Notice of Final Determination of Sales at Less Than Fair Value and Critical Circumstances: Certain Cold-Rolled Carbon Steel Flat Products From The Netherlands

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

EFFECTIVE DATE:

October 3, 2002.

FOR FURTHER INFORMATION CONTACT:

David Salkeld or Jim Neel, AD/CVD Enforcement Office VI, Group II, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-1168 or (202) 482-4161, respectively.

The Applicable Statute and Regulations

Unless otherwise indicated, all citations to the statute are references to the provisions effective January 1, 1995, the effective date of the amendments made to the Tariff Act of 1930 (“the Act”) by the Uruguay Round Agreements Act (“URAA”). In addition, unless otherwise indicated, all citations to Department of Commerce (“the Department”) regulations refer to the regulations codified at 19 CFR part 351 (2002).

Final Determination

We determine that certain cold-rolled carbon steel flat products from The Netherlands are being sold, or are likely to be sold, in the United States at less than fair value (“LTFV”), as provided in section 735 of the Act. The estimated margins of sales at LTFV are shown in the Continuation of Suspension of Liquidation section of this notice.

Case History

The preliminary determination in this investigation was published on May 9, 2002. See Notice of Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination: Certain Cold-Rolled Carbon Steel Flat Products from the Netherlands, 67 FR 31268 (May 9, 2002). Since the issuance of the preliminary determination, the following events have occurred:

On May 1, 2002, Corus Staal BV (“CSBV”), the sole respondent in the investigation, and the largest exporter/producer of imports during the period of investigation requested that the Department postpone the final determination to 135 days after the publication of the preliminary determination and requested that the Department extend the provisional measures period from four months to a period not longer than six months. Pursuant to section 733(b) of the Act, on June 19, 2002, the Department postponed the final determination until no later than September 23, 2002 (i.e. 135 days after publication of the preliminary determination). See Certain Cold-Rolled Carbon Steel Flat Products from The Netherlands: Postponement of Final Determination of Sales at Less Than Fair Value, 67 FR 43280 (June 27, 2002).

In May and June 2002, the Department verified the responses submitted by the respondent in this investigation, CSBV and its affiliates Corus Steel USA, Inc. (“CSUSA”), Rafferty-Brown Inc. of Connecticut (“RBC”) and Rafferty-Brown Inc. of North Carolina (“RBN”). CSBV and CSUSA are collectively referred to as “Corus.” Verification reports were issued in July 2002. Public versions of these reports, and all other Departmental memoranda referred to herein, are on file in the Central Records Unit, room B-099 of the main Commerce building. On May 20, 2002, petitioner Nucor Corporation requested a public hearing. On August 9, 2002, we received case briefs from the petitioners and the respondent. On August 16, 2002, we received rebuttal briefs from the petitioners and the respondent. On August 27, 2002, petitioner Nucor Corporation withdrew its request for a public hearing and asked that the hearing be cancelled. The hearing scheduled for September 5, 2002, was cancelled on September 3, 2002.

With respect to scope, in the preliminary LTFV determinations in these cases, the Department preliminarily excluded certain porcelain enameling steel from the scope of these investigations. See Scope Appendix to the Notice of Preliminary Determination of Sales at Less Than Fair Value: Certain Cold-Rolled Carbon Steel Flat Products from Argentina, 67 FR 31181 (May 9, 2002) (Scope Appendix—Argentina Preliminary LTFV Determination). On June 13, 2002, we issued a preliminary decision on the remaining 75 scope exclusion requests filed in a number of the on-going cold-rolled steel investigations (see the June 13, 2002, memorandum regarding “Preliminary Scope Rulings in the Antidumping Investigations on Certain Cold-Rolled Carbon Steel Flat Products from Argentina, Australia, Belgium, Brazil, France, Germany, India, Japan, Korea, the Netherlands, New Zealand, the People's Republic of China, the Russian Federation, South Africa, Spain, Sweden, Taiwan, Thailand, Turkey, and Venezuela, and in the Countervailing Duty Investigations of Certain Cold-Rolled Carbon Steel Flat Products from Argentina, Brazil, France, and Korea” (Preliminary Scope Rulings), which is on file in the Department's Central Records Unit (CRU), room B-099 of the main Department building. We gave parties until June 20, 2002, to comment on the preliminary scope rulings, and until June 27, 2002, to submit rebuttal comments. We received comments and/or rebuttal comments from petitioners and respondents from various countries subject to these investigations of cold-rolled steel. In addition, on June 13, 2002, North American Metals Company (an interested party in the Japanese proceeding) filed a request that the Department issue a “correction” for an already excluded product. On July 8, 2002, the petitioners objected to this request.

