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NOTICES DEPARTMENT OF COMMERCE [C-557-803] Final Negative Countervailing Duty Determinations; Standard Pipe, Line Pipe, Light-walled Rectangular Tubing and Heavy-walled Rectangular Tubing From Malaysia Monday, November 21, 1988 *46904 AGENCY: Import Administration, International Trade Administration, Commerce. ACTION: Notice. SUMMARY: We determine that de minimis countervailable benefits are being provided to manufacturers, producers, or exporters in Malaysia of standard pipe and light-walled rectangular tubing (LWRT), and that no benefits which constitute bounties or grants within the meaning of the countervailing duty law are being provided to manufacturers, producers, or exporters of heavy-walled rectangular tubing (HWRT). We also determine that no benefits within the meaning of the countervailing duty law are applicable to line pipe because we found no evidence to indicate that there are any producers or exporters in Malaysia which export line pipe to the United States. These products, which constitute four separate "classes or kinds" of merchandise, are fully described in the "Scope of Investigations" section of this notice. Since the estimated net bounties or grants on standard pipe, line pipe, LWRT and HWRT are either de minimis or zero, our determinations are negative. Since our preliminary determination with respect to standard pipe was affirmative, we will direct the U.S. Customs Service to discontinue suspension of liquidation of all entries of standard pipe from Malaysia that were entered, or withdrawn from warehouse, for consumption on or after September 8, 1988, and to refund all estimated countervailing duties deposited on these entries. EFFECTIVE DATE: November 21, 1988. FOR FURTHER INFORMATION CONTACT:Kay Halpern or Barbara Tillman, Office of Countervailing Investigations, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 377-0192 or 377-2438. SUPPLEMENTARY INFORMATION: Final Determinations Based on our investigations, we determine that de minimis countervailable benefits are being provided to manufacturers, producers, or exporters in Malaysia of standard pipe and LWRT, and that no benefits which constitute bounties or grants within the meaning of section 303 of the Tariff Act of 1930, as amended (the Act), are being provided to manufacturers, producers, or exporters in Malaysia of HWRT. We also determine that no countervailable benefits are applicable to line pipe because we found no evidence to indicate that there are any producers or exporters in Malaysia which export line pipe to the United States. For purposes of the investigation of standard pipe, the following program is found to be countervailable: - Allowance of a Percentage of Net Taxable Income Based on the F.O.B. Value of Export Sales For purposes of the investigation of LWRT, the following program is found to be countervailable: - Export Credit Refinancing We determine the estimated net bounty or grant for standard pipe to be de minimis (0.30 percent ad valorem) for all manufacturers, producers and exporters in Malaysia. We determine the estimated net bounty or grant for LWRT for all manufacturers, producers and exporters in Malaysia to be de minimis (0.002 percent ad valorem). We determine the estimated net bounty or grant for line pipe and HWRT for all manufacturers, producers and exporters in Malaysia to be zero. Case History Since the last Federal Register publication pertaining to these investigations [the Notice of Preliminary Determinations (53 FR 34801, September 8, 1988)], we conducted verification at the government and company offices in Malaysia from September 12 through 23, 1988. Case briefs and rebuttal briefs were received on October 25, 1988 and October 27, 1988, respectively. Scope of Investigations The United States has developed a system of tariff classification based on the international harmonized system of customs nomenclature. On January 1, 1989, the U.S. tariff schedules will be fully converted to the Harmonized Tariff Schedule (HTS) and all the merchandise entered or withdrawn from warehouse for consumption on or after that date will be classified solely according to the appropriate HTS item number(s). Until that time, however, the Department will be providing both the appropriate Tariff Schedules of the United States Annotated (TSUSA) item number(s) and the appropriate HTS item number(s) with its product descriptions. As with the TSUSA, the HTS item numbers are provided for convenience and Customs purposes. The Department's written description of the products under investigation remains dispositive as to the scope of the product coverage. We are requesting petitioners to include the appropriate HTS item number(s) as well as the TSUSA item number(s) in all petitions filed with the Department through the end of this year. A reference copy of the HTS is available for consultation in the Central Records Unit, Room B-099, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230. *46905 