Federal Register / Vol. 75, No. 39 / Monday, March 1, 2010 / Notices 9163 

review of that party absent new 

information as to the party’s location. 

Moreover, if the interested party who 

files a request for review is unable to 

locate the producer or exporter for 

which it requested the review, the 

interested party must provide an 

explanation of the attempts it made to 

locate the producer or exporter at the 

same time it files its request for review, 

in order for the Secretary to determine 

if the interested party’s attempts were 

reasonable, pursuant to 19 CFR 

351.303(f)(3)(ii). 

As explained in Antidumping and 

Countervailing Duty Proceedings: 

Assessment of Antidumping Duties, 68 

FR 23954 (May 6, 2003), the Department 

has clarified its practice with respect to 

the collection of final antidumping 

duties on imports of merchandise where 

intermediate firms are involved. The 

public should be aware of this 

clarification in determining whether to 

request an administrative review of 

merchandise subject to antidumping 

findings and orders. See also the Import 

Administration Web site at http:// 

ia.ita.doc.gov. 

Six copies of the request should be 

submitted to the Assistant Secretary for 

Import Administration, International 

Trade Administration, Room 1870, U.S. 

Department of Commerce, 14th Street 

and Constitution Avenue, NW., 

Washington, DC 20230. The Department 

also asks parties to serve a copy of their 

requests to the Office of Antidumping/ 

Countervailing Operations, Attention: 

Sheila Forbes, in Room 3065 of the main 

Commerce Building. Further, in 

accordance with 19 CFR 351.303(f)(l)(i), 

a copy of each request must be served 

on every party on the Department’s 

service list. 

The Department will publish in the 

Federal Register a notice of ‘‘Initiation 

of Administrative Review of 

Antidumping or Countervailing Duty 

Order, Finding, or Suspended 

Investigation’’ for requests received by 

the last day of March 2010. If the 

Department does not receive, by the last 

day of March 2010, a request for review 

of entries covered by an order, finding, 

or suspended investigation listed in this 

notice and for the period identified 

above, the Department will instruct CBP 

to assess antidumping or countervailing 

duties on those entries at a rate equal to 

the cash deposit of (or bond for) 

estimated antidumping or 

countervailing duties required on those 

entries at the time of entry, or 

withdrawal from warehouse, for 

consumption and to continue to collect 

the cash deposit previously ordered. 

For the first administrative review of 

any order, there will be no assessment 

of antidumping or countervailing duties 

on entries of subject merchandise 

entered, or withdrawn from warehouse, 

for consumption during the relevant 

provisional-measures ‘‘gap’’ period, of 

the order, if such a gap period is 

applicable to the POR. 

This notice is not required by statute 

but is published as a service to the 

international trading community. 

Dated: February 22, 2010. 

John M. Andersen, 

Acting Deputy Assistant Secretary for 

Antidumping and Countervailing Duty 

Operations. 

[FR Doc. 2010–4182 Filed 2–26–10; 8:45 am] 

BILLING CODE 3510–DS–P 

DEPARTMENT OF COMMERCE 

International Trade Administration 

[C–570–957] 

Certain Seamless Carbon and Alloy 

Steel Standard, Line, and Pressure 

Pipe From the People’s Republic of 

China: Preliminary Affirmative 

Countervailing Duty Determination, 

Preliminary Affirmative Critical 

Circumstances Determination 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

SUMMARY: The Department of Commerce 

preliminarily determines that 

countervailable subsidies are being 

provided to producers and exporters of 

certain seamless carbon and alloy steel 

standard, line, and pressure pipe from 

the People’s Republic of China. For 

information on the estimated subsidy 

rates, see the ‘‘Suspension of 

Liquidation’’ section of this notice. The 

Department of Commerce further 

preliminarily determines that critical 

circumstances exist with respect to 

imports of the subject merchandise. 

DATES: Effective Date: March 1, 2010. 

FOR FURTHER INFORMATION CONTACT: 

Shane Subler, Yasmin Nair, Joseph 

Shuler, or Matthew Jordan, AD/CVD 

Operations, Office 1, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, NW., Washington, DC 20230; 

telephone: (202) 482–0189, (202) 482– 

3813, (202) 482–4162, (202) 482–1293, 

and (202) 482–1540, respectively. 

SUPPLEMENTARY INFORMATION: 

Case History 

The following events have occurred 

since the publication of the Department 

of Commerce’s (‘‘Department’’) notice of 

initiation in the Federal Register. See 

Certain Seamless Carbon and Alloy 

Steel Standard, Line, and Pressure Pipe 

from the People’s Republic of China: 

Initiation of Countervailing Duty 

Investigation, 74 FR 52945 (October 15, 

2009) (‘‘Initiation Notice’’), and the 

accompanying Initiation Checklist. 

On November 4, 2009, the Department 

selected two Chinese producers/ 

exporters of certain seamless carbon and 

alloy steel standard, line, and pressure 

pipe (‘‘seamless pipe’’) as mandatory 

respondents: (1) Hengyang Steel Tube 

Group Int’l Trading Inc., Hengyang 

Valin Steel Tube Co., Ltd., Hengyang 

Valin MPM Tube Co., Ltd., and their 

affiliate, Xigang Seamless Steel Tube 

Co., Ltd. (collectively, ‘‘Hengyang’’); and 

(2) Tianjin Pipe (Group) Corporation 

(‘‘TPCO’’). See Memorandum to Edward 

Yang, Acting Deputy Assistant Secretary 

for Antidumping and Countervailing 

Duty Operations, ‘‘Respondent Selection 

Memo’’ (November 4, 2009). This 

memorandum is on file in the 

Department’s Central Records Unit 

(‘‘CRU’’) in Room 1117 of the main 

Department building. 

On November 6, 2009, the U.S. 

International Trade Commission (‘‘ITC’’) 

published its affirmative preliminary 

determination that there is a reasonable 

indication that an industry in the 

United States is threatened with 

material injury by reason of allegedly 

subsidized imports of seamless pipe 

from the People’s Republic of China 

(‘‘PRC’’). See Certain Seamless Carbon 

and Alloy Steel Standard, Line, and 

Pressure Pipe From China, 74 FR 57521 

(November 6, 2009). 

