46 FR 22776
NOTICES
DEPARTMENT OF COMMERCE
Float Glass From Italy; Preliminary Results of Administrative Review of
Countervailing Duty Order
Tuesday, April 21, 1981
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AGENCY: International Trade Administration, Commerce.
ACTION: Notice of preliminary results of administrative review of
countervailing duty order.
SUMMARY: The Department of Commerce has conducted an administrative review
of the countervailing duty order on float glass
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from Italy. The time period varies for the two companies involved. As a result of
this review, the Department has preliminarily determined to assess
countervailing duties equal to the calculated value of the net subsidy as a
percent of the f.o.b. invoice price of the merchandise. The rate for Societa
Italiana Vetro S.p.A. for the period March 30,
1979 through December 31, 1979 is 11.36 percent ad valorem. The rates for
Fabbrica Pisana S.p.A are: 10.17 percent ad valorem for the period January 7, 1976
through December 31, 1976; 8.99 percent ad valorem for 1977; 8.80 percent ad
valorem for 1978; and 8.66 percent ad valorem for 1979. Interested parties are
invited to comment on these preliminary results.
EFFECTIVE DATE: April 21, 1981.
FOR FURTHER INFORMATION CONTACT:
Ms. Claire Richard or Ms. Mary Martin, Office of Compliance, Room 1126, Import
Administration, International Trade Administration, Department of
Commerce, Washington, D.C. 20230 (202-377-1487 or 377-1770).
SUPPLEMENTARY INFORMATION:
Procedural Background
On January 7, 1976, the Department of the Treasury ("Treasury") published a
countervailing duty order, T.D. 76-9, with respect to float glass from Italy
(41 FR 1274). Treasury modified the original order on March 8, 1977 (T.D. 77-
77, 42 FR 13016) to exclude Societa Italiana Vetro S.p.A. ("SIV"). The petitioner
challenged that determination and, on March 29, 1979, the U.S. Customs Court (now
the Court of International Trade) held, in ASG Industries Inc. v. United States, 467
F. Supp. 1200 (Cust. Ct. 1979), that imports of float glass from Italy
manufactured or produced by SIV did in fact benefit from the payment of bounties
or grants. Liquidation was suspended on March 30, 1979 following the court's
decision. The United States appealed the Customs Court decision to the U.S. Court of
Customs and Patent Appeals ("CCPA").
On January 1, 1980, the provisions of title I of the Trade Agreement Act of 1979
("the TAA") became effective. On January 2, 1980, the authority for administering
the countervailing duty law was transferred from Treasury to the Department
of Commerce ("the Department").
On June 18, 1980, the CCPA granted the motion of the United States to dismiss its
appeal. As a result, the Department published an order on October 24, 1980,
amending the countervailing duty order applicable to float glass from Italy
to include float glass manufactured or exported by SIV.
The Department published in the Federal Register of May 13, 1980 (45 FR 31455) a
notice of intent to conduct administrative reviews of all outstanding
countervailing duty orders. As required by section 751 of the Tariff Act of
1930 ("the Tariff Act"), the Department has conducted an administrative review of
the order on float glass from Italy.
Scope of the Review
The merchandise covered by this review is flat glass manufactured by the float
process from Italy. It is currently classifiable under item numbers 543.21
through 543.69 of the Tariff Schedules of the United States (TSUS). Entries of float
glass which have been substantially further manufactured (e.g., into tempered glass
or laminated glass) are not subject to this countervailing duty order.
The review covers the two known exporters, Fabbrica Pisana and SIV, of this
merchandise to the United States covered by this order. We have preliminarily
determined that both companies received subsidies in the form of preferential
financing, capital grants, reduced contributions to the Italian Social Welfare System
(l'Istituto Nazionale Previdenza Sociale), and a reduced corporate income tax rate.
Analysis of Programs
(1) Preferential Interest Rate Program
Under these programs firms can obtain medium and long term government loans at
preferential rates. These lower rates encourage firms to locate in the economically
disadvantaged Mezzogiorno region (Southern Italy). The difference between the
interest which would be paid at the commercial rate and that actually paid at the
preferential rate is the subsidy.
