Countervailing Duty Investigation of Certain Cold-Rolled Steel Flat Products From the Republic of Korea: Final Affirmative Determination, 49943-49946 [2016-17939]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 81, Number 146 (Friday, July 29, 2016)]
[Notices]
[Pages 49943-49946]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-17939]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-580-882]


Countervailing Duty Investigation of Certain Cold-Rolled Steel 
Flat Products From the Republic of Korea: Final Affirmative 
Determination

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.

SUMMARY: The Department of Commerce (the Department) determines that 
countervailable subsidies are being provided to producers/exporters of 
certain cold-rolled steel flat products (cold-rolled steel) from the 
Republic of Korea (Korea) as provided in section 705 of the Tariff Act 
of 1930, as amended (the Act). For information on the subsidy rates, 
see the ``Final Determination'' section of this notice. The period of 
investigation is January 1, 2014, through December 31, 2014.

DATES: Effective July 29, 2016.

FOR FURTHER INFORMATION CONTACT: Yasmin Bordas or Emily Maloof, AD/CVD 
Operations, Office VI, Enforcement and Compliance, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue NW., Washington, DC 20230; telephone (202) 482-3813 
or (202) 482-5649, respectively.

[[Page 49944]]


SUPPLEMENTARY INFORMATION: 

Background

    The Department published the Preliminary Determination on December 
22, 2015.\1\ A summary of events that occurred since the Department 
published the Preliminary Determination, as well as a full discussion 
of the issues raised by parties for this final determination, may be 
found in the Issues and Decision Memorandum.\2\ The Issues and Decision 
Memorandum is a public document and is on file electronically via 
Enforcement and Compliance's Antidumping and Countervailing Duty 
Centralized Electronic Service System (ACCESS). ACCESS is available to 
registered users at https://access.trade.gov, and is available to all 
parties in the Central Records Unit, Room B8024 of the main Department 
of Commerce building. In addition, a complete version of the Issues and 
Decision Memorandum can be accessed directly at https://enforcement.trade.gov/frn/. The signed Issues and Decision Memorandum 
and the electronic version are identical in content.
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    \1\ See Certain Cold-Rolled Steel Flat Products from the 
Republic of Korea: Preliminary Negative Countervailing Duty 
Determination, 80 FR 79567 (December 22, 2015) (Preliminary 
Determination).
    \2\ See Memorandum to Paul Piquado, ``Issues and Decision 
Memorandum for the Final Determination in the Countervailing Duty 
Investigation of Certain Cold-Rolled Steel Flat Products from the 
Republic of Korea,'' dated July 20, 2016 (Issues and Decision 
Memorandum).
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Scope of the Investigation

    The products covered by this investigation are cold-rolled steel 
flat products from Korea. For a complete description of the scope of 
this investigation, see the ``Scope of the Investigation,'' in Appendix 
II of this notice.

Scope Comments

    In accordance with the Preliminary Scope Determination,\3\ the 
Department set aside a period of time for parties to address scope 
issues in case briefs or other written comments on scope issues.
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    \3\ See Memorandum to Christian Marsh, ``Certain Cold-Rolled 
Steel Products From Brazil, the People's Republic of China, India, 
Japan, the Republic of Korea, the Russian Federation, and the United 
Kingdom: Scope Comments Decision Memorandum for the Preliminary 
Determinations,'' dated February 29, 2016 (Preliminary Scope 
Determination).
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    For a summary of the product coverage comments and rebuttal 
responses submitted to the records of the cold-rolled steel 
investigations, and accompanying decision and analysis of all comments 
timely received, see the Final Scope Decision Memorandum.\4\ The Final 
Scope Decision Memorandum is incorporated by, and hereby adopted by, 
this notice.
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    \4\ See Memorandum to Christian Marsh, ``Certain Cold-Rolled 
Steel Flat Products From Brazil, the People's Republic of China, 
India, Japan, the Republic of Korea, the Russian Federation, and the 
United Kingdom: Final Scope Comments Decision Memorandum,'' dated 
May 16, 2016 (Final Scope Decision Memorandum).
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Analysis of Subsidy Programs and Comments Received

    The subsidy programs under investigation and the issues raised in 
the case and rebuttal briefs by parties in this investigation are 
discussed in the Issues and Decision Memorandum. A list of the issues 
that parties raised, and to which we responded in the Issues and 
Decision Memorandum, is attached to this notice as Appendix I.

