65 FR 41444, July 5, 2000
C-122-815
(Pure and Alloy)
Sunset Review
Public Document
MEMORANDUM TO: Troy H. Cribb
Acting Assistant Secretary
for Import Administration
FROM: Jeffrey A. May
Director
Office of Policy
SUBJECT: Issues and Decision Memo for the Full Sunset Reviews of Pure
Magnesium and Alloy Magnesium from Canada; Final Results
Summary:
We have analyzed the comments and rebuttals of interested parties in the
full sunset reviews of the countervailing duty orders covering pure
magnesium and alloy magnesium from Canada. We recommend that you approve
the positions we have developed in the Discussion of the Issues section of
this memorandum. Below is the complete list of the issues in these sunset
reviews for which we received case and rebuttal briefs by parties:
1. Likelihood of continuation or recurrence of a countervailable subsidy
A. Continuation of subsidy programs
B. Elimination of subsidy programs
2. Net countervailable subsidy likely to prevail
A. Rates from the investigation
B. Use of a more recent rate
Background:
On February 29, 2000, the Department of Commerce (“the Department”)
published in the Federal Register a notice of preliminary results of the
full sunset reviews of the countervailing duty orders on pure magnesium
and alloy magnesium from Canada (65 FR 10766) pursuant to section 751(c)
of the Tariff Act of 1930, as amended (“the Act”). In our preliminary
results, we found that revocation of the orders would likely result in
continuation or recurrence of a countervailable subsidy. In addition, we
preliminarily determined the following net countervailable subsidy likely
to prevail if the orders were revoked to be 1.84 percent ad valorem for
Norsk Hydro Canada Inc. ("NHCI") and 4.48 percent ad valorem for "all
others."
On April 14, 2000, within the deadline specified in 19 CFR
351.209(c)(1)(i), we received a case brief on behalf of the Magnesium
Corporation of America ("Magcorp") and respondent interested parties, NHCI
and the Government of Quebec ("GOQ"). On April 24, 2000, within the
deadline specified in 19 CFR 351.309(d), the Department received rebuttal
comments from Magcorp and the GOQ. On March 17, 2000, we received a
request for a hearing on behalf of the GOQ. Subsequently, on April 28,
2000, the GOQ withdrew its request and the Department canceled the hearing.
We note that the Department issued the preliminary results of
countervailing duty administrative reviews covering the period January 1,
1998 through December 31, 1998 on May 4, 2000 (65 FR 25910).
Discussion of the Issues
In accordance with section 751(c)(1) of the Act, the Department conducted
these sunset reviews to determine whether termination of the
countervailing duty orders would likely lead to continuation or recurrence
of a countervailable subsidy. Section 752(c) of the Act provides that, in
making this determination, the Department shall consider the net subsidy
determined in the investigation and subsequent reviews, and whether any
change in the program which gave rise to the net countervailable subsidy
has occurred and is likely to affect that net countervailable subsidy.
Section 752(b)(3) of the Act provides that the Department shall provide to
the International Trade Commission ("the Commission") the net
countervailable subsidy likely to prevail if the order is revoked.
Likelihood of Continuation or Recurrence of a Countervailable Subsidy
Interested Party Comments
Comment 1: SDI Article 7 Grant
In its case brief, the GOQ argues that the Department's reliance on the
unamortized benefits from the 1988 SDI Article 7 Grant to NHCI to
determinate likelihood of continuation or recurrence of subsidies fails to
address core considerations of WTO provisions and violates the Agreement
on Subsidies and Countervailing Measures ("Subsidies Agreement"). The GOQ
contends that the guidance in the Statement of Administrative Action
("SAA") is inconsistent with Article 21.3 of the Subsidies Agreement,
which requires analysis of whether continued subsidization and injury will
occur if the orders expire (see April 14, 2000, case brief of the GOQ at
3). The GOQ maintains that as the only financial contribution by the GOQ
occurred in 1988 and did not continue, there is no evidence to support a
claim that expiration of the subject order will lead to recurrence of
subsidy conduct. Id. Further, the remaining, unamortized portions of the
grant are not a "direct transfer" or other action that qualifies under the
language of the Subsidies Agreement defining subsidization. Id. at 4.