On November 9, 2009, we issued a 

questionnaire to the Government of the 

People’s Republic of China (‘‘GOC’’), 

Hengyang, and TPCO. On December 3, 

2009, the Department published a 

postponement of the deadline for the 

preliminary determination in this 

investigation until February 16, 2010. 

See Certain Seamless Carbon and Alloy 

Steel Standard, Line, and Pressure Pipe 

from the People’s Republic of China: 

Postponement of Preliminary 

Determination in the Countervailing 

Duty Investigation, 74 FR 63391 

(December 3, 2009). 

In December 2009 and January 2010, 

we received responses to our 

questionnaire from the GOC, Hengyang, 

and TPCO. See the GOC’s Original 

Questionnaire Response (January 7, 

2010) (‘‘GQR’’), Hengyang’s Original 

Questionnaire Response (January 5, 

2010) (‘‘HQR’’), and TPCO’s Original 

Questionnaire Response (December 31, 

2009) (‘‘TQR’’). We sent supplemental 

questionnaires to TPCO on January 27, 

2010, and February 4, 2010. We 

received responses to these 

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9164 Federal Register / Vol. 75, No. 39 / Monday, March 1, 2010 / Notices 

1See Petitioners’ new subsidy allegations dated 

January 7, 2010, and January 13, 2010. 

supplemental questionnaires on 

February 3, 2010, and February 12, 

2010. We sent supplemental 

questionnaires to Hengyang on January 

28, 2010, and February 4, 2010. We 

received responses to these 

supplemental questionnaires on 

February 4, 2010, and February 12, 

2010. We sent a supplemental 

questionnaire to the GOC on January 28, 

2010, and received a response to this 

questionnaire on February 4, 2010 

(‘‘G1SR’’). 

On January 7, 2010, United States 

Steel Corporation (‘‘U.S. Steel’’), V&M 

Star L.P., TMK IPSCO, and United Steel, 

Paper and Forestry, Rubber, 

Manufacturing, Energy, Allied 

Industrial and Service Workers 

International Union (collectively, 

‘‘Petitioners’’) filed an allegation of 

critical circumstances with regard to 

seamless pipe from the PRC. On January 

22, 2010, we requested that Hengyang 

and TPCO submit shipment data related 

to this allegation. TPCO and Hengyang 

submitted these data on February 2, 

2010. 

On January 7 and January 13, 2010, 

Petitioners submitted new subsidy 

allegations requesting the Department to 

expand its countervailing duty (‘‘CVD’’) 

investigation to include additional 

subsidy programs.1 On February 17, 

2010, the Department issued a 

memorandum initiating certain of these 

new subsidy allegations. See 

Memorandum from Yasmin Nair, 

International Trade Compliance 

Analyst, Office 1 to Susan H. Kuhbach, 

Director, Office 1, ‘‘New Subsidy 

Allegations’’ (February 17, 2010). 

On January 11, 2010, we issued a 

letter requesting that the GOC update its 

original questionnaire response for the 

cross-owned affiliates for which the 

respondent companies filed 

questionnaire responses. The GOC filed 

its response on January 25, 2010. 

On January 14, 2010, we issued a 

letter notifying the GOC that it did not 

provide responses to certain questions 

in the original questionnaire. In 

response to this letter, on January 25, 

2010, the GOC filed a submission with 

information pertaining to the provision 

of steel rounds. 

On February 12, 2010, Petitioners 

submitted comments for the preliminary 

determination. 

The Department originally extended 

the deadline for this preliminary 

determination until February 16, 2010. 

As explained in the memorandum from 

the Deputy Assistant Secretary for 

Import Administration, the Department 

has exercised its discretion to toll 

deadlines for the duration of the closure 

of the Federal Government from 

February 5, through February 12, 2010. 

Thus, all deadlines in this segment of 

the proceeding have been extended by 

seven days. The revised deadline for the 

preliminary determination of this 

investigation is now February 22, 2010. 

See Memorandum to the Record from 

Ronald Lorentzen, DAS for Import 

Administration, regarding ‘‘Tolling of 

Administrative Deadlines As a Result of 

the Government Closure During the 

Recent Snowstorm,’’ dated February 12, 

2010. 

Scope Comments 

In accordance with the preamble to 

the Department’s regulations, we set 

aside a period of time in our Initiation 

Notice for parties to raise issues 

regarding product coverage, and 

encouraged all parties to submit 

comments within 20 calendar days of 

publication of that notice. See 

Antidumping Duties; Countervailing 

Duties, 62 FR 27296, 27323 (May 19, 

1997), and Initiation Notice, 74 FR at 

52945. We did not receive comments 

concerning the scope of the 

antidumping duty (‘‘AD’’) and CVD 

investigations of seamless pipe from the 

PRC. 

Scope of the Investigation 

The scope of this investigation 

consists of certain seamless carbon and 

alloy steel (other than stainless steel) 

pipes and redraw hollows, less than or 

equal to 16 inches (406.4 mm) in 

outside diameter, regardless of wallthickness, manufacturing process (e.g., 

hot-finished or cold-drawn), end finish 

(e.g., plain end, beveled end, upset end, 

threaded, or threaded and coupled), or 

surface finish (e.g., bare, lacquered or 

coated). Redraw hollows are any 

unfinished carbon or alloy steel (other 

than stainless steel) pipe or ‘‘hollow 

profiles’’ suitable for cold finishing 

operations, such as cold drawing, to 

meet the American Society for Testing 

and Materials (‘‘ASTM’’) or American 

Petroleum Institute (‘‘API’’) 

specifications referenced below, or 

comparable specifications. Specifically 

included within the scope are seamless 

carbon and alloy steel (other than 

stainless steel) standard, line, and 

pressure pipes produced to the ASTM 

A–53, ASTM A–106, ASTM A–333, 

ASTM A–334, ASTM A–335, ASTM A– 

589, ASTM A–795, ASTM A–1024, and 

the API 5L specifications, or comparable 

specifications, and meeting the physical 

parameters described above, regardless 

of application, with the exception of the 

exclusion discussed below. 

Specifically excluded from the scope 

of the investigation are unattached 

couplings. 