Use of Adverse Facts Available

    In making this final determination, the Department relied, in part, 
on facts available and, because POSCO and Hyundai Steel Co., Ltd. 
(Hyundai Steel) did not act to the best of their ability in responding 
to the Department's requests for information, we drew an adverse 
inference where appropriate in selecting from among the facts otherwise 
available.\5\ Specifically, we find that the application of adverse 
facts available is warranted for POSCO for its failure to report 
certain cross-owned input suppliers and facilities located in a foreign 
economic zone (FEZ). We are also applying adverse facts available to 
POSCO's affiliated trading company, Daewoo International Corporation 
(DWI) for certain loans presented at verification. Further, we find 
that the application of adverse facts available is warranted for 
Hyundai Steel for its failure to report its location in an FEZ. For 
further information, see the section ``Use of Facts Otherwise Available 
and Adverse Inferences'' in the accompanying Issues and Decision 
Memorandum.
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    \5\ See sections 776(a) and (b) of the Act.
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Changes Since the Preliminary Determination

    Based on our analysis of the comments received from parties and the 
minor corrections presented, and additional items discovered at 
verification, we made certain changes to the respondents' subsidy rate 
calculations. For a discussion of these changes, see the Issues and 
Decision Memorandum.

Final Determination

    In accordance with section 705(c)(1)(B)(i) of the Act, we 
calculated a rate for POSCO and Hyundai Steel, the two exporters/
producers of subject merchandise selected for individual examination in 
this investigation.
    In accordance with sections 705(c)(1)(B)(i)(I) and 705(c)(5)(A) of 
the Act, for companies not individually investigated, we apply an 
``all-others'' rate, which is normally calculated by weighting the 
subsidy rates of the individual companies selected as respondents with 
those companies' export sales of the subject merchandise to the United 
States. Under section 705(c)(5)(A)(i) of the Act, the all-others rate 
should exclude zero and de minimis rates calculated for the exporters 
and producers individually investigated, and any rates determined 
entirely under section 776 of the Act. Therefore, we have excluded the 
rate calculated for POSCO because it was determined entirely under 
section 776 of the Act. Thus, for the ``all-others'' rate, we applied 
the rate calculated for Hyundai Steel.

------------------------------------------------------------------------
                                                           Subsidy rate
                         Company                             (percent)
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POSCO...................................................           58.36
Hyundai Steel Co., Ltd..................................            3.91
All-Others..............................................            3.91
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Disclosure

    We intend to disclose to parties in this proceeding the 
calculations performed for this final determination within five days of 
the date of public announcement of our final determination, in 
accordance with 19 CFR 351.224(b).

Suspension of Liquidation

    In the Preliminary Determination, the total net countervailable 
subsidy rates for the individually examined respondents were de minimis 
and, therefore, we did not suspend liquidation of entries of certain 
cold-rolled steel flat products from the Republic of Korea. However, 
the estimated subsidy rates for the examined companies are above de 
minimis in this final determination, we are directing U.S. Customs and 
Border Protection (CBP) to suspend liquidation of entries of cold-
rolled steel from Korea that are entered, or withdrawn from warehouse, 
for consumption on or after the date of publication of this notice in 
the Federal Register, and to require a cash deposit for such entries of 
merchandise in the amounts indicated above. The suspension of 
liquidation will remain in effect until further notice. In addition, 
pursuant to section 705(c)(1)(B)(ii) of the Act, we are directing the 
CBP to require a cash

[[Page 49945]]

deposit for such entries of merchandise in the amount indicated above.
    If the U.S. International Trade Commission (ITC) issues a final 
affirmative injury determination, we will issue a CVD order and 
instruct CBP to require a cash deposit of estimated CVDs for such 
entries of subject merchandise in the amounts indicated above. If the 
ITC determines that material injury, or threat of material injury, does 
not exist, this proceeding will be terminated and all estimated duties 
deposited or securities posted as a result of the suspension of 
liquidation will be refunded or canceled.

International Trade Commission 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 administrative protective order (APO), without the written 
consent of the Assistant Secretary of Enforcement and Compliance.

Notification Regarding Administrative Protective Orders (APOs)

    In the event the ITC issues a final negative injury determination, 
this notice will serve as the only reminder to parties subject to an 
APO of their responsibility concerning the disposition of proprietary 
information disclosed under APO in accordance with 19 CFR 
351.305(a)(3). Timely written notification of the return or 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 subject to sanction.
    This determination and notice are issued and published pursuant to 
sections 705(d) and 777(i) of the Act.

