Countervailing Duty Investigation of Certain Cold-Rolled Steel Flat Products From Brazil: Final Affirmative Determination, 49940-49943 [2016-17952]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 81, Number 146 (Friday, July 29, 2016)]
[Notices]
[Pages 49940-49943]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-17952]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-351-844]


Countervailing Duty Investigation of Certain Cold-Rolled Steel 
Flat Products From Brazil: 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

[[Page 49941]]

provided to producers and exporters of certain cold-rolled steel flat 
products (cold-rolled steel, or CRS) from Brazil. For information on 
the estimated 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: Sergio Balbontin, Nicholas Czajkowski, 
or Lana Nigro, AD/CVD Operations, Office I, Enforcement and Compliance, 
International Trade Administration, U.S. Department of Commerce, 1401 
Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-
6478, (202) 482-1395, and (202) 482-1779, respectively.

SUPPLEMENTARY INFORMATION:

Background

    The Department published the Preliminary Determination on December 
22, 2015.\1\ A summary of the 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 Countervailing Duty Investigation of Certain Cold-Rolled 
Steel Flat Products From Brazil: Preliminary Affirmative 
Determination and Alignment of Final Determination With Final 
Antidumping Duty Determination Preliminary Determination, 80 FR 
79562 (December 22, 2015) (Preliminary Determination).
    \2\ See Memorandum from Christian Marsh, Deputy Assistant 
Secretary for Antidumping and Countervailing Duty Operations, to 
Paul Piquado, Assistant Secretary for Enforcement and Compliance, 
``Issues and Decision Memorandum for the Final Determination in the 
Countervailing Duty Investigation of Certain Cold-Rolled Steel Flat 
Products from Brazil,'' dated concurrently with this determination 
(Final Decision Memorandum) and hereby adopted by this notice.
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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, 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: Scope Comments Decision 
Memorandum for the Preliminary Determinations,'' dated February 29, 
2016.
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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 discussion 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, 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 
Memorandum,'' dated May 16, 2016.
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Scope of the Investigation

    The products covered by this investigation are cold-rolled steel 
flat products from Brazil. For a complete description of the scope of 
this investigation, see the ``Scope of the Investigation,'' attached to 
this notice at Appendix I.

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 at Appendix II.

Use of Adverse Facts Available

    In making this final determination, the Department relied, in part, 
on facts available and, because the Government of Brazil and the 
respondent companies did not act to the best of their abilities 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 applied facts available, with 
adverse inferences, for the Reduction of Tax on Industrialized Products 
for Machines and Equipment, the BNDES FINAME Loan program, and the Ex-
Tarif[aacute]rio program, in accordance with section 776(a) and (b) of 
the Tariff Act of 1930, as amended, (the Act). For further information, 
see the section ``Use of Adverse Facts Available'' in the accompanying 
Final 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 Usinas Siderurgicas de Minas Gerais S.A. 
(Usiminas) and Companhia Siderurgica Nacional (CSN), the 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 mandatory respondents by 
those companies' exports of the subject merchandise to the United 
States. Under section 705(c)(5)(A)(i) of the Act, the all-others rate 
excludes zero and de minimis rates calculated for the exporters and 
producers individually investigated as well as any rates based entirely 
on facts otherwise available, pursuant to section 776 of the Act. 
Neither of the respondents' rates was zero or de minimis or based 
entirely on facts otherwise available. Notwithstanding the language of 
section 705(c)(5)(A)(i) of the Act, we did not not calculate the ``all-
others'' rate by weight averaging the rates of the two individually 
investigated respondents using their actual export sales data, because 
doing so risks disclosure of proprietary information. Instead, we 
calculated the all-others rate using the simple average of the 
respondents' calculated rates.\6\ The estimated

[[Page 49942]]

countervailable subsidy rates are as follows:
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    \6\ See Memorandum to Dana S. Mermelstein, Program Manager, AD/
CVD Operations, Office I, ``Final Affirmative Countervailing Duty 
Determination: Cold-Rolled Steel Flat Products from Brazil; 
Calculation of the All Others Rate for the Final Determination in 
the Countervailing Duty Investigation of Cold-Rolled Steel Flat 
Products from Brazil'' dated concurrently with this notice.

