Circular Welded Carbon Quality Steel Line Pipe From the People's Republic of China: Notice of Initiation of Countervailing Duty Investigation, 23184-23188 [E8-9345]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 73, Number 83 (Tuesday, April 29, 2008)]
[Notices]
[Pages 23184-23188]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-9345]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-570-936]


Circular Welded Carbon Quality Steel Line Pipe From the People's 
Republic of China: Notice of Initiation of Countervailing Duty 
Investigation

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

DATES: Effective Date: April 29, 2008.

FOR FURTHER INFORMATION CONTACT: Kristen Johnson or Eric Greynolds, AD/
CVD Operations, Office 3, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
4793 and (202) 482-6071, respectively.

SUPPLEMENTARY INFORMATION:

The Petition

    On April 3, 2008, the Department of Commerce (``Department'') 
received the Petition concerning imports of certain circular welded 
carbon quality steel line pipe (``welded line pipe'') from the People's 
Republic of China (``PRC'') filed in proper form by United States Steel 
Corporation, Maverick Tube Corporation, Tex-Tube Company, and the 
United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied 
Industrial and Service Workers International Union, and AFL-CIO-CLC 
(collectively, ``Petitioners''). See Imposition of Antidumping and 
Countervailing Duties: Certain Circular Welded Carbon Quality Steel 
Line Pipe from the People's Republic of China and the Republic of 
Korea, dated April 3, 2008 (``Petition'').
    On April 9 and 10, 2008, the Department issued requests for 
additional information and clarification of certain areas of the 
Petition. Based on the Department's requests, Petitioners filed 
additional information supplementing the Petition on April 14, 2008, 
including one submission on general issues (Response to the Department 
Questionnaire Concerning Volume I of the Petition, dated April 14, 2008 
(``Supp. Response'')) and one submission on the imposition of 
countervailing duties (``CVD'') (Response to the Department 
Questionnaires Concerning Volume III of the Petition, dated April 14, 
2008 (``Supp. CVD Response'')). On April 16, 2008, the Department 
called Petitioners to request certain information relating to the 
Petition. See Memorandum to the File from Meredith A.W. Rutherford, 
Import Policy Analyst, regarding Petitions for the Imposition of 
Antidumping and Countervailing Duties--Certain Circular Welded Carbon 
Quality Steel Line Pipe from the People's Republic of China and the 
Republic of Korea: Phone Call with Petitioner Regarding Industry 
Support, dated April 16, 2008. On April 17, 2008, the Department issued 
a request for additional information and clarification of certain areas 
of the Petition concerning the imposition of countervailing duties. On 
April 18, 2008, Wheatland Tube Company, a U.S. manufacturer of welded 
line pipe, filed a letter in support of the Petition. On April 21, 
2008, Petitioners filed additional information in response to the April 
16, 2008, memorandum to the file. See Response to the Department's 
Second Request for Additional Information Concerning the People's 
Republic of China and the Republic of Korea, dated April 21, 2008 
(``Second Supp. Response''). Petitioners also filed a response to the 
Department's April 17, 2008, request for additional information on the 
imposition of countervailing duties. See Response to the Department's 
Request for Additional Information Concerning Volume III of the 
Petition filed on April 3, 2008 (``Second CVD Supp. Response'').
    On April 21, 2008, the Department called Petitioners regarding the 
scope language. See Memorandum to the File from Norbert Gannon, 
Supervisory Import Policy Analyst, regarding Petitions for the 
Imposition of Antidumping and Countervailing Duties--Certain Circular 
Welded Carbon Quality Steel Line Pipe from the People's Republic of 
China and the Republic of Korea: Phone Call with Petitioners Regarding 
Industry Support, dated April 21, 2008. Additionally, on April 21, 
2008, Stupp Corporation, a domestic producer of subject merchandise, 
filed a letter in support of the Petition.
    In accordance with section 702(b)(1) of the Tariff Act of 1930, as 
amended (``the Act''), Petitioners allege that manufacturers, 
producers, or exporters of welded line pipe in the PRC receive 
countervailable subsidies within the meaning of section 701 of the Act 
and that such imports are materially injuring, or threatening material 
injury to, an industry in the United States.
    The Department finds that Petitioners filed the Petition on behalf 
of the domestic industry because they are interested parties as defined 
in section 771(9)(C) of the Act and Petitioners have demonstrated 
sufficient industry support with respect to the CVD investigation (see 
``Determination of