    Dated: July 20, 2016.
Paul Piquado,
Assistant Secretary for Enforcement and Compliance.

Appendix I--List of Topics Discussed in the Final Decision Memorandum

I. Summary
II. Background
III. Scope of the Investigation
IV. Subsidies Valuation
V. Benchmarks and Discount Rates
VI. Use of Facts Otherwise Available And Adverse Inferences
VII. Analysis of Programs
VIII. Calculation of All-Others Rate
IX. Analysis of Comments
    Comment 1: Whether the Department Should Apply Adverse Facts 
Available (AFA) to the Provision of Electricity for Less Than 
Adequate Remuneration (LTAR)
    Comment 2: Whether the Department Should Find That the Provision 
of Electricity for LTAR is a Countervailable Subsidy
    Comment 3: Whether the Department Should Use Other submitted 
Data to Measure the Adequacy of Remuneration of Electricity
    Comment 4: Whether the Department Should Find the Provision of 
Natural Gas for LTAR Countervailable
    Comment 5: Application of AFA to POSCO and Treatment of POSCO's 
Unreported Affiliates
    Comment 6: Whether to Apply AFA to POSCO Global R&D Center
    Comment 7: Whether to Apply AFA to Certain Loans Submitted at 
Verification
    Comment 8: Whether to Apply AFA to Hyundai Steel for Use of 
Certain Foreign Economic Zones (FEZs)
    Comment 9: Whether Certain Loans at the Korean Export Import 
Bank (KEXIM) Were Verified
    Comment 10: The Department's Treatment of Unalleged Programs and 
Verification of Non-Use
    Comment 11: Whether to Apply AFA to the GOK for Restriction of 
Special Taxation Agreement (RSTA) Article 120
    Comment 12: Whether to Apply AFA to the GOK for DWI's Debt 
Workout
    Comment 13: Whether the Department Finds Tax Programs de facto 
Specific
    Comment 14: Whether the Department Should Determine That the 
Local Tax Exemption Hyundai Steel Received Under RSTA Article 120 Is 
Related to the Cold-Rolling Assets Purchased From Hyundai HYSCO and 
Is, Therefore, Attributable to Subject Merchandise
    Comment 15: Whether the Department Improperly Countervailed 
Property Tax Exemptions Received by the Pohang Plant Under RSLTA 78
X. Recommendation

Appendix II--Scope of the Investigation

    The products covered by this investigation are certain cold-
rolled (cold-reduced), flat-rolled steel products, whether or not 
annealed, painted, varnished, or coated with plastics or other non-
metallic substances.\6\ The products covered do not include those 
that are clad, plated, or coated with metal. The products covered 
include coils that have a width or other lateral measurement 
(``width'') of 12.7 mm or greater, regardless of form of coil (e.g., 
in successively superimposed layers, spirally oscillating, etc.). 
The products covered also include products not in coils (e.g., in 
straight lengths) of a thickness less than 4.75 mm and a width that 
is 12.7 mm or greater and that measures at least 10 times the 
thickness. The products covered also include products not in coils 
(e.g., in straight lengths) of a thickness of 4.75 mm or more and a 
width exceeding 150 mm and measuring at least twice the thickness. 
The products described above may be rectangular, square, circular, 
or other shape and include products of either rectangular or non-
rectangular cross-section where such cross-section is achieved 
subsequent to the rolling process, i.e., products which have been 
``worked after rolling'' (e.g., products which have been beveled or 
rounded at the edges). For purposes of the width and thickness 
requirements referenced above:
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    \6\ Since the Preliminary Determination, eight interested 
parties (i.e., JFE Steel Corporation, Electrolux Home Products, 
Inc., Electrolux Home Care Products, Inc., ArcelorMittal USA LLC, AK 
Steel Corporation, Nucor Corporation, Steel Dynamics Inc., and 
United States Steel Corporation) commented on the scope of the 
investigation. The Department reviewed these comments and made no 
changes. See Memorandum to Christian Marsh, Deputy Assistant 
Secretary for Antidumping and Countervailing Duty Operations, 
``Certain Cold-Rolled Steel Products From Brazil, the People's 
Republic of China, India, Japan, the Republic of Korea, the Russian 
Federation, and the United Kingdom: Final Scope Comments Decision,'' 
dated concurrently with this final determination.
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    (1) Where the nominal and actual measurements vary, a product is 
within the scope if application of either the nominal or actual 
measurement would place it within the scope based on the definitions 
set forth above, and
    (2) where the width and thickness vary for a specific product 
(e.g., the thickness of certain products with non-rectangular cross-
section, the width of certain products with non-rectangular shape, 
etc.), the measurement at its greatest width or thickness applies.
    Steel products included in the scope of this investigation are 
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:

