[Federal Register Volume 75, Number 177 (Tuesday, September 14, 2010)]
[Notices]
[Pages 55745-55754]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-22901]
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DEPARTMENT OF COMMERCE
International Trade Administration
[C-580-818]
Corrosion-Resistant Carbon Steel Flat Products From the Republic
of Korea: Preliminary Results and Partial Rescission 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 (CORE) from the Republic
of Korea (Korea) for the period of review (POR) January 1, 2008,
through December 31, 2008. As a result of withdrawals of request for
review, we are rescinding this review, in part, with respect to Dongbu
Steel Co., Ltd. (Dongbu) and Pohang Iron and Steel Co., Ltd. (POSCO).
For information on the net subsidy for Hyundai HYSCO Ltd. (HYSCO) the
company reviewed, 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.
DATES: Effective Date: September 14, 2010.
FOR FURTHER INFORMATION CONTACT: Gayle Longest, AD/CVD Operations,
Office 3, Import Administration, International Trade Administration,
[[Page 55746]]
U.S. Department of Commerce, Room 4014, 14th Street and Constitution
Ave., NW., Washington, DC 20230; telephone: (202) 482-3338.
SUPPLEMENTARY INFORMATION:
Background
On August 17, 1993, the Department published in the Federal
Register the CVD order on CORE from Korea. See Countervailing Duty
Orders and Amendments of Final Affirmative Countervailing Duty
Determinations: Certain Steel Products from Korea, 58 FR 43752 (August
17, 1993). On August 3, 2009, 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, 74 FR
38397 (August 3, 2009).
On August 31, 2009, we received a timely request for review from
Dongbu Steel Co., Ltd. (Dongbu), Hyundai HYSCO Ltd. (HYSCO), and Pohang
Iron and Steel Co., Ltd. (POSCO). On September 22, 2009, the Department
published a notice of initiation of the administrative review of the
CVD order on CORE from Korea covering the period January 1, 2008,
through December 31, 2008. See Initiation of Antidumping and
Countervailing Duty Administrative Reviews and Requests for Revocation
in Part (Initiation), 74 FR 48224 (September 22, 2009). On October 14,
2009, and October 23, 2009, POSCO and Dongbu withdrew their requests
for review, respectively.
Under 19 CFR 351.213(d)(1), the Department will rescind an
administrative review, in whole or in part, if a party that requested a
review withdraws the request within 90 days of the date of publication
of the notice of initiation of the requested review.
The Initiation was published on September 22, 2009. Dongbu and
POSCO submitted timely requests for withdrawal on October 14, 2009, and
October 23, 2009, respectively. No other party requested administrative
reviews of Dongbu and POSCO. Therefore, we are rescinding, in part,
this review of the countervailing duty order of CORE from Korea with
regard to Dongbu and POSCO.
On November 2, 2009, the Department issued the initial
questionnaire to HYSCO, and the Government of Korea (GOK). On December
22, 2009, the Department received questionnaire responses from HYSCO
and the GOK. On February 17, 2010, and July 13, 2010, the Department
issued supplemental questionnaires to GOK and HYSCO. On March 17, 2010,
and August 6, 2010, the Department received supplemental questionnaire
responses from the GOK and HYSCO. On April 9, 2010, the Department
published in the Federal Register an extension of its preliminary
results of the instant administrative review. See Corrosion-Resistant
Carbon Steel Flat Products from the Republic of Korea: Notice of
Extension of Preliminary Results of Countervailing Duty Administrative
Review, 75 FR 18153 (April 9, 2010).
In accordance with 19 CFR 351.213(b), this review covers only those
producers or exporters for which a review was specifically requested.
The company that continues to be subject to this review is HYSCO.
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, 7210.70.6030, 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 tables 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 the company-specific
weighted-average interest rate for commercial won-denominated loans
outstanding during the POR. This approach is in accordance with 19 CFR
351.505(a)(3)(i) and the Department's practice. See, e.g., Corrosion-
Resistant Carbon Steel Flat Products From the Republic of Korea: Final
Results of Countervailing Duty Administrative Review, 74 FR 2512
(January 15, 2009) (Final Results of CORE from Korea 2006), and
accompanying Issues and Decision Memorandum (CORE from Korea 2006
Decision Memorandum) at ``Benchmarks for Short-Term Financing.''
B. Benchmark for Long-Term Loans
During the POR, HYSCO had outstanding countervailable long-term
won-denominated loans from government-owned banks and Korean commercial
banks. We used the following benchmarks to calculate the subsidies
attributable to respondents'
[[Page 55747]]
countervailable long-term loans obtained through 2008:
(1) For countervailable, won-denominated long-term loans, we used,
where available, the company-specific interest rates on the company's
comparable commercial, won-denominated loans. If such loans were not
available, we used, where available, the company-specific corporate
bond rate on the company's public and private bonds, as we have
determined that the GOK did not control the Korean domestic bond market
after 1991. 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) (Stainless Steel
Investigation) and ``Analysis Memorandum on the Korean Domestic Bond
Market'' (March 9, 1999). The use of a corporate bond rate as a long-
term benchmark interest rate is consistent with the approach the
Department has taken in several prior Korean CVD proceedings. See Id.;
see also Final Affirmative Countervailing Duty Determination:
Structural Steel Beams from the Republic of Korea (H Beams
Investigation), 65 FR 41051 (July 3, 2000), and accompanying Issues and
Decision Memorandum at ``Benchmark Interest Rates and Discount Rates;''
and Final Affirmative Countervailing Duty Determination: Dynamic Random
Access Memory Semiconductors from the Republic of Korea, 68 FR 37122
(June 23, 2003) (DRAMS Investigation), and accompanying Issues and
Decision Memorandum at ``Discount Rates and Benchmark for Loans.''