[[Page 23185]]

Industry Support for the Petition'' section below).

Period of Investigation

    The period of investigation (``POI'') is January 1, 2007, through 
December 31, 2007.

Scope of Investigation

    The merchandise covered by this investigation is circular welded 
carbon quality steel pipe of a kind used for oil and gas pipelines 
(``welded line pipe''), not more that 406.4 mm (16 inches) in outside 
diameter, regardless of wall thickness, length, surface finish, end 
finish or stenciling.
    The term ``carbon quality steel'' includes both carbon steel and 
carbon steel mixed with small amounts of alloying elements that may 
exceed the individual weight limits for nonalloy steels imposed in the 
Harmonized Tariff Schedule of the United States (``HTSUS''). 
Specifically, the term ``carbon quality'' includes products in which 
(1) iron predominates by weight over each of the other contained 
elements, (2) the carbon content is 2 percent or less by weight and (3) 
none of the elements listed below exceeds the quantity by weight 
respectively indicated:
    (i) 2.00 percent of manganese,
    (ii) 2.25 percent of silicon,
    (iii) 1.00 percent of copper,
    (iv) 0.50 percent of aluminum,
    (v) 1.25 percent of chromium,
    (vi) 0.30 percent of cobalt,
    (vii) 0.40 percent of lead,
    (viii) 1.25 percent of nickel,
    (ix) 0.30 percent of tungsten,
    (x) 0.012 percent of boron,
    (xi) 0.50 percent of molybdenum,
    (xii) 0.15 percent of niobium,
    (xiii) 0.41 percent of titanium,
    (xiv) 0.15 percent of vanadium, or
    (xv) 0.15 percent of zirconium.
    Welded line pipe is normally produced to specifications published 
by the American Petroleum Institute (``API'') (or comparable foreign 
specifications) including API A-25, 5LA, 5LB, and X grades from 42 and 
above, and/or any other proprietary grades or non-graded material. 
Nevertheless, all pipe meeting the physical description set forth above 
that is of a kind used in oil and gas pipelines, including all 
multiple-stenciled pipe with an API line pipe stencil is covered by the 
scope of this investigation.
    The line pipe products that are the subject of this investigation 
are currently classifiable in the HTSUS under subheadings 
7306.19.10.10, 7306.19.10.50, 7306.19.51.10, and 7306.19.51.50. While 
HTSUS subheadings are provided for convenience and customs purposes, 
the written description of the scope of this investigation is 
dispositive.