Because the subsidization arises from a one-time grant made under a
program that was itself not countervailable and has been dormant or
terminated, no continuation of subsidization is likely to occur. Id.
In its case brief, NHCI supports the position of the GOQ that the
Department erred in determining that a countervailable subsidy is likely
to continue or recur if the orders are revoked, and NHCI requests that the
Department reconsider it determination.
In its rebuttal, Magcorp reasserts that the Department correctly
determined that countervailable subsidies under the SDI Article 7 Program
are likely to continue or recur if the orders are revoked. Magcorp
contends that in this proceeding, it is undisputed that the SDI Article 7
program found to be countervailable in the original investigation
continues to exist; therefore, countervailable benefits are likely to
continue or recur if the orders are revoked (see April 24, 2000, rebuttal
brief of Magcorp at 2). Magcorp also reasserts that the SAA at 889 and the
Sunset Policy Bulletin state that a countervailable subsidy will continue
to exist when the benefit stream, as defined by the Department, will
continue beyond the end of the sunset review, without regard to whether
the program that gave rise to the long-term benefit continues to exist.
Id. at 3. Magcorp adds that, in the preliminary results, the Department
did not address the undisputed point that SDI Article 7 program continues
to exist; instead the Department relied on the fact that the allocated
benefit stream will continue to exist past the end of the review. Id.
In addition, Magcorp states that, contrary to the GOQ's claims that the
Department failed to address the inconsistency between its practice and
Article 21.3 of the Subsidies Agreement, there is no statutory requirement
that the Department find a continuing act of subsidization. Id. at 5.
Rather, the Department must evaluate whether a countervailable subsidy is
likely to continue or recur. Thus, the SAA recognizes that the
determination called for in sunset reviews is inherently predictive and
speculative, indicating both that the Department will consider whether the
fully allocated benefit stream is likely to continue after the end of the
review and that this consideration is independent of whether the
underlying subsidy program continues to exist. Id. at 6.
Finally, Magcorp contends that Article 21.3 of the Subsidies Agreement
simply requires consideration of whether revocation of the order would be
likely to lead to continuation or recurrence of subsidization and injury -
the inquiry is prospective in nature - and does not provide a rule of
decision under U.S. law. Id. at 7. Further, provisions in section
102(a)(1) of the Uruguay Round Agreements Act ("URAA") and the H.R. Rep.
No. 103-826, at 23 (1994), are meant to carry out the Congressional intent
that the Agreements not be considered self-executing and that their legal
effect in the United States is governed by implementing legislation. Id.
Thus, the Department acted in accordance with the statute and the
authoritative interpretation of the statute in determining that
countervailable subsidies under SDI Article 7 are likely to continue or
recur if the orders are revoked. Id.