Specifically, in those cases, we determined that, absent company-
specific, commercial long-term loan interest rates, the won-denominated
corporate bond rate is the best indicator of the commercial long-term
borrowing rates for won-denominated loans in Korea because it is widely
accepted as the market rate in Korea. See Final Affirmative
Countervailing Duty Determinations and Final Negative Critical
Circumstances Determinations: Certain Steel Products from Korea, 58 FR
at 37328, 37345-37346 (July 9, 1993) (Steel Products from Korea). Where
company-specific rates were not available, we used the national average
of the yields on three-year, won-denominated corporate bonds, as
reported by the Bank of Korea (BOK). This approach is consistent with
19 CFR 351.505(a)(3)(ii) and our practice. See, e.g., CORE from Korea
2006 Decision Memorandum at ``Benchmark for Long Term Loans.''
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.
I. Programs Determined To Be Countervailable
A. Short-Term Export Financing
Export-Import Bank of Korea (KEXIM) supplies two types of short-
term loans for exporting companies, short-term trade financing and
comprehensive export financing. See the GOK's December 22, 2009,
questionnaire response (QR) at Exhibit J-1. KEXIM provides short-term
loans to Korean exporters that manufacture goods under export
contracts. Id. The loans are provided up to the amount of the bill of
exchange or contracted amount, less any amount already received. Id.
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. Id. To obtain the loans, companies
must report their export performance periodically to KEXIM for review.
Id. Comprehensive export financing loans cover from 50 to 90 percent of
the company's export performance. Id.
In Steel Products from Korea, the Department determined that the
GOK's short-term export financing program was countervailable. See
Final Affirmative Countervailing Duty Determinations and Final Negative
Critical Circumstances Determinations: Certain Steel Products From
Korea, 58 FR 37338, 37350 (July 9, 1993) (Steel Products from Korea);
see also Notice of 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 ``Short-Term Export Financing'' section. No new
information or evidence of changed circumstances was presented in this
review to warrant any reconsideration of the countervailability of this
program. Therefore, we continue to find this program countervailable.
Specifically, we determine that the export financing constitutes a
financial contribution in the form of a loan within the meaning of
section 771(5)(D)(i) of the Act and confers a benefit within the
meaning of section 771(5)(E)(ii) of the Act to the extent that the
amount of interest the respondents paid for export financing under this
program was less than the amount of interest that would have been paid
on a comparable short-term commercial loan. See discussion above in the
``Subsidies Valuation Information'' section with respect to short-term
loan benchmark interest rates. In addition, we preliminarily determine
that the program is specific, pursuant to section 771(5A)(A) of the
Act, because receipt of the financing is contingent upon exporting.
HYSCO 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 free on board (f.o.b.) value of the respective company's total
exports. On this basis, we determine the net subsidy rate to be 0.03
percent ad valorem for HYSCO.
B. Reduction in Taxes for Operation in Regional and National Industrial
Complexes
Under Article 46 of the Industrial Cluster Development and Factory
Establishment Act (Industrial Cluster Act), a state or local government
may provide tax exemptions as prescribed by the Restriction of Special
Taxation Act. In accordance with this authority, Article 276 of the
Local Tax Act provides that an entity that acquires real estate in a
designated industrial complex for the purpose of constructing new
buildings or enlarging existing facilities is exempt from the
acquisition and registration tax. In addition, the entity is exempt
from 50 percent of the property tax on the real estate (i.e., the land,
buildings, or facilities constructed or expanded) for five years from
the date the tax liability becomes effective. The exemption is
increased to 100 percent of the relevant land, buildings, or facilities
that are located in an industrial complex outside of the Seoul
metropolitan area. The GOK established the tax exemption program under
Article 276 in December 1994, to provide incentives for companies to
relocate from populated areas in the Seoul metropolitan region to
industrial sites in less populated parts of the country. The program is
administered by the local tax officials of the county where the
industrial complex is located.
During the POR, pursuant to Article 276 of the Local Tax Act, HYSCO
received exemptions from the
[[Page 55748]]
acquisition tax, registration tax, and property tax based on the
location of its manufacturing facilities, Suncheon Works, in the
Yulchon Industrial Complex, a government-sponsored industrial complex
designated under the Industrial Cluster Act. In addition, HYSCO
received an exemption from the local education tax during the POR. The
local education tax is levied at 20 percent of the property tax. The
property tax exemption, therefore, results in an exemption of the local
education tax.
In the CFS Paper Investigation, the Department determined that the
tax exemptions under Article 276 of the Local Tax Act are
countervailable subsidies. See Coated Free Sheet Paper from the
Republic of Korea: Notice of Final Affirmative Countervailing Duty
Determination, 72 FR 60639 (October 25, 2007) (CFS Paper
Investigation), and accompanying Issues and Decision Memorandum at
``Reduction in Taxes for Operation in Regional and National Industrial
Complexes'' (CFS Paper Decision Memorandum). No new information or
evidence of changed circumstances from HYSCO or the GOK was presented
in this review to warrant a reconsideration of the countervailability
of this program. We, therefore, continue to find this program
countervailable. Specifically, we preliminarily find that the tax
exemptions that HYSCO received constitute a financial contribution and
confer a benefit under sections 771(5)(D)(ii) and 771(5)(E) of the Act,
respectively. We further preliminarily find that the tax exemptions are
regionally specific under section 771(5A)(D)(iv) of the Act because the
exemptions are limited to an enterprise or industry located within
designated geographical regions in Korea.