Comments on Scope of Investigation

    During our review of the Petition, we discussed the scope with 
Petitioners to ensure that it is an accurate reflection of the products 
for which the domestic industry is seeking relief. The scope of this 
investigation covers line pipe which, we recognize, may include certain 
merchandise potentially subject to the on-going antidumping (AD) and 
CVD investigations of circular welded pipe (CWP investigations). See 
Circular Welded Carbon Quality Steel Pipe from the People's Republic of 
China: Notice of Preliminary Determination of Sales at Less than Fair 
Value and Postponement of Final Determination, 73 FR 2445, January 15, 
2008; see also Circular Welded Carbon Quality Steel Pipe from the 
People's Republic of China: Preliminary Affirmative Countervailing Duty 
Determination; Preliminary Affirmative Determination of Critical 
Circumstances; and Alignment of Final Countervailing Duty Determination 
with Final Antidumping Duty Determination, 72 FR 63875, November 13, 
2007. Given that the scope issue has not been finally resolved in the 
CWP investigations, for purposes of this initiation, we have defined 
the scope to include the potential overlap. However, we intend to 
resolve the issue to ensure that there will be no overlap between the 
scopes in the CWP and welded line pipe cases. Moreover, as discussed in 
the preamble to the regulations (Antidumping Duties; Countervailing 
Duties; Final Rule, 62 FR 27296, 27323 (May 19, 1997)), we are setting 
aside a period for interested parties to raise issues regarding product 
coverage. The Department encourages all interested parties to submit 
such comments by May 13, 2008, which is 20 calendar days from the date 
of signature of this notice. Comments should be addressed to Import 
Administration's APO/Dockets Unit, Room 1870, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 
20230. The period of scope consultations is intended to provide the 
Department with ample opportunity to consider all comments and to 
consult with parties prior to the issuance of the preliminary 
determinations.

Consultations

    Pursuant to section 702(b)(4)(A)(ii) of the Act, the Department 
invited representatives of the Government of the PRC for consultations 
with respect to the CVD petition. The Department held these 
consultations in Beijing, China, with representatives of the Government 
of the PRC on April 18, 2008. See the April 18, 2008, Memorandum to the 
File, entitled, ``Consultations with Officials from the Government of 
the People's Republic of China on the Countervailing Duty Petition 
regarding Circular Welded Carbon Quality Steel Line Pipe,'' on file in 
the Central Records Unit (``CRU'') of the Department of Commerce, Room 
1117.

Determination of Industry Support for the Petition

    Section 702(b)(1) of the Act requires that a petition be filed on 
behalf of the domestic industry. Section 702(c)(4)(A) of the Act 
provides that a petition meets this requirement if the domestic 
producers or workers who support the petition account for: (i) At least 
25 percent of the total production of the domestic like product; and 
(ii) more than 50 percent of the production of the domestic like 
product produced by that portion of the industry expressing support 
for, or opposition to, the petition. Moreover, section 702(c)(4)(D) of 
the Act provides that, if the petition does not establish support of 
domestic producers or workers accounting for more than 50 percent of 
the total production of the domestic like product, the Department 
shall: (i) Poll the industry or rely on other information in order to 
determine if there is support for the petition, as required by 
subparagraph (A), or (ii) determine industry support using a 
statistically valid sampling method.
    Section 771(4)(A) of the Act defines the ``industry'' as the 
producers as a whole of a domestic like product. Thus, to determine 
whether a petition has the requisite industry support, the statute 
directs the Department to look to producers and workers who produce the 
domestic like product. The International Trade Commission (``ITC''), 
which is responsible for determining whether ``the domestic industry'' 
has been injured, must also determine what constitutes a domestic like 
product in order to define the industry. While both the Department and 
the ITC must apply the same statutory definition regarding the domestic 
like product (section 771(10) of the Act), they do so for different 
purposes and pursuant to a separate and distinct authority. In 
addition, the Department's determination is subject to limitations of 
time and information. Although this may result in different definitions 
of the like product, such differences do not render the decision of 
either agency contrary to law. See USEC, Inc. v. United States, 132 F. 
Supp. 2d 1, 8 (CIT

[[Page 23186]]

