Wire Decking From the People's Republic of China: Initiation of Countervailing Duty Investigation, 31700-31704 [E9-15705]

Download as PDF 31700 Federal Register / Vol. 74, No. 126 / Thursday, July 2, 2009 / Notices review. See, e.g., Granular Polytetrafluoroethylene Resin from Italy: Final Results of Changed Circumstances Review, 68 FR 25327 (May 12, 2003). These cash deposit rates, if imposed, shall remain in effect until further notice. Also in accordance with 19 CRF 351.221(c)(3)(i), we preliminarily determine that CAFISH is not the successor-in-interest to CATACO. In its March 13, 2009, submission, the information and evidence CATACO provided do not support the claim that CAFISH is the successor-in-interest to CATACO’s shrimp factory. The documentation attached to CATACO’s submission shows significant changes in all key categories that the Department considers in successor-in-interest determinations. That is, in terms of management, production facilities, supplier relationships, and customer base, the documentation shows that CAFISH is materially dissimilar from CATACO’s shrimp factory. In addition, CAFISH continues to conduct its sales to the United States through CATACO, thus CATACO remains an active exporter of the subject merchandise. See Analysis Memo, pp. 6–7. Thus we preliminarily find that CAFISH should not receive CATACO’s current separate rate and that the cash deposit rate for the subject merchandise exported and manufactured by CAFISH should continue to be the current Vietnam-wide rate. Public Comment Any interested party may request a hearing within 10 days of publication of this notice in accordance with 19 CFR 351.310(c). Interested parties may submit case briefs no later than 14 days after the date of publication of this notice, in accordance with 19 CFR 351.309(c)(1)(ii). Rebuttal briefs, limited to issues raised in the case briefs, may be filed no later than 5 days after the case briefs, in accordance with 19 CFR 351.309(d)(1). Any hearing, if requested, will normally be held two days after rebuttal briefs are due, in accordance with 19 CFR 351.310(d)(1). The Department will issue its final results of review within 270 days after the date on which the changed circumstances review was initiated, or within 45 days if all parties to the proceeding agree to the outcome of the review, in accordance with 19 CFR 351.216(e), and will publish these results in the Federal Register. This notice is published in accordance with sections 751(b)(1) and 777(i) of the Act and 19 CFR 351.216 of the Department’s regulations. VerDate Nov<24>2008 15:35 Jul 01, 2009 Jkt 217001 Dated: June 25, 2009. Ronald K. Lorentzen, Acting Assistant Secretary for Import Administration. [FR Doc. E9–15702 Filed 7–1–09; 8:45 am] BILLING CODE 3510–DS–P DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration RIN 0648–XQ08 Chinook Salmon Bycatch Data Collection Program AGENCY: Alaska Fishery Science Center (AFSC), National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce. ACTION: Notice of public workshop. SUMMARY: NMFS announces a workshop to solicit comments from the Bering Sea Pollock fishing industry and other interested persons/parties on draft reporting forms for a proposed Chinook salmon bycatch data collection program. DATES: The workshop will be held on Thursday, July 16, 2009, from 8 a.m. to 5 p.m., Pacific standard time. ADDRESSES: The workshop will be held at the Nordby Conference Room at Fishermen’s Terminal, Seattle, WA 98119. FOR FURTHER INFORMATION CONTACT: Dr. Brian Garber-Yonts, AFSC, 206–526– 6301. NMFS is hosting a public workshop to solicit comment on a data collection program under consideration by the North Pacific Fishery Management Council (Council). The program would collect data from the Bering Sea Pollock industry to evaluate the effectiveness of voluntary industry incentive programs to reduce Chinook salmon bycatch, as well as how the Council’s proposed Chinook salmon bycatch limits and bycatch performance standards affect where, when, and how pollock fishing and salmon bycatch occur. The workshop is an initial information-gathering step intended to ensure that the data collection program collects consistent and accurate information. A draft of each data collection form will be posted on the Alaska Region website (http:// www.alaskafisheries.noaa.gov) at least one week in advance of the workshop. NMFS especially invites people from industry with management, accounting, and fishing backgrounds (especially SUPPLEMENTARY INFORMATION: PO 00000 Frm 00014 Fmt 4703 Sfmt 4703 fishing location decision making), who are familiar with: • Salmon and pollock transfers (including prices); • Cost and revenue information and the way that is kept (including fuel costs of changing fishing location and roe prices, revenues, and quality); and • Decisions to move a vessel and the costs associated with moving a vessel. Special Accommodations This workshop is physically accessible to people with disabilities. Requests for special accommodations should be directed to Brian GarberYonts (see FOR FURTHER INFORMATION CONTACT) at least 5 working days before the workshop date. Dated: June 29, 2009. Alan D. Risenhoover, Director, Office of Sustainable Fisheries, National Marine Fisheries Service. [FR Doc. E9–15679 Filed 7–1–09; 8:45 am] BILLING CODE 3510–22–S DEPARTMENT OF COMMERCE International Trade Administration [C–570–950] Wire Decking From the People’s Republic of China: Initiation of Countervailing Duty Investigation AGENCY: Import Administration, International Trade Administration, Department of Commerce. DATES: Effective Date: July 2, 2009. FOR FURTHER INFORMATION CONTACT: Robert Copyak, AD/CVD Operations, Office 3, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Room 4014, Washington, DC 20230; telephone: (202) 482–2209. SUPPLEMENTARY INFORMATION: The Petition On June 5, 2009, the Department of Commerce (‘‘Department’’) received a petition filed in proper form by AWP Industries, Inc., ITC Manufacturing, Inc., J&L Wire Cloth, Inc., Nashville Wire Products Mfg., Co., Inc., and Wireway Husky Corporation (collectively, ‘‘Petitioners’’), domestic producers of wire decking. On June 11, 2009, and June 12, 2009, the Department issued requests for additional information and clarification of certain general areas of the Petition. Based on the Department’s request, Petitioners filed supplements to the Petition on June 16, 2009, and June 17, 2009, (respectively, ‘‘Supplement to the E:\FR\FM\02JYN1.SGM 02JYN1 Federal Register / Vol. 74, No. 126 / Thursday, July 2, 2009 / Notices General Petition and Supplement to the AD Petition’’). On June 18, 2009, and June 22, 2009, the Department also requested clarification of Petitioners’ subsidy allegations. Based on the Department’s request, Petitioners filed supplements to the countervailing duty (‘‘CVD’’) petition on June 23, 2009, and June 24, 2009. The Department requested further clarifications from Petitioners by supplemental questionnaire and phone on June 18, 2009, regarding scope, and issue relating to the AD Petition. On June 22 and 24, 2009, Petitioners filed the information requested in the additional supplemental questionnaire, including a revised scope. 