Department's Position
As stated in our preliminary results, the Department shall consider the
net countervailable subsidy determined in the investigation and subsequent
reviews, and whether any change in the program which gave rise to the net
countervailable subsidy has occurred that is likely to affect that net
countervailable subsidy. We determine that certain subsidies have been
terminated or do not exist. Specifically, the Department ruled that the
Exemption from Payment of Water Bills has been terminated with no residual
benefits (1) and the Department also determined, in the changed
circumstances review, that the electricity contract between Hydro-Quebec
and NHCI does not provide a countervailable subsidy. (2) Additionally, the
Department determined in the original investigation that the funds
provided by the GOQ under the Federal Funding for a Feasibility Study
program were not countervailable. (3)
The only remaining program to examine is the Article 7 SDI program, and
the Department continues to disagree with NHCI and the GOQ that the
countervailable benefit from the SDI grant will not continue if the orders
are revoked. As we noted in the Sunset Policy Bulletin, the SAA at 889
provides that, with respect to subsidies for which benefits are allocated
over time, the Department will consider whether the fully allocated
benefit stream is likely to continue after the end of the review, without
regard to whether the program that gave rise to the long-term benefit
continues to exist. Further, we stated that we normally will determine
that a countervailable subsidy will continue to exist when the benefit
stream, as defined by the Department, will continue beyond the end of the
sunset review (see section III.A.4 of the Sunset Policy Bulletin). Even if
NHCI's and the GOQ's assertions that the grant was a one-time subsidy are
true, the fact remains that, based on amortization, NHCI will continue to
receive benefits until the year 2004, well after these sunset reviews are
completed. As such, there is no inconsistency with Article 21.3 of the
Subsidies Agreement, and no need to speculate about possible future
subsidies. Therefore, consistent with the SAA and the Sunset Policy
Bulletin, we determine that a countervailable subsidy is likely to
continue or recur if these orders were revoked.
Net Countervailable Subsidy Likely to Prevail
Interested Party Comments
Comment 1:
Magcorp argues that Magnola Metallurgy Inc. ("Magnola") is, as a foreign
producer and exporter of magnesium, subject to the order and the
Department should investigate subsidies Magnola receives. Magcorp contends
that the evidence on the record indicates that Magnola has produced the
subject merchandise in Canada, and that U.S. sales of subject merchandise
produced by Magnola are likely (see April 14, 2000, case brief of Magcorp
at 6). In addition, Magcorp asserts that the Department should apply a
more future-oriented standard and consider whether the evidence indicates
a clear and present intent to produce or export the subject merchandise to
the United States. Id. at 7. Thus, Magcorp asserts that the Department
should determine that Magnola is a producer and exporter of the subject
merchandise.
In its rebuttal, the GOQ argues that there is no evidence to support a
determination that Magnola has produced the subject merchandise. The GOQ
contends that Magcorp provides no evidence demonstrating that commercial
sales by Magnola are likely and, indeed, the Department has never
considered a pilot production, which is treated as part of the
"development" phase, to be the equivalent of actual production, which is
defined to include production stages such as production engineering,
manufacturing, integration, and inspection (see April 24, 2000, rebuttal
brief of the GOQ at 3). Further, the GOQ contends that Magnola has never
exported the subject merchandise; and that, pursuant to 19 C.F.R
351.218(e)(2)(i), the Department's practice is not to assign a CVD rate
absent production and export, and further that it will not use a sunset
review to investigate and calculate a CVD rate for a new shipper. Id.
Accordingly, the GOQ asserts that the Department should ignore Magcorp's
continued attempt to force interested party status (and a new
investigation) on Magnola in these proceedings. Id. at 4.
Department's Position
As stated in our preliminary results, we agree with NHCI and the GOQ that
consideration of Magnola and potential subsidies to Magnola in the course
of these sunset reviews is not appropriate. We disagree with Magcorp that
there is sufficient evidence to support a determination that Magnola has
produced or exported the subject merchandise. Nor do we agree, even if we
were to adopt Magcorp's proposed standard, that the evidence supports a
"clear and present" intent to export. Pursuant to 19 C.F.R.
351.218(e)(2)(i), the Department normally will not assess a CVD rate
absent production and export and, further, in no case will the Department
calculate a CVD rate for a new shipper in the course of a sunset review.
Therefore, we determine that Magnola is neither a producer nor exporter of
the subject merchandise and, therefore, is not an interested party as
defined in section 771(9) of the Act; nor is Magnola subject to this order.