Additionally, all U.S. Customs offices have reference copies, and petitioners may contact the import specialist at their local Customs office to consult the schedule. The products covered by these investigations constitute four separate "classes or kinds" of merchandise. The four separate "classes or kinds" are as follows: (1) Certain circular welded carbon steel pipes and tubes, 0.375 inch or more but not over 16 inches in outside diameter, generally known in the industry as standard pipe. This is a general-purpose commodity used in such applications as plumbing pipe, sprinkler systems, and fence posts. Standard pipe may be supplied with an oil coating (black pipe) or may be galvanized, and is sold in plain, threaded, threaded and coupled, or beveled ends. These products are generally produced to American Society of Testing Materials (ASTM) specifications A-53, A-120, or A-135. Imports of these products are classified under TSUSA categories 610.3231, 610.3234, 610.3241, 610.3242, 610.3243, 610.3252, 610.3254, 610.3256, 610.3258, and 610.4925, and are classified under HTS categories 7306.30.1000, 7306.30.5025, 7306.30.5030, 7306.30.5040, 7306.30.5045, 7306.30.5050, 7306.30.5060, 7306.30.5065, 7306.30.5070, and 7306.30.5075. (2) Certain welded carbon steel American Petroleum Institute (API) line pipe, 0.375 inch or more but not over 16 inches in outside diameter known in the industry as line pipe. Line pipe generally is produced to API specification 5L. Line pipe is used for the transportation of gas, oil, or water, generally in pipeline or utility distribution systems. API line pipe not over 16 inches in outside diameter is classified under TSUSA categories 610.3208 and 610.3209, and is classified under HTS categories 7306.10.1010 and 7306.10.1050. (3) Certain heavy-walled carbon steel rectangular tubing having a wall thickness of 0.156 inch or greater, which is generally used for support members for construction or load-bearing purposes in construction, transportation, farm, and meterial-handling equipment. The product is generally produced to ASTM specification A-500, Grade B. Imports of heavy-walled rectangular tubing are classified under TSUSA category 610.3955, and are classified under HTS category 7306.60.1000. (4) Certain light-walled carbon steel rectangular tubing having a wall thickness of less than 0.156 inch, which is generally employed in a variety of end uses other than the conveyance of liquid or gas, such as agricultural equipment frames and parts, and furniture parts. The product is generally produced to ASTM specification A-513 or A-500, Grade A. Imports of light-walled rectangular tubing are classified under TSUSA category 610.4928, and are classified under HTS category 7306.60.5000. Analysis of Programs We verified that all three respondent companies, Maruichi Malaysia Steel Tube Bhd. (Maruichi), Amalgamated Industrial Steel Bhd. (AIS) and Steel Pipe Industry of Malaysia (SPIM), produce and export standard pipe to the United States. We also verified that only AIS produces and exports LWRT and HWRT to the United States. Finally, we found no evidence at verification to indicate that there are any producers or exporters in Malaysia which exported line pipe to the United States during or after the review period. For purposes of these determinations, the period for which we are measuring bounties or grants ("the review period") is calendar year 1987, which corresponds to the most recently completed fiscal year of one of the respondent companies. The other two respondent companies each have different fiscal years which overlap this period. In accordance with our practice in such situations, we have chosen the most recently completed calendar year as our review period. Based upon our analysis of the petition, the responses to our questionnaries, verification, and written comments from petitioners and respondents, we determine the following: I. Programs Determined To Confer Bounties or Grants A. We determine that bounties or grants are being provided to manufacturers, producers or exporters in Malaysia of standard pipe under the following program: Allowance of a Percentage of Net Taxable Income Based on the F.O.B. Value of Export Sales Effective in 1984, section 29 of the Investment Incentives Act of 1968 was amended to allow for a flat deduction or allowance of five percent of export revenues (based on F.O.B. value) from taxable income. Due to the enactment of the Promotion of Investments Act of 1986, this program, provided for under section 39 of the 1986 Act, currently applies only to trading companies and agricultural companies. However, Maruichi was able to claim the section 29 allowance on its tax return filed during the review period. This return was based on Maruichi's fiscal year completed in 1986 (February 1, 1985--January 31, 1986). The Malaysian tax authorities allowed only those exports shipped through December 31, 1985, to be used for the allowance claim. Because only exporters