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 wire decking in the People’s Republic of China (‘‘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 Industry Support for the Petition’’ section below). Period of Investigation The proposed period of investigation (‘‘POI’’) is January 1, 2008, through December 31, 2008. Scope of Investigation The products covered by this investigation are wire decking from the PRC. For a full description of the scope of the investigation, please see the ‘‘Scope of the Investigation’’ in Appendix I of this notice. 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. 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 July 15, 2009, twenty calendar days from the signature date of VerDate Nov<24>2008 15:35 Jul 01, 2009 Jkt 217001 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 determination. 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 on June 23, 2009. See the Memorandum from Sarah C. Ellerman through Melissa Skinner to the File, entitled, ‘‘Countervailing Duty Petition on Wire Decking from the People’s Republic of China: Consultation with the Government of the People’s Republic of China,’’ (June 24, 2009), which is on file in the Central Records Unit (‘‘CRU’’) of the main Department of Commerce building, 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 to poll the industry. 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 PO 00000 Frm 00015 Fmt 4703 Sfmt 4703 31701 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 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 wire decking 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: Wire Decking from the PRC (‘‘Initiation Checklist’’) at Attachment II (‘‘Industry Support’’), dated concurrently with this notice and on file in the CRU. In determining whether Petitioners have standing under section 702(c)(4)(A) of the Act, 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 2008 production of the domestic like product, as well as the 2008 production of the domestic like product for four nonpetitioning companies who are supporters of the Petition, and compared this to total production of the E:\FR\FM\02JYN1.SGM 02JYN1 31702 Federal Register / Vol. 74, No. 126 / Thursday, July 2, 2009 / Notices domestic like product for the entire domestic industry. See Volume I of the Petition, at 4, and Exhibit General-1, and Supplement to the AD/CVD Petitions, dated June 16, 2009, at 10, and Attachment 3, and Second Supplement to the AD/CVD Petitions, dated June 22, 2009, at 3, and Attachment 1, and Petitioners’ Submission, dated June 22, 2009. Petitioners calculated total domestic production based on their own production plus data provided by the four non-petitioning companies that produce the domestic like product in the United States, who are supporters of the Petition. See Volume I of the Petition, at Exhibit General-1, and Supplement to the AD/CVD Petitions, dated June 16, 2009, at Attachment 3, and Second Supplement to the AD/CVD Petitions, dated June 22, 2009, at 3, and Attachment 1; see also Initiation Checklist as Attachment II, Industry Support. In addition, Petitioners identified one other company as a producer of the domestic like product and were able to obtain its 2008 production of the domestic like product in order to calculate total domestic production of the domestic like product. Our 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 established 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, and Initiation Checklist at Attachment II. 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 Petitions account for at least 25 percent of the total production of the domestic like product. See Initiation Checklist at Attachment II. 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 VerDate Nov<24>2008 15:35 Jul 01, 2009 Jkt 217001 industry within the meaning of section 702(b)(1) of the Act. See id. 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 they have demonstrated sufficient industry support with respect to the countervailing duty investigation that they are requesting the Department initiate. See id. 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 this investigation. 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 wire decking from the PRC are benefitting from countervailable subsidies and that such imports are causing, or threaten to cause, material injury to the domestic industries producing wire decking. 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, increased import penetration, underselling and price depressing and suppressing effects, lost sales and revenue, reduced production, shipments, capacity, and capacity utilization, reduced employment, and an overall decline in financial performance. 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 (Analysis of Allegations and Evidence of Material Injury and Causation for the Petition). 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 PO 00000 Frm 00016 Fmt 4703 Sfmt 4703 available to the petitioner(s) supporting the allegations. The Department has examined the CVD Petition on wire decking 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 wire decking 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. Loan Programs 1. Honorable Enterprises Program 2. Preferential Loans for Key Projects and Technologies 3. Preferential Loans as Part of the Northeast Revitalization 4. Policy Loans for Firms Located in Industrial Zones in the City of Dalian in Liaoning Province B. Government Provision of Goods and Services for Less Than Adequate Remuneration (‘‘LTAR’’) 1. Government Provision of Wire Rod for LTAR 2. Government Provision of Hot-Rolled Steel for LTAR 3. Government Provision of Zinc for LTAR 4. Government Provision of Electricity for LTAR 5. Provision of Land for LTAR for Firms Located in Designated Geographical Areas in the City of Dailan in Liaoning Province 6. Provision of Water for LTAR for Firms Located in Designated Geographical Areas in the City of Dailan in Liaoning Province 7. Provision of Electricity for LTAR for Firms Located in Designated Geographical Areas in the City of Dailan in Liaoning Province C. Income and Other Direct Taxes 1. Income Tax Credits for Domestically Owned Companies Purchasing Domestically Produced Equipment 2. Income Tax Exemption for Investment in Domestic ‘‘Technological Renovation’’ 3. Preferential Income Tax Policy for Enterprises in the Northeast Region 4. Forgiveness of Tax Arrears for Enterprises in the Old Industrial Bases of Northeast China 5. Income Tax Exemption for Investors in Designated Geographical Regions Within the Province of Liaoning D. Indirect Tax and Tariff Exemption Programs 1. Value Added Tax (VAT) Deductions on Fixed Assets 2. Export Incentive Payments Characterized as ‘‘VAT Rebates’’ 3. Import Tariff and VAT Exemptions for FIEs and Certain Domestic