Notice of Intent to Rescind Countervailing Duty Administrative Review: Certain Hot-Rolled Carbon Steel Flat Products from Argentina

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of Intent to Rescind Countervailing Duty Administrative Review.

SUMMARY:

On October 24, 2002, the Department of Commerce (the Department) initiated an administrative review of the countervailing duty order on certain hot-rolled carbon steel flat products from Argentina (hot-rolled products), covering the period January 1, 2001 through December 31, 2001, and one manufacturer/exporter of the subject merchandise, Siderar Sociedad Anomina Industrial & Commercial (Siderar). See Initiation of Antidumping and Countervailing Duty Administrative Reviews, 67 FR 65336 (October 24, 2002). The Department intends to rescind this review due to Siderar's lack of shipments during the period of review.

EFFECTIVE DATE:

May 16, 2003.

FOR FURTHER INFORMATION CONTACT:

Stephanie Moore or Cindy Robinson, AD/CVD Enforcement, Office 6, Group II, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, D.C. 20230; telephone: (202) 482-3692 or (202) 482-3797, respectively.

SUPPLEMENTARY INFORMATION:

Background

On September 30, 2002, the Department received a letter from Siderar requesting an administrative review of the countervailing order on hot-rolled products from Argentina. On October 24, 2002, the Department initiated an administrative review of this order for the period January 1, 2001 through December 31, 2001 (period of review). On November 19, 2002, the Department held an ex parte meeting with representatives of the Government of Argentina and Siderar. See Memorandum to the File from Melissa G. Skinner, Director dated November 20, 2002, which is on file in the Central Records Unit (CRU), Room B-099, Main Building of the Department of Commerce. At that meeting, Siderar informed the Department that it did not have any shipments of the subject merchandise to the United States during the period of review (POR). On January 22, 2003, the Department conducted a customs query to ascertain whether there were any entries, exports, or sales of the subject merchandise from Siderar during the POR; the query showed that there were none. See Memorandum to The File from Team regarding Customs Query dated May 8, 2003, the public version of which is on file in the CRU.

On February 11, 2003, petitioners requested that the Department rescind the initiation and terminate the administrative review based on Siderar's statement that it had no shipments. See letter from Dewey Ballantine LLP on behalf of domestic producers Bethlehem Steel Corporation, United States Steel Corporation and National Steel Corp., on file in the CRU. On March 7, 2003, Siderar submitted a letter responding to petitioners' comments and acknowledging that it had no shipments of subject merchandise to the United States during the POR. See letter from White & Case on behalf of Siderar, on file in the CRU.

Scope of the Review

Imports covered by this review are shipments of certain hot-rolled carbon-quality steel from Argentina: (1) universal mill plates (i.e., flat-rolled products rolled on four faces or in a closed box pass, of a width exceeding 150 mm but not exceeding 1250 mm, and of a nominal or actual thickness of not less than 4 mm, which are cut-to-length (not in coils) and without patterns in relief), of iron or non-alloy-quality steel; and (2) flat-rolled products, hot-rolled, of a nominal or actual thickness of 4.75 mm or more and of a width which exceeds 150 mm and measures at least twice the thickness, and which are cut-to-length (not in coils). Steel products included in the scope are of rectangular, square, circular or other shape and of rectangular or non-rectangular cross-section where such non-rectangular cross-section is achieved subsequent to the rolling process (i.e., products which have been “worked after rolling”)--for example, products which have been beveled or rounded at the edges. Steel products that meet the noted physical characteristics that are painted, varnished or coated with plastic or other non-metallic substances are included within this scope. Also, specifically included in the scope are high strength, low alloy (HSLA) steels. HSLA steels are recognized as steels with micro-alloying levels of elements such as chromium, copper, niobium, titanium, vanadium, and molybdenum. Steel products included in this scope, regardless of Harmonized Tariff Schedule of the United States (HTSUS) definitions, are products in which: (1) iron predominates, by weight, over each of the other contained elements; (2) the carbon content is two percent or less, by weight; and (3) none of the elements listed below is equal to or exceeds the quantity, by weight, respectively indicated: 1.80 percent of manganese, or 1.50 percent of silicon, or 1.00 percent of copper, or 0.50 percent of aluminum, or 1.25 percent of chromium, or 0.30 percent of cobalt, or 0.40 percent of lead, or 1.25 percent of nickel, or 0.30 percent of tungsten, or 0.10 percent of molybdenum, or 0.10 percent of niobium, or 0.41 percent of titanium, or 0.15 percent of vanadium, or 0.15 percent zirconium. All products that meet the written physical description, and in which the chemistry quantities do not equal or exceed any one of the levels listed above, are within the scope unless otherwise specifically excluded. The following products are specifically excluded from the scope: (1) products clad, plated, or coated with metal, whether or not painted, varnished or coated with plastic or other non-metallic substances; (2) SAE grades (formerly AISI grades) of series 2300 and above; (3) products made to ASTM A710 and A736 or their proprietary equivalents; (4) abrasion-resistant steels (i.e., USS AR 400, USS AR 500); (5) products made to ASTM A202, A225, A514 grade S, A517 grade S, or their proprietary equivalents; (6) ball bearing steels; (7) tool steels; and (8) silicon manganese steel or silicon electric steel.

