"68 FR 37122, June 23, 2003
DEPARTMENT OF COMMERCE
International Trade Administration
[C-580-851]
Final Affirmative Countervailing Duty Determination: Dynamic
Random Access Memory Semiconductors from the Republic of Korea
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of final affirmative countervailing duty determination.
-----------------------------------------------------------------------
SUMMARY: The Department of Commerce has made a final determination that
countervailable subsidies are being provided to certain producers and
exporters of dynamic random access memory semiconductors from the
Republic of Korea. For information on the estimated countervailing duty
rates, please see the ``Suspension of Liquidation'' section, below.
EFFECTIVE DATE: June 23, 2003.
FOR FURTHER INFORMATION CONTACT: Ryan Langan, Jesse Cortes, or Daniel
J. Alexy, Office of Antidumping/Countervailing Duty Enforcement, Group
1, Import Administration, U.S. Department of Commerce, Room 3099, 14th
Street and Constitution Avenue, N.W., Washington, D.C. 20230;
telephone(202) 482-2613, (202) 482-3986, and (202) 482-1540,
respectively.
SUPPLEMENTARY INFORMATION:
Petitioner
The petitioner in this investigation is Micron Technology, Inc.
(``the petitioner'').
Period of Investigation
The period for which we are measuring subsidies, or period of
investigation, is January 1, 2001 through June 30, 2002.
Case History
The following events have occurred since the publication of the
preliminarydetermination in the Federal Register on April 7, 2003. See
[[Page 37123]]
Preliminary Affirmative Countervailing Duty Determination: Dynamic
Random Access Memory Semiconductors from the Republic of Korea (68 FR
16766 ) (``Preliminary Determination'').
On April 7, 2003, the petitioner submitted comments alleging that
Samsung Electronics Co., Ltd., (``SEC'') was uncreditworthy during the
period 1997 through 1999. SEC filed rebuttal information relating to
this allegation on April 10 and 17, 2003. The Department of Commerce
(``the Department'') initiated an investigation of SEC's
creditworthiness for 1998 only in an April 17, 2003 memorandum to Louis
Apple entitled ``Samsung Electronics Co., Ltd. Uncreditworthiness
Allegation,'' which is on file in the Department's Central Records Unit
in Room B-099 of the main Department building (``CRU''). SEC and the
petitioner filed further comments on this creditworthiness
investigation subsequent to its initiation.
On April 8, 2003, Hynix Semiconductor, Inc. (``Hynix'') submitted
ministerial error allegations relating to the Preliminary
Determination. The petitioner filed a response to these allegations on
April 14, 2003. We addressed these ministerial error allegations in an
April 16, 2003 memorandum to Louis Apple entitled ``Ministerial Error
Allegations for Preliminary Determination,'' which is on file in the
Department's CRU.
We issued supplemental questionnaires to SEC, Hynix, and the
Government of the Republic of Korea (``GOK'') on April 8, and May 5, 6,
and 20, 2003. We received responses to these supplemental
questionnaires on April 14 and 16, and May 13, 15, and 22, 2003. The
respondents, the petitioner, and interested parties also submitted
factual information, comments, and arguments at numerous instances
prior to the final determination based on various deadlines for
submissions of factual and information and/or arguments established by
the Department subsequent to the Preliminary Determination.
From April 21 to May 3, 2003, we conducted verification of the
questionnaire responses submitted by the GOK, Hynix, and SEC.
On May 28, 2003, the Department issued a memorandum entitiled
``Preliminary Determination on New Subsidy Allegations and New
Subsidies Discovered in the Course of Investigation'' (``Supplemental
Preliminary Determination Memo'') that addressed two new allegations
raised by the petitioner just prior to the Preliminary Determination,
as well as one new program discovered during verification.
We received case briefs from the GOK, SEC, Hynix, Infineon
Technologies North America Corporation and Infineon Technologies
Richmond, LP (a domestic producer and an interested party in this
proceeding), and the petitioner on May 22, 2003. The parties submitted
rebuttal briefs on May 30, 2003. On June 2, 2003, the petitioner and
the GOK/SEC submitted supplemental case briefs on the issues addressed
in the Department's Supplemental Preliminary Determination Memo. These
same parties submitted rebuttal briefs on these topics on June 4, 2003.
We held a hearing in this investigation on June 6, 2003.
Scope of Investigation
The products covered by this investigation are dynamic random
access memory semiconductors (``DRAMS'') from the Republic of Korea
(``ROK''), whether assembled or unassembled. Assembled DRAMS include
all package types. Unassembled DRAMS include processed wafers, uncut
die, and cut die. Processed wafers fabricated in the ROK, but assembled
into finished semiconductors outside the ROK are also included in the
scope. Processed wafers fabricated outside the ROK and assembled into
finished semiconductors in the ROK are not included in the scope.