The merchandise covered by the 

investigation is currently classified in 

the Harmonized Tariff Schedule of the 

United States (‘‘HTSUS’’) under item 

numbers: 7304.19.1020, 7304.19.1030, 

7304.19.1045, 7304.19.1060, 

7304.19.5020, 7304.19.5050, 

7304.31.6050, 7304.39.0016, 

7304.39.0020, 7304.39.0024, 

7304.39.0028, 7304.39.0032, 

7304.39.0036, 7304.39.0040, 

7304.39.0044, 7304.39.0048, 

7304.39.0052, 7304.39.0056, 

7304.39.0062, 7304.39.0068, 

7304.39.0072, 7304.51.5005, 

7304.51.5060, 7304.59.6000, 

7304.59.8010, 7304.59.8015, 

7304.59.8020, 7304.59.8025, 

7304.59.8030, 7304.59.8035, 

7304.59.8040, 7304.59.8045, 

7304.59.8050, 7304.59.8055, 

7304.59.8060, 7304.59.8065, and 

7304.59.8070. 

Although the HTSUS subheadings are 

provided for convenience and customs 

purposes, our written description of the 

merchandise subject to this scope is 

dispositive. 

Period of Investigation 

The period for which we are 

measuring subsidies, i.e., the period of 

investigation (‘‘POI’’), is January 1, 2008, 

through December 31, 2008. 

Critical Circumstances 

In their January 7, 2010, submission, 

Petitioners alleged that critical 

circumstances exist with respect to 

imports of seamless pipe from the PRC. 

Section 703(e)(1) of the Tariff Act of 

1930, as amended (‘‘the Act’’) states that 

if the petitioner alleges critical 

circumstances, the Department will 

determine, on the basis of information 

available to it at the time, if there is a 

reason to believe or suspect that: (A) 

The alleged countervailable subsidy is 

inconsistent with the World Trade 

Organization (‘‘WTO’’) Agreement on 

Subsidies and Countervailing Measures 

(‘‘SCM Agreement’’), and (B) there have 

been massive imports of the subject 

merchandise over a relatively short 

period. 

In accordance with 19 CFR 

351.206(c)(2)(i), because Petitioners 

submitted a critical circumstances 

allegation more than 20 days before the 

scheduled date of the preliminary 

determination, the Department must 

issue a preliminary critical 

circumstances determination not later 

than the date of the preliminary 

determination. See, e.g., Change in 

Policy Regarding Timing of Issuance of 

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Federal Register / Vol. 75, No. 39 / Monday, March 1, 2010 / Notices 9165 

2http://dataweb.usitc.gov/ 

Critical Circumstances Determinations, 

63 FR 55364 (October 15, 1998). 

As discussed in the ‘‘Analysis of 

Programs’’ section below, the 

Department has preliminarily 

determined that TPCO and Hengyang 

received countervailable export 

subsidies during the POI. For ‘‘all other’’ 

exporters, we are basing our finding on 

the experience of TPCO and Hengyang 

and, therefore, we find that ‘‘all others’’ 

benefitted from export subsidies. Export 

subsidies are inconsistent with the SCM 

Agreement. Therefore, the criterion of 

section 703(e)(1)(A) of the Act has been 

satisfied. See Notice of Preliminary 

Affirmative Countervailing Duty 

Determination, Preliminary Affirmative 

Critical Circumstances Determination, 

and Alignment of Final Countervailing 

Duty Determination With Final 

Antidumping Duty Determination: 

Certain Softwood Lumber Products 

From Canada, 66 FR 43186, 43189–90 

(August 17, 2001); unchanged in Notice 

of Amended Final Affirmative 

Countervailing Duty Determination and 

Notice of Countervailing Duty Order: 

Certain Softwood Lumber Products 

From Canada, 67 FR 36070 (May 22, 

2002). 

In determining whether there are 

‘‘massive imports’’ over a ‘‘relatively 

short period’’ pursuant to section 

703(e)(1)(B) of the Act, the Department 

normally compares shipments of the 

subject merchandise for three months 

immediately preceding the filing of the 

petition (i.e., the ‘‘base period’’) with the 

three months following the filing of the 

petition (i.e., the ‘‘comparison period’’). 

In addition, 19 CFR 351.206(h)(2) 

provides that an increase in imports of 

15 percent during the ‘‘relatively short 

period’’ of time may be considered 

‘‘massive.’’ Finally, 19 CFR 351.206(i) 

defines ‘‘relatively short period’’ as 

normally being the period beginning on 

the date the proceeding begins (i.e., the 

date the petition is filed) and ending at 

least three months later. 

In accordance with 19 CFR 351.206(i), 

we are using the three months preceding 

the filing of the petition (i.e., July to 

September 2009) as the base period and 

the three months following the filing of 

the petition (i.e., October to December 

2009) as the comparison period. 

Because Petitioners filed their petition 

on September 16, 2009, which is the 

second half of the month, September is 

included in the base period. 

Based upon the monthly shipment 

data submitted by TPCO, we 

preliminarily find that TPCO’s 

shipments did not reach the minimum 

threshold necessary for finding that 

imports have been massive over a 

relatively short period. Therefore, we 

preliminarily determine that critical 

circumstances do not exist with respect 

to imports of seamless pipe from TPCO. 

For further discussion, see the 

Memorandum to the File, ‘‘Critical 

Circumstances Analysis’’ (February 22, 

2010) (‘‘Critical Circumstances Analysis 

Memo’’), on file in the Department’s 

CRU. 

Based upon the monthly shipment 

data submitted by Hengyang, we 

preliminarily find that Hengyang’s 

seamless pipe imports increased more 

than 15 percent during the ‘‘relatively 

short period,’’ as required by 19 CFR 

351.206(h)(2). See Critical 

Circumstances Analysis Memo. Further, 

as explained above, we find that 

Hengyang received an export subsidy, 

i.e., a subsidy inconsistent with the 

SCM Agreement. Therefore, we 

preliminarily determine that the 

requirements of section 703(e)(1)(B) of 

the Act have been satisfied, and that 

critical circumstances exist for 

Hengyang. 

