Stainless Steel Plate in Coils From Belgium: Final Results of Countervailing Duty Administrative Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of Final Results of Countervailing Duty Administrative Review.

SUMMARY:

On April 23, 2001, the Department of Commerce published in the Federal Register its preliminary results of administrative review of the countervailing duty order on stainless steel plate in coils from Belgium for the period September 4, 1998 through December 31, 1999. Based on our analysis of the comments received, we have made changes to ALZ N.V.'s net subsidy rate, and, as a result, the final results differ from the preliminary results. The final net subsidy rate for ALZ N.V. is listed below in the section entitled “Final Results of Review.”

EFFECTIVE DATE:

August 27, 2001.

FOR FURTHER INFORMATION CONTACT:

Melani Miller, Jarrod Goldfeder, or Anthony Grasso, AD/CVD Enforcement, Group I, Office 1, Import Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone (202) 482-0116, (202) 482-0189, or (202) 482-3853, respectively.

SUPPLEMENTARY INFORMATION:

Applicable Statute and Regulations

Unless otherwise indicated, all citations to the statute are references to the provisions of section 751(a) of the Tariff Act of 1930, as amended by the Uruguay Round Agreements Act (“URAA”) effective January 1, 1995 (“the Act”). Similarly, unless otherwise indicated, all citations to the Department of Commerce's (“the Department”) regulations are to the current regulations as codified at 19 CFR Part 351 (2000), including the new substantive countervailing duty regulations published in the Federal Register on November 25, 1998 (63 FR 65348).

Background

On May 11, 1999, the Department published in the Federal Register the countervailing duty order on stainless steel plate in coils from Belgium. See Notice of Amended Final Determinations: Stainless Steel Plate in Coils from Belgium and South Africa; and Notice of Countervailing Duty Orders: Stainless Steel Plate in Coils from Belgium, Italy and South Africa, 64 FR 25288 (May 11, 1999). In accordance with section 351.213(b)(1) of the Department's regulations, this review of the order covers ALZ N.V. (“ALZ”), the only company for which a review was specifically requested. This review covers 27 programs.

Since the publication of Stainless Steel Plate in Coils from Belgium: Preliminary Results of Countervailing Duty Administrative Review, 66 FR 20425 (April 23, 2001) (“Preliminary Results”), the following events have occurred.

On April 25, 2001, the Department issued a supplemental questionnaire to ALZ. On May 3, 2001, ALZ submitted its response to this supplemental questionnaire.

On May 22, 2001, the Government of Belgium (“GOB”) and the Government of Flanders (“GOF”) filed their combined case brief. On May 24, 2001, the petitioners in this proceeding (Allegheny Ludlum Corp., Armco, Inc., Lukens Inc., and United Steelworkers of America, AFL-CIO/CLC) and ALZ filed their case briefs. On June 8, 2001, the petitioners and ALZ filed rebuttal briefs. The GOB and the GOF did not file a rebuttal brief. The Department did not conduct a hearing in this review because none was requested.

Scope of the Review

Imports covered by this review are shipments of certain stainless steel plate 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 plate products are flat-rolled products, 254 mm or over in width and 4.75 mm or more in thickness, in coils, and annealed or otherwise heat treated and pickled or otherwise descaled. The subject plate may also be further processed (e.g., cold-rolled, polished, etc.) provided that it maintains the specified dimensions of plate following such processing. Excluded from the scope of this order are the following: (1) Plate not in coils, (2) plate that is not annealed or otherwise heat treated and pickled or otherwise descaled, (3) sheet and strip, and (4) flat bars. In addition, certain cold-rolled stainless steel plate in coils is also excluded from the scope of this order. The excluded cold-rolled stainless steel plate in coils is defined as that merchandise which meets the physical characteristics described above that has undergone a cold-reduction process that reduced the thickness of the steel by 25 percent or more, and has been annealed and pickled after this cold reduction process.