 2.50 percent of manganese, or
 3.30 percent of silicon, or
 1.50 percent of copper, or
 1.50 percent of aluminum, or
 1.25 percent of chromium, or
 0.30 percent of cobalt, or
 0.40 percent of lead, or
 2.00 percent of nickel, or
 0.30 percent of tungsten (also called wolfram), or
 0.80 percent of molybdenum, or
 0.10 percent of niobium (also called columbium), or
 0.30 percent of vanadium, or
 0.30 percent of zirconium

    Unless specifically excluded, products are included in this 
scope regardless of levels of boron and titanium.
    For example, specifically included in this scope are vacuum 
degassed, fully stabilized (commonly referred to as interstitial-
free (IF)) steels, high strength low alloy (HSLA) steels, motor 
lamination steels, Advanced High Strength Steels (AHSS), and Ultra 
High Strength Steels (UHSS). IF steels are recognized as low carbon 
steels with micro-alloying levels of elements such as titanium and/
or niobium added to stabilize carbon and nitrogen elements. HSLA 
steels are recognized as steels with micro-alloying

[[Page 49946]]

levels of elements such as chromium, copper, niobium, titanium, 
vanadium, and molybdenum. Motor lamination steels contain micro-
alloying levels of elements such as silicon and aluminum. AHSS and 
UHSS are considered high tensile strength and high elongation 
steels, although AHSS and UHSS are covered whether or not they are 
high tensile strength or high elongation steels.
    Subject merchandise includes cold-rolled steel that has been 
further processed in a third country, including but not limited to 
annealing, tempering, painting, varnishing, trimming, cutting, 
punching, and/or slitting, or any other processing that would not 
otherwise remove the merchandise from the scope of the investigation 
if performed in the country of manufacture of the cold-rolled steel.
    All products that meet the written physical description, and in 
which the chemistry quantities do not exceed any one of the noted 
element levels listed above, are within the scope of this 
investigation unless specifically excluded. The following products 
are outside of and/or specifically excluded from the scope of this 
investigation:
     Ball bearing steels; \7\
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    \7\ Ball bearing steels are defined as steels which contain, in 
addition to iron, each of the following elements by weight in the 
amount specified: (i) Not less than 0.95 nor more than 1.13 percent 
of carbon; (ii) not less than 0.22 nor more than 0.48 percent of 
manganese; (iii) none, or not more than 0.03 percent of sulfur; (iv) 
none, or not more than 0.03 percent of phosphorus; (v) not less than 
0.18 nor more than 0.37 percent of silicon; (vi) not less than 1.25 
nor more than 1.65 percent of chromium; (vii) none, or not more than 
0.28 percent of nickel; (viii) none, or not more than 0.38 percent 
of copper; and (ix) none, or not more than 0.09 percent of 
molybdenum.
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     Tool steels; \8\
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    \8\ Tool steels are defined as steels which contain the 
following combinations of elements in the quantity by weight 
respectively indicated: (i) More than 1.2 percent carbon and more 
than 10.5 percent chromium; or (ii) not less than 0.3 percent carbon 
and 1.25 percent or more but less than 10.5 percent chromium; or 
(iii) not less than 0.85 percent carbon and 1 percent to 1.8 
percent, inclusive, manganese; or (iv) 0.9 percent to 1.2 percent, 
inclusive, chromium and 0.9 percent to 1.4 percent, inclusive, 
molybdenum; or (v) not less than 0.5 percent carbon and not less 
than 3.5 percent molybdenum; or (vi) not less than 0.5 percent 
carbon and not less than 5.5 percent tungsten.
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     Silico-manganese steel; \9\
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    \9\ Silico-manganese steel is defined as steels containing by 
weight: (i) Not more than 0.7 percent of carbon; (ii) 0.5 percent or 
more but not more than 1.9 percent of manganese, and (iii) 0.6 