For ‘‘all other’’ exporters, we are 

basing our finding on data from USITC 

Dataweb.2 We preliminarily determine 

that there were massive imports over a 

relatively short period for ‘‘all other’’ 

producers/exporters of seamless pipe 

from the PRC. For further discussion, 

see Critical Circumstances Analysis 

Memo. Further, as explained above, we 

find that ‘‘all other’’ producers and 

exporters received a subsidy 

inconsistent with the SCM Agreement. 

Therefore, we preliminarily determine 

that the requirements of section 

703(e)(1)(B) of the Act have been 

satisfied, and that critical circumstances 

exist for ‘‘all others.’’ 

Application of the Countervailing Duty 

Law to Imports From the PRC 

On October 25, 2007, the Department 

published Coated Free Sheet Paper from 

the People’s Republic of China: Final 

Affirmative Countervailing Duty 

Determination, 72 FR 60645 (October 

25, 2007) (‘‘CFS from the PRC’’), and the 

accompanying Issues and Decision 

Memorandum (‘‘CFS Decision 

Memorandum’’). In CFS from the PRC, 

the Department found that 

given the substantial difference between the 

Soviet-style economies and China’s economy 

in recent years, the Department’s previous 

decision not to apply the CVD law to these 

Soviet-style economies does not act as (a) bar 

to proceeding with a CVD investigation 

involving products from China. 

See CFS Decision Memorandum, at 

Comment 6. The Department has 

affirmed its decision to apply the CVD 

law to the PRC in subsequent final 

determinations. See, e.g., Circular 

Welded Carbon Quality Steel Pipe from 

the People’s Republic of China: Final 

Affirmative Countervailing Duty 

Determination and Final Affirmative 

Determination of Critical 

Circumstances, 73 FR 31966 (June 5, 

2008), and accompanying Issues and 

Decision Memorandum (‘‘CWP Decision 

Memorandum’’), at Comment 1. 

Additionally, for the reasons stated in 

the CWP Decision Memorandum, we are 

using the date of December 11, 2001, the 

date on which the PRC became a 

member of the WTO, as the date from 

which the Department will identify and 

measure subsidies in the PRC. See CWP 

Decision Memorandum, at Comment 2. 

Use of Facts Otherwise Available and 

Adverse Inferences 

Sections 776(a)(1) and (2) of the Act 

provide that the Department shall apply 

‘‘facts otherwise available’’ if necessary 

information is not on the record or an 

interested party or any other person: (A) 

Withholds information that has been 

requested; (B) fails to provide 

information within the deadlines 

established, or in the form and manner 

requested by the Department, subject to 

subsections (c)(1) and (e) of section 782 

of the Act; (C) significantly impedes a 

proceeding; or (D) provides information 

that cannot be verified as provided by 

section 782(i) of the Act. 

Section 776(b) of the Act further 

provides that the Department may use 

an adverse inference in applying the 

facts otherwise available when a party 

has failed to cooperate by not acting to 

the best of its ability to comply with a 

request for information. 

GOC—Steel Rounds 

The Department is investigating the 

alleged provision of steel rounds for less 

than adequate remuneration by the 

GOC. We requested information from 

the GOC about the PRC’s steel rounds 

industry in general and the specific 

companies that produced the steel 

rounds purchased by the mandatory 

respondents. In both respects, the GOC 

has failed to provide the requested 

information within the established 

deadlines. 

At pages 87–89 of the GQR, the GOC 

responded, ‘‘No such information is 

available,’’ to the following questions on 

the steel rounds industry in the PRC. 

The GOC provided no further 

explanation on the following requested 

information: 

• The number of producers of steel 

rounds (e.g., billets, blooms); 

• the total volume and value of 

domestic production of steel rounds that 

is accounted for by companies in which 

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9166 Federal Register / Vol. 75, No. 39 / Monday, March 1, 2010 / Notices 

3 Includes governments at all levels, including 

townships and villages, ministries, or agencies of 

those governments including state asset 

management bureaus, state-owned enterprises and 

labor unions. 

the GOC maintains an ownership or 

management interest either directly or 

through other government entities; 3

• the total volume and value of 

domestic consumption of steel rounds 

and the total volume and value of 

domestic production of steel rounds; 

• the percentage of domestic 

consumption accounted for by domestic 

production; and 

• the names and addresses of the top 

ten steel rounds companies—in terms of 

sales and quantity produced—in which 

the GOC maintains and ownership or 

management interest, and identification 

of whether any of these companies have 

affiliated trading companies that sell 

imported or domestically produced steel 

rounds. 

On page 91 of the GQR, the GOC 

responded that it was still gathering 

information in response to the following 

question: 

Are there trade publications which specify 

the prices of the good/service within your 

country and on the world market? Provide a 

list of these publications, along with sample 

pages from these publications listing the 

prices of the good/service within your 

country and in world markets during the 

period of investigation. 

With respect to the specific 

companies that produced the steel 

rounds purchased by the mandatory 

respondents, we asked the GOC to 

provide particular ownership 

information for these producers so that 

we could determine whether the 

producers are ‘‘authorities’’ within the 

meaning of section 771(5)(B) of the Act. 

Specifically, we stated in our 

questionnaire that the Department 

normally treats producers that are 

majority owned by the government or a 

government entity as ‘‘authorities.’’ 

Thus, for any steel rounds producers 

that were majority government-owned, 

the GOC needed to provide the 

following ownership information if it 

wished to argue that those producers 

were not authorities: 

• Translations of the most recent 

capital verification report predating the 

POI and, if applicable, any capital 

verification reports completed during 

the POI. Translation of the most recent 

articles of association, including 

amendments thereto. 

• The names of the ten largest 

shareholders and the total number of 

shareholders, a statement of whether 

any of these shareholders have any 

government ownership (including the 

percentage of ownership), and an 

explanation of any other affiliation 

between these shareholders and the 

government. 

• The total level (percentage) of state 

ownership, either direct or indirect, of 

the company’s shares; the names of all 

government entities that own shares in 

the company; and the amount of shares 

held by each. 

• Any relevant evidence to 

demonstrate that the company is not 

controlled by the government, e.g., that 

the private, minority shareholder(s) 

controls of the company. 