To calculate the benefit, we divided HYSCO's total tax exemptions
by the company's total f.o.b. sales value for 2008. On this basis, we
preliminarily determine the net subsidy rate to be less than 0.005
percent ad valorem, which consistent with the Department's practice,
does not confer a measurable benefit and is not included in the
calculation of the net countervailable rate. See, e.g., CORE from Korea
2006 Decision Memorandum at ``GOK's Direction of Credit'' section.
C. GOK's Direction of Credit for Loans Issued Prior to 2002
In the Final Results of CORE from Korea 2006, the Department
determined the GOK ended its practice of directing credit to the steel
industry as of 2002. See Preliminary Results of CORE from Korea 2006,
73 FR 52315; 52317 (September 9, 2008) unchanged in Final Results of
CORE from Korea 2006, 74 FR 2512 (January 15, 2009), and Issues and
Decision Memorandum for the Countervailing Duty Administrative Review
on Corrosion-Resistant Carbon Steel Flat Products from the Republic of
Korea at ``Programs Determined To Confer Subsidies, A. The GOK's
Direction of Credit'' section. However, during 2008, the respondent had
an outstanding loan that was provided prior to 2002.
In accordance with 19 CFR 351.505(c)(2) and (4), we calculated the
benefit for the loan received prior to 2002 as 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.
To calculate the net subsidy rate, we divided the company's total
benefit by its respective total f.o.b. sales values during the POR, as
this program is not tied to exports or a particular product. For HYSCO,
we preliminarily determine the net subsidy rate under the direction of
credit program to be less than 0.005 percent ad valorem, which
consistent with the Department's practice, does not confer a measurable
benefit and is not included in the calculation of the net
countervailable rate. See, e.g., CORE from Korea 2006 Decision
Memorandum at ``GOK's Direction of Credit'' section.
D. R&D Grants Under the Act on the Promotion of the Development of
Alternative Energy
The GOK's Development of Alternative Energy program is designed to
contribute to the preservation of the environment, the sound and
sustainable development of the national economy, and the promotion of
national welfare by diversifying energy resources through promoting
technological development, the use and diffusion of alternative energy,
and reducing the discharge of gases harmful to humans or the
environment by activating the alternative energy industry. See GOK's
December 22, 2009, QR at Exhibit G-1. The program is administered by
the Ministry of Knowledge Economy (MKE), Korea Energy Management
Corporation (KEMCO), and Alternative Energy Development Center under
KEMCO. Id.
Under the Act on the Promotion of the Development and Use of
Alternative Energy, the GOK provides research and development (R&D)
grants to support the following: (1) Survey of resources for
alternative energy and demand for its technology, and compilation of
statistics, (2) research and development of alternative energy, (3)
collection, analysis, and provision of technological information on
alternative energy, (4) guidance, education and publicity of
technologies related to alternative energy, (5) use and diffusion of
alternative energy, and model projects, (6) international cooperation
related to alternative energy, (7) other projects necessary for the
technological development and use or diffusion of alternative energy.
Id., at 2.
Pursuant to Articles 4 and 5 of the Act on the Promotion of the
Development and Use of Alternative Energy, MKE prepares a base plan and
a yearly execution plan for the development of alternative energy. Id.,
at 3. The base and execution plan are announced to the public. Id.
According to the GOK, any person who wishes to participate in the
program prepares an R&D business plan and then submits the application
to the Alternative Energy Development Center under KEMCO, which then
evaluates the application and selects the projects eligible for
government-support. Id. After the selected application is finally
approved by MKE, KEMCO and the general supervising institute of the
consortium enter into an R&D agreement and then MKE provides the grant
through KEMCO. Id.
The costs of the R&D projects under this program are shared by the
company (or research institution) and the GOK. Id., at 2. Specifically,
the grant ratio for project costs are as follows: (1) For large
companies the GOK provides grants up to one-half of the project costs,
(2) for small/medium-sized companies the GOK provides grants up to
three-fourth of the project costs, (3) for consortium \1\ the GOK
provides grants up to three-fourth of the project costs, and (4) others
the GOK provides grants up to one-half of the project costs. Id.
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\1\ If the ratio of small to medium-sized companies in a
consortium is above two-thirds, the GOK provides grants up to one-
half of the project costs.
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When the project is evaluated as ``successful'' upon completion,
the participating companies must repay 40 percent of the R&D grant to
the GOK. Id., at 2. However, when the project is evaluated as ``not
successful'', the company does not have to repay any of the grant
amount to the GOK. Id.
During the POR, HYSCO received an energy-related grant under the
Act on the Promotion of the Development of Alternative Energy
(Alternative Energy Act) for a R&D project in which the company
participated with other firms. See GOK's December 22, 2009 QR at 18.
HYSCO reported that R&D grants under
[[Page 55749]]
the Alternative Energy Act are provided with respect to specific
projects, which are generally multi-year projects where the amount of
funds to be provided by the GOK is set out in the project contract. See
HYSCO's March 17, 2010 QR at Exhibit G-10. The cost of R&D projects
under this program is shared by the participating companies and the
GOK. Id. HYSCO's grant is related to new technologies that are
applicable to both inputs of subject merchandise as well as subject
merchandise. See Memorandum to the File titled ``HYSCO's R&D Grants
under the Act on the Promotion of the Development and Use of
Alternative Energy'' (September 7, 2010) (HYSCO Alternative Energy
Grant Memorandum), of which a public version is on file in the CRU.
In the previous administrative review of this case, we examined
this R&D grant and found that the subsidy rate under this program was
less than 0.005 percent ad valorem, which, consistent with the
Department's practice, did not confer a measurable benefit. See
Corrosion-Resistant Carbon Steel Flat Products From the Republic of
Korea: Preliminary Results of Countervailing Duty Administrative Review
(Preliminary Results of CORE From Korea 2007), 74 FR 46100; 46106
(September 8, 2009) unchanged in Corrosion-Resistant Carbon Steel Flat
Products From the Republic of Korea: Final Results of Countervailing
Duty Administrative Review (Final Results of CORE From Korea 2007), 74
FR 55192 (October 27, 2009). Consequently, it was unnecessary for the
Department to make a finding as to the countervailability of the
program in that review. Id.
