerce pursuant to the Coastal Zone Management Act of 1972 (CZMA), 16 U.S.C. 1451 *et seq.* , and implementing regulations found at 15 CFR part 930, subpart H. AES appeals an objection, filed by the State of Maryland, to a consistency determination prepared by AES related to its proposed LNG terminal project in Baltimore County, Maryland. Under the CZMA, the Secretary may override the State's objection on grounds that the project is consistent with the objectives or purposes of the CZMA, or necessary in the interest of national security. To make the determination that the proposed activity is “consistent with the objectives or purposes” of the CZMA, the Secretary must find that:
(1)The proposed activity furthers the national interest as articulated in sections 302 or 303 of the CZMA, in a significant or substantial manner;
(2)the adverse effects of the proposed activity do not outweigh its contribution to the national interest, when those effects are considered separately or cumulatively; and
(3)no reasonable alternative is available that would permit the activity to be conducted in a manner consistent with enforceable policies of the State's coastal management program. 15 CFR 930.121. To make the determination that the proposed activity is “necessary in the interest of national security,” the Secretary must find that a national defense or other national security interest would be significantly impaired were the proposed activity not permitted to go forward as proposed. 15 CFR 930.122. II. Appeal Documents NOAA intends to provide the public with access to all publicly available materials and related documents comprising the appeal record during business hours, at the NOAA Office of the General Counsel for Ocean Services. For additional information about this appeal contact Odin Smith, 301-713-7392. Dated: September 5, 2007. Joel La Bissonniere, Assistant General Counsel for Ocean Services. [Federal Domestic Assistance Catalog No. 11.419 Coastal Zone Management Program Assistance.] [FR Doc. 07-4416 Filed 9-7-07; 8:45 am]
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Traces to 30 documents
CFR
4 references not yet in our index
  • 43 F.3d 1442
  • 268 F.3d 1376
  • 117 F.3d 1401
  • 15 CFR 930
Citation graph
cites case law
Notices
Notice of appeal
C.F.R.§ 351.213
C.F.R.§ 351.402
C.F.R.§ 351.411
C.F.R.§ 351.412
C.F.R.§ 351.403
C.F.R.§ 351.224
C.F.R.§ 351.309
C.F.R.§ 351.303
C.F.R.§ 351.310
F. App'x43 F.3d 1442
F. App'x268 F.3d 1376
F. App'x117 F.3d 1401
Cites 34 · showing 12Cited by 0 across 0 sources
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