[Federal Register Volume 59, Number 21 (Tuesday, February 1, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-2241]
[[Page Unknown]]
[Federal Register: February 1, 1994]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
[C-475-812]
Preliminary Affirmative Countervailing Duty Determination: Grain-
Oriented Electrical Steel From Italy
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
EFFECTIVE DATE: February 1, 1994.
FOR FURTHER INFORMATION CONTACT: Annika L. O'Hara or David R. Boyland,
Office of Countervailing Investigations, Import Administration, U.S.
Department of Commerce, room 3099, 14th Street and Constitution Avenue,
NW., Washington, DC 20230; telephone (202) 482-4198 and (202) 482-0588,
respectively.
PRELIMINARY DETERMINATION: The Department preliminarily determines that
benefits which constitute subsidies within the meaning of section 701
of the Tariff Act of 1930, as amended (``the Act''), are being provided
to manufacturers, producers, or exporters in Italy of grain-oriented
electrical steel. For information on the estimated net subsidies,
please see the Suspension of Liquidation section of this notice.
Case History
Since the publication of the notice of initiation in the Federal
Register (58 FR 49018, September 21, 1993), the following events have
occurred.
On September 20, 1993, we issued a questionnaire to the European
Community (``EC'') in Washington, DC, concerning petitioners'
allegations. On October 21, 1993, we received a response from the EC.
We issued deficiency questionnaires to the EC on November 1, 1993, and
January 10, 1994, and we received responses on November 19, 1993, and
January 18, 1994.
On September 23, 1993, we issued a questionnaire to the Government
of Italy (``GOI'') in Washington, DC, concerning petitioners'
allegations. The GOI indicated on September 30, 1993 that ILVA S.p.A.
(``ILVA'') was the only company in Italy producing and exporting grain-
oriented electrical steel to the United States. On October 7, 1993,
petitioners requested that the Department reconsider its decision not
to include in its investigation six subsidy programs alleged in the
petition. On October 29, 1993, the Department decided to include two of
these alleged programs. We issued a questionnaire to the GOI regarding
these two programs on October 29, 1993.
On November 3, 1993, we postponed the preliminary determination to
January 24, 1994 (58 FR 59990, November 12, 1993). On November 4, 1993,
we published in the Federal Register a notice revising the scope of
this investigation (58 FR 58838).
On November 8 and 12, 1993, we received questionnaire responses
from the GOI and ILVA. We issued deficiency questionnaires to these
parties on November 24 and December 2, 1993, and on January 10, 1994.
We received responses on December 15, 20, and 23, 1993, and on January
18 and 21, 1994. We also received certain factual information requested
by the Department from ILVA on January 12, 1994.
Scope of Investigation
This investigation concerns the following class or kind of
merchandise: Grain-oriented electrical steel (``electrical steel'')
from Italy.
The product covered by this investigation is grain-oriented silicon
electrical steel, which is a flat-rolled alloy steel product containing
by weight at least 0.6 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, of a thickness of no more than 0.560 millimeters, in coils
of any width, or in straight lengths which are of a width measuring at
least 10 times the thickness, as currently classifiable in the
Harmonized Tariff Schedule (``HTS'') under item numbers 7225.10.0030,
7225.30.7000, 7225.40.7000, 7225.50.8000, 7225.90.0000, 7226.10.1030,
7226.10.5015, 7226.10.5065, 7226.91.7000, 7226.91.8000, 7226.92.5000,
7226.92.7050, 7226.92.8050, 7226.99.0000, 7228.30.8050, 7228.60.6000,
and 7229.90.1000.
Although the HTS subheadings are provided for convenience and
customs purposes, our written description of the scope of this
proceeding is dispositive.
Injury Test
Because Italy is a ``country under the Agreement'' within the
meaning of section 701(b) of the Act, the U.S. International Trade
Commission (``ITC'') is required to determine whether imports of
electrical steel from Italy materially injure, or threaten material
injury to, a U.S. industry. On October 12, 1993, the ITC preliminarily
determined that there is a reasonable indication that an industry in
the United States is being materially injured or threatened with
material injury by reason of imports from Italy of the subject
merchandise (58 FR 54168, October 20, 1993).
Petitioners
The petition in this investigation was filed by Allegheny Ludlum
Corp.; Armco, Inc.; United Steelworkers of America; Butler Armco
Independent Union; and Zanesville Armco Independent Union.
Corporate History of Respondent ILVA
Prior to 1987, electrical steel in Italy was produced by Terni
S.p.A., a main operating company of Finsider. Finsider was a
government-owned holding company which controlled all state-owned steel
companies in Italy. In a restructuring of the Italian steel industry in
1982, Terni S.p.A. took over two companies, Lovere Sidermeccanica
S.p.A. (``Lovere'') and Attivita Industriali Triestine S.p.A.
(``Trieste''), from Italsider, another Finsider-owned steel producer.
Italsider has previously been found to be the recipient of
countervailable subsidies (see Final Affirmative Countervailing Duty
Determinations: Certain Steel Products from Italy (``Certain Steel'')
(58 FR 37327, July 9, 1993).
As part of a subsequent restructuring in 1987, Terni S.p.A.
transferred its assets to a new company, Terni Acciai Speciali
(``TAS'') which thereafter held all the assets for electrical steel
production in Italy. Lovere and Trieste ended up being wholly-owned
subsidiaries of TAS. In 1988, another restructuring took place in which
Finsider and its main operating companies (TAS, Italsider, and Nuova
Deltasider) entered into liquidation and a new company, ILVA S.p.A.
(``ILVA''), was formed. ILVA took over some of the assets and
liabilities of the liquidating companies. With respect to TAS, part of
its liabilities and all of its viable assets, including all the assets
associated with the production of electrical steel, were transferred to
ILVA on December 31, 1988. ILVA itself became operational on January 1,
1989. Part of TAS' remaining assets and liabilities were transferred to
ILVA on April 1, 1990. After that date, TAS no longer had any
manufacturing activities.
ILVA currently consists of several operating divisions, one of
which is a Terni division which manufactures the subject merchandise.
In addition, ILVA is the majority owner of a large number of separately
incorporated subsidiaries. The subsidiaries produce various types of
steel products and also include service centers, trading companies, an
electric power company, etc. ILVA and its subsidiaries together
constitute the ILVA Group. The ILVA Group is owned by the Instituto per
la Ricostruzione Industriale (``IRI''), a holding company wholly-owned
by the GOI.
For purposes of this investigation, we have calculated the amount
of subsidies bestowed on the subject merchandise by cumulating benefits
provided to Terni, TAS and ILVA from 1978 through 1992.