In this administrative review, we calculated the GOK's contribution
to the project that was apportioned to HYSCO and then, in accordance
with 19 CFR 351.524(b)(2), determined whether to allocate the non-
recurring benefit from the grant over HYSCO's total sales in the year
the grant was approved. Because the amount of the grant is less that
0.5 percent of the relevant sales, we expensed the benefit for the
grant to the year of receipt. We preliminarily determine the subsidy
rate under this program to be greater than 0.005 percent ad valorem,
which, consistent with the Department's practice is a measurable
benefit. Consequently, it is necessary for the Department to make a
finding as to the countervailability of this program.
Therefore, in these preliminary results, we have analyzed whether
the grant received from the GOK under the Alternative Energy Act is
countervailable. We analyzed whether the GOK provided grants to the
respondent and/or Korean industries in a manner that was specific
within the meaning of section 771(5A) of the Act. We preliminarily
determine the Alternative Energy Act is de jure specific within the
meaning of 771(5A)(D)(i) because the GOK expressly limits access to the
subsidy to the development and promotion of alternative energy. See
GOK's December 22, 2009 QR at Exhibit G-2 and G-4. We also
preliminarily determine that a financial contribution provided in the
form of revenue forgone, and a benefit within the meaning of sections
771(5)(D)(ii) and 771(5)(E) of the Act.
To determine the benefit from the grant HYSCO received from this
program, we calculated the GOK's contribution for the R&D grant that
was apportioned to HYSCO. See 19 CFR 351.504(a). Next, in accordance
with 19 CFR 351.524(b)(2), we determined whether to allocate the non-
recurring benefit from the grants over a 15-year AUL by dividing the
GOK approved grant amount by the company's total sales in the year of
approval. Because the approved amount was less than 0.5 percent of the
company's total sales, we expensed the grant to the year of receipt.
Next, to calculate the net subsidy rate, we divided the portion of the
benefit allocated to the POR by HYSCO's total f.o.b. sales for 2008.
See 19 CFR 351.525(b)(3). On this basis, we preliminarily determine the
net subsidy rate under this program to be 0.01 percent ad valorem for
HYSCO.
E. R&D Grants Under the Act on Special Measures for the Promotion of
Specialized Enterprises for Parts and Materials
Under the Act on Special Measures for the Promotion of Specialized
Enterprises for Parts and Materials (Promotion of Specialized
Enterprises Act), the GOK shares the costs of R&D projects with
companies or research institutions the goal of the program is to
support technology development for core parts and materials necessary
for technological innovation and improvement in competitiveness. See
GOK's December 22, 2009 QR at Exhibit G-5. The program is administered
by the Ministry of Knowledge Economy (MKE) and Korea Evaluation
Institute of Industrial Technology (KEIT). Id.
In accordance with Articles 3 and 4 of the Promotion of Specialized
Enterprises Act, MKE prepares a base plan and a yearly execution plan
for the development of the parts and materials industry. See GOK's
December 22, 2009 QR at Exhibit G-5. Under the execution plan, MKE
announces to the public a detailed business plan for the development of
parts and materials technology. Id. at 2. This business plan includes
support areas, qualifications, and the application process. Id.
According to the GOK, any person or company can participate in the
program by preparing an R&D business plan that conforms with the
requirements set forth in the MKE business plan. Id. at 3. The
completed application must then be submitted to KEIT, which evaluates
the application and selects the projects eligible for government-
support. Id. After the selected application is finally approved by MKE,
MKE and the participating companies enter into an R&D agreement and
then MKE provides the grant. Id.
R&D project costs are shared by the GOK and companies or research
institutions as follows: (1) When the group of companies involved in
the research is made up of a ratio above two-thirds small to medium-
sized companies, the GOK provides a grant up to three-forth of the
project cost; (2) When the group of companies involved in the research
is made up of a ratio below two-thirds small to medium-sized companies,
the GOK provides a grant up to one-half of the project cost. See GOK's
December 22, 2009 QR, Exhibit G-5 at 2.
Upon completion of the project, if the GOK evaluates the project as
``successful'', the participating companies must repay 40 percent of
the R&D grant to the GOK over five years. See GOK's December 22, 2009
QR, Exhibit G-5 at 2. However, if the project is evaluated by the GOK
as ``not successful'', the company does not have to repay any of the
grant amount to the GOK. Id.
HYSCO reported that during the POR, it was involved in two R&D
projects under this program. See HYSCO's December 22, 2009 QR at 18.
HYSCO further reported that it led a consortia of several companies in
these projects for the steel used in automobiles. Id. Moreover, HYSCO
stated that it received R&D grants under this program that are for the
development of specialized technologies associated with the production
of subject merchandise. Id.
Therefore, in these preliminary results, we have analyzed whether
the grants received from the GOK under the Promotion of Specialized
Enterprises Act is countervailable. We analyzed whether the GOK
provided grants to the respondent and/or Korean industries in a manner
that was specific within the meaning of section 771(5A) of the Act.
Because we do not have a full translation of the Promotion of
Specialized Enterprises Act on the record, we do not have the
information necessary to determine whether it is
[[Page 55750]]
de jure specific. Subsequent to these preliminary results, we will
request a full translation of the law from the GOK so that we can make
a de jure specificity determination for the final results.
Where the Department cannot find de jure specificity, section
771(5A)(D)(iii) of the Act also directs the Department to examine
whether the benefits provided under the program are de facto specific--
that is, whether the benefits are specific as a matter of fact.
