71 FR 14174, March 21, 2006
DEPARTMENT OF COMMERCE
International Trade Administration
C-580-851
Dynamic Random Access Memory Semiconductors from the Republic of
Korea: Final Results of Countervailing Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: On September 15, 2005, the Department of Commerce (``the
Department'') published in the Federal Register its preliminary results
of administrative review of the countervailing duty order on dynamic
random access memory semiconductors (``DRAMS'') from the Republic of
Korea (``Korea'') for the period April 7, 2003, through December 31,
2003. This review covers one company, Hynix Semiconductor, Inc.
(``Hynix'').
We gave interested parties an opportunity to comment on the
preliminary results. Based on information received since the
preliminary results and our analysis of the comments received, the
Department has revised the net subsidy rate for Hynix. The final net
subsidy rate for the reviewed company is listed below in the section
entitled ``Final Results of Review.''
EFFECTIVE DATE: March 21, 2006.
FOR FURTHER INFORMATION CONTACT: Ryan Langan, Natalie Kempkey, or
Andrew McAllister, AD/CVD Operations, Office 1, Import Administration,
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW,
Washington, DC 20230; telephone: (202) 482-2613, (202) 482-1698, or
(202) 482-1174, respectively.
SUPPLEMENTARY INFORMATION:
Background
Since the publication of the preliminary results of this review
(see Dynamic Random Access Memory Semiconductors from the Republic of
Korea: Preliminary Results of Countervailing Duty Administrative
Review, 70 FR 54525 (September 15, 2005) (``Preliminary Results'')),
the following events have occurred: On September 16, 2005, the
Department had a disclosure meeting with Micron Technology, Inc.
(``Micron'') regarding the Preliminary Results calculations (see
Memorandum to the File, ``Disclosure Meeting with Counsel for Micron
Technology Inc.,'' dated September 16, 2005). Also, on September 16,
the Department revised its August 31, 2005, calculation memorandum (see
Memorandum to the File, ``Revision of the Preliminary Determination
Calculation Memorandum,'' dated September 16, 2005).
On October 18, 2005, the Department met with officials from Micron
and Infineon Technologies North America Corp. to discuss alleged
irregularities with regard to Hynix's payment of countervailing duties
(understating entered value). See Memorandum to the File, ``Meeting
with Counsel for Micron Technology, Inc. and Infineon Technologies
North America Corp.,'' dated October 20, 2005. As a follow up to the
October 18, 2005, meeting, on November 2, 2005, Micron submitted a
letter requesting the Department to further investigate Hynix's alleged
understatement of entered value.
We invited interested parties to comment on the Preliminary
Results. On October 24, 2005, we received a case brief and request for
a hearing from Hynix and case briefs from Micron and the Government of
Korea (``GOK''). We received rebuttal briefs from Micron and Hynix on
November 7, 2005. On November 14, 2005, Micron submitted comments on
the bracketing of Hynix's October 24, 2005, case brief.
On November 16, 2005, we extended the time limit for the final
results of this administrative review by 60 days (to March 14, 2006),
pursuant to section 751(a)(3)(A) of the Tariff Act of 1930, as amended
(``the Act''). (See Dynamic Random Access Memory Semiconductors from
the Republic of Korea: Notice of Extension of Time Limit for
Countervailing Duty Administrative Review, 70 FR 69514 (November 16,
2005)).
On November 30, 2005, the Department provided Hynix the opportunity
to submit any additional information regarding shipments of subject
merchandise to a foreign trade zone (``FTZ'').
On December 6, 2005, the Department asked Micron to identify
alleged inconsistencies in Hynix's bracketing. On December 7, 2005,
Micron responsed to the Department's December 6, 2005, letter. On
December 9, 2005, the Department rejected Hynix' October 24, 2005, case
brief due to improper bracketing and requested that Hynix resubmit its
case brief. On December 12, 2005, Hynix resubmitted its October 24,
2005, case brief with revised bracketing. On December 14, 2005, Hynix
re-filed its December 12, 2005, case brief with additional bracketing
revisions.