Spin-offs
ILVA's responses show that between 1990 and 1992, the company sold
``productive units,'' as defined in the General Issues Appendix, to
private buyers. (See General Issues Appendix to Final Affirmative
Countervailing Duty Determination: Certain Steel Products from Austria
(``General Issues Appendix'') (58 FR 37217, 37265-8, July 9, 1993)).
Using the pass-through methodology described in the General Issues
Appendix, we have calculated the proportion of subsidies received by
ILVA that ``left'' the company as a result of the sales of these
productive units.
ILVA has also stated that TAS sold Lovere and Trieste to private
buyers before the 1988 restructuring of Finsider into ILVA. However, we
have not done pass-through calculations for these two spun-off units.
With respect to Trieste, TAS's 1989 Annual Report indicates that the
entire capital stock of Trieste was transferred to ILVA in 1989.
Therefore, the alleged sale to a private buyer does not seem to have
taken place. Regarding Lovere, TAS sold this company to Fin.Lo S.p.A.
in 1990, according to TAS's 1990 Annual Report. However, ILVA has
failed to provide the information requested by the Department in order
to conduct its pass-through analysis.
Equityworthiness and Creditworthiness
Petitioners have alleged that Terni, TAS and ILVA were
unequityworthy in each year they received equity infusions from the GOI
and that the equity infusions were, therefore, inconsistent with
commercial considerations. Petitioners have also alleged that Terni and
ILVA were uncreditworthy in every year between 1978 and 1992.
With respect to our analysis of the companies' equityworthiness, we
noted that the companies have sustained losses from 1976 onward. ILVA
had a brief period of operating profits for 1989 through 1991, but its
return on equity during this period declined until there was a negative
return. No evidence of equity investment by private investors during
the period in question was provided in the responses. Terni and ILVA's
debt to equity ratios were relatively high; read in conjunction with
other financial indicators, such as negative rates of return on equity
and sales plus net losses for numerous years, the companies' financial
performance appears to be weak. Based on our analysis of the responses,
the Department preliminarily finds that Terni, TAS and ILVA were
unequityworthy from 1978 through 1992, except in 1979, 1983, 1988, and
1989 when no equity infusions were received. See also January 13, 1994
Memorandum to Director of Accounting.
After examining Terni and ILVA's current, quick, times interest
earned and debt to equity, the Department also preliminarily determines
that Terni, TAS and ILVA were uncreditworthy from 1978 through 1992.
For example, the companies' times interest earned ratios were anemic
for approximately 16 years, indicating a weak long-term solvency.
Furthermore, the debt to equity ratio for both Terni and ILVA were
relatively high. See also January 13, 1994 Memorandum to Director of
Accounting.
For uncreditworthy companies, Sec. 355.44(b)(6)(iv) of the
Department's Proposed Regulations (Countervailing Duties; Notice of
Proposed Rulemaking and Request for Public Comments, 54 FR 23366, May
31, 1989) directs us to use, as the benchmark interest rate, the
highest long-term interest rate plus an amount equal to 12 percent of
the prime rate. However, because the highest long-term interest rate is
not available, we have used the reference rate provided by the Bank of
Italy. We then added to this rate an amount equal to 12 percent of the
Italian prime rate. We have used the resulting interest rate for each
appropriate year as the benchmark for our long-term loan calculations,
and as the discount rate for allocating over time the benefit from
equity infusions and non-recurring grants.
Analysis of Programs
For purposes of this preliminary determination, the period for
which we are measuring subsidies (the POI) is calendar year 1992.
In determining the benefits received under the various programs
described below, we used the following calculation methodology. We
first calculated the benefit attributable to the POI for each
countervailable program, using the methodologies described in each
program section below. For those subsidies received by ILVA that were
allocated over time, we then performed the pass-through analysis
discussed in the General Issues Appendix at 37269. For each program, we
then divided the benefit attributable to ILVA by a denominator which
represented the sales of ILVA S.p.A. or the sales of the Terni division
of ILVA, depending on which company received the benefit. (The program
sections below indicate which denominator has been used for each
program.) Next, we added the benefits for all programs, including the
benefits for programs which were not allocated over time, to arrive at
ILVA's total subsidy rate. Because ILVA is the only respondent company
in this investigation, this rate equals the country-wide rate.
Consistent with our practice in preliminary determinations, when a
response to an allegation denies the existence of a program, receipt of
benefits under a program, or eligibility of a company or industry under
a program, and the Department has no persuasive evidence showing that
the response is incorrect, we accept the response for purposes of the
preliminary determination. All such responses, however, are subject to
verification. If the response cannot be supported at verification, and
the program is otherwise countervailable, the program will be
considered a subsidy in the final determination.
Based upon our analysis of the petition and the responses to our
questionnaires, we preliminarily determine the following:
I. Programs Preliminarily Determined To Be Countervailable
1. Equity Infusions
a. New Equity Capital. The GOI, through the IRI, provided new
equity capital to Terni, TAS, or ILVA in every year from 1978 through
1991, except in 1979, 1983, 1988, and 1989. Because the GOI provided no
information with respect to specificity, we are assuming as the best
information available (``BIA''), that these equity investments were
provided specifically to the steel industry. (See also Certain Steel.)
As discussed above, we have preliminarily determined that Terni,
TAS, and ILVA were unequityworthy in each year they received new equity
capital. Therefore, these provisions of equity were inconsistent with
commercial considerations and countervailable.
To calculate the benefit for the POI, we treated each of the equity
amounts as a grant and allocated the benefits over a 15-year period.
(Our treatment of equity as grants and our choice of allocation period
is discussed in the General Issues Appendix, at 37239 and 37225,
respectively.)
For equity infusions provided to Terni or TAS, we have divided the
benefit allocated to the POI by the sales of the Terni division of
ILVA. We chose this sales denominator because this division of ILVA
most closely resembles the former companies, Terni and TAS. For equity
infusions into ILVA, we used ILVA S.p.A.'s sales as our denominator, as
benefits from these investments are not tied to any division of ILVA.
On this basis, we find the estimated net subsidy from equity infusions
into Terni, TAS, and ILVA, to be 9.66 percent ad valorem for all
manufacturers, producers, and exporters in Italy of the subject
merchandise.
b. Restructuring of Finsider into ILVA. As discussed above under
the ``Corporate History'' section of this notice, the GOI liquidated
Finsider and its main operating companies in 1988 and assembled the
group's most productive assets into a new operating company, ILVA
S.p.A. At the same time, the Finsider Group had total liabilities of
10.6 trillion lire. ILVA assumed 4.3 trillion lire of this debt and the
remaining 6.3 billion was assumed by IRI. In 1990, additional assets
and liabilities of TAS went to ILVA.