Subparagraphs (I) through (IV) of section 771(5A)(D)(iii) of the Act
stipulate that a program is de facto specific if one or more of the
following factors exist:
(I) The actual recipients of the subsidy whether considered on an
enterprise or industry basis are limited in number.
(II) An enterprise or industry is a predominant user of the
subsidy.
(III) An enterprise or industry receives a disproportionately large
amount of the subsidy
(IV) The manner in which the authority providing the subsidy has
exercised discretion in the decision to grant the subsidy indicates
that an enterprise or industry is favored over others.
In response to the Department's request, the GOK provided the
Department with a breakdown of the R&D grants approved under the
Promotion of Specialized Enterprises Act by the GOK, for HYSCO and by
industry, for the years 2002 through 2008, which corresponds to the
years the R&D projects in question were approved and the three previous
years. See GOK's August 6, 2010 QR at Exhibit G-15 and Exhibit G-16. In
conducting our de facto specificity analysis, we identified the GOK
assistance approved for HYSCO's R&D projects under this program for
which it received grants during the POR. We then analyzed the
distribution of all GOK grants received under this program in the years
in which HYSCO's R&D project was approved and the three previous
years.\2\ Specifically, we compared the amount of assistance approved
for HYSCO to the average amount of assistance approved for other
companies. See Memorandum to the file titled: ``De Facto Specificity
Analysis for Preliminary Results: The Act on special Measures for the
Promotion of Specialized Enterprises for Parts and Materials 2002-
2008'' (Specialized Enterprises Act Specificity Memorandum) of which a
public version is on file in CRU. Based on our analysis of the GOK's
R&D grants under the Specialized Enterprises Act, we preliminarily
determined that HYSCO received a disproportionate share of assistance
under this program in 2005 and 2008 because the amounts it received
were significantly larger than the average amount disbursed to other
companies in those years. See Specialized Enterprises Act Specificity
Memorandum. Therefore, consistent with our past practice, we
preliminarily find that the program, with respect to the assistance
provided to HYSCO, is de facto specific within the meaning of
771(5A)(D)(iii)(III) of the Act because the respondent received a
disproportionate amount of the benefits under the program. See, e.g.,
Alloy Magnesium From Canada: Final Results of Countervailing Duty New
Shipper Review, 68 FR 22359 (April 28, 2003), and accompanying issues
and decision memorandum at Comment 2, in which the Department found a
program to be de facto specific based, in part, on the fact that the
amount of benefits received by the respondent was, ``* * * greater than
the grants received by 99 percent of all the beneficiaries and over
ninety times larger than the typical grant amount.'' We also
preliminarily determine that a financial contribution is provided in
the form of revenue forgone, and a benefit within the meaning of
sections 771(5)(D)(ii) and 771(5)(E) of the Act.
---------------------------------------------------------------------------
\2\ The GOK only provided information by industry concerning the
year in which HYSCO's R&D projects were approved, 2005 and 2008, and
the preceding three years.
---------------------------------------------------------------------------
To determine the benefit from the grants HYSCO received from the
Specialized Enterprises Act program, we calculated the GOK's
contribution for the R&D grant that was apportioned to HYSCO. See 19
CFR 351.504(a). Next, in accordance with 19 CFR 351.524(b)(2), we
determined whether to allocate the non-recurring benefit from the
grants over a 15-year AUL by dividing the GOK approved grant amount by
the company's total sales in the year of approval. Because the approved
amount was less than 0.5 percent of the company's total sales, we
expensed the grant to the year of receipt. Next, to calculate the net
subsidy rate, we divided the portion of the benefit allocated to the
POR by HYSCO's total f.o.b. sales for 2008. See 19 CFR 351.525(b)(3).
On this basis, we preliminarily determine the net subsidy rate under
this program to be 0.03 percent ad valorem for HYSCO.
II. Programs Preliminarily Determined Not To Confer a Benefit During
the POR
A. Research and Development Grants Under the Industrial Development Act
(IDA)
The GOK, through the Ministry of Knowledge Economy (MKE),\3\
provides R&D grants to support numerous projects pursuant to the IDA,
including technology for core materials, components, engineering
systems, and resource technology. See Corrosion-Resistant Carbon Steel
Flat Products From the Republic of Korea: Preliminary Results of
Countervailing Duty Administrative Review Preliminary Results of CORE
From Korea 2007), 74 FR 46100; 46102 (September 8, 2009) unchanged in
Corrosion-Resistant Carbon Steel Flat Products From the Republic of
Korea: Final Results of Countervailing Duty Administrative Review
(Final Results of CORE from Korea 2007), 74 FR 55192 (October 27,
2009). The IDA is designed to foster the development of efficient
technology for industrial development. Id. To participate in this
program a company may: (1) Perform its own R&D project, (2) participate
through the Korea Association of New Iron and Steel Technology
(KANIST),\4\ 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 as
well as funds received from the GOK. Id. 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 Plan. Id. If the R&D project is
not successful, the company must repay the full amount of the grants
provided by the GOK. Id.
---------------------------------------------------------------------------
\3\ Prior to February 29, 2008, MKE was known as the Ministry of
Commerce, Industry, and Energy (MOCIE).
\4\ Also known as Korea New Iron & Steel Technology Research
Association (KNISTRA).
---------------------------------------------------------------------------
In the H Beams Investigation, the Department determined that
through KANIST, the Korean steel industry receives funding specific to
the steel industry. Therefore, given the nature of KANIST, the
Department found projects under KANIST to be specific. See Preliminary
Negative 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 the final results, 65 FR
69371 (July 3, 2000), and accompanying Issues and Decision Memorandum
at ``R&D Grants Under the
[[Page 55751]]
Korea New Iron & Steel Technology Research Association (KNISTRA)'').