are eligible for the program, we determine that it is countervailable. To calculate the benefit from this program, we divered Maruichi's tax savings from the program by the respondent companies' total exports during the review period in accordance with section 706(a)(2) of the Act, which requires us to calculate a country-wide rate for purposes of determining whether an investigation results in an affirmative or a negative determination. The country-wide rate includes all respondent companies because we verified that each company exports standard pipe to the United States. We divided the tax savings by the respondents' total exports because the program is not segregable by product or market. The resulting estimated net bounty or grant rate is 0.30 percent ad valorem. In the preliminary determination on standard pipe we had calculated a bounty or grant rate for the review period of 1.17 percent ad valorem. We obtaining this rate by dividing Maruichi's section 29 allowance tax savings by its total exports during the review period. We excluded from this calculation all respondent companies with de minimis rates. We now have determined that the more appropriate way of calculating the bounty or grant rate is to include companies with de minimis rates in our determination of the country-wide rate (see DOC Position on Comment 2). This rate is only applicable to standard pipe because Maruichi exported only standard pipe to the United States during the review period. The rate for this program appolicable to LWRT and HWRT is zero because AIS, the only respondent which exported these products to the United States during the review period, did not claim benefits under this program on its tax return filed during the review period. On January 1, 1986, the Government of Malaysia terminated the Allowance of a Percentage of Net Taxable Income Based on the F.O.B. Value of Export Sales, except with regard to trading and agricultural companies. This termination was implemented through the passage of the Promotion of Investments Act of 1986. The Government replaced the Allowance with a new program applicable to exports made on or after January 1, 1986. The new program, provided for under Section 36 of the 1986 *46906 Act, is the "Abatement of Taxable Income Based on the Ratio of Export Sales to Total Sales and Abatement of Five Percent of the Value of Indigenous Materials Used in Exports." It provides for an abatement of adjusted income for exports. The amount of adjusted income to be abated is: (1) A rate equivalent to 50 percent of the ratio of export sales to total sales; and (2) five percent of the value of indigenous Malaysian materials incorporated in the manufacture of exported products. This program is only applicable if there is adjusted income and cannot be carried forward if there is an adjusted loss. It is not available to companies still participating in programs under the repealed Investment Incentives Act of 1968, including pioneer status, or to companies granted pioneer status or an investment tax allowance under the Promotion of Investments Act of 1986. We verified that Maruichi and AIS claimed the first section of the Abatement on their tax returns filed in 1988. However, since these benefits were not claimed until after the review period, they do not affect our net bounty or grant determination. We must look at a finite period of time in making our determination as to whether countervailable benefits are above a de minimis rate. During the review period the countervailable tax benefits realized by the respondent companies were de minimis. Since the export tax allowance program was the only countervailable program used during the review period, we have no basis to issue an affirmative determination on standard pipe. Furthermore, we note that we can not at this time determine whether the benefits from the Abatement program would be above de minimis after the review period. In our preliminary determination on standard pipe we estimated a duty deposit rate for Maruichi for the Abatement program by dividing its 1988 tax savings by its 1987 sales. We used the 1987 sales as a surrogate for 1988 sales in order to estimate the eventual duty liability. However, as described above, for purposes of our final determination on standard pipe we have now determined that the countervailable benefits during the review period are de minimis, and that there is, therefore, no basis to issue a countervailing duty order on standard pipe. Accordingly, the issue as to the appropriate duty deposit rate is moot. B. We determine that bounties or grants are being provided to manufacturers, producers or exporters in Malaysia of LWRT under the following program: Export Credit Refinancing The Bank Negara Malaysia, the central bank of Malaysia, provides short-term export credit refinancing through commercial banks. The Export Credit Refinancing (ECR) programs, as revised in January 1986, provide pre- and post- shipment financing of exports for periods