SIV received two ten-year loans at preferential interest rates, one in 1974 and one
in 1976. These are 7.71 and 10.8 percentage points below our estimate of the
commercially available rates at the times. Fabbrica Pisana received two loans in
1972 and two additional loans in 1979. The two loans in 1972 were for ten years at
interest rates which were 9.1 and 6.0 percentage points below the commercially
available rates at the time. The interest rates of the 1979 loans were 10.75 and 1.9
percentage points below commercial rates. Payments for the first of these 1979
loans did not begin until after the present review period ended and it is, therefore,
not considered here. We calculated the net ad valorem benefits of the preferential
interest rate program for SIV to be 3.14 percent and for Fabbrica Pisana to be 1.60
percent (1976), 1.16 percent (1977), 0.99 percent (1978) and 0.88 percent (1979).
(2) Capital Investment Grants
We have received information indicating that SIV received a capital grant related to
investments in the Mezzogiorno. Fabbrica Pisana submitted no information about
such grants; however, other evidence indicates that Fabbrica Pisana received such a
grant which was to be paid out over a 15 year period. Allocating the benefits equally
over a 15 year period, we calculated the ad valorem subsidy for SIV to be 1.33
percent and for Fabbrica Pisana to be 0.32 percent (1976), 0.29 percent (1977),
0.27 percent (1978), and 0.25 percent (1979).
(3) Reduced Contributions to l'Istituto Nazionale Previdenza Sociale
To encourage investment in the Mezzogiorno, the Italian Government may reduce a
company's payments to the social welfare fund. The amount by which they were
lowered was included as an item in the total subsidy figure for each company. The
best information available described this reduced payment as a percentage of labor
costs. Labor costs for each firm were estimated to be a constant percentage of the
total value of production. We received no information regarding this item from
Fabbrica Pisana. In the absence of other information, we assumed that they took
maximum advantage of this benefit, as SIV did. We calculated the net ad valorem
benefit to be 0.64 percent for SIV and 1.29 percent each year for Fabbrica Pisana.
(4) Income Tax (IRPEG) Payments
While the normal income tax rate for corporations is 25 percent, our information
indicates that the Government of Italy reduces the rate by half for companies
operating in Southern Italy. We computed the taxable income for each firm to
be half of the value of production, as we lack actual figures from the companies. The
difference in the rates of taxation, 12.5 percent of taxable income, was calculated as
this program's subsidy for each company. We calculated this ad valorem subsidy to
be for SIV 6.25 percent and for Fabbrica Pisana: 6.96 percent (1976), 6.25 percent
(1977, 1978, 1979).
Preliminary Results of Review
As a result of our review, we preliminarily determine the net subsidy rate conferred
upon SIV to be 11.36 percent ad valorem. The net subsidy rates for Fabbrica Pisana
are: 10.17
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percent ad valorem for January 7, 1976 through December 31, 1976, 8.99 percent
ad valorem for January 1, 1977 through December 31, 1977, 8.80 percent ad
valorem for January 1, 1978 through December 31, 1978 and 8.66 percent ad
valorem for January 1, 1979 through December 31, 1979. The Department intends
to instruct the Customs Service to assess countervailing duties on
merchandise from SIV entered, or withdrawn from warehouse, for consumption
on or after March 30, 1979 and exported on or before
December 31, 1979, at the 11.36 percent ad valorem rate. The Department intends
to instruct the Customs Service to assess countervailing duties on
merchandise from Fabbrica Pisana entered, or withdrawn from warehouse, for
consumption on or after January 7, 1976 and exported before December 31, 1979
at the above stated rates.
Further, the Customs Service will be instructed to collect a cash deposit of estimated
countervailing duties at the most recent of the above (11.36 percent for SIV,
8.66 percent for Fabbrica Pisana) on all shipments entered, or withdrawn from
warehouse, for consumption on or after the date of the publication of the final
results. This requirement shall remain in effect until publication of the final results
of the next administrative review. Pending publication of the final results of the
present review, the suspension of liquidation and deposit requirements previously
ordered will continue.
Interested parties may submit written comments on these preliminary results on or
before May 21, 1981 and may request disclosure and/or a hearing on or before May
6, 1981. Any requests for an administrative protective order must be made on or
before April 27, 1981. The Department will publish a notice of the final results of the
administrative review including the results of its analysis of any such comments or
hearing.
(Sec. 751(a)(1) of the Tariff Act (19 U.S.C. 1675(a)(1)) and § 355.41 of the Commerce
Regulations (19 CFR 355.41).
John D. Greenwald,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 81-11887 Filed 4-20-81; 8:45 am]
BILLING CODE 3510-25-M