Enterprises E:\FR\FM\02JYN1.SGM 02JYN1 Federal Register / Vol. 74, No. 126 / Thursday, July 2, 2009 / Notices Using Imported Equipment in Encouraged Industries 4. VAT Exemptions for Newly Purchased Equipment in the Jinzhou District E. Grant Programs 1. ‘‘Five Points, One Line’’ Program 2. Export Interest Subsidies 3. The State Key Technology Project Fund. 4. Subsidies for Development of Famous Export Brands and China World Top Brands 5. Sub-Central Government Programs To Promote Famous Export Brands and China World Top Brands 6. Exemption of Fees for Firms Located in Designated Geographical Areas in the City of Dailan in Liaoning Province F. Preferential Income Tax Subsidies for Foreign Invested Entities (‘‘FIEs’’) 1. ‘‘Two Free, Three Half’’ Program 2. Income Tax Exemption Program for Export-Oriented FIEs 3. Local Income Tax Exemption and Reduction Programs for ‘‘Productive’’ Foreign-Invested Enterprises 4. Preferential Tax Programs for ForeignInvested Enterprises Recognized as High or New Technology Enterprises 5. Income Tax Subsidies for FIEs Based on Geographic Location 6. VAT Refunds for FIEs Purchasing Domestically Produced Equipment For further information explaining why the Department is investigating these programs, see the 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: A. Policy Lending to Wire Decking Producers Petitioners allege that the GOC, through various national level industrial plans, directs credit to wire decking producers. Similar to the Department’s finding in Wire Grating from the PRC Initiation, we find that Petitioners have not sufficiently alleged that the GOC’s industrial plans specifically direct credit to producers of wire decking. See Certain Steel Grating from the People’s Republic of China: Initiation of Countervailing Duty Investigation, 74 FR 30278, 30281 (June 25, 2009) (‘‘Steel Grating from the PRC Initiation’’). Petitioners may re-submit this allegation to the extent the Department selects an integrated producer whose affiliated input suppliers are producing a steel input that is covered by the GOC’s industrial plans. B. Export Loans Petitioners allege that in Line Pipe from the PRC, the Department found that a number of companies benefitted from export-contingent loans from State owned commercial banks (‘‘SOCBs’’) and that Chinese wire decking VerDate Nov<24>2008 15:35 Jul 01, 2009 Jkt 217001 producers would be eligible for such loans. See Circular Welded Carbon Quality Steel Line Pipe from the People’s Republic of China: Final Affirmative Countervailing Duty Determination, 73 FR 70961 (Nov. 24, 2008) (‘‘Line Pipe from the PRC’’), and accompanying Issues and Decision Memorandum (‘‘Line Pipe from PRC Decision Memorandum’’) at ‘‘Export Loans.’’ According to Petitioners, this program has not been eliminated by any reforms to the Chinese banking system. However, the producers investigated in Line Pipe from the PRC are not identified in the Petition filed on the record of this proceeding. Therefore, we find that the support relied on in Line Pipe from the PRC to initiate an investigation of the Export Loans program does not apply to the facts of this proceeding. Petitioners have provided insufficient evidence indicating that wire decking producers can benefit from this alleged program. C. Export Assistance Grants Petitioners allege that grants are provided to exporters. However, Petitioners fail to identify the administering authority that is allegedly providing the grants (i.e., national, provincial, or local governments) or the program under which the alleged benefits are provided. Therefore, we are not initiating an investigation of this allegation. D. Provision of Land for LTAR Petitioners allege that the GOC prohibits private land ownership in the PRC. According to Petitioners, private companies may purchase land-use rights, but national and local governments do not provide the rights consistently with market principles. Petitioners assert that the government may take land from farmers, often without fair compensation, and transfer this land to industrial users. Further, Petitioners allege that commercial sales are often conducted illegally through opaque processes marked by widespread corruption. Petitioners did not provide evidence that the GOC is providing land for LTAR at the national level. Further, with the exception of Jiangxi Province and the City of Dalian in Liaoning Province, Petitioners do not provide any information to support their allegation that provincial and local governments in the PRC provide land for LTAR. Therefore, we are limiting our investigation of this allegation to alleged sales of land for LTAR to wire decking producers located in the City of Dalian. PO 00000 Frm 00017 Fmt 4703 Sfmt 4703 31703 D. Government Restraints on Exports of Wire Rod, Flat-Rolled Steel, and Zinc Petitioners allege that the GOC imposes export restrictions (such as export quotas, export taxes, export licensing, and restrictions on which enterprises are eligible to export) to intervene in markets for such primary raw materials as wire rod, flat-rolled steel, and zinc that are consumed in the production of wire decking. Petitioners contend that these restrictions increase the supply of wire rod, flat-rolled steel, and zinc and thereby artificially lower the prices within the PRC to downstream wire decking producers. Petitioners have not adequately shown how these particular export taxes and licenses constitute entrustment or direction of private entities by the GOC to provide a financial contribution to producers of subject merchandise. Moreover, Petitioners have not provided sufficient data regarding historic price trends demonstrating, e.g., that price decreases correlated with the imposition of the alleged export restraints. The Department declined to initiate on this program in prior CVD initiations involving the PRC. See, e.g., Notice of Initiation of Countervailing Duty Investigation: Certain Kitchen Appliance Shelving and Racks from the People’s Republic of China, 73 FR 50304, 50306 (August 26, 2008) (Racks and Shelves from the PRC Initiation). Therefore, we are not investigating the government restraints on wire rod, flatrolled steel, and zinc exports. E. Tax Reduction for Enterprises Making Little Profit Petitioners allege that, according to China’s WTO subsidies notification, enterprises with annual taxable incomes between RMB 30,000 and 100,000 are eligible for a 3 percent reduction in their annual income tax rate. We find Petitioners have not established with reasonably available information that ‘‘enterprises making little profit’’ are a de jure specific group because Petitioners have provided no 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. See, e.g., Preamble to Countervailing Duty Regulations, 63 Fed. Reg. 65348, 65357 (November 25, 1998) (‘‘* * * because the user represented numerous and diverse industries, the program was found not to be specific’’). Therefore, we are not initiating an investigation of this allegation. E:\FR\FM\02JYN1.SGM 