of up to 90 days. In December 1987, the maximum periods for financing under these programs were extended to 120 and 180 days, respectively. Currently, ECR offers order-based pre- and post- shipment financing and "certificate of performance" (CP) based pre-shipment financing. Order-based financing is provided on specific sales to specific markets. CP-based financing, which is a line of credit based on the previous 12 months' export performance, cannot be tied to specific sales in specific markets. We verified that AIS is the only respondent company which paid interest on an Export Credit Refinancing loan for exports to the United States during the review period. The company received an order-based ECR loan on one shipment of LWRT to the United States. Because only exporters are eligible for ECR loans, we determine that they are countervailable to the extent that they are provided at preferential rates. In order to determine whether the loan received by AIS was provided at a preferential rate, we compared the interest rate charged to our short-term loan benchmark interest rate. As a benchmark for short-term loans, it is our practice to use the most comparable, predominant commercial rate for short-term financing. For purposes of these determinations, we are using the 90-day Bankers' Acceptance (BA) rate as the most comparable and commonly used alternative source of short-term financing. This is the benchmark that we applied in Final Affirmative Countervailing Duty Determination: Carbon Steel Wire Rod from Malaysia (53 FR 13303, April 22, 1988) (Wire Rod), the last investigation in which this program was used. Based on this comparison, we find that the ECR loan was provided at a preferential rate and, therefore, is countervailable. To calculate the benefit from the ECR loan on which AIS paid interest in 1987, we followed the short-term methodology which has been applied consistently in our past determinations and is described in more detail in the Subsidies Appendix attached to the notice of Cold-Rolled Carbon Steel Flat- Rolled Products from Argentina: Final Affirmative Countervailing Duty Determination and Countervailing Duty Order (49 FR 18006, April 26, 1984). We compared the amount of interest actually paid during the review period to the amount that would have been paid at the benchmark rate. Because order- based ECR loans are shipment-specific, we included only that loan which financed exports of the products under investigation to the United States (in this case, LWRT). For this loan, we calculated the amount of interest that would have been paid using the BA benchmark and subtracted the amount of interest that was actually paid. We divided the result by AID's exports of LWRT to the United States during the review period. The result was a rate of 0.002 percent Ad valorem. This rate is only applicable to LWRT because the loan received by AIS was for a shipment of this product. II. Program Determined Not To Confer a Bounty or Grant We determine that bounties or grants are not being provided to manufacturers, producers or exporters in Malaysia of standard pipe, line pipe, LWRT or HWRT under the following program: Accelerated Depreciation Allowance The Accelerated Depreciation Allowance (ADA) was introduced in the mid-1970s. Since then, it has gone through several revisions, the most recent being a change from allowing an 80 percent annual depreciation on approved assets (thus providing a 100 percent tax write-off for these assets in the first year, since the initial allowance is 20 percent), to reducing the annual allowance to 40 percent (thereby spreading the tax write-off over two years). This revision was implemented with respect to assets purchased after January 1, 1986, according to Rules 1986 of the Income Tax Act of 1967. The allowance applies to plant and machinery. We verified that there are no restrictions as to which companies can claim the ADA. In addition, we found that there are no qualifying or application procedures associated with the claim and that the Government has no discretion to vary the level of the allowance (40 percent for all companies). Moreover, we found no distinctions within the manufacturing sector as to which companies have claimed the ADA. We thus determine that this program is not limited to a specific enterprise or industry or group of enterprises or industries and, therefore, is not counteravailable. *46907 III. Programs Determined Not To Be Used Based on verified information, we determine that manufacturers, producers, or exporters in Malaysia of the pipe and tube products under investigation did not apply for, claim or receive benefits during the review period for exports of these products to the United States under the programs listed below. The program descriptions given below are based on verified information. Programs not described below are fully described in the notice of preliminary determinations in these investigations (53 FR 34801, September 8, 1988). A. Export Tax