In Certain Steel, we determined that the Finsider assets
transferred to ILVA were an equity infusion into ILVA and that the
portion of the debt assumed by IRI represented a debt forgiveness to
ILVA. Based on those findings in Certain Steel, petitioners in this
proceeding have alleged that the 1988 equity infusion that created ILVA
and the 1988 debt forgiveness constitute subsidies to electrical steel.
Additionally, petitioners have alleged that: (1) A 1988 forgiveness of
TAS's debt by Finsider and (2) various other forms of assistance
provided after 1988 to TAS, confer subsidies on the subject
merchandise.
We have reconsidered the Department's analysis in Certain Steel. We
note that the Department applied BIA in the final determination in that
case because we did not verify ILVA's data. Much of the BIA was taken
from the petition.
Based on our review of the information presented in this
investigation, we have preliminarily concluded that the analysis used
in Certain Steel was inconsistent with the restructuring methodology
described in Final Affirmative Countervailing Duty Determination:
Certain Steel Products from Austria (``Certain Steel from Austria'')
(58 FR 37217, July 9, 1993), Final Affirmative Countervailing Duty
Determinations: Certain Steel Products from Spain (``Certain Steel from
Spain'') (58 FR 37374, July 9, 1993) and the General Issues Appendix.
In the Austrian case, the Department examined a government-owned
operating company (``VAAG'') which was split up into numerous operating
companies. In order to effect this split-up, the assets and liabilities
of the original company were divided among the new operating companies.
The Department ruled in Certain Steel from Austria, that this
``equity infusion'' creating the new operating companies ``was merely a
redistribution of existing assets'' which, in and of itself, did not
give rise to any benefits (at 37222). Instead, the benefit that arose
through the restructuring of VAAG was the fact that losses that had
been incurred by the original company were not distributed to the new
operating companies. Because it did not receive a portion of those
losses, the Department determined that the operating company under
investigation effectively received a grant in the amount of the losses
that should have been distributed to it.
Similarly, in Certain Steel from Spain, a cold rolling mill was
transferred from one government-owned company to another (at 37379). We
did not treat the redistributed capital as an equity infusion into the
recipient company. Instead, prior subsidies allocable to the cold
rolling mill were allocated to its new owner.
We believe that the restructuring of Finsider into ILVA is
analogous to the situations in Austrian and Spanish steel cases. The
assets and a portion of the liabilities that resided in the government-
owned Terni/TAS were merely redistributed to ILVA. These assets brought
subsidies with them, i.e., the subsidies previously received by Terni/
TAS and described elsewhere in this notice, but the movement of assets
from Terni and the other former Finsider companies such as Italsider
into ILVA does not constitute a countervailable equity infusion.
This does not mean, however, that no new benefits were received by
ILVA through the 1988 restructuring and the subsequent transfer of
assets and liabilities in 1990. In Certain Steel from Austria, a
benefit arose because accumulated losses were not distributed along
with assets and liabilities. In the case of the Finsider restructuring,
and more specifically the transfer of assets from Terni/TAS to ILVA,
ILVA received its Terni division with assets in excess of liabilities.
This was despite the fact that prior to the transfer Terni/TAS's
liabilities exceeded its assets. Thus, as part of the transfer process,
Terni/TAS's balance sheet was effectively rewritten so as to change its
equity from negative 99,885,535,826 lire to positive 317,836,000,000.
It is not clear from the information provided in the petition or
the responses exactly how this change was effected. As noted above,
there was forgiveness of Terni/TAS and Finsider debt in 1988. Also,
petitioners have alleged various forms of assistance to Terni/TAS since
1988. We believe that the debt forgiveness and, perhaps, some of the
further assistance alleged by petitioners may have been the tools used
by the GOI to rewrite Terni's balance sheet. However, rather than focus
on these individual pieces of assistance, we have relied on a
comparison of what Terni looked like before the restructuring and what
it looked like after the restructuring. We believe this is the most
reasonable approach given the complicated nature and extensive number
of transactions surrounding the transfer. At verification, we will seek
to clarify the events that made up the restructuring. We will continue
to examine our approach to this issue throughout the remainder of the
investigation and will take into consideration comments submitted by
interested parties for purposes of our final determination. Given the
complexity of this situation, we invite particular comment focused on
this issue.
Based on the analysis described above, we are treating as a grant
the difference between Terni/TAS's equity position before and after the
restructuring. Because the transfer of assets and liabilities from
Terni/TAS to ILVA took place in two parts, first in 1988 and then in
1990, we have divided the total amount of the grant between these two
years. In 1988, 60 percent of TAS's assets were transferred. Therefore,
we have treated 60 percent of the grant amount as having been received
in that year. The remainder was treated as a grant received in 1990.
The benefit allocated to the POI was divided by the Terni division's
sales in the POI.
It may be argued that the amount we have countervailed overstates
the benefit to production of electrical steel because a portion of the
assets that existed in Terni/TAS prior to the restructuring continues
to reside in Terni/TAS in liquidation. Despite this, the Department
treated the entire benefit arising from the rewriting of Terni/TAS's
balance sheet as a subsidy to the Terni division of ILVA. On the other
hand, it may be argued that the production of electrical steel benefits
from alleged subsidies received by Terni/TAS after the final transfer
of assets in 1990.
We preliminarily disagree with both of these arguments. The effect
of the 1988 and 1990 transfers was to move the production activities of
Terni/TAS to ILVA. As best we can follow, TAS remained to close down
non-productive facilities and to carry on financial operations
connected with its liquidation. Consistent with the position
articulated most recently by the Department in the General Issues
Appendix, at 37269, subsidies do not remain with closed down
operations. Therefore, it is proper to assign all benefits from the
restructuring to the ongoing production operations now located in ILVA.
Similarly, because the entire production operations have transferred to
ILVA and because we believe we have captured the full amount of the
assistance needed to effect that transfer, any alleged subsidies to
what remained in TAS do not provide any benefit to the subject
merchandise.
