99-903

NOTICES

DEPARTMENT OF COMMERCE

International Trade Administration

[C-427-603]

Final Results of Expedited Sunset Review: Brass Sheet and Strip from France

Friday, September 3, 1999

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AGENCY: Import Administration, International Trade Administration,
Department of Commerce.

ACTION: Notice of Final Results of Expedited Sunset Review: Brass Sheet and Strip from
France.

SUMMARY: On February 1, 1999, the Department of Commerce ("the Department")
initiated a sunset review of the countervailing duty order on brass sheet and strip
from France (64 FR 4840) pursuant to section 751(c) of the Tariff Act of 1930, as
amended ("the Act"). On the basis of a notice of intent to participate and adequate
substantive comments filed on behalf of domestic interested parties, as well as inadequate
response (in this case, no response) from respondent interested parties, the Department
determined to conduct an expedited (120 day) review. As a result of this review, the
Department finds that termination of the countervailing duty order would be likely to
lead to continuation or recurrence of a countervailable subsidy. The net countervailable
subsidy and the nature of the subsidy are identified in the "Final Results of Review" section
of this notice.

FOR FURTHER INFORMATION CONTACT: Kathryn B. McCormick or Melissa G. Skinner,
Office of Policy for Import Administration, International Trade Administration, US
Department of Commerce, 14th Street & Constitution Avenue, NW, Washington, D.C.
20230; telephone: (202) 482-1698 or (202) 482-1560, respectively.

EFFECTIVE DATE: September 3, 1999.

Statute and Regulations

This review was conducted pursuant to sections 751(c) and 752 of the Act. The
Department's procedures for the

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conduct of sunset reviews are set forth in
Procedures for Conducting Five-year ("Sunset") Reviews of Antidumping and
Countervailing Duty Orders, 63 FR 13516 (March 20, 1998) ("Sunset Regulations").
Guidance on methodological or analytical issues relevant to the Department's conduct of
sunset reviews is set forth in the Department's Policy Bulletin 98:3--Policies Regarding the
Conduct of Five-year ("Sunset") Reviews of Antidumping and Countervailing Duty
Orders; Policy Bulletin, 63 FR 18871 (April 16, 1998) ("Sunset Policy Bulletin").

Scope

This order covers shipments of coiled, wound-on-reels (traverse wound), and
cut-to-length brass sheet and strip (not leaded or tinned) from France. The subject
merchandise has, regardless of width, a solid rectangular cross section over 0.0006
inches (0.15 millimeters) through 0.1888 inches (4.8 millimeters) in finished thickness or
gauge. The chemical composition of the covered products is defined in the Copper
Development Association ("C.D.A.") 200 Series or the Unified Numbering System
("U.N.S.") C2000; this review does not cover products with chemical compositions that
are defined by anything other than the C.D.A. or U.N.S. series. The merchandise is
currently classified under Harmonized Tariff Schedule ("HTS") item numbers 7409.21.00
and 7409.29.00. The HTS item numbers are provided for convenience and U.S. Customs
purposes. The written description remains dispositive.
This review covers all producers and exporters of brass sheet and strip from France.

History of the Order

The Government of France, Pechiney S.A. ("Pechiney") and Trefimeteaux S.A
("Trefimeteaux") participated in the original investigation. Two programs were found to
confer subsidies: (1) Government Equity Infusion and Other Financial Assistance to
Trefimetaux, and (2) Certain Financing from Credit National.
The Department published its final affirmative countervailing duty determination on
brass sheet and strip from France in the Federal Register on January 12, 1987 (52 FR
1218) and issued the countervailing duty order on March 6, 1987 (52 FR 6996). The
Department determined the estimated net subsidy to be 7.24 percent and the order
remains in effect for all producers and exporters of brass sheet and strip from France.
The Department has not conducted any administrative reviews since the issuance of the
order.

