Certain Magnesia Carbon Bricks From the People's Republic of China: Final Affirmative Countervailing Duty Determination, 45472-45474 [2010-18939]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 75, Number 147 (Monday, August 2, 2010)]
[Notices]
[Pages 45472-45474]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-18939]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-570-955]


Certain Magnesia Carbon Bricks From the People's Republic of 
China: Final Affirmative Countervailing Duty Determination

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

SUMMARY: The Department of Commerce (the Department) has reached a 
final determination that countervailable subsidies are being provided 
to producers/exporters of magnesia carbon bricks (MCBs) from the 
People's Republic of China (PRC). For information on the estimated 
subsidy rates, see the ``Suspension of Liquidation'' section of this 
notice.

DATES: Effective Date: August 2, 2010.

FOR FURTHER INFORMATION CONTACT: Summer Avery or Toni Page, AD/CVD 
Operations, Office 6, Import Administration, International Trade 
Administration, U.S. Department of Commerce, Room 7866, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
4052 or (202) 482-1398, respectively.

SUPPLEMENTARY INFORMATION:

Case History

    The following events have occurred since the preliminary 
determination. See Certain Magnesia Carbon Bricks From the People's 
Republic of China: Preliminary Negative Countervailing Duty 
Determination, 74 FR 68241 (December 23, 2009) (Preliminary 
Determination).
    On January 7, 2010, Petitioner \1\ submitted a letter, in 
accordance with section 705(a)(1) of the Tariff Act of 1930, as amended 
(the Act), requesting alignment of the final countervailing duty (CVD) 
determination with the final antidumping duty (AD) determinations of 
MCBs from the PRC and Mexico. On January 28, 2010, the Department 
aligned the final CVD determination with the final determinations in 
the companion AD investigations of MCBs from the PRC and Mexico. See 
Certain Magnesia Carbon Bricks From the People's Republic of China: 
Alignment of Final Countervailing Duty Determination With Final 
Antidumping Duty Determinations, 75 FR 4528 (January 28, 2010).
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    \1\ The Petitioner in the instant investigation is Resco 
Products Inc.
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    On January 22, 2010, the GOC filed a request for a hearing for the 
instant investigation.
    The Department issued three supplemental questionnaires to the 
Government of the People's Republic of China (GOC) on December 8, 2009, 
February 22, 2010, and March 26, 2010, respectively. The GOC submitted 
responses on January 5, 2010, March 15, 2010, March 22, 2010, and April 
2, 2010.
    The Department issued two supplemental questionnaires to Liaoning 
Mayerton Refractories (LMR) and its cross-owned affiliate Dalian 
Mayerton Refractories Co. Ltd. (DMR) (collectively, Mayerton) on 
December 8, 2009 and February 22, 2010, respectively. Mayerton 
submitted a response on January 5, 2010 for the first supplemental 
questionnaire but did not respond to the Department's second 
supplemental questionnaire. On April 1, 2010, Mayerton filed a letter 
with the Department informing us that that they would no longer be 
participating in this investigation.
    The Department issued two supplemental questionnaires to RHI 
Refractories Liaoning Co., Ltd. (RHIL) as well as its cross-owned 
affiliates RHI Refractories (Dalian) Co., Ltd. (RHID) and Liaoning RHI 
Jinding Magnesia Co., Ltd. (RHIJ) (collectively, RHI) on December 8, 
2009 and February 22, 2010, respectively. RHI submitted responses to 
the Department's questionnaires on January 5, 2010, March 15, 2010, and 
March 22, 2010. Public versions of all questionnaires and responses, as 
well as the various memoranda cited below, are available in the 
Department's Central Records Unit (CRU), Room 1117 in the HCHB building 
of the Commerce Department.
    From May 4 through May 7, 2010, we conducted verification of the 
questionnaire responses submitted by RHI. We issued the verification 
report for RHI on June 1, 2010. See Memorandum to the File from Toni 
Page and Summer Avery, International Trade Analysts, Verification of 
the Questionnaire Responses Submitted by RHI Refractories Liaoning Co., 
Ltd., RHI Refractories (Dalian) Co., Ltd., and Liaoning RHI Jinding 
Magnesia Co., Ltd. (June 1, 2010).
    On May 6, 2010, the Department issued its post-preliminary 
determination regarding two programs, ``Export Restraints of Raw 
Materials'' and the ``Provision of Electricity for Less than Adequate 
Remuneration.'' See Countervailing Duty Investigation of Certain 
Magnesia Carbon Bricks from the People's Republic of China: Post-
Preliminary Determination (May 6, 2010).
    The Department received case briefs from Petitioner, the GOC, and 
RHI on June 10, 2010 and rebuttal briefs from the same parties on June 
17, 2010. On June 17, 2010, the GOC withdrew its hearing request.