The scope of this investigation additionally includes memory
modules containing DRAMS from the ROK. A memory module is a collection
of DRAMS, the sole function of which is memory. Memory modules include
single in-line processing modules, single in-line memory modules, dual
in-line memory modules, small outline dual in-line memory modules,
Rambus in-line memory modules, and memory cards or other collections of
DRAMS, whether unmounted or mounted on a circuit board. Modules that
contain other parts that are needed to support the function of memory
are covered. Only those modules that contain additional items which
alter the function of the module to something other than memory, such
as video graphics adapter boards and cards, are not included in the
scope. This investigation also covers future DRAMS module types.
The scope of this investigation additionally includes, but is not
limited to, video random access memory and synchronous graphics random
access memory, as well as various types of DRAMS, including fast page-
mode, extended data-out, burst extended data-out, synchronous dynamic
RAM, Rambus DRAM, and Double Data Rate DRAM. The scope also includes
any future density, packaging, or assembling of DRAMS. Also included in
the scope of this investigation are removable memory modules placed on
motherboards, with or without a central processing unit, unless the
importer of the motherboards certifies with the U.S. Bureau of Customs
and Border Protection (``Customs'') that neither it, nor a party
related to it or under contract to it, will remove the modules from the
motherboards after importation. The scope of this investigation does
not include DRAMS or memory modules that are re-imported for repair or
replacement.
The DRAMS subject to this investigation are currently classifiable
under ubheadings 8542.21.8005 and 8542.21.8021 through 8542.21.8029 of
the Harmonized Tariff Schedule of the United States (``HTSUS''). The
memory modules containing DRAMS from the ROK, described above, are
currently classifiable under subheadings 8473.30.10.40 or 8473.30.10.80
of the HTSUS. Although the HTSUS subheadings are provided for
convenience and customs purposes, the Department's written description
of the scope of this investigation remains dispositive.
Injury Test
Because the ROK is a ``Subsidies Agreement Country'' within the
meaning of section 701(b) of the Tariff Act of 1930, as amended by the
Uruguay Round Agreements Act effective January 1, 1995 (``the Act''),
the International Trade Commission (``ITC'') is required to determine
whether imports of the subject merchandise from the ROK materially
injure, or threaten material injury to, a U.S. industry. On December
13, 2002, the ITC made its preliminary determination that there is a
reasonable indication that an industry in the United States is being
materially injured by reason of imports from the ROK of the subject
merchandise. See Drams and Dram Modules from Korea, 67 FR 79148
(December 27, 2002).
Analysis of Comments Received
All issues raised in the case and rebuttal briefs by parties to
this investigation are addressed in the ``Issues and Decision
Memorandum'' from Jeffrey May, Deputy Assistant Secretary, Import
Administration, to Joseph A. Spetrini, Acting Assistant Secretary,
Import Administration, dated June 16, 2003 (``Decision Memorandum''),
which is hereby adopted by this notice. Attached to this
[[Page 37124]]
notice as an Appendix is a list of the issues which parties have raised
and to which we have responded in the Decision Memorandum. Parties can
find a complete discussion of all issues raised in this investigation
and the corresponding recommendations in this public memorandum which
is on file in the CRU. In addition, a complete version of the Decision
Memorandum can be accessed directly on the Internet at https://enforcement.trade.gov/frn/
under the heading ``Korea.'' The paper copy and
electronic version of the Decision Memorandum are identical in content.
Suspension of Liquidation
As a result of our Preliminary Determination, we instructed Customs
to suspend liquidation of all entries of DRAMS from the ROK which were
entered or withdrawn from warehouse, for consumption on or after April
7, 2003, the date of the publication of the Preliminary Determination
in the Federal Register (with the exception of entries from SEC as we
preliminarily determined SEC's rate to be de minimis).
In accordance with section 705(c)(1)(C) of the Act, we are
directing Customs to continue to suspend liquidation of all imports of
the subject merchandise from the ROK that are entered, or withdrawn
from warehouse, for consumption on or after the date of publication of
this notice in the Federal Register, with the exception of entries for
SEC, for whom we have determined the net subsidy rate to be de minimis.
These suspension of liquidation instructions will remain in effect
until further notice.
We determine the total estimated net subsidy rate for each company
to be the following:
------------------------------------------------------------------------
Producer/Exporter Net Subsidy Rate
------------------------------------------------------------------------
Samsung Electronics Co., Ltd........................ 0.04 percent (de
minimis)
Hynix Semiconductor Inc. (formerly, Hyundai 44.71 percent
Electronics Industries Co., Ltd.)..................