The merchandise subject to this order is currently classifiable in the Harmonized Tariff Schedule of the United States (“HTSUS”) at subheadings: 7219.11.00.30, 7219.11.00.60, 7219.12.00.05, 7219.12.00.20, 7219.12.00.25, 7219.12.00.50, 7219.12.00.55, 7219.12.00.65, 7219.12.00.70, 7219.12.00.80, 7219.31.00.10, 7219.90.00.10, 7219.90.00.20, 7219.90.00.25, 7219.90.00.60, 7219.90.00.80, 7220.11.00.00, 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, 7220.90.00.10, 7220.90.00.15, 7220.90.00.60, and 7220.90.00.80. Although the HTSUS subheadings are provided for convenience and for U.S. Customs Service (“Customs”) purposes, the written description of the scope of the order is dispositive.

Period of Review

According to section 351.213(e)(2)(ii) of the Department's regulations, the first administrative review of a countervailing duty order should cover the period from the initial date of suspension of liquidation of the subject merchandise to the end of the most recently completed fiscal year. In this case, suspension of liquidation began on September 4, 1998. See Preliminary Countervailing Duty Determination and Alignment of Final Countervailing Duty Determination With Final Antidumping Duty Determination: Stainless Steel Plate in Coils From Belgium, 63 FR 47239 (September 4, 1998). Therefore, the period of review (“POR”) for which we are measuring countervailable subsidies is from September 4, 1998 through December 31, 1999.

Because it is the Department's practice to calculate subsidy rates on an annual basis, we calculated a 1998 rate and a 1999 rate for ALZ. The rate calculated for 1998 will be applicable only to entries, or withdrawals from warehouse, for consumption made on and after September 4, 1998 through the end of 1998.

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties to this administrative review are addressed in the August 21, 2001 Issues and Decision Memorandum (“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 Central Records Unit, Room B-099 of the Department. In addition, a complete version of the Decision Memorandum can be accessed directly on the internet at http://ia.ita.doc.gov/frn/frnhome.htm. The paper copy and electronic version of the Decision Memorandum are identical in content.

Changes Since the Preliminary Results

Based on our analysis of comments received, we have made changes to ALZ's net subsidy rate by revising the allocation period used to allocate certain non-recurring subsidies which have not been previously allocated.

Final Results of Review

In accordance with section 351.221(b)(4)(i) of the Department's regulations, we calculated an individual subsidy rate for ALZ, the only producer/exporter subject to this administrative review. For the period September 4, 1998 through December 31, 1998, we determine the net subsidy rate for ALZ to be 3.25 percent; for January 1, 1999 and for the period May 11, 1999 through December 31, 1999, we determine the net subsidy rate for ALZ to be 1.78 percent. (In accordance with section 703(d) of the Act, countervailing duties will not be assessed on entries made during the period January 2, 1999 through May 10, 1999.)

We will instruct the Customs to assess countervailing duties as indicated above. The Department will also instruct Customs to collect cash deposits of estimated countervailing duties at the 1999 rate on the f.o.b. value of all shipments of the subject merchandise from ALZ entered, or withdrawn from warehouse, for consumption on or after the date of publication of the final results of this administrative review.

Because the URAA replaced the general rule in favor of a country-wide rate with a general rule in favor of individual rates for investigated and reviewed companies, the procedures for establishing countervailing duty rates, including those for non-reviewed companies, are now essentially the same as those in antidumping cases, except as provided for in section 777A(e)(2)(B) of the Act. The requested review will normally cover only those companies specifically named. See section 351.213(b) of the Department's regulations. Pursuant to the Department's regulations at section 351.212(c), for all companies for which a review was not requested, duties must be assessed at the cash deposit rate, and cash deposits must continue to be collected, at the rate previously ordered. As such, the countervailing duty cash deposit rate applicable to a company can no longer change, except pursuant to a request for a review of that company. See Federal-Mogul Corporation v. United States, 822 F.Supp. 782 (CIT 1993), and Floral Trade Council v. United States, 822 F.Supp. 766 (CIT 1993). Therefore, the cash deposit rates for all companies, except those covered by this review, are not changed by the results of this review.