Comment 2:
Magcorp argues that the Department erred in refusing to include water
bill, electricity contract, and federal feasibility study subsidies in the
rate likely to prevail if the order is revoked. First, Magcorp asserts
that the Electricity Contract Subsidy Program has not been terminated and,
although the GOQ was not found in the original investigation to have
provided countervailable feasibility study subsidies, the Government of
Canada ("GOC") was found to have provided such subsidies. Magcorp contends
that although the Department found in the changed circumstances review
that the original electric power contract between Hydro-Quebec and NHCI
had been modified to eliminate the original benefit, the Department did
not find that the electric power subsidy program had been modified or
eliminated (see April 14, 2000, case brief of Magcorp at 11-12). Further,
the Department did not find that NHCI (or any other producer of subject
merchandise) was excluded from eligibility for program benefits, and
NHCI's voluntary renunciation of benefits does not reflect what is likely
to happen in the event of revocation. Id. at 13. Thus, the Department
cannot infer from the electricity contract modification that the original
electric power subsidy program is not fully operative and will, after
revocation, have an impact on the bestowal of countervailable subsidies.
Id. at 14.
Magcorp also states that, even if the Department were to find that the
electric power subsidy program has been modified to exclude subject
companies from eligibility, the program is likely to be reinstated by the
GOQ in its original form. Id. at 14. Magcop contends that the GOQ would
have every incentive to reinstate the program in its original form if the
orders were revoked because NHCI has announced a plan to double its
production capacity at its Becancour, Quebec primary magnesium plant, and
Magnola Metallurgy Inc. ("Magnola"), a Canadian producer/exporter of
subject merchandise, is establishing the world's largest greenfield
magnesium plant. Id.
Second, Magcorp asserts that the Water Bill Exemption Program of La
Societe du Parc Industriel du Centre du Quebec continues to exist, and the
water bill benefit could be negotiated at any time to cover NHCI's current
or future consumption needs (see April 14, 2000, case brief of Magcorp at
10). Further Magcorp states that the administrative review finding was
never adequately explained by the Department and contends that NHCI's
exhaustion of water bill credit does not provide evidence of an official
act to terminate the program. Therefore, the Department should find in
this review that the program continues to exist and is likely to confer
countervailable benefits if the orders are revoked. Id. at 15.
Third, Magcorp contends that the Canadian Federal Subsidy Program
continues to exist, and the fact that the Department found in the original
investigation that the original subsidiary agreement was terminated on
March 31, 1992, does not imply that the federal feasibility study program
itself was terminated. Id. at 16. In fact, Magcorp asserts that, as
evidenced in its September 13, 1999, substantive responses, the original
subsidiary agreement has been replaced by-or has been renewed by-other
Subsidiary Agreements which provide funding for the program. Id. at 17.
The GOQ asserts in its case brief that the Department should use a rate
reflecting SDI amortization applicable to the year 2000 for both NHCI and
"all others." That rate would be 1.22 percent, based on the most recent
sales information in the seventh review that is now nearing completion
(see April 14, 2000, case brief of the GOQ at 8).
In its case brief, NHCI urges the Department to reconsider its
preliminary determination and, rather, use NHCI's proposed rate of 1.22
percent. NHCI asserts that this rate is based upon a numerator calculated
by the Department, as it reflects the Department's calculation of the
amortized SDI benefit for the year 2000 and a denominator (which the
Department has not yet used) that is based upon sales value information
reported to the Department and on the record in the most current
administrative review covering calendar year 1998 (see April 14, 2000,
case brief of NHCI at 2-3). NHCI argues that this rate of 1.22 percent
would best reflect the most recent information available to the Department
and the best estimate of the likely denominator in the year 2000. Id.
However, NHCI continues, if the Department still relies on the original
rate, then the Department should look to the seventh (1998) administrative
reviews of the orders or rely upon a rate more reflective of the net
subsidy rate likely to prevail if the orders were revoked in 2000. Id.
With respect to the rate for NHCI, Magcorp argues that there is no basis
for the Department to report 1.22 percent as the net countervailable
subsidy likely to prevail if the order were revoked; rather, the
Department should select the subsidy rate from the original investigation.