2001), citing Algoma Steel Corp. Ltd. v. United States, 688 F. Supp. 
639, 644 (CIT 1988), aff'd 865 F.2d 240 (Fed. Cir. 1989), cert. denied 
492 U.S. 919 (1989).
    Section 771(10) of the Act defines the domestic like product as ``a 
product which is like, or in the absence of like, most similar in 
characteristics and uses with, the article subject to an investigation 
under this title.'' Thus, the reference point from which the domestic 
like product analysis begins is ``the article subject to an 
investigation,'' (i.e., the class or kind of merchandise to be 
investigated, which normally will be the scope as defined in the 
petition).
    With regard to the domestic like product, Petitioners do not offer 
a definition of domestic like product distinct from the scope of the 
investigation. Based on our analysis of the information submitted on 
the record, we have determined that welded line pipe constitutes a 
single domestic like product and we have analyzed industry support in 
terms of that domestic like product. For a discussion of the domestic 
like product analysis in this case, see ``Countervailing Duty 
Investigation Initiation Checklist: Circular Carbon Quality Steel Line 
Pipe from the People's Republic of China,'' (``Initiation Checklist'') 
Industry Support at Attachment II, on file in the CRU.
    In determining whether Petitioners have standing (i.e., those 
domestic workers and producers supporting the petition account for (1) 
at least 25 percent of the total production of the domestic like 
product and (2) more than 50 percent of the production of the domestic 
like product produced by that portion of the industry expressing 
support for, or opposition to, the petition), we considered the 
industry support data contained in the Petition with reference to the 
domestic like product as defined in the ``Scope of Investigation'' 
section above. To establish industry support, Petitioners provided 
their shipments for the domestic like product for the year 2007, and 
compared them to shipments of the domestic like product for the 
industry. In the Petition, Petitioners demonstrated the correlation 
between shipments and production. See Petition, Volume I, at 3, and 
Exhibit 3b. Based on the fact that total industry production data for 
the domestic like product for 2007 is not reasonably available, and 
that Petitioners have established that shipments are a reasonable proxy 
for production data, we have relied upon shipment data for purposes of 
measuring industry support. For further discussion see Initiation 
Checklist, at Attachment II (Industry Support).
    The Department's review of the data provided in the Petition, 
supplemental submissions, and other information readily available to 
the Department indicates that Petitioners have established industry 
support. First, the Petition establishes support from domestic 
producers (or workers) accounting for more than 50 percent of the total 
production of the domestic like product and, as such, the Department is 
not required to take further action in order to evaluate industry 
support (e.g., polling). See Section 702(c)(4)(D) of the Act. Second, 
the domestic producers (or workers) have met the statutory criteria for 
industry support under section 702(c)(4)(A)(I) of the Act because the 
domestic producers (or workers) who support the Petition account for at 
least 25 percent of the total production of the domestic like product. 
Finally, the domestic producers (or workers) have met the statutory 
criteria for industry support under section 702(c)(4)(A)(ii) of the Act 
because the domestic producers (or workers) who support the Petition 
account for more than 50 percent of the production of the domestic like 
product produced by that portion of the industry expressing support 
for, or opposition to, the Petition. Accordingly, the Department 
determines that the Petition was filed on behalf of the domestic 
industry within the meaning of section 702(b)(1) of the Act. See 
Initiation Checklist at Attachment II (Industry Support). The 
Department finds that Petitioners filed the Petition on behalf of the 
domestic industry because they are an interested party as defined in 
section 771(9)(C) and (D) of the Act and they have demonstrated 
sufficient industry support with respect to the CVD investigation that 
they are requesting the Department initiate. See Initiation Checklist 
at Attachment II (Industry Support).

Injury Test

    Because the PRC is a ``Subsidies Agreement Country'' within the 
meaning of section 701(b) of the Act, section 701(a)(2) of the Act 
applies to these investigations. Accordingly, the ITC must determine 
whether imports of the subject merchandise from the PRC materially 
injure, or threaten material injury to, a U.S. industry.

Allegations and Evidence of Material Injury and Causation

    Petitioners allege that imports of welded line pipe from the PRC 
are benefitting from countervailable subsidies and that such imports 
are causing or threaten to cause, material injury to the domestic 
industry producing welded line pipe. In addition, Petitioners allege 
that subsidized imports exceed the negligibility threshold provided for 
under section 771(24)(A) of the Act.
    Petitioners contend that the industry's injured condition is 
illustrated by reduced market share, underselling and price depressing 
and suppressing effects, lost sales and revenue, a decline in financial 
performance, and an increase in import penetration. We have assessed 
the allegations and supporting evidence regarding material injury, 
threat of material injury, and causation, and we have determined that 
these allegations are properly supported by adequate evidence and meet 
the statutory requirements for initiation. See Initiation Checklist at 
Attachment III (Injury).