Based on the information provided above, we preliminarily find the
estimated net subsidy from the restructuring of Finsider to ILVA to be
5.70 percent ad valorem for all manufacturers, producers and exporters
in Italy of the subject merchandise.
c. The 1987 Restructuring. As part of a 1987 restructuring, Terni
conferred its assets to TAS. For the reasons discussed under the
``Restructuring of Finsider into ILVA'' section above, we have
preliminarily determined not to treat the transfer of assets as an
equity infusion into TAS. However, we have treated as an equity
infusion capital received by TAS in 1987 that was not associated with
the asset transfer. The estimated net subsidy from this infusion is
included in the equity calculation above (see section a). Also, the
subsidies received by Terni prior to the 1987 transfer are being
allocated in full to TAS and, from 1988, to ILVA.
d. The Transfer of Lovere and Trieste to Terni in 1982. As
discussed in the ``Corporate History'' section of this notice, Lovere
and Trieste were transferred from Italsider to Terni as part of a 1982
restructuring. Petitioners included the value of the transferred assets
as part of their equity allegation for 1982.
We have preliminarily determined that this transaction is more
correctly characterized as an internal corporate restructuring that
warrants a reallocation of subsidies among government-owned units. When
Italsider received untied subsidies (e.g., equity infusions), those
subsidies benefitted all of Italsider's operations, including Lovere
and Trieste. The transfer of these two industrial plants to Terni did
nothing to alter those subsidies. (See Final Affirmative Countervailing
Duty Determination: Certain Hot Rolled Lead and Bismuth Carbon Steel
Products from the United Kingdom 58 FR 12534, January 27, 1993
(``Leaded Bar'')). Therefore, consistent with our restructuring
methodology, when Lovere and Trieste ``traveled'' to Terni, they
brought with them a portion of the subsidies which had been provided to
Italsider.
As stated in the General Issues Appendix at 37266, the Department
does not consider internal corporate restructurings that transfer or
shuffle assets among related parties to constitute a ``sale'' for
purposes of its pass-through analysis. However, when assets are
transferred internally, the Department still needs to allocate
subsidies.
We do not have sufficient information on the current record as to
the total amount of untied benefits received by Italsider prior to the
transfer of Lovere and Trieste. ILVA has, however, provided the amount
of equity infusions received by Italsider from 1978 (the beginning of
our allocation period) through 1982. Therefore, for purposes for the
preliminary determination, we have calculated the amount of subsidies
that travelled with Lovere and Trieste from Italsider to Terni based on
the equity infusions provided to Italsider.
We determined the amount of Italsider's subsidies attributable to
Lovere and Trieste by calculating the percentage of assets these two
companies represented of the total Italsider assets. We applied this
percentage to Italsider's subsidy amount to calculate the portion of
benefit Lovere and Trieste carried with them to Terni. This benefit for
the POI was divided by the total sales of the Terni division of ILVA.
On this basis, we find the estimated net subsidy from the transfer of
Lovere and Trieste to Terni to be .49 percent ad valorem for all
manufacturers, producers, and exporters in Italy of the subject
merchandise.
2. Interest-Free Loan to ILVA
Based on ILVA's 1992 Annual Report, petitioners have alleged that
the company received a 300 billion lire equity infusion in that year.
According to ILVA, this amount does not represent an equity infusion
but rather a loan.
Because the GOI has provided no information with respect to
specificity, we are assuming as BIA, that this loan was provided
specifically to ILVA. ILVA has provided no interest rate, repayment
schedule, or other terms for the loan. Therefore, we have assumed that
this was an interest-free loan. To determine the benefit, we first
calculated the interest that would have been paid during the POI on a
300 billion lire loan at the benchmark interest rate. We then divided
this amount by ILVA S.p.A's sales in the POI. On this basis, we
determine the estimated net subsidy from this program to be .65 percent
ad valorem for all manufacturers, producers, and exporters in Italy of
the subject merchandise.
3. Law 675/77 Preferential Financing
a. General Description of Law 675/77. Law 675/77 was enacted to
bring about restructuring and reconversion in the following industrial
sectors: (1) Electronic technology; (2) the manufacturing industry; (3)
the agro-food industry; (4) the chemical industry; (5) the steel
industry; (6) the pulp and paper industry; (7) the fashion sector; and
(8) the automobile and aviation sectors. Law 675/77 also sought to
promote optimal exploitation of energy resources, and ecological and
environmental recovery.
A primary goal of this legislation was to bring all government
industrial assistance programs under a single law in order to develop a
system to replace indiscriminate and random public intervention by the
GOI. Other goals were (1) to reorganize and develop the industrial
sector as a whole; (2) to increase employment in the South; and (3) to
maintain employment in depressed areas. Among other measures taken, the
Interministerial Committee for the Coordination of Industrial Policy
(``CIPI'') was created as a result of Law 675/77. CIPI approves
specific projects in each of the industrial sectors listed above.
Six main programs were provided under Law 675/77: (1) Interest
contributions on bank loans; (2) mortgage loans provided by the
Ministry of Industry at subsidized interest rates; (3) interest
contributions on funds raised by bond issues; (4) capital grants for
projects in the South; (5) personnel retraining grants; and (6) VAT
reductions on purchases of capital goods by companies in the South.
Except for personnel retraining grants, Law 675/77 went into effect
in 1977. According to ILVA, the law has since expired. The GOI has not
been specific on this point but has stated that no company has applied
for funding under Law 675/77 since 1982.
Information provided by the GOI shows that the steel industry was
the single largest recipient of benefits under Law 675/77 programs (1)
through (3), listed above. The GOI's response also indicates that the
steel industry received a disproportionate share of the benefits under
this law. Based on this information, the Department preliminarily
determines that the steel industry was a dominant user of programs
under Law 675/77 and, therefore, that benefits received by ILVA under
this law are being provided to a specific enterprise or industry or
group of enterprises or industries. (See also Certain Steel.)
b. Countervailable Assistance Under Law 675/77.
(i) Interest Contributions on Bank Loans. Italian commercial banks
provided loans at market interest rates to industries designated under
Law 675/77. However, the interest owed by the recipient companies was
offset by interest contributions from the GOI. Terni received bank
loans with interest contributions under Law 675/77 which were
outstanding in the POI.
To determine whether this assistance conferred a benefit, we
compared the effective interest rate paid on these loans to the
benchmark interest rate, discussed above. Based on this comparison, we
preliminarily determine that the financing provided under this program
is inconsistent with commercial considerations.
Because Terni knew that it would receive the interest contributions
when it obtained the loans, we consider the contributions to constitute
reductions in the interest rates charged rather than grants (see
Certain Steel at 37335).
To calculate the benefit we used our standard long-term loan
methodology as described in Sec. 355.49(c)(1) of the Proposed
Regulations. We then divided the benefit allocated to the POI by the
1992 sales made by the Terni division of ILVA. On this basis, we
determine the estimated net subsidy from this program to be .07 percent
ad valorem for all manufacturers, producers, and exporters in Italy of
the subject merchandise.