Further, we found that the grants constitute a financial contribution
under section 771(5)(D)(i) of the Act in the form of a grant, and
bestow 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 continue to find 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.
HYSCO benefitted from this program during the POR. See HYSCO's
December 22, 2009 QR at 17. HYSCO participated in a project indirectly
through KANIST. Id. HYSCO claims that the project for which grants were
received from the government was not related to subject merchandise.
Id. at 18.
The Department has previously determined that the grants HYSCO
received under this program are attributed to the production of non-
subject. See Corrosion-Resistant Carbon Steel Flat Products From the
Republic of Korea: Preliminary Results of Countervailing Duty
Administrative Review (Preliminary Results of CORE from Korea 2007), 74
FR 46100; 46102 (September 8, 2010) unchanged in Corrosion-Resistant
Carbon Steel Flat Products From the Republic of Korea: Final Results of
Countervailing Duty Administrative Review (Final Results of CORE From
Korea 2007), 74 FR 55192 (October 27, 2008); and Memorandum to the File
titled ``HYSCO's R&D Grants Under the IDA Memorandum to the file in the
Countervailing Duty Administrative Review for the period of review
(POR) January 1, 2007 through December 31, 2007'' (July 26, 2010)
(HYSCO IDA Grants Memorandum), of which a public version is on file in
the CRU. Therefore, consistent with 19 CFR 351.525(b)(5)(i) and our
past practice, we determine that these grants are tied to non-subject
merchandise and, thus did not confer a benefit to HYSCO during the POR.
B. Energy Savings Fund Program
The Energy Savings Fund (ESF) program provides financing for
investment in projects and equipment that use energy efficiently. In
the DRAMS Investigation, the Department found that the loans were not
specific within the meaning of section 771(5A) of the Act during the
period of investigation (POI), which was January 1, 2001, through June
30, 2002. See Final Affirmative Countervailing Duty Determination:
Dynamic Random Access Memory Semiconductors from the Republic of Korea,
68 FR 37122 (June 23, 2003) (DRAMS Investigation), and accompanying
Issues and Decision Memorandum (DRAMS Investigation Decision
Memorandum) at ``ESF Program'' and ``Comment 24.'' In the instant
review, HYSCO reported that, during the POR, the company had
outstanding balances for ESF loans that were received in 2000. The
Department's specificity finding in the DRAMS Investigation did not
cover the year 2000. See Preliminary Affirmative Countervailing Duty
Determination: Dynamic Random Access Memory Semiconductors from the
Republic of Korea, 68 FR 16766, 16775 (April 7, 2003) (unchanged in
final results, 68 FR 37122 (June 23, 2003)). However, because there is
no measurable benefit for this program as explained below, we
preliminarily determine that it is unnecessary for the Department to
make a determination on the countervailability of ESF loans that were
issued in 2000.
We performed the loan benefit calculation applying the long-term
benchmark interest rates described above in the ``Subsidies Valuation
Information'' section. For the POR, we preliminarily determine the net
subsidy rate under the ESF loan program to be less than 0.005 percent
ad valorem, which, consistent with the Department's practice, does not
confer a measurable benefit and is not included in the calculation of
the net countervailable rate. See, e.g., CORE from Korea 2006 Decision
Memorandum at ``GOK's Direction of Credit'' section.
C. Overseas Resource Development Program: Loan From Korea Resources
Corporation (KORES)
In Final Results of CORE from Korea 2006, the Department found that
GOK enacted the Overseas Resource Development (ORD) Business Act in
order to establish the foundation for securing the long-term supply of
essential energy and major material minerals, which are mostly imported
because of scarce domestic resources. See Preliminary Results of CORE
from Korea 2006, 73 FR 52315; 52326 (September 9, 2008) unchanged in
Final Results of CORE from Korea 2006, 74 FR 2512 (January 15, 2009),
and Issues and Decision Memorandum for the Countervailing Duty
Administrative Review on Corrosion-Resistant Carbon Steel Flat Products
from the Republic of Korea at ``Programs Determined To Be Not Used''
section. Pursuant to Article 11 of this Act, the Ministry of Commerce,
Industry and Energy (MOCIE) annually announces its budget and the
eligibility criteria to obtain a loan from MOCIE. Id. Any company that
meets the eligibility criteria may apply for a loan to MOCIE. Id. The
eligibility criteria for receiving an ORD loan are that the loan should
be used for surveying, exploration, development, production,
engineering services and financing for the development of overseas
natural resources. Id. The applicant submits its ORD plans to MOCIE in
accordance with the Overseas Resources Development Business Act. Id.
MOCIE requests that the KORES, a public corporation that is wholly
owned by the GOK, conduct an eligibility review, feasibility study and
credit evaluation. Id. KORES was established in 1967 and has assumed a
direct role in establishing and implementing the GOK's resources
development policy, whose purpose is to secure mineral resources for
Korea. Id. In the selection process, KORES uses a loan evaluation
committee to select the recipients based on the criteria for the
project to develop strategic minerals (e.g., bituminous coal, uranium,
iron ore, copper, zinc, nickel, etc.) including co-development with
resource-owning countries, mining right of minerals, etc. KORES
provides the evaluation results and its recommendation to MOCIE. Id. If
the result and recommendation are favorable, MOCIE approves the loan
application and provides funds to KORES. KORES then lends the funds to
the company for foreign resource development. Id.
During the POR, HYSCO obtained loans from KORES for investment in a
copper mine in Mexico. See HYSCO's December 22, 2009 QR at 11 and
Exhibit 8 at 24. However, under 19 CFR 351.505(b), no benefits were
received by HYSCO during the POR. Therefore, we preliminarily determine
that HYSCO did not receive a benefit from this program during the POR.