Initiation of Countervailing Duty Investigation

    Section 702(b) of the Act requires the Department to initiate a CVD 
proceeding whenever an interested party files a petition on behalf of 
an industry that (1) alleges the elements necessary for an imposition 
of a duty under section 701(a) of the Act; and (2) is accompanied by 
information reasonably available to the petitioner(s) supporting the 
allegations. The Department has examined the CVD petition on welded 
line pipe from the PRC and finds that it complies with the requirements 
of section 702(b) of the Act. Therefore, in accordance with section 
702(b) of the Act, we are initiating a CVD investigation to determine 
whether manufacturers, producers, or exporters of welded line pipe in 
the PRC receive countervailable subsidies. For a discussion of evidence 
supporting our initiation determination, see Initiation Checklist.
    We are including in our investigation the following programs 
alleged in the Petition to have provided countervailable subsidies to 
producers and exporters of the subject merchandise in the PRC:

A. Preferential Loans

    1. Preferential Lending of Policy Loans to State-Owned 
Enterprises (``SOEs'') and the Steel Industry by State-Owned and 
Controlled Banks.
    2. Preferential Loans for Key Projects and Technologies.

B. Equity Infusions and Debt-to-Equity Swaps

    1. Equity Infusions into Baosteel.
    2. Debt-to-Equity Swaps for SOEs.

C. Tax Benefit Programs

    1. The ``Two Free, Three Half'' Program.
    2. Income Tax Reduction for Export-Oriented Foreign Invested 
Enterprises (``FIEs'').

[[Page 23187]]

    3. Income Tax Reductions for FIEs Based on Location.
    4. Preferential Tax Programs for FIEs that Quality as 
Technology-Intensive or Knowledge-Intensive.
    5. Preferential Tax Programs for FIEs Recognized as High or New 
Technology
    Enterprises.
    6. Preferential Tax Programs for FIEs that are Engaged in 
Research and Development.
    7. Income Tax Reduction for FIEs that Reinvest Profits into 
Export-Oriented Enterprises.
    8. Local Income Tax Exemption and Reduction Programs for 
``Productive'' FIEs.
    9. Income Tax Credits on Purchases of Domestically-produced 
Equipment by FIEs.
    10. Income Tax Credits on Purchases of Domestically-produced 
Equipment by Domestically-Owned Companies.

D. Value-Added Tax (``VAT'') Programs

    1. VAT Exemptions for Use of Imported Equipment.
    2. VAT Export Rebates.

E. Land Grants and Discounts

F. Provision of Inputs for Less Than Adequate Remuneration

    1. Hot-Rolled Steel.
    2. Electricity.
    3. Water.

G. Grant Programs

    1. Interest Subsidies for Key Projects and Technologies.
    2. State Key Technologies Renovation Project Fund.
    3. Central Government's Famous Brands Program.
    4. Government of Guandong Province Provision of Grants to 
Companies for Outward Expansion and Export Performance.
    5. Export Interest Subsidy Program.
    6. Grants to State Owned Enterprises Operating at Loss.

H. Provincial Programs

    1. Northeast Revitalization Program.
    2. Liaoning Province Framework.
    3. The ``Five Points One Line'' Program.
    4. Liaoning Province Grants.
    5. Sub-Central Government Programs to Promote Famous Brands.