02JYN1 31704 Federal Register / Vol. 74, No. 126 / Thursday, July 2, 2009 / Notices F. China’s Enforced Undervaluation of Its Currency Petitioners allege that the GOCmaintained exchange rate effectively prevents the appreciation of the Chinese currency (RMB) against the U.S. dollar. In addition, Petitioners allege that the GOC requires that foreign exchange earned from export activities be converted to RMB at the government prescribed rate. Therefore, when producers in the PRC sell their dollars at official foreign exchange banks, as required by law, the producers receive more RMB than they otherwise would if the value of the RMB were set by market mechanisms. Consistent with past initiations, we are not initiating on this allegation on the grounds that Petitioners have not sufficiently alleged the elements necessary for the imposition of a countervailing duty and did not support the allegation with reasonably available information. See, e.g., Racks and Shelves from the PRC Initiation, 73 FR at 50307. G. Reduction in or Exemption From Fixed Assets Investment Orientation Regulatory Tax The Petitioners claim that producers of wire decking are exempted from or receive preferential income tax rates on investments in fixed assets. These tax breaks apply to both new construction and upgrades in the encouraged industries. We are not initiating on this program because Petitioners have not provided information to demonstrate that wire decking producers would be covered by the relevant legislation. For example, the legislation includes specific aspects of the iron and steel production process that are eligible for tax benefits, but it does not include any processes related to production of wire decking. However, if one of the mandatory respondents chosen in this investigation is part of a vertically integrated steel company, or cross-owned with a primary steel producer, Petitioners may re-allege this program under a timely-filed new subsidy allegation, at which time the Department will reconsider the information provided. H. Preferential Investment Policies for FIEs Located in Liaoning Province Petitioners allege that the Liaoning Province allows FIEs located in the province to enjoy ‘‘preferential policies for foreign investment projects.’’ They further allege that the relevant legislation specifically covers wire decking producers. Petitioners identify several wire decking producers located in Liaoning Province. VerDate Nov<24>2008 15:35 Jul 01, 2009 Jkt 217001 The supporting documentation provided by Petitioners does not specifically mention any loans and the term ‘‘preferential investment policies’’ by itself, as indicated in the source document included in the Petition, does not constitute a sufficient basis for initiation. We are not initiating an investigation of this program. Respondent Selection To determine the total and relative volume and value of import data for each potential respondent, the Department normally relies on U.S. Customs and Border Protection import data for the POI. However, in the instant proceeding, the Harmonized Tariff Schedule of the United States (‘‘HTSUS’’) categories that include subject merchandise are very broad, and include products other than those subject to this investigation. Therefore, because of the unique circumstances of this case, the Department will issue ‘‘Quantity and Value Questionnaires’’ to potential respondents for the purposes of respondent selection. The Department will send the quantity and value questionnaire to PRC companies identified in the June 5, 2009 Petition, at Exhibit 4, Volume 1. The Department will post the quantity and value questionnaire along with the filing instructions on the Import Administration’s Web site, at http:// ia.ita.doc.gov/ia-highlights-andnews.html. 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 Government of the PRC. As soon as 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 section 351.203(c)(2) of the Department’s regulations. 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 wire decking 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 PO 00000 Frm 00018 Fmt 4703 Sfmt 4703 proceed according to statutory and regulatory time limits. This notice is issued and published pursuant to section 777(i) of the Act. Dated: June 25, 2009. Ronald K. Lorentzen, Acting Assistant Secretary for Import Administration. Appendix I—Scope of the Investigation The scope of the investigation covers welded-wire rack decking, which is also known as, among other things, ‘‘pallet rack decking,’’ ‘‘wire rack decking,’’ ‘‘wire mesh decking,’’ ‘‘bulk storage shelving,’’ or ‘‘welded-wire decking.’’ Wire decking consists of wire mesh that is reinforced with structural supports and designed to be load bearing. The structural supports include sheet metal support channels, or other structural supports, that reinforce the wire mesh and that are welded or otherwise affixed to the wire mesh, regardless of whether the wire mesh and supports are assembled or unassembled and whether shipped as a kit or packaged separately. Wire decking is produced from carbon or alloy steel wire that has been welded into a mesh pattern. The wire may be galvanized or plated (e.g., chrome, zinc or nickel coated), coated (e.g., with paint, epoxy, or plastic), or uncoated (‘‘raw’’). The wire may be drawn or rolled and may have a round, square or other profile. Wire decking is sold in a variety of wire gauges. The wire diameters used in the decking mesh are 0.105 inches or greater for round wire. For wire other than round wire, the distance between any two points on a cross-section of the wire is 0.105 inches or greater. Wire decking reinforced with structural supports is designed generally for industrial and other commercial storage rack systems. Wire decking is produced to various profiles, including, but not limited to, a flat (‘‘flush’’) profile, an upward curved back edge profile (‘‘backstop’’) or downward curved edge profile (‘‘waterfalls’’), depending on the rack storage system. The wire decking may or may not be anchored to the rack storage system. The scope does not cover the metal rack storage system, comprised of metal uprights and cross beams, on which the wire decking is ultimately installed. Also excluded from the scope is wire mesh shelving that is not reinforced with structural supports and is designed for use without structural supports. Wire decking enters the United States through several basket categories in the Harmonized Tariff Schedule of the United States (‘‘HTSUS’’). U.S. Customs and Border Protection has issued a ruling (NY F84777) that wire decking is to be classified under HTSUS 9403.90.8040. Wire decking has also been entered under HTSUS 7217.10, 7217.20, 7326.20, 7326.90, 9403.20.0020 and 9403.20.0030. While HTSUS subheadings are provided for convenience and Customs purposes, the written description of the scope of the investigations is dispositive. [FR Doc. E9–15705 Filed 7–1–09; 8:45 am] BILLING CODE 3510–DS–P E:\FR\FM\02JYN1.SGM 02JYN1