------------------------------------------------------------------------
                                                           Subsidy rate
                         Company                             (percent)
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Companhia Siderurgica Nacional (CSN)....................           11.31
Usinas Siderurgicas de Minas Gerais S.A. (Usiminas).....           11.09
All Others..............................................           11.20
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Continuation of Suspension of Liquidation

    As a result of our Preliminary Determination and pursuant to 
section 703(d) of the Act, we instructed U.S. Customs and Border 
Protection (CBP) to suspend liquidation of all entries of cold-rolled 
steel from Brazil, that were entered, or withdrawn from warehouse, for 
consumption on or after December 22, 2015, the date of the publication 
of the Preliminary Determination in the Federal Register. In accordance 
with section 703(d) of the Act, we issued instructions to CBP to 
discontinue the suspension of liquidation for countervailing duty (CVD) 
purposes for subject merchandise entered, or withdrawn from warehouse, 
on or after April 20, 2016, but to continue the suspension of 
liquidation of all entries from December 22, 2015 through April 19, 
2016.
    If the U.S. International Trade Commission (ITC) issues a final 
affirmative injury determination, we will issue a CVD order and will 
reinstate the suspension of liquidation under section 706(a) of the Act 
and will 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.

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

Notification Regarding Administrative Protective Orders

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

Appendix I--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. 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:
    (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 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; \1\
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    \1\ 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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[[Page 49943]]

     Tool steels; \2\
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    \2\ 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; \3\
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    \3\ 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.\4\
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    \4\ 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.\5\
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    \5\ 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 the 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 
U.S. Customs purposes only. The written description of the scope of 
the investigation is dispositive.

Appendix II--List of Topics Discussed in the Issues and Decision 
Memorandum

I. Summary
    Issues
II. Background
    A. Case History
    B. Period of Investigation
III. Scope of the Investigation
IV. Use of Adverse Facts Available
    Subsidies Valuation
    A. Allocation Period
    B. Attribution of Subsidies
    C. Denominators
V. Interest Rates Benchmarks and Discount Rates
VI. Analysis of Programs
    A. Programs Determined To Be Countervailable
    B. Program Determined To Be Not Countervailable
    C. Programs Determined To Be Not Used, or Not To Confer a 
Measurable Benefit, During the POI
    D. Program Determined Not to Exist
VII. Analysis of Comments
    Comment 1: Whether To Apply AFA to both the GOB and Respondents 
for the Reduction of IPI for Machines and Equipment Program
    Comment 2: Whether the Reduction of IPI for Machines and 
Equipment Program is Countervailable
    Comment 3: Whether To Apply AFA for the Ex-Tarif[aacute]rio 
Program
    Comment 4: Whether Ex-Tarif[aacute]rio is De Facto Specific
    Comment 5: Whether Ex-Tarif[aacute]rio Provides a Financial 
Contribution
    Comment 6: Whether the FINAME Loan Program is Specific
    Comment 7: Whether To Apply AFA to Determine the Benefit of the 
FINAME Program
    Comment 8: Whether To Re-Calculate the FINAME Program for 
Usiminas
    Comment 9: Whether To Use a Company-Specific Interest Rate 
Benchmark for the FINAME Loan Program
    Comment 10: Whether the Integrated Drawback Scheme is 
Countervailable
    Comment 11: Whether Usiminas Received a Benefit from the 
Integrated Drawback Scheme
    Comment 12: Whether Reintegra is Countervailable
    Comment 13: Whether To Recalculate the Reintegra Subsidy Rate
    Comment 14: Whether CSN Applied For/Used the Reintegra Program 
During the POI
    Comment 15: Whether the Exemption of Payroll Tax is 
Countervailable
    Comment 16: Whether Subsidies Provided to UMSA should be 
Attributed to Usiminas
    Comment 17: Whether the Economic Subvention to National 
Innovation Program is not Countervailable
    Comment 18: Whether FINEP's Economic Subvention Program has not 
Conferred a Measurable Benefit
    Comment 19: Whether the Bahia State Industrial Development and 
Economic Integration Program (Desenvolve) is De Jure specific
    Comment 20: Whether the GOB's References to Web sites Constitute 
a Full Response
VIII. Recommendation

[FR Doc. 2016-17952 Filed 7-28-16; 8:45 am]
 BILLING CODE 3510-DS-P