At the request of multiple respondents, the Department held a public hearing with respect to the Preliminary Scope Rulings on July 1, 2002. The Department's final decisions on the scope exclusion requests are addressed in the “Scope of Investigation” section below.

Scope of Investigation

For purposes of this investigation, the products covered are certain cold-rolled (cold-reduced) flat-rolled carbon-quality steel products. A full description of the scope of this investigation is contained in “Appendix I” attached to the Notice of Correction to Final Determination of Sales at Less Than Fair Value: Certain Cold-Rolled Carbon Steel Flat Products from Australia, 67 FR 52934 (August 14, 2002). For a complete discussion of the comments received on the Preliminary Scope Rulings, see the memorandum regarding “Issues and Decision Memorandum for the Final Scope Rulings in the Antidumping Duty Investigations on Certain Cold-Rolled Carbon Steel Flat Products from Argentina, Australia, Belgium, Brazil, France, Germany, India, Japan, Korea, the Netherlands, New Zealand, the People's Republic of China, the Russian Federation, South Africa, Spain, Sweden, Taiwan, Thailand, Turkey, and Venezuela, and in the Countervailing Duty Investigations of Certain Cold-Rolled Carbon Steel Flat Products from Argentina, Brazil, France, and Korea,” dated July 10, 2002, which is on file in the CRU.

Period of Investigation

The period of investigation (POI) is July 1, 2000 through June 30, 2001. This period corresponds to the four most recent fiscal quarters prior to the month of the filing of the petition (i.e., September 2001).

Verification

As provided in section 782(i) of the Act, we conducted verification of the cost and sales information submitted by the respondent. We used standard verification procedures including examination of relevant accounting and production records, and original source documents provided by the respondent.

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties to this antidumping proceeding are listed in the appendix to this notice and addressed in the Issues and Decision Memorandum from Holly A. Kuga to Faryar Shirzad RE: the Antidumping Duty (“AD”) Investigation of Certain Cold-Rolled Carbon Steel Flat Products from The Netherlands, (“Decision Memorandum”), dated September 23, 2002, which is on file in room B-099 of the main Department of Commerce building, and which is hereby adopted. In addition, a complete version of the Decision Memorandum can be accessed directly on the World Wide Web at http://ia.ita.doc.gov/. The paper and electronic versions of the Decision Memorandum are identical in content.

Changes Since the Preliminary Determination

Based on our findings at verification, and analysis of comments received, we have made adjustments to the preliminary determination in calculating the final dumping margin in this proceeding. These adjustments are discussed in the Decision Memorandum for this investigation, and include:

—Excusing Corus from reporting downstream sales by its bankrupt affiliate GalvPro;

—Excluding Corus' sales to its affiliate GalvPro from the U.S. sales database;

—Adding RBC galvanizing costs to the further manufacturing field;

—Calculating a revised bad debt expense for CSBV;

—Correcting clerical errors identified at verification;

—Revising the VCOM field in the cost of production and constructed value calculations;

—Revising further manufacturing general and administrative (“G&A”) expenses; and

—Calculating a separate G&A rate for each further manufacturing company.

Use of Facts Available

For a discussion of our application of facts available, see the “Facts Available” section of the Decision Memorandum, which is on file in B-099 and available on the Web at ia.ita.doc.gov/frn/frnhome.