Incentives 1. Abatement of Five Percent of the Value of Indigenous Materials Used in Exports. Section 36 of the Promotion of Investments Act of 1986 provides for an abatement of adjusted income for exports. The amount of adjusted income to be abated is: (1) A rate equivalent to 50 percent of the ratio of export sales to total sales; and (2) five percent of the value of indigenous Malaysian materials incorporated in the manufacture of exported products. Maruichi made a claim under the first section of this program on its tax return filed in 1988 (see section I. of the notice), but did not make a claim under the second. This program is not available to companies still participating in programs under the repeal Investment Incentives Act of 1968, including pioneer status, or to companies granted pioneer status of an investment tax allowance under the Promotion of Investments Act of 1986. 2. Allowance of Taxable Income of Five Percent for Trading Companies Exporting Malaysian-made Products. Under section 39 of the Promotion of Investments Act of 1986, an allowance of five percent of the F.O.B. value of export revenues is available to trading companies and agricultural companies exporting Malaysian- made products. This program, like the abatement based on indigenous materials used in exports, is not available to companies still participating in programs under the repealed Investment Incentives Act of 1968, including pioneer status, or to companies granted pioneer status or an investment tax allowance under the Promotion of Investments Act of 1986. 3. Double Deduction for Export Credit Insurance Payments. 4. Double Deduction for Export Promotion Expenses. 5. Industrial Building Allowance. B. Other Export Incentive Export Insurance Program. C. Other Tax Incentives 1. Pioneer Status Under the Investment Incentives Act of 1968. Pioneer status under this Act, as amended, is available to companies producing a product (1) with favorable prospects for further development, including development for export, or (2) currently being produced in insufficient quantities to meet the development needs of Malaysia, including export. Benefits granted under pioneer status include exemptions on the portion of income derived from sales of the pioneer product from the following: (1) The 40 percent corporate income tax; (2) the five percent development tax; and (3) the three percent excess profits tax. Pioneer status benefits are available for a period of up to five years and may be extended for up to an additional three years. This program is not available to companies granted pioneer status for the same product under the Promotion of Investments Act of 1986. It is also not available to companies which received an investment tax credit under the Investment Incentives Act of 1968 or which received an investment tax allowance under the 1986 Act. We verified that all three respondent companies received pioneer status in the 1970s and that they completely utilized any residual benefits remaining from this program before the review period. 2. Pioneer Status Under the Promotion of Investments Act of 1986. As stated above, the Promotion of Investments Act of 1986 replaced the Investment Incentives Act of 1968. Companies which received pioneer status under the 1968 Act may not receive it again under the 1986 Act for the same product. They may, however, receive it again under the 1986 Act for a different product. In addition, pioneer status under the 1986 Act is not available to companies which received an investment tax credit under the 1968 Act or which received an investment tax allowance under the 1986 Act. The primary changes in the pioneer status program under the new law are as follows: (1) The initial grant of pioneer status is five years for all companies, regardless of their level of investment; (2) the product must be on the "promoted product" or "promoted activities" list; (3) specific one-year extensions for location, priority products, and Malaysian content have been eliminated; (4) extensions are now granted for five years if the product is on the "promoted product" list for extensions and the company meets certain investment, employment, or development criteria; and (5) pioneer status may also be provided to non-corporate entities such as cooperative societies, associations, etc. We verified that none of the respondent companies have been approved for pioneer status under the 1986 Act. 3. Investment Tax Allowance. 