(ii) Mortgage Loans from the Ministry of Industry. Under Law 675/
77, companies could obtain low-interest mortgage loans from the
Ministry of Industry. The response indicates that Terni received two
such loans which were still outstanding in the POI.
To determine whether these loans were provided on terms
inconsistent with commercial considerations, we used the benchmark
interest rates described above. Because the interest rates paid on the
Law 675/77 loans were below the benchmark interest rates, the
Department preliminarily determines that loans provided under this
program are countervailable.
We calculated the benefit using our standard long-term loan
methodology. We then divided the benefit allocated to the POI by the
1992 sales made by the Terni division of ILVA. On this basis, we
determine the estimated net subsidy from this program to be .20 percent
ad valorem for all manufacturers, producers, and exporters in Italy of
the subject merchandise.
(iii) Interest Contributions on Loans Financed by IRI Bond Issues.
Under Law 675/77, IRI was allowed to issue bonds to finance
restructuring measures of companies within the IRI Group. The proceeds
from the sales of the bonds were then re-lent to IRI companies. The
effective interest rate on such loans was reduced by interest
contributions made by the GOI. Terni had two of these loans outstanding
during the POI. Both loans had variable interest rates.
To determine whether these loans were countervailable, the
Department used the benchmark interest rate described above. (Because
the loans in question have variable interest rates, we would have
preferred to use a variable rate benchmark. However, we lack
information to do this.) We compared the benchmark rates in the year
the loans were received to the effective rates paid by Terni in that
year and found that these loans were provided on terms inconsistent
with commercial considerations.
To determine the benefit, we first calculated the difference
between what was paid on these loans during the POI and what would have
been paid during the POI had the loans been provided on commercial
terms. We then divided the resulting difference by the 1992 sales made
by the Terni division of ILVA. On this basis, we determine the
estimated net subsidy from this program to be .48 percent ad valorem
for all manufacturers, producers, and exporters in Italy of the subject
merchandise.
4. Interest Grants for ``Indirect Debts'' Under Law 750/81
Interest grants pursuant to Law 750/81 were extended between 1981
and 1983 to IRI-owned companies undergoing reconversion. Respondents
have indicated that Law 750/81 was enacted to implement Article 12 of
Law 675/77 (see section I.3, above), but that the interest
contributions provided for under Law 750/81 were separate from those
made under Law 675/77. Article 12 of Law 675/77 outlines various rules
and budgetary considerations with regard to the extension of financial
aid to state-owned companies under Law 675/77.
Terni received 48.6 billion lire and 27.5 billion lire under this
program in 1982 and 1983, respectively. The response does not tie the
interest contributions to specific loans and the payments, therefore,
appear to have been provided to cover aggregate interest payments on
several different loans as opposed to interest payments on specific
loans.
Because interest contributions pursuant to Law 750/81 are limited
to government-owned companies in reconversion, we preliminarily find
that payments made under Law 750/81 also confer a countervailable
subsidy. We further determine that these payments are non-recurring
grants (see General Issues Appendix at 37226).
To calculate the benefit for the POI, we used our standard grant
methodology (see Sec. 355.49(b) of the Proposed Regulations) using the
discount rate described above. We divided the benefit allocated to the
POI by the 1992 sales of the Terni division of ILVA. On this basis, we
determine the estimated net subsidy from this program to be .77 percent
ad valorem for all manufacturers, producers, and exporters in Italy of
the subject merchandise.
5. Finsider Financing
The response indicates that Terni received four loans from Finsider
of which only one, provided at a variable interest rate, appears to
have been outstanding in the POI. ILVA has argued that such financing
from a parent company to a subsidiary is a normal transaction which
should not be considered to provide a countervailable benefit.
In Certain Steel from Spain (at 37383), the Department declined to
find short-term financing from the National Industrial Institute
(``INI'') to its subsidiary Ensidesa (the state-owned steel company
under investigation) to be countervailable. In that investigation, the
Department determined that there was no evidence that the financing was
a result of a program designed to benefit the steel industry. Further,
the Department found that INI was involved in a number of sectors
outside the steel industry and that INI was capable of generating funds
independently of the government.
In this investigation, however, we have found that Finsider was
previously the holding company only for state-owned steel companies.
Therefore, Finsider's only source of funds for internal lending, beyond
government contributions, was its other steel companies. Given the
financial state of Terni and Finsider's other subsidiaries (see Certain
Steel at 37328), we find no reason to believe that its companies could
generate such funds. More importantly, Finsider has been found to be
the conduit for government-provided assistance to its steel companies.
(See Certain Steel at 37329: ``The GOI made these investments by
transferring funds to the IRI Group, which either directly or through
Finsider made equity infusions into (Italsider, Nuova Italsider).''
Emphasis added.) The Department, therefore, preliminarily determines
that all internal financing provided by Finsider is limited to
Finsider-owned companies and is countervailable to the extent that such
financing was provided on terms inconsistent with commercial
considerations.
Because ILVA has provided incomplete information regarding this
loan, the Department has used BIA for the calculation of the benefit.
Specifically, ILVA did not provide the outstanding balance on this loan
in the POI. Therefore, we have assumed that the entire original loan
amount was still outstanding. Also, because ILVA has not reported the
interest rate in effect during the POI, we have used the reported
interest rate from the most recent period.
To determine whether this loan was countervailable, the Department
used the benchmark interest rate described above. (Because the loan in
question has a variable interest rate, we would have preferred to use a
variable rate benchmark. However, we lack information to do this.) We
compared the benchmark rate in the year the loan was received to the
rate paid by Terni in that year and found that this loan was provided
on terms inconsistent with commercial considerations.
We calculated the benefit for the POI as the difference between the
interest that would have been paid under a benchmark loan and the
interest that was actually paid in the POI. We then divided the benefit
by the 1992 sales made by the Terni division of ILVA. On this basis, we
determine the estimated net subsidy from this program to be .03 percent
ad valorem for all manufacturers, producers, and exporters in Italy of
the subject merchandise.
6. Exchange Rate Guarantee Program
This program, which was enacted by Law 796/76, provided exchange
rate guarantees on foreign currency loans from the European Coal and
Steel Community (``ECSC''). The recipient of a guaranteed loan would
repay the loan at an agreed upon exchange rate. In the event that the
lire depreciated against the currency in which the loan was
denominated, the loan recipient would pay up to two percent more for
the loan. Any currency fluctuations above and beyond two percent of the
fixed exchange rate would be covered by the Treasury Ministry.
This program is limited to companies receiving loans under Articles
54 and 56 of the ECSC Treaty, i.e., iron and steel companies. While all
benefits under this program were eliminated in 1991 by Law 333,
guarantees granted before the enactment of this law were still in
effect in the POI.