Agencies

[Federal Register Volume 74, Number 126 (Thursday, July 2, 2009)]
[Notices]
[Pages 31700-31704]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-15705]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-570-950]


Wire Decking From the People's Republic of China: Initiation of 
Countervailing Duty Investigation

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

DATES: Effective Date: July 2, 2009.

FOR FURTHER INFORMATION CONTACT: Robert Copyak, AD/CVD Operations, 
Office 3, Import Administration, International Trade Administration, 
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., 
Room 4014, Washington, DC 20230; telephone: (202) 482-2209.

SUPPLEMENTARY INFORMATION:

The Petition

    On June 5, 2009, the Department of Commerce (``Department'') 
received a petition filed in proper form by AWP Industries, Inc., ITC 
Manufacturing, Inc., J&L Wire Cloth, Inc., Nashville Wire Products 
Mfg., Co., Inc., and Wireway Husky Corporation (collectively, 
``Petitioners''), domestic producers of wire decking. On June 11, 2009, 
and June 12, 2009, the Department issued requests for additional 
information and clarification of certain general areas of the Petition. 
Based on the Department's request, Petitioners filed supplements to the 
Petition on June 16, 2009, and June 17, 2009, (respectively, 
``Supplement to the

[[Page 31701]]

General Petition and Supplement to the AD Petition''). On June 18, 
2009, and June 22, 2009, the Department also requested clarification of 
Petitioners' subsidy allegations. Based on the Department's request, 
Petitioners filed supplements to the countervailing duty (``CVD'') 
petition on June 23, 2009, and June 24, 2009.
    The Department requested further clarifications from Petitioners by 
supplemental questionnaire and phone on June 18, 2009, regarding scope, 
and issue relating to the AD Petition. On June 22 and 24, 2009, 
Petitioners filed the information requested in the additional 
supplemental questionnaire, including a revised scope.
    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 wire decking in the People's Republic of 
China (``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 Industry Support for the Petition'' section below).

Period of Investigation

    The proposed period of investigation (``POI'') is January 1, 2008, 
through December 31, 2008.

Scope of Investigation

    The products covered by this investigation are wire decking from 
the PRC. For a full description of the scope of the investigation, 
please see the ``Scope of the Investigation'' in Appendix I of this 
notice.

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. 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 July 15, 2009, twenty calendar days 
from the signature date 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 
determination.