We will continue to examine this program in future reviews.
D. Overseas Resource Development Program: Loan From Korea National Oil
Corporation (KNOC)
In Final Results of CORE from Korea 2007, the Department found that
GOK enacted the Overseas Resource Development (ORD) Business Act in
order to establish the foundation for securing the long-term supply of
essential energy and major material minerals, which are mostly imported
because of scarce domestic resources. See Preliminary Results of CORE
from Korea 2007, 74 FR 46100; 46107-46108
[[Page 55752]]
(September 8, 2010) unchanged in Final Results of CORE from Korea 2007)
74 FR 55192 (October 27, 2008). Pursuant to Article 11 of this Act, the
MKE annually announces its budget and the eligibility criteria to
obtain a loan from MKE. Id. Any company that meets the eligibility
criteria may apply for a loan to MKE. Id. For projects that are related
to petroleum and natural gas, the KNOC lends the funds to the company
for foreign resources development. Id. An approved company enters into
a borrowing agreement with KNOC for the development of the selected
resource. Id. Two types of loans are provided under this program:
``General loans'' and ``success-contingent loans''. For a success-
contingent loan, the repayment obligation is subject to the results of
the development project. In the event that the project fails, the
company will be exempted for all or a portion of the loan repayment
obligation. However, if the project succeeds, a portion of the project
income is payable to KNOC. Id.
During the POR, HYSCO obtained a loan from KNOC related to the
exploration for petroleum in New Zealand. See HYSCO's December 22, 2009
questionnaire response (QR) at 11 and Exhibit 8 at 24. However, under
19 CFR 351.505(b), no benefits were received by HYSCO during the POR.
Therefore, we preliminarily determine that HYSCO did not receive a
benefit from this program during the POR. We will continue to examine
this program in future reviews.
III. Programs Preliminarily Determined To Be Not Countervailable
A. Long-Term Loans From the Korean Development Band (KDB) Issued in
Years 2002 through 2008
HYSCO had long-term loans that were issued by the Korean
Development Bank (KDB), a government policy bank, in years 2002 through
2008 on which they made interest payments during the POR. Therefore, in
these preliminary results, we have analyzed whether the long-term KDB
loans are countervailable. First, we analyzed whether the KDB issued
long-term loans to the respondent and/or the Korean steel industry in a
manner that was specific within the meaning of section 771(5A) of the
Act.
The Department has previously determined that long-term loans
issued by the KDB during the period 2002 through 2006 are not de jure
specific within the meaning of sections 771(5A)(D)(i) and (ii) of the
Act because: (1) They are not based on exportation; (2) they are not
contingent on the use of domestic goods over imported goods; and (3)
the legislation and/or regulations do not expressly limit access to the
subsidy to an enterprise or industry, or groups thereof, as a matter of
law. See CFS Paper Investigation 72 FR 60639 (October 25, 2007) and CFS
Paper Decision Memorandum at ``Long-Term Lending Provided by the KDB
and Other GOK-Owned Institutions'' section. The Department's finding in
the CFS Paper Investigation that long-term loans issued by the KDB
during the period 2002 through 2006 are not de jure specific was not
limited to a particular industry or industries. Id. Therefore, in
regard to this issue, we find that the Department's determination in
the CFS Paper Investigation is applicable to the instant review.
Further, concerning this program, there is no information on the record
of the instant review that warrants reconsideration of the Department's
prior finding of the absence of de jure specificity during the 2002
through 2006 period. On this basis, we preliminarily determine that the
KDB's issuance of long-term loans during the 2002 through 2007 period
are not de jure specific within the meaning of sections 771(5A)(D)(i)
and (ii) of the Act.
Where the Department finds no de jure specificity, section
771(5A)(D)(iii) of the Act also directs the Department to examine
whether the benefits provided under the program are de facto specific--
that is, whether the benefits are specific as a matter of fact.
Subparagraphs (I) through (IV) of section 771(5A)(D)(iii) of the Act
stipulate that a program is de facto specific if one or more of the
following factors exist:
(I) The actual recipients of the subsidy whether considered on an
enterprise or industry basis are limited in number.
(II) An enterprise or industry is a predominant user of the
subsidy.
(III) An enterprise or industry receives a disproportionately large
amount of the subsidy
(IV) The manner in which the authority providing the subsidy has
exercised discretion in the decision to grant the subsidy indicates
that an enterprise or industry is favored over others.
In response to the Department's request, the GOK provided the
Department with a breakdown of the issuance of long-term lending by the
KDB, by industry, for the years 2002 through 2008. See GOK's March 17,
2010, Questionnaire Response, at Exhibit A-5. In conducting our de
facto specificity analysis, we identified all long-term loans issued by
the KDB to HYSCO on which interest payments were made during the POR.
We then analyzed the distribution of all long-term loans issued by the
KDB across industry groups in the year in which HYSCO's outstanding
loans were issued as well as the two preceding years.\5\ Specifically,
we compared the amount of long-term KDB loans issued to the ``Base
Metal Industry'' (e.g., the steel industry) to the amount of long-term
KDB loans issued to other industries.
---------------------------------------------------------------------------
\5\ The GOK was able to provide information concerning the
amount of loans the KDB issued to each industry during the period
2001 through 2007. Therefore, when analyzing whether loans issued in
2002 were specific, we were only able to analyze lending patterns
during the period 2001 and 2002.
---------------------------------------------------------------------------
Based on our analysis of the long-term KDB lending data coupled
with the KDB lending data reported by HYSCO in their respective
questionnaire responses, we preliminarily determine that the respondent
firm, as an individual enterprise, did not receive KDB loans in a
manner that was de facto specific as described in sections
771(5A)(D)(iii) of the Act. Further, based on these comparisons, we
preliminarily determine that the KDB did not issue loans to the steel
industry in a manner that was de facto specific as described in section
771(5A)(D)(iii) of the Act. For further information, see Memorandum to
the File titled ``Analysis of KDB Lending Data'' (September 7, 2010),
which is a public document on file in the CRU.