The GOI has stated that the premium paid only covered part of the
long-term costs of the program. While we question whether payments
under this program are properly to be considered premiums, the fact
that they are inadequate to cover the costs of operating the guarantee
program is sufficient to find that the program confers a benefit. (See
also Certain Steel) Moreover, we determine that benefits are provided
to a specific enterprise or industry or group of enterprises or
industries.
So long as the lire depreciates against the currency in which the
loan is denominated by more than the two percent maximum, the GOI makes
payments on the guaranteed loan. Because future currency fluctuations
are not known at the time the loan is taken out, no grant equivalent
can be calculated for the guaranteed loans. Therefore, we calculated
the benefit as the payments on this loan made in the POI by the
Treasury Ministry. We divided this amount by the 1992 sales of ILVA's
Terni division. On this basis, we determine the estimated net subsidy
from this program to be .08 percent ad valorem for all manufacturers,
producers, and exporters in Italy of the subject merchandise.
7. Early Retirement
Italy has had a series of laws providing for early retirement since
the late 1960s. Some older laws have been replaced by newer laws, while
other older laws are still in effect, overlapping with newer
legislation.
In 1981, the parliament passed Law 155/81 with the intention to
encourage people to retire before the normal retirement age. Pursuant
to this law, men could retire at the age of 55 and women at the age of
50. Law 155/81 covered all manufacturing industries, including steel,
that the CIPI had declared to be in a state of crisis. Government
documentation provided with the response shows that Italian workers
received benefits under Law 155/81 through 1991. No information has
been provided with respect to usage of this early retirement provision
in the POI.
Law 193/84 lowered the minimum age for early retirement
specifically for steel workers to 50 years for men and 47 years for
women. Government documentation provided with the response shows that
workers received benefits under this law through 1991. We have no
information with respect to usage of the early retirement provision
under Law 193/84 in 1992.
Law 181/89 introduced various social and other measures related to
rationalizing the government-owned steel industry. It also set
numerical targets for the number of workers who could use early
retirement. Pursuant to Law 181/89, a maximum of 8,500 steel workers
were allowed to use early retirement from 1989 through 1991. However,
the GOI has stated that this number was insufficient to solve the
problem of surplus manpower in the steel industry. Therefore, a new law
was passed in 1991 (Law 223/91) which authorized another 20,000 workers
to use early retirement. Of these 20,000 slots, 26 percent were
allocated to the government-owned steel industry while the rest were
distributed among five other industries (shipbuilding, aluminum,
refractory materials and graphite electrodes, thermo-electrical
engineering, and ``innovative industrial companies'' in highly
competitive sectors).
Law 223/91 also set minimum age limits for steel workers using the
early retirement provision under this law to 55 and 50 years for men
and women, respectively, in the private steel industry, and 50 and 47
years for men and women, respectively, in the state-owned steel
industry. Pursuant to Law 223/91, participating companies must make a
financial contribution to the early retirement plan corresponding to 30
percent of the pension. ILVA's 1992 Annual Report indicates that 3,022
employees from ILVA S.p.A. used the early retirement provisions under
Law 223/91 in the POI.
Finally, Decree Law 14, passed in January 1992, allowed another
25,000 workers to use the early retirement scheme. After having been
re-issued several times, this Decree was turned into Law 406 in October
1992. Employees in companies which have adopted a reconstruction
program approved by the Interministerial Committee for Economic
Planning (``CIPE'') are eligible to use the program. The age limits are
55 for men and 50 for women. The 25,000 slots are allocated by CIPE
among crisis-hit companies. The Department has no information on how
the slots were allocated among various crisis industries. Under Law
406/92, participating companies pay 50 percent of the pension.
The GOI has stated that early retirement is available to workers in
other sectors beyond steel, e.g., commercial workers and workers in the
cement industry. However, information provided with the GOI's response
shows that for these other industries, the provisions for early
retirement expired before the POI. Apart from the latest early
retirement provision in Law 406/92, pursuant to which a limited number
of workers in industries undergoing reconstruction are eligible for
early retirement, only eight industries (including steel) were eligible
for some form of early retirement program in the POI. These industries
were: steel, shipbuilding, aluminum, refractory materials and graphite
electrodes, thermo-electrical engineering, and ``innovative industrial
companies,'' all pursuant to Law 223/91; dock workers pursuant to Law
230; and workers in the publishing industry pursuant to Law 416.
Based on this, we preliminarily determine that early retirement
benefits are provided to a specific enterprise or industry or group of
enterprises or industries. (See also Certain Steel.)
Respondents have further stated that Italian companies have no
legal obligation to offer early retirement to their employees. However,
based on a statement made during verification by an official at a
private Italian steel company, we found in Certain Steel that although
Italian companies have no legal obligation to offer their employees
early retirement as an alternative to being laid off, social factors
such as the threat of strikes and social unrest prevent companies from
simply firing surplus workers. In addition, the GOI has stated in its
response that early retirement is used as an alternative to collective
lay-offs. Therefore, we preliminarily determine that the government is
relieving the steel companies of an obligation they would otherwise
incur. Hence, the program is countervailable.
In the General Issues Appendix to Certain Steel from Austria (at
37226), we listed early retirement programs as typically providing
recurring benefits. We have, therefore, treated benefits received by
ILVA under the early retirement program as a recurring grant.
To calculate the benefit, we have estimated the amount the company
saved by not having to pay wages to the workers who took early
retirement in 1992 by reference to ILVA's 1992 Annual Report, which
provides the total number of employees, the total labor cost, and the
number of workers who used early retirement. Had it been provided, we
would have subtracted ILVA's cost for the program from the wage bill.
(We have asked ILVA to provide this list before verification.)
We divided this benefit by the 1992 sales made by ILVA. On this
basis, we determine the estimated net subsidy from this program to be
3.54 percent ad valorem for all manufacturers, producers, and exporters
in Italy of the subject merchandise.
8. ECSC Article 56 Redeployment Aid
Pursuant to Article 56(2)(b) of the ECSC Treaty, redeployment
assistance is provided to workers affected by the restructuring of the
coal and steel industries in the ECSC member states. The assistance
consists of the following types of grants: (1) Income support grants
for workers affected by unemployment, re-employment at a lower salary
or early retirement; (2) grants to enable companies to continue paying
workers who have been laid off temporarily; (3) vocational training
grants; and (4) resettlement grants. According to the EC, Article 56
redeployment aid was disbursed to ILVA's workers in the POI for
training, early retirement, and unemployment.