The products covered by this review are provided for under the following HTSUS item numbers: 7208.40.3030, 7208.40.3060, 7208.51.0030, 7208.51.0045, 7208.51.0060, 7208.52.0000, 7208.53.0000, 7208.90.0000, 7210.70.3000, 7210.90.9000, 7211.13.0000, 7211.14.0030, 7211.14.0045, 7211.90.0000, 7212.40.1000, 7212.40.5000, 7212.50.0000, 7225.40.3050, 7225.40.7000, 7225.50.6000, 7225.99.0090, 7226.91.5000, 7226.91.7000, 7226.91.8000, 7226.99.0000.

Although the HTSUS subheadings are provided for convenience and Customs purposes, the written description of the scope of this proceeding is dispositive.

Rescission of Review

In their February 11, 2003, request that the Department rescind the review, petitioners asserted that the Department's consistent practice has been to rescind an administrative review upon learning that no shipments of subject merchandise occurred during the relevant POR. They cited to several notices in which the Department rescinded antidumping administrative reviews on the basis of lack of shipments. Petitioners also cited to the preliminary results of Carbon Steel Wire Rod from New Zealand, 56 FR 33253 (July 19, 1991) and the preliminary results of Brass Sheet and Strip from Brazil, 56 FR 33252 (July 19, 1991) as the only two instances they could locate where the Department decided to complete administrative reviews of countervailing duty (CVD) orders for a POR during which no shipments of the subject merchandise occurred. However, they asserted that both of these reviews preceded the Uruguay Round Agreements Act (URAA) and involved a program-wide change in which the subsidy programs to be reviewed had been terminated. Given the post-URAA regulations and practice and the lack of a program-wide change, petitioners argued that the Department should promptly rescind the instant review.

On March 7, 2003, Siderar confirmed that it did not have any shipments of subject merchandise to the United States during the POR. However, Siderar submitted that the Department has the discretion to conduct an administrative review in this case for the purpose of adjusting Siderar's deposit rate. Siderar stated that it requested this administrative review for the sole purpose of having the Department's determination in the recently completed investigation of cold rolled products from Argentina¹ extended to this case and having the CVD deposit adjusted accordingly. Siderar stated that the factual circumstances of this case are clear and not in dispute.

In support of its position that the Department has the discretion to conduct a CVD administrative review for the purpose of adjusting the cash deposit rate even in the absence of shipments during the review period, Siderar pointed out that the Department has done so in the past. Siderar cited Carbon Steel Wire Rod From New Zealand, where a program-wide change involving the termination of two government programs took place, and to precedent.³ Siderar asserted that, in that case, the Department concluded that Section 751 of the Tariff Act of 1930, as amended (the Act) (19 U.S.C. § 1675 (a)(1)) authorizes it to conduct annual administrative reviews to determine the amount of any net countervailing subsidy and estimated duty to be deposited, even in the absence of entries, shipments, or exports. Siderar acknowledged that the issue in this review does not involve a “program-wide change.” However, it argued that the Department's determination in Cold Rolled has the same effect as a program-wide change in that it removes the legal and factual basis for the collection of deposits at the rate previously established. See the letter from Siderar to the Department dated March 7, 2003, which is on file in the CRU.

We agree with petitioners that it has been the Department's practice to rescind administrative reviews when we find a lack of exports. See Certain Hot-Rolled Lead and Bismuth Carbon Steel Products From Germany: Notice of Termination of Countervailing Duty Administrative Review, 64 FR 44489 (August 16, 1999), and 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).

In accordance with the Department's regulations, and consistent with its practice, the Department intends to rescind the administrative review of hot-rolled products from Argentina for the period January 1, 2001 to December 31, 2001 due to no shipments during the POR. See 19 CFR section 351.213(d)(3), which states in pertinent part: “The Secretary may rescind an administrative review under this section, in whole or only with respect to a particular exporter or producer, if during the POR, there were no entries, exports, or sales of the subject merchandise.”

This notice is in accordance with section 751(a)(1) of the Act, and section 351.213(d) of the Department's regulations.