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 on June 23, 2009. See the Memorandum 
from Sarah C. Ellerman through Melissa Skinner to the File, entitled, 
``Countervailing Duty Petition on Wire Decking from the People's 
Republic of China: Consultation with the Government of the People's 
Republic of China,'' (June 24, 2009), which is on file in the Central 
Records Unit (``CRU'') of the main Department of Commerce building, 
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 to poll the industry.
    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 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 wire decking 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: Wire Decking from the PRC (``Initiation 
Checklist'') at Attachment II (``Industry Support''), dated 
concurrently with this notice and on file in the CRU.
    In determining whether Petitioners have standing under section 
702(c)(4)(A) of the Act, 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 2008 production 
of the domestic like product, as well as the 2008 production of the 
domestic like product for four non-petitioning companies who are 
supporters of the Petition, and compared this to total production of 
the

[[Page 31702]]

domestic like product for the entire domestic industry. See Volume I of 
the Petition, at 4, and Exhibit General-1, and Supplement to the AD/CVD 
Petitions, dated June 16, 2009, at 10, and Attachment 3, and Second 
Supplement to the AD/CVD Petitions, dated June 22, 2009, at 3, and 
Attachment 1, and Petitioners' Submission, dated June 22, 2009. 
Petitioners calculated total domestic production based on their own 
production plus data provided by the four non-petitioning companies 
that produce the domestic like product in the United States, who are 
supporters of the Petition. See Volume I of the Petition, at Exhibit 
General-1, and Supplement to the AD/CVD Petitions, dated June 16, 2009, 
at Attachment 3, and Second Supplement to the AD/CVD Petitions, dated 
June 22, 2009, at 3, and Attachment 1; see also Initiation Checklist as 
Attachment II, Industry Support. In addition, Petitioners identified 
one other company as a producer of the domestic like product and were 
able to obtain its 2008 production of the domestic like product in 
order to calculate total domestic production of the domestic like 
product.
    Our 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 established 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, and Initiation Checklist 
at Attachment II. 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 Petitions account for at least 25 percent of the total 
production of the domestic like product. See Initiation Checklist at 
Attachment II. 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 id.
    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 they have demonstrated sufficient 
industry support with respect to the countervailing duty investigation 
that they are requesting the Department initiate. See id.

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 this investigation. 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 wire decking from the PRC are 
benefitting from countervailable subsidies and that such imports are 
causing, or threaten to cause, material injury to the domestic 
industries producing wire decking. 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, increased import penetration, 
underselling and price depressing and suppressing effects, lost sales 
and revenue, reduced production, shipments, capacity, and capacity 
utilization, reduced employment, and an overall decline in financial 
performance. 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 (Analysis of Allegations and 
Evidence of Material Injury and Causation for the Petition).

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 wire decking 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 wire decking 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. Loan Programs
    1. Honorable Enterprises Program
    2. Preferential Loans for Key Projects and Technologies
    3. Preferential Loans as Part of the Northeast Revitalization
    4. Policy Loans for Firms Located in Industrial Zones in the 
City of Dalian in Liaoning Province
B. Government Provision of Goods and Services for Less Than Adequate 
Remuneration (``LTAR'')
    1. Government Provision of Wire Rod for LTAR
    2. Government Provision of Hot-Rolled Steel for LTAR
    3. Government Provision of Zinc for LTAR
    4. Government Provision of Electricity for LTAR
    5. Provision of Land for LTAR for Firms Located in Designated 
Geographical Areas in the City of Dailan in Liaoning Province
    6. Provision of Water for LTAR for Firms Located in Designated 
Geographical Areas in the City of Dailan in Liaoning Province
    7. Provision of Electricity for LTAR for Firms Located in 
Designated Geographical Areas in the City of Dailan in Liaoning 
Province
C. Income and Other Direct Taxes
    1. Income Tax Credits for Domestically Owned Companies 
Purchasing Domestically Produced Equipment
    2. Income Tax Exemption for Investment in Domestic 
``Technological Renovation''
    3. Preferential Income Tax Policy for Enterprises in the 
Northeast Region
    4. Forgiveness of Tax Arrears for Enterprises in the Old 
Industrial Bases of Northeast China
    5. Income Tax Exemption for Investors in Designated Geographical 
Regions Within the Province of Liaoning
D. Indirect Tax and Tariff Exemption Programs
    1. Value Added Tax (VAT) Deductions on Fixed Assets
    2. Export Incentive Payments Characterized as ``VAT Rebates''
    3. Import Tariff and VAT Exemptions for FIEs and Certain 
Domestic Enterprises

[[Page 31703]]

Using Imported Equipment in Encouraged Industries
    4. VAT Exemptions for Newly Purchased Equipment in the Jinzhou 
District
E. Grant Programs
    1. ``Five Points, One Line'' Program
    2. Export Interest Subsidies
    3. The State Key Technology Project Fund.
    4. Subsidies for Development of Famous Export Brands and China 
World Top Brands
    5. Sub-Central Government Programs To Promote Famous Export 
Brands and China World Top Brands
    6. Exemption of Fees for Firms Located in Designated 
Geographical Areas in the City of Dailan in Liaoning Province
F. Preferential Income Tax Subsidies for Foreign Invested Entities 
(``FIEs'')
    1. ``Two Free, Three Half'' Program
    2. Income Tax Exemption Program for Export-Oriented FIEs
    3. Local Income Tax Exemption and Reduction Programs for 
``Productive'' Foreign-Invested Enterprises
    4. Preferential Tax Programs for Foreign-Invested Enterprises 
Recognized as High or New Technology Enterprises
    5. Income Tax Subsidies for FIEs Based on Geographic Location
    6. VAT Refunds for FIEs Purchasing Domestically Produced 
Equipment

    For further information explaining why the Department is 
investigating these programs, see the 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:

A. Policy Lending to Wire Decking Producers

    Petitioners allege that the GOC, through various national level 
industrial plans, directs credit to wire decking producers. Similar to 
the Department's finding in Wire Grating from the PRC Initiation, we 
find that Petitioners have not sufficiently alleged that the GOC's 
industrial plans specifically direct credit to producers of wire 
decking. See Certain Steel Grating from the People's Republic of China: 
Initiation of Countervailing Duty Investigation, 74 FR 30278, 30281 
(June 25, 2009) (``Steel Grating from the PRC Initiation''). 
Petitioners may re-submit this allegation to the extent the Department 
selects an integrated producer whose affiliated input suppliers are 
producing a steel input that is covered by the GOC's industrial plans.