All Others.......................................... 44.71 percent
------------------------------------------------------------------------
In accordance with sections 777A(e)(2)(B) and 705(c)(5)(A) of the
Act, we have set the ``all others'' rate as Hynix' rate because the
rate for SEC, the only other investigated company, is de minimis.
We will issue a countervailing duty order if the ITC issues a final
affirmative injury determination and we will instruct Customs to
require a cash deposit of estimated countervailing duties for such
entries of merchandise in the amounts indicated above. If the ITC
determines that material injury, or threat of material injury, does not
exist, this proceeding will be terminated and all estimated duties
deposited or securities posted as a result of the suspension of
liquidation will be refunded or canceled.
ITC Notification
In accordance with section 705(d) of the Act, we will notify the
ITC of our determination. In addition, we are making available to the
ITC all non-privileged and non-proprietary information related to this
investigation. We will allow the ITC access to all privileged and
business proprietary information in our files, provided the ITC
confirms that it will not disclose such information, either publicly or
under an Administrative Protective Order (``APO''), without the written
consent of the Assistant Secretary for Import Administration.
Return or Destruction of Proprietary Information
In the event that the ITC issues a final negative injury
determination, this notice will serve as the only reminder to parties
subject to an APO of their responsibility concerning the destruction of
proprietary information disclosed under APO in accordance with 19 CFR
351.305(a)(3). Failure to comply is a violation of the APO.
This determination is published pursuant to sections 703(f) and
777(i) of the Act.
Dated: June 16, 2003.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
APPENDIX
List of Comments and Issues in the Decision Memorandum
Comment 1: Direction of Credit
Comment 2: Specificity Relating to Direction of Credit
Comment 3: Application of Commercial Benchmarks to Determine the Amount
of Benefits to Hynix Semiconductor Inc. (formerly, Hyundai Electronics
Industries Co., Ltd. (``HEI'')) (``Hynix'')
Comment 4: Direction of Credit Through the Government of the Republic
of Korea's (``GOK'') Control of the Bond Market
Comment 5: Hynix Creditworthiness
Comment 6: Korea Development Bank (``KDB'') Fast Track Program
Comment 7: Hynix October 2001 Debt-to-Equity Conversion
Comment 8: Hynix October 2001 Debt Forgiveness
Comment 9: Hynix Five-Year Interest-Free Loan Stemming from October
2001 Restructuring
Comment 10: Hynix October 2001 Retroactive Reduction of Accrued
Interest as Part of Debt-Equity Swap
Comment 11: Hynix Benefit from Convertible Bonds (``CB'') Arising
Between Issuance and Conversion Stemming from October 2001
Restructuring
Comment 12: Treating Loans to Hynix in Excess of Banking Act Exposure
Limitations and Documents Against Acceptance (``D/A'') Financing as
Grants
Comment 13: D/A Interest Rates
Comment 14: Hynix Sales
Comment 15: Hynix Short-Term Financing
Comment 16: Ministerial Errors In Certain Hynix Preliminary
Determination Calculations
Comment 17: Use of LG Semiconductor, Inc. (``LG Semicon'') Bonds as
Hynix Benchmarks
Comment 18: Calculation of Uncreditworthy Benchmarks
Comment 19: Other General Benchmark Issues
Comment 20: Samsung Electronics Co., Ltd. (``SEC'') Creditworthiness
Comment 21: Facts Available for SEC's Unreported Short- and Long-Term
Financing
Comment 22: Treatment of Certain SEC Interest Payments
Comment 23: SEC Sales
Comment 24: Energy Savings Fund (``ESF'') Program
Comment 25: De Facto Specificity of Certain Tax Programs Under the Tax
Reduction and Exemption Control Act (``TERCL'') and/or the Restriction
of Special Taxation Act (``RSTA'')
Comment 26: RSTA Article 26 and Import Substitution
Comment 27: 21st Century Frontier Research and Development (``R&D'')
Program
Comment 28: Other R&D Programs
Comment 29: Export Insurance Program
Comment 30: Electricity Discounts Under the Requested Load Adjustment
(``RLA'') Program
[[Page 37125]]
Comment 31: Duty Drawback on Non-Physically Incorporated Items and
Excessive Loss Rates, and on Domestic Sales of Finished Products
Manufactured from Imported Raw Materials
Comment 32: Import Duty Reduction for Cutting Edge Products
Comment 33: Permission for Hynix and SEC to Build in Restricted Area
Comment 34: Exemption of Value-Added Tax (``VAT'') on Imports Used for
Bonded FactoriesUnder Construction
[FR Doc. 03-15793 Filed 6-20-03; 8:45 am]