4. Reinvestment Allowance. D. Medium- and Long-term Government Financing E. Reduction in the Cost of State Land for New Industry F. Preferential Financing for Bumiputeras Interested Party Comments Comment 1 Petitioners argue that we should use a weighted-average rate for overdrafts and Bankers Acceptances (BAs) combined as the benchmark for calculating benefits from ECR financing. They allow that BA financing is "comparable" to ECR financing but contend that the BA rate alone should not be used because BAs are not the "predominant" form of short-term financing in Malaysia. In support of their contention, they cite Final Affiramtive Countervailing Duty Determination: Carbon Steel Wire Rod From Malaysia (53 FR 13303, April 18, 1988) (Wire Rod), where the Department used "the most comparable, predominant commercial rate for short-term financing" as the benchmark for the ECR loan program. Respondents claim that BA financing is the commercial equivalent of ECR financing and, therefore, the BA rate is the most appropriate benchmark for calculating benefits from ECR financing. DOC Position In calculating benefits from short-term loans, the Department uses the most appropriate national average commercial method of short-term financing (see, for example, the Subsidies Appendix). In Wire Rod, the BA rate was used as the benchmark for calculating benefits from ECR loans because BA financing was found to be the predominant alternative to ECR financing. In the current investigation we verified at the Bank Negara, Malaysia's central bank, and at a commercial bank that BA financing is the predominant alternative to ECR financing. Therefore, we consider the BA rate the most appropriate rate to use as our benchmark. Comment 2 Petitioners argue that the Department should obtain a final bounty or grant rate for standard pipe by calculating an individual rate for Maruichi, as it did in *46908 the preliminary determination. They cite section 607 of the Act (19 U.S.C. 1671e(a)(2)), which allows the Department to calculate separate rates for different companies if there is a "significant differential between companies receiving subsidy benefits." They further contend that it has been the Department's practice to find a significant differential between companies when one received de minimis benefits and another received benefits that are above de minimis. In support of their argument, they cite Final Affirmative Countervailing Duty Determination: Certain Stainless Steel Hollow Products from Sweden (52 Fr 5794, February 1987), among other cases, in which significant differentials were found and only the sales of non-de minimis companies were used in calculating the subsidy rate. Respondents claim that the Department should calculate a final rate for standard pipe by allocating Maruichi's tax benefits received during the review period over all respondent companies' sales. They cite Ceramica Regiomontana, S.A. v. United States (7 ITRD 2512, CIT 1986), in which the Court of International Trade ruled that "Congress has endorsed a legislative presumption in favor of a country-wide rate." They also refer to the Department's proposed regulations, which interpret the term "significant differential" to allow for company-specific rates only if there is "a difference of the greater of at least 10 percentage points, or 25 percent, from the weighted-average net subsidy calculated on a country-wide basis." DOC Position Section 706(a)(2) of the Act creates a presumption in favor of country-wide rates. This presumption is overcome if the Department determines there is a significant differential between companies receiving subsidy benefits. In this regard, Congress directed the Department to develop a "reasonable" standard for determining what is a significant differential. See H.R. Conf. Rep. No. 1156, 98th Cong., 2d Sess. 180 (1984). Section 355.20(d)(3) of our proposed countervailing duty regulations (50 FR 24217, 24225 (1985)) defines a significant differential as "a difference of the greater of at least 10 percentage points, or 25 percent, from the weighted- average net subsidy calculated on a country-wide basis." It is also our practice, as the cases cited by petitioners suggest, to define a significant differential as the difference between a net subsidy of zero (or de minimis) and any rate greater than de minimis. However, before we will consider the question of a significant differential, we must first test the presumption in favor of country-wide rates. Thus, the initial step in the Department's calculation of the net subsidy is to determine the country-wide average rate. In the past, we have excluded companies with de minimis rates in determining the country-wide rate. We now determine that the more appropriate basis to calculate the country-wide rate is to include all companies regardless of the level of benefits for each company. If the country-wide average is de minimis, our determination in an investigation will be negative. If the country-wide average is above de minimis, we then compare individual company rates with the country-wide average rate to determine whether significant differentials exist. Because we also consider individual rates of zero and de minimis to constitute a "significant differential," we remove all zero and de minimis companies (as well as other companies with significantly different rates) from the calculation of the country-wide average rate. As soon as at least one company is removed from the country-wide rate average, we no longer use the country-wide