On December 14, 2005, Hynix also provided a response to the
Department's November 30, 2005, letter regarding the company's
shipments to an FTZ. On December 23, 2005, the Department gave Micron
the opportunity to submit comments on the new factual information
contained in Hynix' November 7, 2005, rebuttal brief. On December 30,
2005, Micron submitted comments in response to the Department's
December 23, 2005, letter.
A public hearing was held at the Department on January 10, 2006.
Scope of the Order
The products covered by this order are dynamic random access memory
semiconductors (DRAMS) from Korea, whether assembled or unassembled.
Assembled DRAMS include all package types. Unassembled DRAMS include
processed wafers, uncut die, and cut die. Processed wafers fabricated
in Korea, but assembled into finished semiconductors (DRAMS) outside
Korea are also included in the scope. Processed wafers fabricated
outside Korea and assembled into finished
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semiconductors in Korea are not included in the scope.
The scope of this order additionally includes memory modules
containing DRAMS from Korea. 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 order also covers future DRAMS module types.
The scope of this order additionally includes, but is not limited
to, video random access memory, and synchronous graphics ram, 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
order are removable memory modules placed on motherboards, with or
without a central processing unit, unless the importer of the
motherboards certifies with U.S. Customs and Border Protection
(``CBP'') that neither it, nor a party related to it or under contract
to it, will remove the modules from the motherboards after importation
or, consistent with the Memorandum from Stephen J. Claeys to David M.
Spooner, ``Final Scope Ruling,'' dated January 12, 2006, unless the
importer of the motherboards certifies with CBP that the motherboard is
being imported for repair or refurbishment, and that neither it, nor a
party related to it or under contract to it, will remove the modules
from the motherboards after importation, except as necessary in the
course of repair or refurbishment of the motherboards, in which case
any subject memory modules removed from the motherboards will be
destroyed.
The scope of this order does not include DRAMS or memory modules
that are re-imported for repair or replacement, as stated in the Final
Scope Ruling, provided that the importing company can demonstrate that
the DRAMS or memory modules are being re-imported for repair or
replacement to the satisfaction of CBP.
The DRAMS subject to this order are currently classifiable under
subheadings 8542.21.8005 and 8542.21.8020 through 8542.21.8030 of the
Harmonized Tariff Schedule of the United States (``HTSUS''). The memory
modules containing DRAMS from Korea, described above, are currently
classifiable under subheadings 8473.30.10.40 and 8473.30.10.80 of the
HTSUS. Removable memory modules placed on motherboards, described
above, are classifiable under subheading 8471.50.0085, 8517.30.5000,
8517.50.1000, 8517.50.5000, 8517.50.9000, 8517.90.3400, 8517.90.3600,
8517.90,3800, 8517.90.4400 and 8543.89.9600. Although the HTSUS
subheadings are provided for convenience and customs purposes, the
department's written description of the scope of this order remains
dispositive.
Scope Rulings
On December 29, 2004, the Department received a request from Cisco
Systems, Inc. (``Cisco''), to determine whether removable memory
modules placed on motherboards that are imported for repair or
refurbishment are within the scope of the countervailing duty (``CVD
order''). The Department initiated a scope inquiry pursuant to 19 CFR
351.225(e) on February 4, 2005. On June 16, 2005, the Department issued
a preliminary scope ruling, finding that removable memory modules
placed on motherboards that are imported for repair or refurbishment
are within the scope of the CVD order. See Memorandum from Julie H.
Santoboni to Barbara E. Tillman, ``Preliminary Scope Ruling,'' dated
June 16, 2005. On July 5, 2005, and July 22, 2005, comments on the
preliminary scope ruling were received from Cisco. On July 6, 2005, and
July 15, 2005, comments were received from Micron.
On January 12, 2006, the Department issued a final scope ruling,
finding that removable memory modules placed on motherboards that are
imported for repair or refurbishment are not within the scope of the
CVD order if the importer certifies that it will destroy any memory
modules that are removed during repair or refurbishment. See Final
Scope Ruling. The scope of the CVD order was clarified to CBP in
message number 6037201, dated February 6, 2006.
Period of Review
The period for which we are measuring subsidies, i.e., the period
of review (``POR''), is April 7, 2003, through December 31, 2003.