percent or more but not more than 2.3 percent of silicon.
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     Grain-oriented electrical steels (GOES) as defined in 
the final determination of the U.S. Department of Commerce in Grain-
Oriented Electrical Steel From Germany, Japan, and Poland.\10\
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    \10\ Grain-Oriented Electrical Steel From Germany, Japan, and 
Poland: Final Determinations of Sales at Less Than Fair Value and 
Certain Final Affirmative Determination of Critical Circumstances, 
79 FR 42,501, 42,503 (Dep't of Commerce, July 22, 2014). This 
determination defines grain-oriented electrical steel as ``a flat-
rolled alloy steel product containing by weight at least 0.6 percent 
but not more than 6 percent of silicon, not more than 0.08 percent 
of carbon, not more than 1.0 percent of aluminum, and no other 
element in an amount that would give the steel the characteristics 
of another alloy steel, in coils or in straight lengths.''
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     Non-Oriented Electrical Steels (NOES), as defined in 
the antidumping orders issued by the U.S. Department of Commerce in 
Non-Oriented Electrical Steel From the People's Republic of China, 
Germany, Japan, the Republic of Korea, Sweden, and Taiwan.\11\
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    \11\ Non-Oriented Electrical Steel From the People's Republic of 
China, Germany, Japan, the Republic of Korea, Sweden, and Taiwan: 
Antidumping Duty Orders, 79 FR 71,741, 71,741-42 (Dep't of Commerce, 
Dec. 3, 2014). The orders define NOES as ``cold-rolled, flat-rolled, 
alloy steel products, whether or not in coils, regardless of width, 
having an actual thickness of 0.20 mm or more, in which the core 
loss is substantially equal in any direction of magnetization in the 
plane of the material. The term `substantially equal' means that the 
cross grain direction of core loss is no more than 1.5 times the 
straight grain direction (i.e., the rolling direction) of core loss. 
NOES has a magnetic permeability that does not exceed 1.65 Tesla 
when tested at a field of 800 A/m (equivalent to 10 Oersteds) along 
(i.e., parallel to) the rolling direction of the sheet (i.e., B800 
value). NOES contains by weight more than 1.00 percent of silicon 
but less than 3.5 percent of silicon, not more than 0.08 percent of 
carbon, and not more than 1.5 percent of aluminum. NOES has a 
surface oxide coating, to which an insulation coating may be 
applied.''
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    The products subject to this investigation are currently 
classified in the Harmonized Tariff Schedule of the United States 
(HTSUS) under item numbers: 7209.15.0000, 7209.16.0030, 
7209.16.0060, 7209.16.0070, 7209.16.0091, 7209.17.0030, 
7209.17.0060, 7209.17.0070, 7209.17.0091, 7209.18.1530, 
7209.18.1560, 7209.18.2510, 7209.18.2520, 7209.18.2580, 
7209.18.6020, 7209.18.6090, 7209.25.0000, 7209.26.0000, 
7209.27.0000, 7209.28.0000, 7209.90.0000, 7210.70.3000, 
7211.23.1500, 7211.23.2000, 7211.23.3000, 7211.23.4500, 
7211.23.6030, 7211.23.6060, 7211.23.6090, 7211.29.2030, 
7211.29.2090, 7211.29.4500, 7211.29.6030, 7211.29.6080, 
7211.90.0000, 7212.40.1000, 7212.40.5000, 7225.50.6000, 
7225.50.8080, 7225.99.0090, 7226.92.5000, 7226.92.7050, and 
7226.92.8050.
    The products subject to this investigation may also enter under 
the following HTSUS numbers: 7210.90.9000, 7212.50.0000, 
7215.10.0010, 7215.10.0080, 7215.50.0016, 7215.50.0018, 
7215.50.0020, 7215.50.0061, 7215.50.0063, 7215.50.0065, 
7215.50.0090, 7215.90.5000, 7217.10.1000, 7217.10.2000, 
7217.10.3000, 7217.10.7000, 7217.90.1000, 7217.90.5030, 
7217.90.5060, 7217.90.5090, 7225.19.0000, 7226.19.1000, 
7226.19.9000, 7226.99.0180, 7228.50.5015, 7228.50.5040, 
7228.50.5070, 7228.60.8000, and 7229.90.1000.
    The HTSUS subheadings above are provided for convenience and 
customs purposes only. The written description of the scope of the 
investigation is dispositive.

[FR Doc. 2016-17939 Filed 7-28-16; 8:45 am]
 BILLING CODE 3510-DS-P