rate for duty deposit purposes. Rather, we assign individual company-specific rates to those companies that are "significantly different" (including zero rate and de minimis companies); the remaining companies form the basis of the "all other" rate. An "all other" rate is different from a country-wide rate because an "all other" rate is not based on all companies. There are three exceptions to this general practice: (1) An investigation does not cover virtually all exports of the merchandise to the United States; (2) we have no company- specific export data, only aggregate export data from a government; and (3) we use generally recognized sampling techniques. Since none of these three exceptions apply to these investigations and since the country-wide rates for our investigations of standard pipe and LWRT are de minimis, we did not reach the question of whether there is a significant differential between the companies receiving countervailable benefits. Therefore, our determinations in these investigations are negative. Comment 3 Respondents argue that the tax benefits received by Maruichi and AIS on their returns filed in 1988 should not be considered in making our final determination for standard pipe because these returns were filed after the review period. They contend that the Department's policy has been to treat benefits from income tax programs as accruing in the year in which the tax return claiming the benefits is filed. DOC Position The Department's practice for tax programs is to calculate benefits based on when the respondent companies realize or know the extent of their tax savings. Generally, as here, the amount of tax savings is not known until the tax return is filed. As noted in section I.A. of the notice, the countervailable tax benefits realized by the respondent companies during the review period were de minimis. Since the export tax allowance program was the only countervailable program used during the review period, we have no basis to issue an affirmative determination on standard pipe. While post-review period information can be used to determine whether there has been a program-wide change for purposes of calculating a duty deposit rate in an affirmative determination, such information cannot be used as the basis for obtaining an affirmative determination. Therefore, since the estimated net bounty or grant rate for the review period is negative for standard pipe, there is no reason to calculate a separate duty deposit rate based on post-review period information. Comment 4 Respondents claim that the tax allowance benefit received by Maruichi was not generated by U.S. sales since the fiscal year covered by Maruichi's 1987 return was February 1, 1985--January 31, 1986, and Maruichi began exporting to the United States in the last quarter of 1987. DOC Position Since our determination for standard pipe is negative, the issue is moot. In calculating the benefit bestowed by a tax program, it is our practice to apply the tax savings from the return filed during the review period to review period sales, regardless of the fiscal year covered by the tax return. Verification We verified the information used in making our final determinations in accordance with section 776(b) of the Act. We used standard verification *46909 procedures including meetings with government and company officials and examination of relevant accounting records and original source documents of the respondents. Our verification results are outlined in the public versions of the verification reports which are on file in the Central Records Unit (Room B-099) of the Main Commerce Building. Suspension of Liquidation Discontinued The estimated net bounty or grant rate for standard pipe is 0.30 percent ad valorem. The estimated net bounty or grant rate for LWRT is 0.002 percent ad valorem. Under section 355.8 of our regulations, an aggregate net subsidy of less than 0.5 percent ad valorem is considered de minimis. The estimated net bounty or grant rate for HWRT is zero because no bounties or grants were conferred on the export of this product to the United States during the review period. The estimated net bounty or grant rate for line pipe is zero because we verified that there were no exports of this product from Malaysia to the United States during the review period. For the above reasons, we are directing the U.S. Customs Service to discontinue suspension of liquidation of all entries of standard pipe from Malaysia that we entered, or withdrawn from warehouse, for consumption on or after September 8, 1988, and to refund all estimated countervailing duties deposited on these entries. Since the determinations on line pipe, HWRT and LWRT are also negative, no suspension of liquidation will be required for these products. These determinations are published pursuant to section 705(d) of the Act (19 U.S.C. 1671d(d). Jan W. Mares, Assistant Secretary for Import Administration. [FR Doc. 88-26869 Filed 11-18-88; 8:45 am] BILLING CODE 3510-DS-M