Magcorp contends that because the countervailable subsidy rate for NHCI in
the original investigation was 21.61 percent ad valorem, and because none
of the exceptions in the Sunset Policy Bulletin applies, 21.61 percent
should be the rate likely to prevail for NHCI. Id. at 15. NHCI's
assumption that its 1998 level of sales is an appropriate surrogate for
its level of sales in the year 2000 is directly contrary to the SAA, which
states that the Administration does not intend that the Department
calculate future net countervailable subsidies. Id. at 15-16. Moreover,
NHCI has not even demonstrated that this case presents the most
"extraordinary circumstances" sufficient to trigger an exception to the
Department's preference for actual calculations performed in
investigations or prior reviews. Id. at 16.
In its rebuttal, the GOQ asserts that the Department has repeatedly found
that the credits under the water contract have been exhausted, and that
the alleged preferential rates provided under the electricity contract
with Hydro-Quebec have been eliminated (see April 24, 2000, rebuttal brief
of the GOQ at 4). Moreover, the Department has consistently treated the
water and electricity contracts as "single-contract" type programs that
expired according to their own terms and they are clearly not likely to
recur or continue in any way that would support continuation of the orders
after sunset. Id.
With respect to the Federal Feasibility Study Program, the GOQ rebuts
Magcorp's arguments that the Canada-Quebec Subsidiary Agreement on
Industrial Development was the subject of a later investigation in which
the Department found countervailable subsidies. On the contrary, the GOQ
contends that this program, under which NHCI received assistance, has
expired, and there is no evidence to suggest that any magnesium producer
has received benefits under any other subsidiary agreement.
Id. at 5.
Department's Position
With respect to the inclusion of the water bill, electricity contract and
federal feasibility study programs the Department normally will report to
the Commission an original subsidy rate as adjusted to take into account
program-wide changes. As stated in our preliminary results, because the
Department has determined that the Exemption of Payment for Water Bills,
the Preferential Electric Rates, and the Federal Funding for a Feasibility
Study have been terminated or are not countervailable, we have subtracted
the benefits arising from these programs from the original net subsidy.
Exemption of Payment for Water Bills was terminated with respect to NHCI
during the review period covering January 1, 1997, through December 31,
1997 (64 FR 488805, September 8, 1999). In a changed circumstances review,
NHCI was found not to have received Preferential Electric Rates (57 FR
54047, November 16, 1992). The GOQ's Federal Funding for a Feasibility
Study was found to be not countervailable by the Department in the final
determination (57 FR 30946, July 13, 1992).
The Department continues to agree with the GOQ that the amount of the
amortized benefit for the Article 7 SDI grants should be taken into
account when determining the net subsidy. We note that NHCI has not
received any additional grants under this program since 1988. In the
Final Results of Sunset Review: Live Swine from Canada (64 FR 60301,
November 4, 1999), we stated that we normally will not determine that the
mere availability of a program indicates the likelihood of continuation or
recurrence of a countervailable subsidy where there is a long track record
of non-use of the program. However, we disagree that the subsidy rate of
1.22 percent, based on the calculation for the year 2000, as recommended
by NHCI and the GOQ, should be used. Given that the only remaining program
is the Article 7 SDI grants, we will report to the Commission the rate of
1.84 percent for NHCI because is the most recently calculated rate
available to the Department, from the final results of the sixth (1997)
administrative review.
Comment 3:
In its case brief, Magcorp argues that the Department published the wrong
"all others" rate, and the preliminary results are not consistent with the
SAA at 890 and the Department's policy of basing the "all others" rate in
a sunset review on the "all others" rate from the original investigation.