    For further information explaining why the Department is 
investigating these programs, see Initiation Checklist.
    We are not including in our investigation the following programs 
alleged to benefit producers and exporters of the subject merchandise 
in the PRC:

1. VAT Refunds Available to Companies Operating in Specific Locations

    Petitioners allege that VAT refunds are available to companies that 
are located in the Economic Development Zone of Hainan. Specifically, 
under the ``Preferential Policies Regarding Investment by 
Manufacturer,'' high-tech or labor intensive enterprises with an 
investment of more than RMB 3 billion and more than 1,000 local 
employees are refunded 25 percent of the VAT paid on domestic sales, 
the percentage of the tax received by the local government. The subsidy 
starts the first year the company has production and sales and 
continues for five years. Petitioners, however, did not demonstrate 
that producers/exporters of welded line pipe are located in the Hainan 
Province or explain why such information is unavailable. Therefore, we 
are not investigating this program.

2. Preferential Tax Programs for Enterprises Making Little Profit

    Petitioners assert that China's subsidies notification to the World 
Trade Organization (``WTO'') indicates that the Chinese government 
(``GOC'') provides preferential tax treatment to enterprises making 
little profit. This program, which is authorized by the Ministry of 
Finance, provides an 18 percent income tax reduction for enterprises 
which have annual taxable income of less than RMB 30,000 and a 27 
percent income tax reduction to enterprises which have annual taxable 
income between RMB 30,000 and RMB 100,000. Petitioners, however, have 
not established with reasonably available information that 
``enterprises making little profit'' are a de jure or de facto specific 
group. Petitioners failed to provide an explanation of why companies 
with access to this program comprise an enterprise or industry, or 
group of enterprises or industries, as those terms are normally 
interpreted by the Department. Therefore, we are not investigating this 
program.

3. Preferential Tax Programs for Enterprises Engaged in Research and 
Development

    Petitioners allege that the GOC provides preferential tax policies 
for domestic-invested enterprises engaged in research and development. 
Specifically, Petitioners claim that under this program, authorized by 
the Ministry of Finance, the costs associated with research and 
development of new products, new technologies, and new crafts which 
have increased 10 percent or more from the previous year, are offset by 
150 percent from the taxable income of that year. Petitioners, however, 
have not established with reasonably available information that 
``domestic enterprises'' are a de jure or de facto specific group. 
Petitioners failed to provide an explanation of why companies with 
access to this program comprise an enterprise or industry, or group of 
enterprises or industries, as those terms are normally interpreted by 
the Department. Therefore, we are not investigating this program.

4. Central Government Grants and Loans

    Petitioners allege that the government provides grants and loans 
for technology and research. Petitioners claim that one such program is 
administered by the Ministry of Finance pursuant to State Council 
Circular No. 99 of 1987, which is referenced in China's WTO accession. 
Petitioners assert that this grant program is intended to benefit 
preferred industries such as the steel industry, including welded line 
pipe producers. Petitioners, however, have not provided adequate 
documentation to support the allegation that this program is specific. 
For example, the evidence provided by Petitioners does not support the 
claim that this program is specific to state-owned enterprises or to 
the steel industry. We, therefore, are not investigating this program.

5. Hunan Province Grants and Loans

    Petitioners allege that in 1999, the Hunan Province provided 
approximately RMB 300 million, in the form of grants and reduced-
interest loans, for technological upgrades and for hi-tech companies 
located in the province. Petitioners claim that welded line pipe 
producers located in Hunan Province likely benefited from the program. 
Petitioners, however, have failed to demonstrate that welded line pipe 
producers are located in Hunan Province. We, therefore, are not 
investigating this program.

6. Government-Mandated Mergers and Transfers of Ownership on Terms 
Inconsistent With Commercial Considerations

    Petitioners allege that the GOC provides benefits to welded line 
pipe producers through government-mandated mergers and transfers of 
ownership on terms inconsistent with commercial considerations. 
Petitioners maintain that the mergers are driven by the GOC's Eleventh 
FYP and China's Steel Policy. Petitioners allege that because many 
Chinese steel companies are controlled by the government, the GOC can 
essentially order companies to merge. Petitioners allege that such 
mergers commonly involve offering ownership stakes in state-owned steel 
companies to other, larger steel producers at prices below market 
value, or even for free. Petitioners, however, fail to explain how 
mergers and restructuring of state-owned enterprises provide a 
financial contribution in light of the Department's past practice in 
addressing restructuring of government-owned steel companies. See, 
e.g., Final Affirmative Countervailing Duty

[[Page 23188]]

Determination: Certain Steel Products from Italy, 58 FR 37327 (July 9, 
1993). Therefore, we are not investigating the provision of ``other 
companies'' for less than adequate remuneration.