B. Export Loans

    Petitioners allege that in Line Pipe from the PRC, the Department 
found that a number of companies benefitted from export-contingent 
loans from State owned commercial banks (``SOCBs'') and that Chinese 
wire decking producers would be eligible for such loans. See Circular 
Welded Carbon Quality Steel Line Pipe from the People's Republic of 
China: Final Affirmative Countervailing Duty Determination, 73 FR 70961 
(Nov. 24, 2008) (``Line Pipe from the PRC''), and accompanying Issues 
and Decision Memorandum (``Line Pipe from PRC Decision Memorandum'') at 
``Export Loans.'' According to Petitioners, this program has not been 
eliminated by any reforms to the Chinese banking system. However, the 
producers investigated in Line Pipe from the PRC are not identified in 
the Petition filed on the record of this proceeding. Therefore, we find 
that the support relied on in Line Pipe from the PRC to initiate an 
investigation of the Export Loans program does not apply to the facts 
of this proceeding. Petitioners have provided insufficient evidence 
indicating that wire decking producers can benefit from this alleged 
program.

C. Export Assistance Grants

    Petitioners allege that grants are provided to exporters. However, 
Petitioners fail to identify the administering authority that is 
allegedly providing the grants (i.e., national, provincial, or local 
governments) or the program under which the alleged benefits are 
provided. Therefore, we are not initiating an investigation of this 
allegation.

D. Provision of Land for LTAR

    Petitioners allege that the GOC prohibits private land ownership in 
the PRC. According to Petitioners, private companies may purchase land-
use rights, but national and local governments do not provide the 
rights consistently with market principles. Petitioners assert that the 
government may take land from farmers, often without fair compensation, 
and transfer this land to industrial users. Further, Petitioners allege 
that commercial sales are often conducted illegally through opaque 
processes marked by widespread corruption.
    Petitioners did not provide evidence that the GOC is providing land 
for LTAR at the national level. Further, with the exception of Jiangxi 
Province and the City of Dalian in Liaoning Province, Petitioners do 
not provide any information to support their allegation that provincial 
and local governments in the PRC provide land for LTAR. Therefore, we 
are limiting our investigation of this allegation to alleged sales of 
land for LTAR to wire decking producers located in the City of Dalian.

D. Government Restraints on Exports of Wire Rod, Flat-Rolled Steel, and 
Zinc

    Petitioners allege that the GOC imposes export restrictions (such 
as export quotas, export taxes, export licensing, and restrictions on 
which enterprises are eligible to export) to intervene in markets for 
such primary raw materials as wire rod, flat-rolled steel, and zinc 
that are consumed in the production of wire decking. Petitioners 
contend that these restrictions increase the supply of wire rod, flat-
rolled steel, and zinc and thereby artificially lower the prices within 
the PRC to downstream wire decking producers.
    Petitioners have not adequately shown how these particular export 
taxes and licenses constitute entrustment or direction of private 
entities by the GOC to provide a financial contribution to producers of 
subject merchandise. Moreover, Petitioners have not provided sufficient 
data regarding historic price trends demonstrating, e.g., that price 
decreases correlated with the imposition of the alleged export 
restraints. The Department declined to initiate on this program in 
prior CVD initiations involving the PRC. See, e.g., Notice of 
Initiation of Countervailing Duty Investigation: Certain Kitchen 
Appliance Shelving and Racks from the People's Republic of China, 73 FR 
50304, 50306 (August 26, 2008) (Racks and Shelves from the PRC 
Initiation). Therefore, we are not investigating the government 
restraints on wire rod, flat-rolled steel, and zinc exports.

E. Tax Reduction for Enterprises Making Little Profit

    Petitioners allege that, according to China's WTO subsidies 
notification, enterprises with annual taxable incomes between RMB 
30,000 and 100,000 are eligible for a 3 percent reduction in their 
annual income tax rate.
    We find Petitioners have not established with reasonably available 
information that ``enterprises making little profit'' are a de jure 
specific group because Petitioners have provided no 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. See, e.g., Preamble to 
Countervailing Duty Regulations, 63 Fed. Reg. 65348, 65357 (November 
25, 1998) (``* * * because the user represented numerous and diverse 
industries, the program was found not to be specific''). Therefore, we 
are not initiating an investigation of this allegation.