For any suppliers that the GOC 

claimed were directly, 100-percent 

owned by individual persons during the 

POI, we requested the following: 

• Translated copies of source 

documents that demonstrate the 

supplier’s ownership during the POI, 

such as capital verification reports, 

articles of association, share transfer 

agreements, or financial statements. 

• Identification of the owners, 

members of the board of directors, or 

managers of the suppliers who were also 

government or Chinese Communist 

Party (‘‘CCP’’) officials during the POI. 

• A discussion of whether and how 

operational or strategic decisions that 

are made by the management or board 

of directors are subject to government 

review or approval. 

For input suppliers with some direct 

corporate ownership or less-thanmajority state ownership during the 

POI, we explained that it was necessary 

to trace back the ownership to the 

ultimate individual or state owners. For 

these suppliers, we requested the 

following: 

• The total level (percentage) of state 

ownership of the company’s shares; the 

names of all government entities that 

own shares, either directly or indirectly, 

in the company; whether any of the 

owners are considered ‘‘state-owned 

enterprises’’ by the government; and the 

amount of shares held by each 

government owner. 

• For each level of ownership, a 

translated copy of the section(s) of the 

articles of association showing the rights 

and responsibilities of the shareholders 

and, where appropriate, the board of 

directors, including all decision making 

(voting) rules for the operation of the 

company. 

• For each level of ownership, 

identification of the owners, members of 

the board of directors, or managers of 

the suppliers who were also government 

or CCP officials during the POI. 

• A discussion of whether and how 

operational or strategic decisions that 

are made by the management or board 

of directors are subject to government 

review or approval. 

• A statement of whether any of the 

shares held by government entities have 

any special rights, priorities, or 

privileges, e.g., with regard to voting 

rights or other management or decisionmaking for the company; a statement of 

whether there are any restrictions on 

conducting, or acting through, 

extraordinary meetings of shareholders; 

whether there are any restrictions on the 

shares held by private shareholders; and 

the nature of the private shareholders’ 

interest in the company, e.g., 

operational, strategic, or investmentrelated, etc. 

On page 92 of the GQR, the GOC 

stated that it had not obtained complete 

ownership information for the suppliers 

to the mandatory respondents. The GOC 

further stated that it expected to provide 

such information when the Department 

determined which cross-owned 

affiliates of the mandatory respondents 

would be required to file responses. 

On January 11, 2010, we issued a 

letter requesting that the GOC update its 

initial questionnaire response to include 

the cross-owned affiliates for which the 

respondent companies filed 

questionnaire responses. After the GOC 

requested an extension to the deadline 

for filing this response, we set a final 

deadline of January 25, 2010. 

On January 14, 2010, we issued a 

separate letter noting that the GOC had 

failed to provide the information 

requested in the original questionnaire 

regarding the ownership of the firms 

that produce the steel rounds/billets 

used by the mandatory respondents. We 

pointed out that the GOC had not 

requested, and the Department had not 

granted, an extension of the deadline for 

submitting this information. We stated 

that the requested information must be 

submitted by January 25, 2010. 

On January 25, 2010, the GOC 

submitted a list of producers of the steel 

rounds that respondents purchased 

during the POI. The GOC identified the 

producers as state-owned enterprises 

(‘‘SOEs’’), foreign-invested enterprises 

(‘‘FIEs’’), privately-held, or ‘‘to be 

updated.’’ The GOC also submitted 

certain documentation on the 

ownership of many of the producers 

designated as FIEs or privately-held. 

However, for producers that the GOC 

claimed to be privately-owned, the GOC 

did not answer the question on whether 

owners, members of the board of 

directors, or managers of the suppliers 

were also government or CCP officials 

during the POI. The GOC also did not 

discuss whether and how operational or 

strategic decisions that are made by the 

management or board of directors are 

subject to government review or 

approval. For producers with some 

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direct corporate ownership or less-thanmajority state ownership during the 

POI, the GOC did not respond to our 

requests for the following information: 

• The total level (percentage) of state 

ownership of the company’s shares; the 

names of all government entities that 

own shares, either directly or indirectly, 

in the company; whether any of the 

owners are considered ‘‘state-owned 

enterprises’’ by the government; and the 

amount of shares held by each 

government owner. 

• For each level of ownership, 

identification of the owners, members of 

the board of directors, or managers of 

the suppliers who were also government 

or CCP officials during the POI. 

• A discussion of whether and how 

operational or strategic decisions that 

are made by the management or board 

of directors are subject to government 

review or approval. 

• A statement of whether any of the 

shares held by government entities have 

any special rights, priorities, or 

privileges, e.g., with regard to voting 

rights or other management or decisionmaking for the company; a statement of 

whether there are any restrictions on 

conducting, or acting through, 

extraordinary meetings of shareholders; 

whether there are any restrictions on the 

shares held by private shareholders; and 

the nature of the private shareholders’ 

interest in the company, e.g., 

operational, strategic, or investmentrelated, etc. 

Based on the above, we preliminarily 

determine that the GOC has withheld 

necessary information that was 

requested of it and, thus, that the 

Department must rely on ‘‘facts 

available’’ in making our preliminary 

determination. See sections 776(a)(1) 

and (a)(2)(A) of the Act. Moreover, we 

preliminarily determine that the GOC 

has failed to cooperate by not acting to 

the best of its ability to comply with our 

request for information. Consequently, 

an adverse inference is warranted in the 

application of facts available. See 

section 776(b) of the Act. 

With respect to the GOC’s failure to 

provide requested information about the 

production and consumption of steel 

rounds or billets generally, we are 

assuming adversely that the GOC’s 

dominance of the market in the PRC for 

this input results in significant 

distortion of the prices and, hence, that 

use of an external benchmark is 

warranted. With respect to the GOC’s 

failure to provide certain requested 

ownership information about the 

producers of the steel rounds purchased 

by the respondents, we are assuming 

adversely that all of the respondents’ 

non-cross-owned suppliers of steel 

rounds are ‘‘authorities.’’ 