Magcorp contends that none of the programs found to provide
countervailable subsidies in the original investigation has been
terminated; thus, because a country-wide rate of 21.61 percent was
reported in the original investigation, the "all others" rate for purposes
of this review is 21.61 percent (see April 14, 2000, case brief of Magcorp
at 21). However, if the Department chooses to report the current all
others rate as the rate likely to prevail if the orders were revoked, the
Department should report a rate of 7.34 percent ad valorem, the all others
country-wide rate from the second review. Id. at 23. Finally, if the
Department continues to decline to include the reported rate amounts for
the water bill, electricity contract and federal feasibility study
programs, it should adjust its preliminary rate for the SDI Article 7
program to reflect the original countervailable subsidy of 6.18 percent ad
valorem.
The GOQ argues that the "all others" rate is inappropriate and contrary
to the Subsidies Agreement. The GOQ asserts that although the record
establishes at most that NHCI may have left-over unamortized benefits from
the SDI grant it received, there is no basis for finding subsidization
with respect to any other entity (see April 14, 2000, case brief of the
GOQ at 4). First, the Department cannot presume that unknown "others" will
benefit from "continued subsidization" when all that remains in this
record is the residue of a single grant, bestowed over 10 years ago on a
single company, under a program the Department found non-countervailable
except in this one instance of alleged disproportionate use. Id. The GOQ
cites Delverde v. United States in its assertion that because the
Department's obligations under the Subsidies Agreement and the
implementing statute are specific, and without evidence on the record, the
Department cannot presume the factual basis for a finding that a party or
exporter may receive a "financial contribution" or "benefit" and, thus, is
subject to countervailing duties. Id. at 5.
Further, the GOQ cites the WTO Dispute Panel Report on United States -
Imposition of Countervailing Duties on Certain Hot-Rolled Lead and Bismuth
Carbon Steel Product Originating in the United Kingdom in which the panel
ruled that the presumption in U.S. CVD practice that benefits continue to
flow from untied, non recurring financial contributions to a predecessor
entity was rebutted by an arms-length purchase. Id. at 5-6. The GOQ
asserts that, although the Department's basis to assume in British Steel
that a benefit stream from the non-recurring grant might continue with the
successor entity, in this case, no other entity in the magnesium business
has obtained an SDI grant or participated in any of the contracts or
programs previously investigated. Id. at 6. The allegations from the
original petition nearly ten years ago cannot now form a basis for finding
an "all others" rate in these sunset reviews. Id. Therefore, absent
evidence that others have obtained or will obtain disproportionate SDI
grants no "all others" rate can be premised on the SDI program under the
statute or under the Subsidies Agreement. Id. at 7.
With respect to the 4.48 percent "all others" rate, the GOQ asserts that
while, presumably, the rate is based on the finding applicable to the NHCI
in the third administrative review covering the period January 1, 1994,
through December 31, 1994, this approach is flawed for two reasons. First,
the GOQ asserts that the rate for NHCI was formulated based on the SDI
grant and the Exemption from Water Bills; however, because the Department
determined that the Exemption from Water Bills was terminated there cannot
be a danger of future "recurrence" of this alleged subsidy, and it cannot
be used to establish an "all others" rate.
Second, the GOQ contends that the 3.83 percent SDI rate set in the third
review for NHCI cannot be used to establish a projected "all others" rate
for non-investigated companies; if any NHCI-based rate is to be grafted
into an "all others" category, it must be a current determination that
incorporates all of the relevant information available to the
investigating authority at the time of the determination, and a valuation
of such benefits at such time. Id. at 8.
In its rebuttal, Magcorp asserts that the GOQ's arguments fail to
acknowledge that the very purpose of an "all others" rate is to cover
exporters that have not been specifically investigated. Id. at 19.
Moreover, under the Sunset Policy Bulletin the Department must report an
"all others" rate because countervailing duty orders are not issued on a
company-specific basis and Magnola was not assigned its own rate in the
original investigation. Id. at 11. Therefore, because Magnola is a
producer and exporter that is subject to the orders, and because it was
not assigned its own rate in the original investigation, the Department
must report an "all others" rate to the Commission.