[[Page 31704]]

F. China's Enforced Undervaluation of Its Currency

    Petitioners allege that the GOC-maintained exchange rate 
effectively prevents the appreciation of the Chinese currency (RMB) 
against the U.S. dollar. In addition, Petitioners allege that the GOC 
requires that foreign exchange earned from export activities be 
converted to RMB at the government prescribed rate. Therefore, when 
producers in the PRC sell their dollars at official foreign exchange 
banks, as required by law, the producers receive more RMB than they 
otherwise would if the value of the RMB were set by market mechanisms.
    Consistent with past initiations, we are not initiating on this 
allegation on the grounds that Petitioners have not sufficiently 
alleged the elements necessary for the imposition of a countervailing 
duty and did not support the allegation with reasonably available 
information. See, e.g., Racks and Shelves from the PRC Initiation, 73 
FR at 50307.

G. Reduction in or Exemption From Fixed Assets Investment Orientation 
Regulatory Tax

    The Petitioners claim that producers of wire decking are exempted 
from or receive preferential income tax rates on investments in fixed 
assets. These tax breaks apply to both new construction and upgrades in 
the encouraged industries.
    We are not initiating on this program because Petitioners have not 
provided information to demonstrate that wire decking producers would 
be covered by the relevant legislation. For example, the legislation 
includes specific aspects of the iron and steel production process that 
are eligible for tax benefits, but it does not include any processes 
related to production of wire decking. However, if one of the mandatory 
respondents chosen in this investigation is part of a vertically 
integrated steel company, or cross-owned with a primary steel producer, 
Petitioners may re-allege this program under a timely-filed new subsidy 
allegation, at which time the Department will reconsider the 
information provided.

H. Preferential Investment Policies for FIEs Located in Liaoning 
Province

    Petitioners allege that the Liaoning Province allows FIEs located 
in the province to enjoy ``preferential policies for foreign investment 
projects.'' They further allege that the relevant legislation 
specifically covers wire decking producers. Petitioners identify 
several wire decking producers located in Liaoning Province.
    The supporting documentation provided by Petitioners does not 
specifically mention any loans and the term ``preferential investment 
policies'' by itself, as indicated in the source document included in 
the Petition, does not constitute a sufficient basis for initiation. We 
are not initiating an investigation of this program.

Respondent Selection

    To determine the total and relative volume and value of import data 
for each potential respondent, the Department normally relies on U.S. 
Customs and Border Protection import data for the POI. However, in the 
instant proceeding, the Harmonized Tariff Schedule of the United States 
(``HTSUS'') categories that include subject merchandise are very broad, 
and include products other than those subject to this investigation. 
Therefore, because of the unique circumstances of this case, the 
Department will issue ``Quantity and Value Questionnaires'' to 
potential respondents for the purposes of respondent selection. The 
Department will send the quantity and value questionnaire to PRC 
companies identified in the June 5, 2009 Petition, at Exhibit 4, Volume 
1. The Department will post the quantity and value questionnaire along 
with the filing instructions on the Import Administration's Web site, 
at http://ia.ita.doc.gov/ia-highlights-and-news.html.

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 Government 
of the PRC. As soon as 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 section 351.203(c)(2) 
of the Department's regulations.

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 wire decking 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: June 25, 2009.
Ronald K. Lorentzen,
Acting Assistant Secretary for Import Administration.

Appendix I--Scope of the Investigation

    The scope of the investigation covers welded-wire rack decking, 
which is also known as, among other things, ``pallet rack decking,'' 
``wire rack decking,'' ``wire mesh decking,'' ``bulk storage 
shelving,'' or ``welded-wire decking.'' Wire decking consists of 
wire mesh that is reinforced with structural supports and designed 
to be load bearing. The structural supports include sheet metal 
support channels, or other structural supports, that reinforce the 
wire mesh and that are welded or otherwise affixed to the wire mesh, 
regardless of whether the wire mesh and supports are assembled or 
unassembled and whether shipped as a kit or packaged separately. 
Wire decking is produced from carbon or alloy steel wire that has 
been welded into a mesh pattern. The wire may be galvanized or 
plated (e.g., chrome, zinc or nickel coated), coated (e.g., with 
paint, epoxy, or plastic), or uncoated (``raw''). The wire may be 
drawn or rolled and may have a round, square or other profile. Wire 
decking is sold in a variety of wire gauges. The wire diameters used 
in the decking mesh are 0.105 inches or greater for round wire. For 
wire other than round wire, the distance between any two points on a 
cross-section of the wire is 0.105 inches or greater. Wire decking 
reinforced with structural supports is designed generally for 
industrial and other commercial storage rack systems.
    Wire decking is produced to various profiles, including, but not 
limited to, a flat (``flush'') profile, an upward curved back edge 
profile (``backstop'') or downward curved edge profile 
(``waterfalls''), depending on the rack storage system. The wire 
decking may or may not be anchored to the rack storage system. The 
scope does not cover the metal rack storage system, comprised of 
metal uprights and cross beams, on which the wire decking is 
ultimately installed. Also excluded from the scope is wire mesh 
shelving that is not reinforced with structural supports and is 
designed for use without structural supports.
    Wire decking enters the United States through several basket 
categories in the Harmonized Tariff Schedule of the United States 
(``HTSUS''). U.S. Customs and Border Protection has issued a ruling 
(NY F84777) that wire decking is to be classified under HTSUS 
9403.90.8040. Wire decking has also been entered under HTSUS 
7217.10, 7217.20, 7326.20, 7326.90, 9403.20.0020 and 9403.20.0030. 
While HTSUS subheadings are provided for convenience and Customs 
purposes, the written description of the scope of the investigations 
is dispositive.

[FR Doc. E9-15705 Filed 7-1-09; 8:45 am]
BILLING CODE 3510-DS-P