Background

On February 1, 1999, the Department initiated a sunset review of the countervailing
duty order on brass sheet and strip from France (64 FR 4840), pursuant to section
751(c) of the Act. The Department received a Notice of Intent to Participate on behalf of
Heyco Metals, Inc. ("Heyco"), Hussey Copper Ltd. ("Hussey"), Olin Corporation-Brass
Group ("Olin"), Outokumpu American Brass ("Outokumpu") (formerly American Brass
Company), PMX Industries, Inc. ("PMX"), Revere Copper Products, Inc. ("Revere"), the
International Association of Machinists and Aerospace Workers, the United Auto
Workers (Local 2367), and the United Steelworkers of America (AFL/CIO-CLC)
(hereinafter, collectively "domestic interested parties") on February 16, 1999, within the
deadline specified in section 351.218(d)(1)(i) of the Sunset Regulations. We received a
complete substantive response from the domestic interested parties on March 3, 1999,
within the 30-day deadline specified in the Sunset Regulations under section
351.218(d)(3)(i).
The domestic interested parties claimed interested party status under 19 U.S.C.
1677(9)(C) and (D) as well as under sections 771(9)(C) and (D) of the Act, as domestic
brass mills, rerollers, and unions engaged in the production of brass sheet and strip. With
the exception of Heyco, all of the aforementioned parties were original petitioners in this
case.
We did not receive a substantive response from any respondent interested party to this
proceeding. Pursuant to section 351.218(d)(2)(iii) of the Sunset Regulation, this
constitutes a waiver of participation. As a result, pursuant to 19 CFR 351.218(e)(1)(ii)(C),
the Department determined to conduct an expedited, 120-day, review of this order.
The Department determined that the sunset review of the countervailing duty
investigation on brass sheet and strip from France is extraordinarily complicated. In
accordance with 751(c)(5)(C)(v) of the Act, the Department may treat a review as
extraordinarily complicated if it is a review of a transition order (i.e., an order in effect on
January 1, 1995). (See section 751(c)(6)(C) of the Act.) Therefore, on June 7, 1999, the
Department extended the time limit for completion of the final results of this review until
not later than August 30, 1999, in accordance with section 751(c)(5)(B) of the Act. [FN1]

FN1 See Porcelain-on-Steel Cooking Ware From the People's Republic of China,
Porcelain-on-Steel Cooking Ware From Taiwan, Top-of-the-Stove Stainless Steel Cooking
Ware From Korea (South) (AD & CVD), Top-of-the-Stove Stainless Steel Cooking Ware
From Taiwan (AD & CVD), Standard Carnations From Chile (AD &CVD), Fresh Cut Flowers
From Mexico, Fresh Cut Flowers From Ecuador, Brass Sheet and Strip From Brazil (AD &
CVD), Brass Sheet and Strip From Korea (South), Brass Sheet and Strip From France (AD
& CVD), Brass Sheet and Strip From Germany, Brass Sheet and Strip From Italy, Brass
Sheet and Strip From Sweden, Brass Sheet and Strip From Japan, Pompon
Chrysanthemums From Peru: Extension of Time Limit for Final Results of Five-Year
Reviews, 64 FR 30305 (June 7, 1999).

Determination

In accordance with section 751(c)(1) of the Act, the Department is conducting this review
to determine whether termination of the countervailing duty order would be likely to
lead to continuation or recurrence of a countervailable subsidy. Section 752(b) of the Act
provides that, in making this determination, 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 and is likely to affect that net countervailable subsidy. Pursuant to section
752(b)(3) of the Act, the Department shall provide to the International Trade
Commission ("the Commission") the net countervailable subsidy likely to prevail if the
order is revoked. In addition, consistent with section 752(a)(6), the Department shall
provide to the Commission information concerning the nature of the subsidy and whether
it is a subsidy described in Article 3 or Article 6.1 of the 1994 WTO Agreement on
Subsidies and Countervailing Measures ("Subsidies Agreement").
The Department's determinations concerning continuation or recurrence of a
countervailable subsidy, the net countervailable subsidy likely to prevail if the order is
revoked, and nature of the subsidy are discussed below. In addition, the domestic
interested parties' comments with respect to each of these issues are addressed within the
respective sections.