7. Other Grant Programs

    Petitioners assert that a review of available financial reports of 
Chinese welded line pipe producers indicates that many of the producers 
have benefitted from direct cash grants provided under other grant 
programs and policies administered by the GOC. Petitioners, however, 
have not adequately established with reasonably available evidence how 
these programs are specific. Petitioners also have not established 
whether these grants are a result of programs separate from those which 
Petitioners have already alleged. We, therefore, are not investigating 
this program.

 Application of the Countervailing Duty Law to the PRC

    The Department has treated the PRC as a non-market economy 
(``NME'') country in all past AD investigations and administrative 
reviews. In accordance with section 771(18)(C)(i) of the Act, any 
determination that a country is an NME country shall remain in effect 
until revoked by the administering authority. See, e.g., Tapered Roller 
Bearings and Parts Thereof, Finished and 10 Unfinished, (``TRBs'') From 
the People's Republic of China: Preliminary Results of 2001-2002 
Administrative Review and Partial Rescission of Review, 68 FR 7500, 
7500-1 (February 14, 2003), unchanged in TRBs from the People's 
Republic of China: Final Results of 2001-2002 Administrative Review, 68 
FR 70488, 70488-89 (December 18, 2003).
    In the final affirmative CVD determination on coated free sheet 
paper from the PRC, the Department determined that the current nature 
of the PRC economy does not create obstacles to applying the necessary 
criteria in the CVD law. See Coated Free Sheet Paper from the People's 
Republic of China: Final Affirmative Countervailing Duty Determination, 
72 FR 60645 (October 25, 2007), and the accompanying Issues and 
Decision Memorandum at Comment 1. Therefore, because Petitioners have 
provided sufficient allegations and support of their allegations to 
meet the statutory criteria for initiating a CVD investigation of 
welded line pipe from the PRC, initiation of a CVD investigation is 
warranted in this case.

Respondent Selection

    For this investigation, the Department expects to select 
respondents based on U.S. Customs and Border Protection (``CBP'') data 
for U.S. imports during the POI. We intend to make our decision 
regarding respondent selection within 20 days of publication of this 
Federal Register notice. The Department invites comments regarding the 
CBP data and respondent selection within seven calendar days of 
publication of this Federal Register notice.

Distribution of Copies of the Petition

    In accordance with section 702(b)(4)(A)(i) of the Act, a copy of 
the public version of the Petition has been provided to the GOC. As 
soon as possible and to the extent practicable, we will attempt to 
provide a copy of the public version of the Petition to each exporter 
named in the Petition, consistent with 19 CFR 351.203(c)(2).

ITC Notification

    We have notified the ITC of our initiation, as required by section 
702(d) of the Act.

Preliminary Determination by the ITC

    The ITC will preliminarily determine, within 25 days after the date 
on which it receives notice of the initiation, whether there is a 
reasonable indication that imports of subsidized welded line pipe from 
the PRC are causing material injury, or threatening to cause material 
injury, to a U.S. industry. See Section 703(a)(2) of the Act. A 
negative ITC determination will result in the investigation being 
terminated; otherwise, the investigation will proceed according to 
statutory and regulatory time limits.
    This notice is issued and published pursuant to section 777(i) of 
the Act.

    Dated: April 23, 2008.
David M. Spooner,
Assistant Secretary for Import Administration.
 [FR Doc. E8-9345 Filed 4-28-08; 8:45 am]
BILLING CODE 3510-DS-P