The Article 56 redeployment grants, which are disbursed to the
member states, are paid from the European Commission's operational
budget for the ECSC steel program. This budget is funded by (1) levies
imposed on coal and steel producers in the member countries; (2) income
from ECSC's investments; (3) guarantee fees and fines paid to the ECSC;
and (4) interest received from companies that have obtained loans from
the ECSC.
Because the ECSC contribution under Article 56 is sourced from
producer levies, we find the ECSC portion of such payments to be not
countervailable (see Certain Steel at 37336). However, according to the
EC's response, the Commission's decision to grant readaptation aid is
contingent upon a matching contribution from the member state. We
further found that member state contributions are countervailable to
the extent that they are specific and relieve a company of an
obligation it would otherwise incur.
As with the early retirement benefits described above, the GOI has
claimed that ILVA had no obligation to provide the types of worker
assistance described under Article 56. With respect to vocational
training grants, we have no evidence to refute this claim. Therefore,
we preliminarily determine that any vocational training grants funded
by the GOI in conjunction with Article 56 are not countervailable.
However, for reasons explained under the ``Early Retirement'' section,
above, we find that ILVA was relieved of obligations with respect to
unemployment and early retirement payments. Therefore, GOI
contributions for these purposes under Article 56(2)(b) provide a
countervailable benefit to ILVA.
In the General Issues Appendix to Certain Steel, we listed early
retirement and worker assistance as programs which typically provide
recurring benefits. We have, therefore, treated the Article 56
redeployment aid as a recurring grant.
ILVA has stated that because payments under Article 56 go directly
from the GOI to the workers, the company has no records of the amount
paid to the workers under this program. The information provided by the
GOI on the amount of its contribution is not clear from the GOI
response. However, we have obtained from the EC the amount that the
ECSC paid to ILVA's workers in the POI under Article 56. As BIA, we
have assumed that the GOI's contribution was equal to the payment made
by the ECSC. (See also Certain Steel at 37336.) We divided this amount
by the 1992 sales made by ILVA S.p.A. On this basis, we determine the
estimated net subsidy from this program to be 1.27 percent ad valorem
for all manufacturers, producers, and exporters in Italy of the subject
merchandise.
9. Urban Redevelopment Financing Under Law 181/89
Urban redevelopment financing is provided to fund re-
industrialization projects and to alleviate unemployment in areas
affected by the crisis in the steel sector. With regard to the re-
industrialization projects, respondents have stated that the urban
redevelopment financing provided to ILVA did not involve or affect the
manufacture of steel, specifically not the production of the subject
merchandise.
With respect to the benefits provided to laid-off employees, the
response indicates that Law 181/89 provided early retirement measures
for steel workers.
This program provided benefits to priority areas hit by the steel
crisis. Thus, we preliminarily determine that assistance under this
program is provided on a regional basis and is, therefore, limited to a
group of industries (Certain Steel at 37332). Therefore, the Department
preliminarily determines that early retirement payments made to ILVA
under Law 181/89 provide countervailable benefits.
ILVA has not provided any amounts received under this program, nor
has ILVA indicated whether funds under this program were received in
the form of loans or grants. As BIA, the Department has used the amount
listed in ILVA's 1992 Annual Report. In the General Issues Appendix (at
37226), we listed early retirement programs as typically providing
recurring benefits. We have, therefore, treated benefits received by
ILVA under this program as a recurring grant.
To determine the benefit under this program, we divided the amount
received during the POI by ILVA's 1992 sales. On this basis, we
determine the estimated net subsidy from this program to be .11 percent
ad valorem for all manufacturers, producers, and exporters in Italy of
the subject merchandise.
10. ECSC Article 54 Loans
Under Article 54 of the 1951 ECSC Treaty, the European Commission
can provide loans directly to iron and steel companies for
modernization and the purchase of new equipment. The loans finance up
to 50 percent of an investment project. The remaining financing needs
must be met from other sources. The Article 54 loan program is financed
by loans taken by the Commission, which are then re-lent to iron and
steel companies in the member states at a slightly higher interest rate
than that at which the Commission obtained them.
ILVA had outstanding Article 54 loans in the POI. These loans,
which were originally received by Terni, were transferred to ILVA as
part of the 1988 partial transfer of Terni's assets and liabilities.
We preliminarily determine that this program is limited to the iron
and steel industry. Terni received a total of four Article 54 loans,
two of which were denominated in U.S. dollars and two in European
Currency Units (``ECU''). To determine whether the loans were provided
on terms inconsistent with commercial considerations, we used the
following benchmark interest rates. For the U.S. dollar loan obtained
in one of the years in which Terni has been found to be uncreditworthy,
we used, as a benchmark interest rate, the highest interest rate on
long-term fixed-rate U.S. dollar loans obtained in the United States,
as reported by the Federal Reserve. To this interest rate, we added a
premium equivalent to 12 percent of the U.S. prime rate in that year.
For the other U.S. dollar loan, which was obtained in a year for which
we have not made an uncreditworthiness determination, we used the
average interest rate on long-term fixed-rate U.S. dollar loans
obtained in the United States, as reported by the Federal Reserve.
We have found Terni to be uncreditworthy in both the years it
obtained the ECU loans. For these loans, we were unable to find the
highest interest rate charged on long-term fixed-rate ECU loans.
Instead, we used as the benchmark interest rate, the interest rate paid
on 5-7 year ECU-denominated bonds, as reported in an EC publication,
plus a risk premium.
Because the interest rates paid on all the Article 54 loans were
below the benchmark interest rates, the Department preliminarily
determines that loans provided under this program are countervailable.
We calculated the benefit using our standard long-term loan
methodology. We then divided the benefit allocated to the POI by the
1992 sales made by the Terni division of ILVA. On this basis, we
determine the estimated net subsidy from this program to be .09 percent
ad valorem for all manufacturers, producers, and exporters in Italy of
the subject merchandise.
II. Programs Preliminarily Determined To Be Not Countervailable
A. Government Loan Guarantees
Finsider guaranteed certain loans taken out by Terni. Terni paid
Finsider guarantee fees in the form of a one-time payment of 0.2
percent of the loan amount. According to ILVA's response, these fees
were equal to the cost of commercially provided guarantees. Therefore,
the Department preliminarily determines that the Finsider loan
guarantees were not provided on terms inconsistent with commercial
considerations and, thus, not countervailable.
B. European Social Fund (``ESF'') Grants
The ESF was established by the 1957 European Economic Community
Treaty to increase employment and help raise worker living standards.
We found in Certain Steel that the ESF receives its funds from the
EC's general budget whose main revenue sources are customs duties,
agricultural levies, value-added taxes collected by the member states,
and other member state contributions.