Magcorp also argues that the "all others" rate from the original
investigation should not be updated based upon current subsidy
calculations. Magcorp contends that because none of the programs found
countervailable in the instant proceeding has been terminated, the
Department should not make any adjustments to the original "all others"
rate of 21.61 percent ad valorem. Nevertheless, even if the Department
were to find that all programs other than SDI Article 7 have been
terminated, it should simply subtract the original rates for the
terminated programs from the original "all others" rate, resulting in an
"all others" rate of 6.18 percent ad valorem (the original countervailing
duty rate for SDI Article 7). Id. at 13. There is no basis in the
Department's policy or practice for basing the all others rate on current
subsidy calculations.
Magcorp disagrees with the GOQ's claims that WTO dispute panel report
requires that the "all others" rate be a current determination that
incorporates all of the relevant information available to the
investigating authority at the time of the determination, and a valuation
of benefits at such time. Rather, Magcorp contends that the standards for
reporting countervailing duties in sunset reviews are legally distinct
and, therefore, the Department should adhere to its practice and base the
"all others" rate on calculations from the original investigation. Id. at
14.
The GOQ in its rebuttal reasserts that no "all others" rate should be
referred to the Commission for the reasons spelled out in its April 14,
2000, case brief. The GOQ contends that the SAA and the Sunset Policy
Bulletin recognize that the final rate from the investigation is
"normally"
the rate referred to the Commission, but that the rate referred must bear
a demonstrable connection to what is likely to occur if the order expires
(see April 24, 2000, rebuttal brief of the GOQ at 5). In this case, the
sole
remaining basis for continuing the order is unamortized benefits from a
specific grant that was deemed disproportionate in the year it was
approved.
Id at 6. Therefore, there is no basis in the record to support a
conclusion
that benefits are likely to be conferred at the same level as was initially
found in the original investigation. Id. To act in conformity with the
statute and the Subsidies Agreement, the GOQ argues, the Department must
use the more probative information in the results of the seventh
administrative review in setting any rate to be referred to the
Commission.
Department's Position
We disagree with Magcorp's argument that the Department should report to
the Commission the "all others" rate of 21.6 percent, or that we should
report an "all others" rate of 7.34 percent from the second administrative
review. With the exception of the Article 7 SDI grants, the programs
included in the original net subsidy from the investigation have been
terminated. However, we also disagree with the GOQ that we should base our
determination on the preliminary results of the seventh administrative
review and use a rate reflecting SDI amortization applicable to the year
2000 for both NHCI and "all others."
The GOQ cites the WTO Dispute Panel Report to demonstrate how the U.S. CVD
practice presumes that benefits continue to flow from untied, non-
recurring financial contributions to a predecessor entity. The GOQ asserts
that, in this case, because no other entity in the magnesium business has
obtained an SDI grant, the Department cannot determine an "all others"
rate based on allegations from the original petition. We disagree with the
GOQ. Because the SDI Article 7 program continues to exist and the
allocated benefit stream will continue past the end of the sunset review,
pursuant to the SAA at 889 and the Sunset Policy Bulletin, there is
insufficient evidence that the original rate will not continue or recur.
Therefore, we determine to report to the Commission the most recent "all
others" rate 4.48 percent ad valorem (62 FR 18749, April 17, 1994).
Timminco is excluded from the orders.
Recommendation:
Based on our analysis of the comments received, we recommend adopting all
of the above positions. If these recommendations are accepted, we will
publish the final results of review in the Federal Register.
AGREE____ DISAGREE____
________________________________________________________________________
footnotes:
1. See Pure Magnesium and Alloy Magnesium from Canada: Final Results of
Countervailing Duty Administrative Reviews, 64 FR 48805 (September 8,
1999).
2. See Final Results of Changed Circumstances Administrative Reviews:
Pure Magnesium and Alloy Magnesium from Canada, 57 FR 54047 (November 16,
1992).
3. See Final Affirmative Countervailing Duty Determinations: Pure
Magnesium and Alloy Magnesium from Canada, 57 FR 30946 (July 13, 1992).