Critical Circumstances

Section 733(e)(1) of the Act provides that if a petitioner alleges critical circumstances, the Department will determine, on the basis of the information available at the time, whether there is a reasonable basis to believe or suspect that (i) there is a history of dumping and material injury by reason of dumped imports in the United States or elsewhere of the subject merchandise, or (ii) the person by whom, or for whose account, the merchandise was imported knew, or should have known that the exporter was selling the subject merchandise at LTFV and that there would be material injury by reason of such sales (see 733(e)(1)(A)(i) and (ii)), and there have been massive imports of the subject merchandise over a relatively short period (section 733(e)(1)(B).

In the Notice of Preliminary Determinations of Critical Circumstances: Certain Cold-Rolled Carbon Steel Flat Products From Australia, the People's Republic of China, India, the Republic of Korea, the Netherlands, and the Russian Federation, 67 FR 19157 (April 18, 2002), we preliminarily found that both criteria for critical circumstances, i.e., a history of injurious dumping and massive imports of subject merchandise, exist. For the reasons discussed in the Decision Memorandum, we continue to find that critical circumstances exist in this final determination pursuant to section 735(a)(3) of the Act.

Continuation of Suspension of Liquidation

In accordance with section 735(c)(1)(B) of the Act, we are directing the Customs Service to continue to suspend liquidation of all entries of certain cold-rolled carbon steel flat products from The Netherlands that are entered, or withdrawn from warehouse, for consumption on or after the date which is 90 days prior to the date of publication of the preliminary determination. The Customs Service shall continue to require a cash deposit or the posting of a bond based on the estimated weighted-average dumping margins shown below. The suspension of liquidation instructions will remain in effect until further notice.

We determine that the following weighted-average dumping margins exist for The Netherlands:

International Trade Commission Notification

In accordance with section 735(d) of the Act, we have notified the International Trade Commission (ITC) of our determinations. The ITC will determine, within 45 days, whether imports of subject merchandise from the Netherlands are causing material injury, or threaten material injury, to an industry in the United States. If the ITC determines that material injury or threat of injury does not exist, the proceedings will be terminated and all securities posted will be refunded or canceled. If the ITC determines that such injury does exist, the Department will issue antidumping orders directing Customs Service officials to assess antidumping duties on all imports of the subject merchandise entered, or withdrawn from warehouse for consumption on or after the effective date of the suspension of liquidation.

This notice also serves as a reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305. Timely notification of return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.

This determination is issued and published in accordance with sections 735(d) and 777(i)(1) of the Act.

Appendix—Issues Covered in Decision Memorandum

Sales Issues

1. Excusing Corus from reporting downstream sales by its bankrupt affiliate GalvPro, LP (“GalvPro”)

2. Missing payment dates for certain U.S. sales

3. Rafferty-Brown Inc. of Connecticut (“RBC”) galvanizing costs

4. Scrap Recovery Offset to U.S. warranty expenses

5. Applying adverse facts available to calculate Corus' less than fair value (“LTFV”) margins

6. Sufficiency of petition to provide the basis for initiation

7. Classifying Corus' U.S. sales as export price (“EP”) sales or constructed export price (“CEP”) sales

8. CEP offset

9. Whether GalvPro's unpaid sales should be treated as a bad debt expense

10. Critical circumstances

11. “Zeroing” methodology

12. Clerical error in the margin program

13. Clerical Errors Identified at Verification

14. Variable Cost of Manufacture (“VCOM”) Calculation

Cost Issues

15. Non-Prime Offset to Standard Costs

16. General and Administrative (“G&A”) Expenses

17. Corporate Rationalization Charges—G&A Expenses

18. Extraordinary Charges—G&A Expenses

19. Further-Manufacturing Overhead

20. Further-Manufacturing G&A Expenses

21. Inter-company Charges—Further-Manufacturing G&A Expenses

22. Corporate Rationalization versus Group G&A—Further-Manufacturing G&A Expenses