On this basis, we preliminarily determine that the long-term loans
that HYSCO received from the KDB during the years 2002 through 2008 are
not specific within the meaning of section 771(5A) of the Act, and,
therefore, we preliminarily determine that they are not
countervailable.
IV. Programs Preliminarily Determined To Be Not Used
Overseas Resource Development Program: Loan From KEXIM
In Final Results of CORE from Korea 2006, the Department found that
GOK enacted the Overseas Resource Development (ORD) Business Act in
order to establish the foundation for securing the long-term supply of
essential energy and major material minerals, which are mostly imported
because of scarce domestic resources. See Corrosion-Resistant Carbon
Steel Flat Products From the Republic of Korea: Preliminary Results of
Countervailing Duty Administrative Review (Preliminary Results of CORE
from Korea 2006), 73 FR 52315; 52326 (September 9, 2008) unchanged in
Corrosion-Resistant Carbon Steel Flat Products From the Republic of
Korea: Final Results of Countervailing Duty Administrative Review
(Final Results of
[[Page 55753]]
CORE from Korea 2006), 74 FR 2512 (January 15, 2009), and Issues and
Decision Memorandum at ``Programs Determined To Be Not Used'' section.
Pursuant to Article 11 of this Act, the MKE annually announces its
budget and the eligibility criteria to obtain a loan from MKE. Id. Any
company that meets the eligibility criteria may apply for a loan to
MKE. Id. The eligibility criteria for receiving an ORD loan are that
the loan should be used for surveying, exploration, development,
production, engineering services and financing for the development of
overseas natural resources. Id. The applicant submits its ORD plans to
MKE in accordance with the ORD. Id. The loan evaluation committee
evaluates the applications, selects the recipients and gets the
approval from the minister of MKE. Id.
During the POR, HYSCO reported in its 2007-2008 financial
statements that it obtained loans from KEXIM for investment in a copper
mine in Mexico. See HYSCO's December 22, 2009, QR at 11 and Exhibit 8
at 24; see also HYSCO's Loan Agreement with KEXIM, Exhibit A-5. Copper
is not an input used in the production of subject merchandise.
Therefore, we preliminarily determine that HYSCO did not use this
program with respect to the subject merchandise during the POR. We will
continue to examine this program in future reviews.
In addition, we found that the following programs were not used
during the POR:
Reserve for Research and Manpower Development Fund Under
RSTA Article 9 (TERCL Article 8)
RSTA Article 11: Tax Credit for Investment in Equipment to
Development Technology and Manpower (TERCL Article 10)
Reserve for Export Loss Under TERCL Article 16
Reserve for Overseas Market Development Under TERCL Article
17
Reserve for Export Loss Under TERCL Article 22
Exemption of Corporation Tax on Dividend Income from
Overseas Resources Development Investment Under TERCL Article 24
Tax Credits for Temporary Investments Under TERCL Article
27
Social Indirect Capital Investment Reserve Funds Under
TERCL Article 28
Energy-Savings Facilities Investment Reserve Funds Under
TERCL Article 29
Reserve for Investment (Special Cases of Tax for Balanced
Development Among Areas Under TERCL Articles 41-45)
Tax Credits for Specific Investments Under TERCL Article 71
Asset Revaluation Under Article 56(2) of the Tax Reduction
and Exemption Control Act (TERCL)
Emergency Load Reduction Program
Electricity Discounts Under the Requested Loan Adjustment
Program
Electricity Discounts Under the Emergency Load Reductions
Program
Export Industry Facility Loans and Specialty Facility Loans
Local Tax Exemption on Land Outside of a Metropolitan Area
Short-Term Trade Financing Under the Aggregate Credit
Ceiling Loan Program Administered by the Bank of Korea
Industrial Base Fund
Excessive Duty Drawback
Private Capital Inducement Act
Scrap Reserve Fund
Special Depreciation of Assets on Foreign Exchange Earnings
Export Insurance Rates Provided by the Korean Export
Insurance Corporation
Loans from the National Agricultural Cooperation Federation
Tax Incentives from Highly Advanced Technology Businesses
Under the Foreign Investment and Foreign Capital Inducement Act
Other Subsidies Related to Operations at Asan Bay:
Provision of Land and Exemption of Port Fees Under the Harbor Act
D/A Loans Issued by the Korean Development Bank and Other
Government-Owned Banks
R&D Grants under the Promotion of Industrial Technology
Innovation Act
Export Loans by Commercial Banks Under KEXIM's Trade Bill
Rediscounting Program
Restriction of Special Taxation Act (RSTA) Article 94:
Equipment Investment to Promote Worker's Welfare
Preliminary Results of Review
In accordance with 19 CFR 351.221(b)(4)(i), we calculated an
individual subsidy rate for each producer/exporter subject to this
administrative review. For the period January 1, 2008, through December
31, 2008, we preliminarily determine the net subsidy rate for HYSCO to
be 0.07 percent ad valorem, a de minimis rate. 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 countervailable duties all
shipments of subject merchandise produced by HYSCO, entered, or
withdrawn from warehouse, for consumption from January 1, 2008, through
December 31, 2008. The Department will also instruct CBP not to collect
cash deposits of estimated countervailing duties on shipments of the
subject merchandise produced by HYSCO, 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.
Pursuant to 19 CFR 351.305(b)(4), 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)(i), 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.
[[Page 55754]]
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: September 7, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 2010-22901 Filed 9-13-10; 8:45 am]
BILLING CODE 3510-DS-P