Scope of Investigation

    The merchandise under investigation consists of certain chemically-
bonded (resin or pitch), magnesia carbon bricks with a magnesia 
component of at least 70 percent magnesia (``MgO'') by weight, 
regardless of the source of raw materials for the MgO, with carbon 
levels ranging from trace amounts to 30 percent by weight, regardless 
of enhancements (for example, magnesia carbon bricks can be enhanced 
with coating, grinding, tar impregnation or coking, high temperature 
heat treatments, anti-slip treatments or metal casing) and regardless 
of whether or not antioxidants are present (for example, antioxidants 
can be added to the mix from trace amounts to 15 percent by weight as 
various metals, metal alloys, and metal carbides). Certain magnesia 
carbon bricks that are the subject of this investigation are currently 
classifiable under subheadings 6902.10.1000, 6902.10.5000, 
6815.91.0000,

[[Page 45473]]

6815.99.2000 and 6815.99.4000 \2\ of the Harmonized Tariff Schedule of 
the United States (``HTSUS''). While HTSUS subheadings are provided for 
convenience and customs purposes, the written description is 
dispositive.
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    \2\ In the Preliminary Determination, we included HTSUS 
subheading 6815.99 in our description of the scope of the 
investigation. Subsequently, we determined that all of the ten-digit 
subheadings under subheading 6815.99 must be used instead. 
Accordingly, the appropriate HTSUS ten-digit subheadings have been 
listed.
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Scope Comments

    On September 8, 2009, Pilkington North America Inc. (PNA), a U.S. 
importer of magnesia bricks from the People's Republic of China (PRC) 
and Mexico, filed timely comments concerning the scope of the AD and 
CVD investigations of certain magnesia carbon bricks from the PRC and 
the AD investigation of certain magnesia carbon bricks from Mexico. See 
Letter from Pilkington North America Inc. Re: Scope Comments (September 
8, 2009).
    In its submission, PNA requested that the Department amend the 
scope of these investigations to exclude ceramic bonded magnesia bricks 
with or without trace amounts of carbon or clarify that this product is 
outside the scope of these investigations. According to PNA, the 
ceramic bonded magnesia bricks it imports are clearly not within the 
intended scope of these investigations. Petitioner did not submit 
comments on PNA's submission; however, in a telephone conversation with 
a Department official, Petitioner stated that it agreed that the bricks 
at issue were outside the scope of these investigations. See Memorandum 
to the File, through Tom Gilgunn, Program Manager, Office 6, from 
Summer Avery, International Trade Analyst, Re: Import Administration 
Countervailing Duty Investigation of Certain Magnesia Carbon Bricks 
from the People's Republic of China: Scope Comments (February 16, 
2010).
    After reviewing PNA's comments, the Department determined that the 
scope of these investigations does not include the bonded MCBs imported 
by PNA. However, because the language in the scope is clear that only 
chemically bonded magnesia carbon bricks are covered, the Department 
concluded that it was not necessary to amend or clarify the existing 
scope language in these investigations in response to PNA's request. 
See Memorandum from John M. Anderson, Acting Deputy Assistant Secretary 
Re: Certain Magnesia Carbon Bricks from the People's Republic of China 
and Mexico: Scope Comments (February 24, 2010).
    A respondent in the companion AD investigation of MCBs from Mexico, 
RHI-Refmex S.A. de C.V. (Refmex), argued in its case brief that the 
Department should expressly hold that resin-bonded magnesia carbon 
functional refractory products, as opposed to magnesia carbon brick 
products, are not within the scope of the MCBs under investigation. The 
Department has decided not to amend the scope of the MCB investigations 
to include a specific exclusion for such products because the current 
description of the scope of these investigations adequately limits the 
scope to bricks. A full summary of Refmex's comments and the 
Department's position are at Comment 1 of the Issues and Decision 
Memorandum for the AD Mexico investigation and Comment 5 of the Issues 
and Decision Memorandum for the AD PRC investigation. See Issues and 
Decision Memorandum for Certain Magnesia Carbon Bricks From Mexico: 
Final Determination of Sales at Less Than Fair Value and Issues and 
Decision Memorandum for Certain Magnesia Carbon Bricks From the 
People's Republic of China: Final Determination of Sales at Less Than 
Fair Value (July 26, 2010).

