Countervailing Duty Investigation of Certain Hot-Rolled Steel Flat Products From the Republic of Korea: Final Affirmative Determination, 53439-53441 [2016-19377]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 81, Number 156 (Friday, August 12, 2016)]
[Notices]
[Pages 53439-53441]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-19377]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-580-884]


Countervailing Duty Investigation of Certain Hot-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 hot-rolled steel flat products (hot-rolled steel) from the 
Republic of Korea (Korea). 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 August 12, 2016.

FOR FURTHER INFORMATION CONTACT: Katie Marksberry, AD/CVD Operations, 
Office V, Enforcement and Compliance, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue NW., Washington, DC 20230; telephone (202) 482-
7906.

SUPPLEMENTARY INFORMATION: 

Background

    The Department published the Preliminary Determination on January 
15, 2016.\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 Countervailing Duty Investigation of Certain Hot-Rolled 
Steel Flat Products From the Republic of Korea: Preliminary Negative 
Determination and Alignment of Final Determination With Final 
Antidumping Duty Determination, 81 FR 2172 (January 15, 2016) 
(Preliminary Determination), and accompanying Preliminary Decision 
Memorandum (PDM).
    \2\ See Memorandum to Paul Piquado, ``Issues and Decision 
Memorandum for the Final Determination in the Countervailing Duty 
Investigation of Certain Hot-Rolled Steel Flat Products from the 
Republic of Korea,'' dated August 4, 2016 (Issues and Decision 
Memorandum).
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Scope of the Investigation

    The products covered by this investigation are hot-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.

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.\3\ 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) \4\ 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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    \3\ See sections 776(a) and (b) of the Act.
    \4\ POSCO reported at verification that DWI changed its name to 
POSCO Daewoo Corporation (PDC) in March 2016. See IDM at 6.
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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)
------------------------------------------------------------------------
POSCO...................................................           57.04
Hyundai Steel Co., Ltd..................................            3.89
All-Others..............................................            3.89
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[[Page 53440]]

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 
hot-rolled steel flat products from the Republic of Korea. However, as 
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 hot-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.
    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 and 19 CFR 351.210(c).

    Dated: August 4, 2016.
Ronald K. Lorentzen,
Acting Assistant Secretary for Enforcement and Compliance.

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

I. Summary
II. Background
III. Scope Comments
IV. Scope of the Investigation
V. Subsidies Valuation
VI. Benchmarks and Discount Rates
VII. Use of Facts Otherwise Available And Adverse Inferences
VIII. Analysis of Programs
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 Bubmitted 
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 Research and 
Development (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: The Department Improperly Countervailed Property Tax 
Exemptions Received by the Pohang Plant Under RSTA 78
    Comment 10: The Department's Methodology for Attributing RSTA 
Article 22 Benefits Received by Hyundai Corporation to Hyundai Steel 
Was Incorrect
    Comment 11: Whether Hyundai Steel Should Have Reported 
Additional ITIPA Grants
    Comment 12: Whether Hyundai Steel Should Have Provided a 
Questionnaire Response for Hyundai Green Power
X. Recommendation

Appendix II--Scope of the Investigation

    The products covered by this investigation are certain hot-
rolled, flat-rolled steel products, with or without patterns in 
relief, and 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 
thickness, and 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 of 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 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 achieve 
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 unless the resulting measurement makes the product 
covered by the existing antidumping \5\ or countervailing duty \6\ 
orders on Certain Cut-To-Length Carbon-Quality Steel Plate Products 
From the Republic of Korea (A-580-836; C-580-837), and
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    \5\ See Notice of Amendment of Final Determinations of Sales at 
Less Than Fair Value and Antidumping Duty Orders: Certain Cut-To-
Length Carbon-Quality Steel Plate Products From France, India, 
Indonesia, Italy, Japan and the Republic of Korea, 65 FR 6585 
(February 10, 2000).
    \6\ See Notice of Amended Final Determinations: Certain Cut-to-
Length Carbon-Quality Steel Plate From India and the Republic of 
Korea; and Notice of Countervailing Duty Orders: Certain Cut-To-
Length Carbon-Quality Steel Plate From France, India, Indonesia, 
Italy, and the Republic of Korea, 65 FR 6587 (February 10, 2000).
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    (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

[[Page 53441]]

     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, or
     0.80 percent of molybdenum, or
     0.10 percent of niobium, 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, the 
substrate for 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. The substrate for motor 
lamination steels contains 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 hot-rolled steel that has been 
further processed in a third country, including but not limited to 
pickling, oiling, levelling, annealing, tempering, temper rolling, 
skin passing, painting, varnishing, trimming, cutting, punching, 
and/or slitting, or any other processing that would not otherwise 
remove the merchandise from the scope of the investigations if 
performed in the country of manufacture of the hot-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 these 
investigations unless specifically excluded. The following products 
are outside of and/or specifically excluded from the scope of this 
investigation:
     Universal mill plates (i.e., hot-rolled, flat-rolled 
products not in coils that have been rolled on four faces or in a 
closed box pass, of a width exceeding 150 mm but not exceeding 1250 
mm, of a thickness not less than 4.0 mm, and without patterns in 
relief);
     Products that have been cold-rolled (cold-reduced) 
after hot-rolling; \7\
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    \7\ For purposes of this scope exclusion, rolling operations 
such as a skin pass, levelling, temper rolling or other minor 
rolling operations after the hot-rolling process for purposes of 
surface finish, flatness, shape control, or gauge control do not 
constitute cold-rolling sufficient to meet this exclusion.
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     Ball bearing steels; \8\
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    \8\ 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; \9\ and
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    \9\ 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 steels; \10\
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    \10\ 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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    The products subject to this investigation are currently 
classified in the Harmonized Tariff Schedule of the United States 
(``HTSUS'') under item numbers: 7208.10.1500, 7208.10.3000, 
7208.10.6000, 7208.25.3000, 7208.25.6000, 7208.26.0030, 
7208.26.0060, 7208.27.0030, 7208.27.0060, 7208.36.0030, 
7208.36.0060, 7208.37.0030, 7208.37.0060, 7208.38.0015, 
7208.38.0030, 7208.38.0090, 7208.39.0015, 7208.39.0030, 
7208.39.0090, 7208.40.6030, 7208.40.6060, 7208.53.0000, 
7208.54.0000, 7208.90.0000, 7210.70.3000, 7211.14.0030, 
7211.14.0090, 7211.19.1500, 7211.19.2000, 7211.19.3000, 
7211.19.4500, 7211.19.6000, 7211.19.7530, 7211.19.7560, 
7211.19.7590, 7225.11.0000, 7225.19.0000, 7225.30.3050, 
7225.30.7000, 7225.40.7000, 7225.99.0090, 7226.11.1000, 
7226.11.9030, 7226.11.9060, 7226.19.1000, 7226.19.9000, 
7226.91.5000, 7226.91.7000, and 7226.91.8000. The products subject 
to the investigation may also enter under the following HTSUS 
numbers: 7210.90.9000, 7211.90.0000, 7212.40.1000, 7212.40.5000, 
7212.50.0000, 7214.91.0015, 7214.91.0060, 7214.91.0090, 
7214.99.0060, 7214.99.0075, 7214.99.0090, 7215.90.5000, 
7226.99.0180, and 7228.60.6000.
    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.

[FR Doc. 2016-19377 Filed 8-11-16; 8:45 am]
 BILLING CODE 3510-DS-P