The Department’s practice when 

selecting an adverse rate from among 

the possible sources of information is to 

ensure that the result is sufficiently 

adverse ‘‘as to effectuate the statutory 

purposes of the adverse facts available 

rule to induce respondents to provide 

the Department with complete and 

accurate information in a timely 

manner.’’ See Notice of Final 

Determination of Sales at Less than Fair 

Value: Static Random Access Memory 

Semiconductors From Taiwan, 63 FR 

8909, 8932 (February 23, 1998). The 

Department’s practice also ensures ‘‘that 

the party does not obtain a more 

favorable result by failing to cooperate 

than if it had cooperated fully.’’ See 

Statement of Administrative Action 

(‘‘SAA’’) accompanying the Uruguay 

Round Agreements Act, H.R. Doc. No. 

103–316, vol. 1 at 870 (1994). 

Section 776(c) of the Act provides 

that, when the Department relies on 

secondary information rather than on 

information obtained in the course of an 

investigation or review, it shall, to the 

extent practicable, corroborate that 

information from independent sources 

that are reasonably at its disposal. 

Secondary information is ‘‘information 

derived from the petition that gave rise 

to the investigation or review, the final 

determination concerning the subject 

merchandise, or any previous review 

under section 751 concerning the 

subject merchandise.’’ See, e.g., SAA, at 

870. The Department considers 

information to be corroborated if it has 

probative value. See id. To corroborate 

secondary information, the Department 

will, to the extent practicable, examine 

the reliability and relevance of the 

information to be used. The SAA 

emphasizes, however, that the 

Department need not prove that the 

selected facts available are the best 

alternative information. See SAA, at 

869. 

To corroborate the Department’s 

treatment of the companies that 

produced the steel rounds and billets 

purchased by the mandatory 

respondents as authorities and our 

finding that the GOC dominates the 

domestic market for this input, we are 

relying on Circular Welded Carbon 

Quality Steel Line Pipe from the 

People’s Republic of China: Final 

Affirmative Countervailing Duty 

Determination, 73 FR 70961 (November 

24, 2008) (‘‘Line Pipe from the PRC’’). In 

that case, the Department determined 

that the GOC owned or controlled the 

entire hot-rolled steel industry in the 

PRC. See Line Pipe from the PRC and 

accompanying Issues and Decision 

Memorandum at Comment 1. Evidence 

on the record of this investigation shows 

that many steel producers in the PRC 

are integrated, producing both long 

products (rounds and billets) and flat 

products (hot-rolled steel). See 

Memorandum to the File, ‘‘Additional 

Information on Steel Rounds,’’ dated 

February 22, 2010. Consequently, 

government ownership in the hot-rolled 

steel industry is a reasonable proxy for 

government ownership in the steel 

rounds and billets industry. 

For details on the calculation of the 

subsidy rate for the respondents, see 

below at section I.C., ‘‘Provision of Steel 

Rounds for Less Than Adequate 

Remuneration.’’ 

GOC—Electricity 

The GOC also did not provide a 

complete response to the Department’s 

November 9, 2009 questionnaire 

regarding its alleged provision of 

electricity for less than adequate 

remuneration. Specifically, the 

Department requested that the GOC 

explain how electricity cost increases 

are reflected in retail price increases. 

The GOC responded that it was 

gathering this information, but it did not 

request an extension from the 

Department for submitting this 

information after the original 

questionnaire deadline date. On January 

14, 2010, the Department reiterated its 

request for this information and notified 

the GOC that this information would be 

accepted if the GOC submitted it by 

January 25, 2010. However, the GOC’s 

subsequent supplemental questionnaire 

responses did not address the missing 

information. Consequently, we 

preliminarily determine that the GOC 

has withheld necessary information that 

was requested of it and, thus, that the 

Department must rely on ‘‘facts 

available’’ in making our preliminary 

determination. See section 776(a)(1), 

section 776(a)(2)(A), and section 

776(a)(2)(B) of the Act. Moreover, we 

preliminarily determine that the GOC 

has failed to cooperate by not acting to 

the best of its ability to comply with our 

request for information as it did not 

respond by the deadline dates, nor did 

it explain why it was unable to provide 

the requested information, with the 

result that an adverse inference is 

warranted in the application of facts 

available. See section 776(b) of the Act. 

In drawing an adverse inverse inference, 

we find that the GOC’s provision of 

electricity constitutes a financial 

contribution within the meaning of 

section 771(5)(D) of the Act and is 

specific within the meaning of section 

771(5A) of the Act. We have also relied 

on an adverse inference in selecting the 

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4See TQR at 5. 

5See Certain Oil Country Tubular Goods From 

the People’s Republic of China: Preliminary 

Affirmative Countervailing Duty Determination, 

Preliminary Negative Critical Circumstances 

Determination, 74 FR 47210, 47215 (September 15, 

2009) (unchanged in Certain Oil Country Tubular 

Goods From the People’s Republic of China: Final 

Affirmative Countervailing Duty Determination, 

Final Negative Critical Circumstances 

Determination, 74 FR 64045 (December 7, 2009) 

(‘‘OCTG from the PRC’’)). 

benchmark for determining the 

existence and amount of the benefit. See 

section 776(b)(2) of the Act and section 

776(b)(4) of the Act. The benchmark 

rates we have selected are derived from 

information submitted by the GOC in 

the countervailing duty investigation of 

‘‘Certain Kitchen Appliance Shelving 

and Racks from the People’s Republic of 

China’’ and information from the record 

of the instant review. See Memorandum 

to File from Yasmin Nair, International 

Trade Compliance Analyst, Office 1, 

‘‘Electricity Rate Data’’ (February 22, 

2010). 

For details on the calculation of the 

subsidy rate for the respondents, see 

below at section I.D., ‘‘Provision of 

Electricity for Less Than Adequate 

Remuneration.’’ 

GOC—TPCO’s Other Subsidies 

At pages 143–144 of TPCO Group’s 

2008 Audit Report in Exhibit 6 of the 

TQR and at page 14 of its February 16, 

2010 supplemental questionnaire 

response, TPCO reported receipt of 

countervailable grants. In our January 

26, 2010, supplemental questionnaire to 

TPCO, we instructed TPCO to provide 

information regarding other subsidies 

identified in its 2008 financial 

statements and to provide the GOC with 

the names of the programs under which 

these subsidies were given. 