Therefore, we will instruct Customs to continue to collect cash deposits for non-reviewed companies at the most recent company-specific or country-wide rate applicable to that company. Accordingly, the cash deposit rates that will be applied to non-reviewed companies covered by this order are those established in the most recently completed administrative proceeding conducted under the URAA. If such a review has not been conducted, the rate established in the most recently completed administrative proceeding pursuant to the statutory provisions that were in effect prior to the URAA amendments is applicable. See Certain Cut-to-Length Carbon Steel Plate from Mexico: Final Results of Countervailing Duty Administrative Review, 65 FR 13368, 13369 (March 13, 2000). These rates shall apply to all non-reviewed companies until a review of a company assigned these rates is requested. In addition, for the periods September 4, 1998 through January 1, 1999 and May 11, 2000 through December 31, 1999, the assessment rates applicable to all non-reviewed companies covered by this order are the cash deposit rates in effect at the time of entry.

This notice 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 the Department's regulations at section 351.305(a). Timely written notification of return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.

This administrative review and notice are in accordance with sections 751(a)(1) and 777(i)(1) of the Act (19 U.S.C. 1675(a)(1) and 19 U.S.C. 1677f(i)(1)).

Appendix—List of Issues Discussed in the Decision Memorandum

Methodology and Background Information

Responding Producers

Benchmarks for Long-term Loans and Discount Rates

Equity Methodology

Allocation Period

Analysis of Programs

I. Programs Determined to Confer Subsidies

A. 1985 ALZ Share Subscriptions

B. 1987 ALZ Common Share Transaction Between the GOB and Sidmar

C. Industrial Reconversion Zones

1. Alfin

2. Albufin

D. Regional Subsidies under the Economic Expansion Law of 1970

1. Expansion Real Estate Tax Exemption

2. Accelerated Depreciation

E. Belgian Industrial Finance Company (“Belfin”) Loans

F. Societe Nationale de Credite a l'Industrie (“SNCI”) Loans

G. Subsidies Provided to Sidmar that are Attributable to ALZ

1. 1984 Purchase of Sidmar's Common and Preference Shares

2. Conversion of Sidmar's Debt to Equity (OCPC-to-PB) in 1985

3. SidInvest

II. Programs Determined to Be Not Used During the POR

A. Government of Belgium Programs

1. Subsidies Provided to Sidmar that are Potentially Attributable to ALZ Water Purification Grants

2. Societe Nationale pour la Reconstruction des Secteurs Nationaux

3. Regional subsidies under the 1970 Law Investment and Interest Subsidies

4. Reduced Social Security Contributions Pursuant to the Maribel Scheme (Article 35 of the Law of June 29, 1981)

B. Government of Flanders Programs

1. Regional subsidies under the 1970 Law

a. Corporate Income Tax Exemption

b. Capital Registration Tax Exemption

c. Government Loan Guarantees

d. 1993 Expansion Grant

2. Special Depreciation Allowance

3. Preferential Short-Term Export Credit

4. Interest Rate Rebates

C. Programs of the European Commission

1. ECSC Article 54 Loans and Interest Rebates

2. ECSC Article 56 Conversion Loans, Interest Rebates and Redeployment Aid

3. European Social Fund Grants

4. European Regional Development Fund Grants

5. Resider II Program

Analysis of Comments

Comment 1: GOB Equity Infusions

Comment 2: Average Useful Life for Non-recurring Subsidies Benefitting Sidmar Which Have Not Been Previously Allocated

Comment 3: Reduced Social Security Contributions Pursuant to the Maribel Scheme

Comment 4: Cash Deposit Rate for Future Entries