Continuation or Recurrence of a Countervailable Subsidy

Drawing on the guidance provided in the legislative history accompanying the Uruguay
Round Agreements Act ("URAA"), specifically the SAA, H.R. Doc. No. 103- 316, vol. 1
(1994), the House Report, H.R. Rep. No. 103-826, pt.1 (1994), and the Senate Report, S.

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Rep. No. 103-412 (1994), the Department issued its Sunset Policy Bulletin
providing guidance on methodological and analytical issues, including the basis for
likelihood determinations. The Department clarified that determinations of likelihood will
be made on an order-wide basis (see section III.A.2 of the Sunset Policy Bulletin).
Additionally, the Department normally will determine that revocation of a
countervailing duty order is likely to lead to continuation or recurrence of a
countervailable subsidy where (a) A subsidy program continues, (b) a subsidy program
has been only temporarily suspended, or (c) a subsidy program has been only partially
terminated (see section III.A.3.a of the Sunset Policy Bulletin). Exceptions to this policy
are provided where a company has a long record of not using a program (see section
III.A.3.b of the Sunset Policy Bulletin).
In addition to considering the guidance on likelihood cited above, section 751(c)(4)(B) of
the Act provides that the Department shall determine that revocation of an order is likely
to lead to continuation or recurrence of dumping where a respondent interested party
waives its participation in the sunset review. Pursuant to the SAA, at 881, in a review of a
countervailing duty order, when the foreign government has waived participation, the
Department shall conclude that revocation of the order would be likely to lead to a
continuation or recurrence of a countervailable subsidy for all respondent interested
parties. [FN2] In the instant review, the Department did not receive a response from the
foreign government or from any other respondent interested party. Pursuant to section
351.218(d)(2)(iii) of the Sunset Regulations, this constitutes a waiver of participation.

FN2 See 19 CFR 351.218(d)(2)(iv).
The domestic interested parties argue that revocation of the countervailing duty
order on brass sheet and strip from France will result in the continuation or recurrence
of a countervailable subsidy. Citing the SAA, the domestic interested parties assert that
continuation, temporary or partial termination of a subsidy program will be highly
probative of the likelihood of continuation or recurrence of countervailable subsidies,
absent significant evidence to the contrary (see March 3, 1999 Substantive Response of
domestic interested parties at 33). The domestic interested parties assert that there is no
indication that the French government's subsidy programs have been modified or
eliminated (see March 3, 1999 Substantive Response of domestic interested parties at 38),
and they submit as support the fact that the order has never been subject to an
administrative review.
In its final countervailing duty determination (January 12, 1987; 52 FR 1218), the
Department concluded that the Government of France was providing countervailable
subsidies to exporters of the subject merchandise through two different programs: (1)
Government Equity Infusion and Other Financial Assistance and (2) Certain Financing
from Credit National. Trefimetaux, the sole producer/exporter reviewed by the
Department, was determined to be receiving subsidies through both of these programs.
There have been no administrative reviews of this order, nor has any evidence been
submitted to the Department demonstrating the termination of these programs that
conferred countervailable subsidies. Therefore, it is reasonable to assume that these
programs continue to exist and are utilized. Absent argument and evidence to the
contrary, the Department determines that there is a likelihood of continuation or
recurrence of a countervailable subsidy if the order were revoked.

Net Countervailable Subsidy

In the Sunset Policy Bulletin, the Department stated that, consistent with the SAA and
House Report, the Department normally will select a rate from the investigation, because
that is the only calculated rate that reflects the behavior of exporters and foreign
governments without the discipline of an order or suspension agreement in place. The
Department noted that this rate may not be the most appropriate rate if, for example, the
rate was derived from subsidy programs which were found in subsequent reviews to be
terminated, there has been a program-wide change, or the rate ignores a program found
to be countervailable in a subsequent administrative review. [FN3]