The Department requested that the 

GOC provide information about these 

grants in the initial questionnaire and 

the January 27, 2010 supplemental 

questionnaire. In the GOC’s February 4, 

2010, supplemental response, at page 

10, the GOC did not provide the 

requested information, asserting that it 

needed additional time to gather the 

data. Although the GOC responded that 

it was gathering this information, it did 

not request an extension from the 

Department for submitting this 

information after the supplemental 

questionnaire deadline date. 

Because the GOC did not provide the 

requested information concerning these 

grants, we preliminarily determine that 

necessary information is not on the 

record and that the GOC did not provide 

requested information by the 

submission deadline. Accordingly, the 

use of facts otherwise available is 

appropriate. See sections 776(a)(1) and 

(2)(B) of the Act. Also, we preliminarily 

determine that the GOC has failed to 

cooperate by not acting to the best of its 

ability to comply with our request for 

information as it did not respond by the 

deadline dates, nor did it explain why 

it is unable to provide the requested 

information, with the result that an 

adverse inference is warranted in the 

application of facts available. See 

section 776(b) of the Act. 

For details on the calculation of the 

subsidy rate for TPCO, see below at 

section I.G., ‘‘Other Subsidies Received 

by TPCO.’’ 

Subsidies Valuation Information 

Allocation Period 

The average useful life (‘‘AUL’’) period 

in this proceeding, as described in 19 

CFR 351.524(d)(2), is 15 years according 

to the U.S. Internal Revenue Service’s 

1977 Class Life Asset Depreciation 

Range System. See U.S. Internal 

Revenue Service Publication 946 (2008), 

How to Depreciate Property, at Table B– 

2: Table of Class Lives and Recovery 

Periods. No party in this proceeding has 

disputed this allocation period. 

Attribution of Subsidies 

The Department’s regulations at 19 

CFR 351.525(b)(6)(i) state that the 

Department will normally attribute a 

subsidy to the products produced by the 

corporation that received the subsidy. 

However, 19 CFR 351.525(b)(6)(ii)-(iv) 

direct the Department to attribute 

subsidies received by certain other 

companies to the combined sales of 

those companies if (1) cross-ownership 

exists between the companies, and (2) 

the cross-owned companies produce the 

subject merchandise, are a holding or 

parent company of the subject company, 

or produce an input that is primarily 

dedicated to the production of the 

downstream product. In the case of a 

transfer of a subsidy between crossowned companies, 19 CFR 

351.525(b)(6)(v) directs the Department 

to attribute the subsidy to the sales of 

the company that receives the 

transferred subsidy. 

According to 19 CFR 

351.525(b)(6)(vi), cross-ownership exists 

between two or more corporations 

where one corporation can use or direct 

the individual assets of the other 

corporation(s) in essentially the same 

ways it can use its own assets. This 

regulation states that this standard will 

normally be met where there is a 

majority voting interest between two 

corporations or through common 

ownership of two (or more) 

corporations. The Court of International 

Trade (‘‘CIT’’) has upheld the 

Department’s authority to attribute 

subsidies based on whether a company 

could use or direct the subsidy benefits 

of another company in essentially the 

same way it could use its own subsidy 

benefits. See Fabrique de Fer de 

Charleroi v. United States, 166 F. Supp. 

2d 593, 600–604 (CIT 2001). 

TPCO 

TPCO responded to the Department’s 

original and supplemental 

questionnaires on behalf of itself, 

Tianjin Pipe Iron Manufacturing Co., 

Ltd. (‘‘TPCO Iron’’); Tianguan Yuantong 

Pipe Product Co., Ltd. (‘‘Yuantong’’); 

Tianjin Pipe International Economic 

and Trading Co., Ltd. (‘‘TPCO 

International’’); and TPCO Charging 

Development Co., Ltd. (‘‘Charging’’). 

These companies are cross-owned 

within the meaning 19 CFR 

351.525(b)(6)(vi) because of TPCO’s 

substantial ownership position in each 

of them. See the TQR at page 2 and 

Exhibits 1–3. 

TPCO stated that TPCO Iron provides 

‘‘pig iron and direct reduced iron’’ to 

TPCO and that Yuantong provides 

‘‘threading and other finishing processes 

to {TPCO’s} seamless pipe 

production.’’ 4 Because TPCO Iron 

produced an input that is primarily 

dedicated to the production of the 

downstream product, we are 

preliminarily attributing subsidies 

received by TPCO Iron to TPCO, in 

accordance with 19 CFR 

351.525(b)(6)(iv). Yuantong had direct 

involvement in the production of 

subject merchandise during the POI. 

Thus, we are preliminarily attributing 

subsidies received by Yuantong to 

TPCO, in accordance with 19 CFR 

351.525(b)(6)(ii).5

Regarding TPCO International, TPCO 

stated, ‘‘{TPCO International} is the 

trading company through which 

{TPCO} exports all subject 

merchandise.’’ Because TPCO 

International exported subject 

merchandise during the POI, we are 

preliminarily cumulating the benefit 

from subsidies received by TPCO 

International with subsidies provided to 

TPCO, in accordance with 19 CFR 

351.525(c). We are preliminarily using 

TPCO’s consolidated sales as the 

denominator for subsidies to TPCO 

International. On page 12 of the TQR, 

TPCO stated that TPCO consolidates 

directly-owned subsidiaries in which it 

holds an equity share of more than 50 

percent. On page 9 of the TQR, TPCO 

stated that the consolidated sales totals 

in its financial statements are net of 

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6See OCTG from the PRC, and accompanying 

Issues and Decision Memorandum at 9 and 

Comment 40. 

7See HQR at 2. 

8See HQR at 2 and HQR at Vol. 5 p. 1–2. 

inter-company sales. Thus, TPCO’s 

consolidated sales already include 

TPCO International’s sales (net of intercompany sales). By using TPCO’s 

consolidated sales as the denominator 

for subsidies to TPCO International, we 

do not double-count TPCO 

International’s sales in the calculation of 

the subsidy rate. 