Analysis of Subsidy Programs and Comments Received

    All issues raised in the case and rebuttal briefs by parties to 
this investigation are addressed in the Memorandum to Ronald K. 
Lorentzen, Deputy Assistant Secretary for Import Administration, from 
Edward C. Yang, Acting Deputy Assistant Secretary for Antidumping and 
Countervailing Duty Operations, entitled ``Issues and Decision 
Memorandum for the Final Affirmative Countervailing Duty Determination: 
Certain Magnesia Carbon Bricks from the People's Republic of China,'' 
dated concurrently with this notice (hereinafter, Decision Memorandum), 
which is hereby adopted by this notice. Attached to this notice as an 
Appendix is a list of the issues that parties have raised and to which 
we have responded in the Decision Memorandum. The Decision Memorandum 
also contains a complete analysis of the programs covered by this 
investigation, and the methodologies used to calculate the subsidy 
rates. Parties can find a complete discussion of all issues raised in 
this investigation and the corresponding recommendations in this public 
memorandum, which is on file in the CRU. In addition, a complete 
version of the Decision Memorandum can be accessed directly on the 
Internet at https://ia.ita.doc.gov/frn/. The paper copy and electronic 
version of the Decision Memorandum are identical in content.

Use of Adverse Facts Available

    For purposes of this final determination, we continue to rely on 
facts available and have drawn adverse inferences, in accordance with 
sections 776(a) and (b) of the Act, with regard to RHI's receipt of 
countervailable subsidies under the ``Provision of Electricity for Less 
than Adequate Remuneration'' and ``Export Restraints of Raw Materials'' 
programs. In addition, pursuant to sections 776(a)(2)(A) and (C) of the 
Act, we have based the CVD rate for Mayerton on facts otherwise 
available and drawn adverse inferences. A full discussion of our 
decision to apply adverse facts available (AFA) is presented in the 
Decision Memorandum in the section ``Application of Facts Available, 
Including the Application of Adverse Inferences,'' as well as the 
Department's positions in Comment 6: Whether the Use of Facts Available 
with Adverse Inferences Is Warranted For the Export Restraint Subsidy 
and Comment 8: Whether the Department Correctly Applied AFA and Treated 
the Provision of Electricity as a Countervailable Subsidy in the 
Decision Memorandum.

Suspension of Liquidation

    In accordance with section 705(c)(1)(B)(i)(I) of the Act, we have 
calculated an individual rate for the mandatory respondent still 
participating in this investigation, RHI. Section 705(c)(5)(A)(i) of 
the Act states that for companies not investigated, we will determine 
an ``all others'' rate equal to the weighted-average countervailable 
subsidy rates established for exporters and producers individually 
investigated, excluding any zero and de minimis countervailable subsidy 
rates, and any rates determined entirely under section 776 of the Act. 
In this investigation, the Department selected two mandatory 
respondents to review. Because there is only one respondent in this 
investigation for which the Department has calculated a company-
specific rate, consistent with our practice and section 705(c)(5)(A)(i) 
of the Act, its rate serves as the ``all others'' rate. See, e.g., 
Final Affirmative Countervailing Duty Determination: Certain Hot-Rolled 
Carbon Steel Flat Products from Thailand, 66 FR 50410, 50411 (October 
3, 2001); and Final Affirmative Countervailing Duty Determination: Pure 
Magnesium From Israel, 66 FR 49351, 49353 (September 27, 2001). As 
discussed above, mandatory respondent Mayerton

[[Page 45474]]

withdrew from the instant investigation. As discussed in the Decision 
Memorandum, for each program examined in this investigation, we have 
made the adverse inference that Mayerton benefitted from the program 
and calculated a rate accordingly.