Analysis of Comments Received
All issues raised in the case and rebuttal briefs by parties to
these administrative reviews are addressed in the March 14, 2006,
Issues and Decision Memorandum for the Final Results in the First
Administrative Review of the Countervailing Duty Order on Dynamic
Random Access Memory Semiconductors from the Republic of Korea
(``Decision Memorandum'') to David M. Spooner, Assistant Secretary for
Import Administration, which is hereby adopted by this notice. Attached
to this 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 these
reviews and the corresponding recommendations in this public
memorandum, which is on file in the Department's Central Records Unit,
Room B-099 of the main Department building. In addition, a complete
version of the Decision Memorandum can be accessed directly on the
Internet at https://enforcement.trade.gov/frn/index.html. The paper copy and
electronic version of the Decision Memorandum are identical in content.
Final Results of Review
In accordance with 19 CFR 351.221(b)(5), we calculated an
individual subsidy rate for the producer/exporter, Hynix, subject to
this review. For the period April 7, 2003, through December 31, 2003,
we find the net subsidy ad valorem rate for Hynix is 58.22 percent.
Assessment Rates
The Department will instruct CBP, within 15 days of publication of
these final results, to liquidate shipments of DRAMS by Hynix entered
or withdrawn from warehouse, for consumption from April 7, 2003,
through December 31, 2003, at 58.22 percent ad valorem of the F.O.B.
invoice price. We will also instruct CBP to take into account the
``provisional measures cap'' in accordance with 19 CFR 351.212(d).
Cash Deposits
The Department also intends to instruct CBP to collect cash
deposits of estimated countervailing duties at 58.22 percent ad valorem
of the F.O.B. invoice price on all shipments of the subject merchandise
from Hynix, entered, or withdrawn from warehouse, for consumption on or
after the date of publication of the final results of this
administrative review.
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We will instruct CBP to continue to collect cash deposits for non-
reviewed companies covered by this order at the most recent company-
specific rate applicable to the company. Accordingly, the cash deposit
rate that will be applied to non-reviewed companies covered by this
order will be the rate for that company established in the
investigation. See Notice of Amended Final Affirmative Countervailing
Duty Determination: Dynamic Random Access Memory Semiconductors from
the Republic of Korea, 68 FR 44290 (July 28, 2003). The ``all others''
rate shall apply to all non-reviewed companies until a review of a
company assigned this rate is requested. The Department has previously
excluded Samsung Electronics Co., Ltd. from this order. Id.
This notice also serves as a 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(a)(3). Timely written
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 administrative review and notice are issued and published in
accordance with section 751(a)(1) of the Act.
Dated: March 14, 2006.
David M. Spooner,
Assistant Secretary for Import Administration.
APPENDIX I
Comments in the Issues and Decision Memorandum
Comment 1: Entrustment or Direction of the December 2002 Restructuring
A. Government of Korea Policy Towards Hynix
B. Government of Korea Influence of Creditors
C. Government of Korea's Influence over the Creditors' Council
D. The Deutsche Bank Report
Comment 2: Whether the December 2002 Restructuring Was Commercial
Comment 3: Entrustment or Direction of the October 2001 Restructuring
Comment 4: Private and Foreign Banks as Benchmarks
Comment 5: Hynix's Equityworthiness
Comment 6: Hynix's Creditworthiness
Comment 7: Ministerial Error Regarding Financing from Foreign Banks
Comment 8: Ministerial Error Regarding KDB Fast Track Bonds
Comment 9: Adjustment of Benefit to Account for Sale of Hynix's
Subsidiaries
Comment 10: Benefits Relating to Creditors Exercising Appraisal Rights
Comment 11: Ministerial Errors Regarding Benchmarks
Comment 12: Value of October 2001 and December 2002 Equity
Comment 13: Timing of Benefits from the December 2002 Restructuring
Comment 14: Benchmark for Creditworthy Companies / Discount Rate for
Debt Forgiveness
Comment 15: Ministerial Errors Regarding G7/Highly Advanced National
Program
Comment 16: Evasion of the Countervailing Duty Order
Comment 17: Hynix and the Government of Korea's Cooperation and
Disclosure of Information
[FR Doc. E6-4071 Filed 3-20-06; 8:45 am]
BILLING CODE 3510-DS-S