FN3 See section III.B.3 of the Sunset Policy Bulletin.
The domestic interested parties, citing the SAA, note that the Administration intends that
Commerce normally will select the rate from the investigation, because that is the only
calculated rate that reflects the behavior or exporters and foreign governments without
the discipline of an order in place (see March 3, 1999 Substantive Response of domestic
interested parties at 45). Therefore, the domestic interested parties argue that the
Department should determine that the net countervailable subsidy likely to prevail is
7.24 percent, the rate set forth in the original investigation.
The rate determined in the original investigation was 7.24 percent for all imports of brass
sheet and strip from France, and, as noted above, there have been no administrative
reviews of this order. Absent administrative review, the Department has never found that
substantive changes have been made to the programs found to be countervailable.
Therefore, since no changes have been made to any of the French subsidy programs, and
absent any argument and evidence to the contrary, the Department determines that the
net countervailable subsidy that would be likely to prevail in the event of revocation of
the order would be 7.24 percent. This rate is for all producers and exporters of the
subject merchandise from France.

Nature of the Subsidy

In the Sunset Policy Bulletin, the Department states that, consistent with section
752(a)(6) of the Act, the Department will provide to the Commission information
concerning the nature of the subsidy, and whether the subsidy is a subsidy described in
Article 3 or Article 6.1 of the Subsidies Agreement. The domestic interested parties did
not address this issue in their substantive response of March 3, 1999.
Because the receipt of benefit under one of the two programs is contingent on exports,
this program falls within the definition of an export subsidy under Article 3.1(a) of the
Subsidies Agreement. The remaining program, although not falling within the definition of
an export subsidy under Article 3.1(a) of the Subsidies Agreement, could be found to be
inconsistent with Article 6 if the net countervailable subsidy exceeds five percent, as
measured in accordance with Annex IV of the Subsidies Agreement. The Department,
however, has no information with which to make such a calculation, nor do we believe it
appropriate to attempt such a calculation in the course of a sunset review. Rather, we are
providing the Commission with the following program descriptions.

Certain Financing from Credit National. Trefimetaux received countervailable subsidies
under a program of loans provided by Credit National, which has a strong relationship
with the Government (the President of France appoints the General Manager). In this
case, the Department found that Trefimetaux received special loans from Credit National
between 1976 and 1985.

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Specifically, Credit National provided to Trefimetaux a
loan with an interest reduction contingent upon increasing exports, including the subject
merchandise. Therefore, the Department determines that this program constituted an
export subsidy.

Government Equity Infusion and Other Financial Assistance to Trefimetaux. This
program enabled Trefimetaux to receive equity infusions and other financial assistance
from Pechiney, its parent company, from 1982 to 1985. Pechiney received direct equity
infusions from the Government of France, and provided them to Trefimetaux through (1)
equity infusions, (2) loans on terms inconsistent with commercial considerations, and (3)
government grants during a period when Trefimetaux was determined by the Department
to be neither equity nor credit-worthy.

Final Results of Review

As a result of this review, the Department finds that revocation of the countervailing
duty order would be likely to lead to continuation or recurrence of a countervailable
subsidy. The net countervailable subsidy has been determined to be:

-----------------------------------------
Manufacturer/Exporter Margin (percent)
-----------------------------------------
Trefimetaux S.A..................... 7.24
All Others ......................... 7.24
-----------------------------------------

The Government of France's subsidy programs, as determined in the original
investigation, have been deemed to be countervailable subsidies within the definitions
provided by Article 3 and Article 6.1 of the Subsidies Agreement, and all of these subsidy
programs, as determined in the original investigation, remain in place today.
This notice serves as the only reminder to parties subject to administrative protective
order (APO) of their responsibility concerning the disposition of proprietary information
disclosed under APO in accordance with 19 CFR 351.305 of the Department's regulations.
Timely notification of return/destruction of APO materials or conversion to judicial
protective order is hereby requested. Failure to comply with the regulations and the
terms of an APO is a sanctionable violation.
This five-year ("sunset") review and notice are in accordance with sections 751(c), 752,
and 777(i)(1) of the Act.
Dated: August 30, 1999.

Robert S. LaRussa,

Assistant Secretary for Import Administration.

[FR Doc. 99-23047 Filed 9-2-99; 8:45 am]

BILLING CODE 3510-DS-P