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                                            Net countervailable  subsidy
          Exporter/ manufacturer                        rate
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RHI.......................................  24.24% ad valorem.
Mayerton..................................  253.87% ad valorem.
All Others................................  24.24% ad valorem.
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    In accordance with section 705(c)(1)(C) of the Act, we are 
directing U.S. Customs and Border Protection (CBP) to suspend 
liquidation of all imports of the subject merchandise from the PRC that 
are entered, or withdrawn from warehouse, for consumption on or after 
the date of publication of this notice in the Federal Register. The 
suspension of liquidation will remain in effect until further notice.
    If the International Trade Commission (ITC) issues a final 
affirmative injury determination, we will issue a countervailing duty 
order and order CBP to continue the suspension of liquidation of 
entries of MCBs and to require a cash deposit on all such entries equal 
to the subsidy rate listed above. If the ITC determines that material 
injury, or threat of material injury, does not exist, this proceeding 
will be terminated and all deposits or securities posted as a result of 
the suspension of liquidation will be refunded or canceled.

ITC Notification

    In accordance with section 705(d) of the Act, we will notify the 
ITC of our determination. In addition, we are making available to the 
ITC all non-privileged and non-proprietary information related to this 
investigation. We will allow the ITC access to all privileged and 
business proprietary information in our files, provided the ITC 
confirms that it will not disclose such information, either publicly or 
under an APO, without the written consent of the Assistant Secretary 
for Import Administration.

Return or Destruction of Proprietary Information

    In the event that the ITC issues a final negative injury 
determination, this notice will serve as the only reminder to parties 
subject to an administrative protective order (APO) of their 
responsibility concerning the destruction of proprietary information 
disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely 
written notification of the return/destruction of APO materials or 
conversion to judicial protective order is hereby requested. Failure to 
comply with the regulations and terms of an APO is a violation which is 
subject to sanction.
    This determination is issued and published pursuant to sections 
705(d) and 777(i) of the Act.

    Dated: July 26, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.

Appendix--List of Comments and Issues in the Decision Memorandum

Comment 1: Whether the Department Has the Authority to Apply the CVD 
Law to the PRC While Treating the PRC as A Non-Market Economy In The 
Parallel Antidumping Investigation
Comment 2: Whether the Simultaneous Application of the CVD Law and 
the Antidumping Non-Market Economy Methodology in This Case Would 
Lead to Impermissible Double Remedies
Comment 3: Whether the Department's Application of Countervailing 
Duties to a Non-Market Economy Country Violates the Administrative 
Procedures Act
Comment 4: Whether the Department's Decision to Initiate an 
Investigation of Export Restraints at Issue Was Contrary to Law and 
Unsupported by Fact
Comment 5: Whether the Export Restraints at Issue Can be Found to 
Confer a Financial Contribution to the Industry Producing MCBs
Comment 6: Whether the Use of Facts Available with Adverse 
Inferences Is Warranted For the Export Restraint Subsidy
Comment 7: Whether the Department Should Adjust the Manner It 
Calculates the Export Restraints Benefit
Comment 8: Whether the Department Correctly Applied AFA and Treated 
the Provision of Electricity as a Countervailable Subsidy
Comment 9: Whether the Provision of Electricity Is Specific and 
Provides a Financial Contribution
Comment 10: Whether the Department Should Use RHI's Revised 2008 
Sales Amount in the Department's Final Calculations
Comment 11: Whether the Department Should Examine Income Tax Credits 
for Purchases of Domestically Produced Equipment in Detail
Comment 12: Whether the Department Should Apply AFA with Respect to 
VAT Rebates Associated with RHI's Purchases of Domestically Produced 
Equipment
Comment 13: Whether the Department Should Apply Total AFA When 
Assigning Mayerton's Final Countervailing Duty Rate

[FR Doc. 2010-18939 Filed 7-30-10; 8:45 am]
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