The member states are responsible for selecting the projects to be
funded by the EC. The EC then disburses the grants to the member states
which manage the funds and implement the projects. According to the EC,
ESF grants are available to (1) people over 25 who have been unemployed
for more than 12 months; (2) people under 25 who have reached the
minimum school-leaving age and who are seeking a job; and (3) certain
workers in rural areas and regions characterized by industrial decline
or lagging development.
The GOI has stated that the ESF grants received by Italy have been
used for vocational training. Certain regions in the South are also
eligible for private sector re-entry and retraining schemes. Since
1990, the vocational training grants have been available to unemployed
youths and long-term unemployed adults all over Italy, according to the
GOI. Before 1990, however, the GOI gave preference to certain regions
in Italy.
In Certain Steel, we found that a preference was given to the
southern region of Italy in the distribution of benefits. Therefore, we
determined that the program was specific because benefits were provided
on a regional basis (see Certain Steel, at 37335). However, based on
the EC's response in this investigation, it appears that all of the
regions in Italy have received ESF funds. Therefore, we preliminarily
determine that this program is not regionally specific and therefore,
not limited to a specific enterprise or industry, or group of
enterprises or industries. Furthermore, we note that to the extent
there is a regional preference (i.e., southern Italy) in the
distribution of ESF benefits, it has not resulted in a countervailable
benefit to the production of the subject merchandise, which is produced
in northern Italy.
C. Personnel Retraining Grants under Law 675/77
The provision for retraining grants under Law 675/77 went into
effect in 1980, but the program was terminated in 1988 due to lack of
funds, according to the response. The purpose of the program was to
retrain workers to use new manufacturing technologies in companies
undergoing reconstruction and reconversion. The GOI has stated that
Italian companies have no legal obligation to retrain their workers and
that the program, therefore, does not provide relief from such
obligations. We have no evidence to refute this claim. Therefore, we
preliminarily determine that benefits under this program are not
countervailable.
III. Programs Which Did Not Benefit the Subject Merchandise in the POI
The Department preliminarily determines that the following programs
did not benefit the subject merchandise in the POI:
A. Loans under the following programs were not outstanding in the
POI, according to the response.
1. Interest Subsidies under Law 617/81
2. Financing under Law 464/72
B. The following export loans were not used for exports to the
United States, according to the response.
Subsidized Export Financing Under Law 227/77
C. The following programs were directed to the South of Italy.
Since production of the subject merchandise takes place outside the
South, the Department preliminarily determines that countervailable
benefits under these programs were tied to products outside the scope
of this investigation.
1. Law 675/77 Capital Grants
2. Reductions of the Value Added Tax (``VAT'') under Law 675/77
3. Interest Contributions under the Sabatini Law (Law 1329/65)
4. Social Security Exemptions
5. ILOR and IRPEG Exemptions
D. Aid Under the National Research Plan
Aid under the National Research Plan is administered under Law 46/
82. In 1985, the Ministry for University, Technology and Scientific
Research assigned 19 billion lire to Terni under this plan. The purpose
of this plan involves basic research regarding the development of steel
products to be employed in the energy and chemical fields. The research
funds cover costs of personnel assigned to specific research projects
in research laboratories. According to the GOI, the research under this
plan was contracted out to Terni as the result of a competitive bidding
process.
In order to receive funds under this plan, Terni and its
subcontractors had to provide to the Ministry a report for each project
under the plan. In 1988, prior to presentation of the report, Terni
received an advance payment in the amount of 20% of the total in order
to cover its first expenses of the research program. Since that time,
Terni has submitted interim reports of its progress on the particular
projects and, therefore, has received a portion of the funds to which
it is entitled. When the work is completed, a report will be submitted
to the Ministry. At that time, the Ministry will determine whether to
approve the final disbursement to ILVA.
According to Article 11 of Law 46/82, the results of the research
under this program belong to the state and may only be assigned to a
company for valuable consideration. According to the GOI, the rights to
the results of this project have not yet been assigned. Therefore,
because ILVA currently has no rights to the research results, the
Department preliminarily finds that ILVA received no benefits under
this program.
Verification
In accordance with section 776(b) of the Act, we will verify the
information used in making our final determination.
Suspension of Liquidation
In accordance with section 703(d) of the Act, we are directing the
U.S. Customs Service to suspend liquidation of all entries of
electrical steel from Italy, which are entered or withdrawn from
warehouse, for consumption on or after the date of the publication of
this notice in the Federal Register, and to require a cash deposit or
bond for such entries of the merchandise in the amounts indicated
below. This suspension will remain in effect until further notice.
Electrical Steel
Country-Wide Ad Valorem Rate 23.14 percent
ITC Notification
In accordance with section 703(f) of the Act, we will notify the
ITC of our determination. In addition, we are making available to the
ITC all nonprivileged and nonproprietary information relating 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, without the written consent
of the Deputy Assistant Secretary for Investigations, Import
Administration.
If our final determination is affirmative, the ITC will make its
final determination within 45 days after the Department makes its final
determination.
Public Comment
In accordance with 19 CFR 355.38, we will hold a public hearing, if
requested, to afford interested parties an opportunity to comment on
this preliminary determination on Monday, March 24, 1994, at 10 a.m. at
the U.S. Department of Commerce, room 3708, 14th Street and
Constitution Avenue, NW., Washington, DC 20230. Individuals who wish to
request a hearing must submit such a request within ten days of the
publication of this notice in the Federal Register to the Assistant
Secretary for Import Administration, U.S. Department of Commerce, room
B099, 14th Street and Constitution Avenue, NW., Washington, DC 20230.
Parties should confirm by telephone the time, date, and place of the
hearing 48 hours before the scheduled time.
Requests should contain: (1) The party's name, address, and
telephone number; (2) the number of participants; (3) the reason for
attending; and (4) a list of the issues to be discussed. In addition,
ten copies of the business proprietary version and five copies of the
nonproprietary version of the case briefs must be submitted to the
Assistant Secretary no later than March 16, 1994. Ten copies of the
business proprietary version and five copies of the nonproprietary
version of the rebuttal briefs must be submitted to the Assistant
Secretary no later than March 23, 1994. An interested party may make an
affirmative presentation only on arguments included in that party's
case or rebuttal briefs. Written arguments should be submitted in
accordance with section 355.38 of the Commerce Department's regulations
and will be considered if received within the time limits specified
above.
This determination is published pursuant to section 703(f) of the
Act (19 U.S.C. 1671b(f)).
Dated: January 25, 1994.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 94-2241 Filed 1-31-94; 8:45 am]
BILLING CODE 3510-DS-P