With regard to Charging, TPCO stated 

on pages 4–5 of the TQR that Charging 

acts as a trading company that 

purchased and provided steel rounds to 

TPCO during the POI. If the GOC 

provided steel rounds to Charging for 

less than adequate remuneration during 

the POI, the supplier relationship 

between Charging and TPCO may fall 

under 19 CFR 351.525(b)(6)(iv) 

(subsidies to cross-owned input 

suppliers) or 19 CFR 351.525(b)(6)(v) 

(transfer of subsidies). As we stated in 

the previous paragraph, however, TPCO 

consolidates the sales of directly-owned 

subsidiaries in which it holds an equity 

share of more than 50 percent (net of 

inter-company sales). Because TPCO 

consolidates Charging’s sales into its 

own sales, the attribution of the subsidy 

for TPCO’s purchases through Charging 

is identical under 19 CFR 

351.525(b)(6)(iv) or 19 CFR 

351.525(b)(6)(v). Under both sections of 

the regulations, the attribution of the 

subsidy is to TPCO’s consolidated sales. 

Thus, we are preliminarily attributing 

any subsidies under the provision of 

steel rounds to Charging for less than 

adequate remuneration to TPCO’s 

consolidated sales, which includes 

Charging’s sales. 

On page 3 of our January 26, 2010, 

supplemental questionnaire to TPCO, 

we asked TPCO to explain why it did 

not provide a response on behalf of 

Tianjin TEDA Investment Holding Co., 

Ltd. (‘‘TEDA’’), Tianjin Pipe Investment 

Holding Co., Ltd. (‘‘TPCO Holding’’), and 

China Cinda Asset Management 

Corporation (‘‘Cinda’’), which have held 

majority interests in TPCO since 

December 11, 2001. Under 19 CFR 

351.525(b)(6)(iii), we would normally 

attribute to TPCO any subsidies that 

these owners received while each was 

cross-owned with TPCO. In its response 

dated February 16, 2010, TPCO 

responded that TEDA, a government 

agency, is primarily involved in the 

operation and management of assets and 

public infrastructure, and TPCO 

Holding was originally established by 

the Tianjin SASAC (‘‘State-owned 

Assets Supervision and Administration 

Commission of the State Council’’) for 

the sole purpose of holding the assets of 

TPCO. In TPCO’s explanation of why it 

did not file a response for Cinda, it 

refers to the Department’s finding in 

OCTG from the PRC, in which the 

Department found that TEDA and TPCO 

Holding were government agencies.6

TPCO states ‘‘for the same reasons,’’ 

TPCO did not file a response for Cinda, 

which was specifically established to 

restructure debt and non-performing 

assets. Based on TPCO’s response, we 

preliminarily determine that these 

entities were government agencies since 

December 11, 2001. Thus, we are 

preliminarily countervailing subsidies 

that these entities provided to TPCO, 

rather than any subsidies that these 

entities may have received. Moreover, as 

agencies of the government, we 

preliminarily determine these entities to 

be ‘‘government authorities.’’ 

In the January 26, 2010, supplemental 

questionnaire, we also asked TPCO 

questions about certain affiliates that 

may have met the cross-ownership 

standard under 19 CFR 351.525(b)(6)(vi) 

and one or more of the attribution 

standards under 19 CFR 

351.525(b)(6)(ii)–(v). TPCO provided 

responses to these questions in its 

February 12, 2010, response at pages 

5–6. Based on TPCO’s responses, we 

preliminarily determine that none of 

these affiliates met both the crossownership standard of 19 CFR 

351.525(b)(6)(vi) and one or more of the 

attribution standards under 19 CFR 

351.525(b)(6)(ii)–(v). Thus, we have not 

included any subsidies to these 

companies in the subsidy calculation. 

For other affiliated companies that 

TPCO identified in Exhibits 1 and 2 of 

the TQR, TPCO either held a small 

ownership share during the POI or 

identified the companies as having no 

involvement with subject merchandise. 

Thus, we have not included any 

subsidies to these companies in the 

subsidy calculation. 

Regarding the sales denominator for 

calculating TPCO’s subsidy rate, we 

note that the Department will attribute 

subsidies bestowed on a parent or 

holding company to the consolidated 

sales of the parent or holding company 

and its subsidiaries under 19 CFR 

351.525(b)(6)(iii). TPCO was a parent 

company to other companies during the 

POI. On page 12 of the TQR, TPCO 

stated, ‘‘{TPCO} consolidated those 

directly owned subsidiaries in which it 

holds more than 50% equity shares, as 

well as those indirectly owned 

subsidiaries in which its wholly-owned 

subsidiaries hold more than 50% equity 

shares.’’ In accordance with 19 CFR 

351.525(b)(6)(iii), we are preliminarily 

attributing subsidies to TPCO to the 

consolidated sales of TPCO and its 

subsidiaries. 

Therefore, based on information 

currently on the record, we 

preliminarily determine that crossownership within the meaning of 19 

CFR 351.525(b)(6)(vi) exists between 

TPCO, TPCO Iron, Yuantong, TPCO 

International, and Charging. Moreover, 

pursuant to 19 CFR 351.525(b)(6)(iii), 

we are preliminarily attributing 

subsidies received by TPCO to the 

consolidated sales of TPCO and its 

subsidiaries (net of inter-company 

sales). TPCO Iron, Yuantong, and 

Charging are consolidated into TPCO’s 

sales; thus, we are preliminarily 

attributing subsidies received by TPCO 

Iron, Yuantong, and Charging to TPCO’s 

consolidated sales (net of inter-company 

sales). For TPCO International, we 

preliminarily have cumulated TPCO 

International’s subsidy benefits with 

TPCO’s subsidy benefits. See 19 CFR 

351.525(c). We have preliminarily used 

TPCO’s consolidated sales net of intercompany sales as the denominator for 

subsidies to TPCO International. 

Hengyang 

As of this preliminary determination, 

Hengyang has responded to the 

Department’s original and supplemental 

questionnaires on behalf of Hengyang 

Steel Tube Group International Trading, 

Inc. (‘‘Hengyang Trading’’), Hengyang 

Valin Steel Tube Co., Ltd. (‘‘Hengyang 

Valin’’), and Hengyang Valin MPM Tube 

Co., Ltd. (‘‘Hengyang MPM’’), and their 

affiliated parties Xigang Seamless Steel 

Tube Co., Ltd. (‘‘Xigang Seamless’’), 

Wuxi Seamless Special Pipe Co., Ltd. 

(‘‘Special Pipe’’), Wuxi Resources Steel 

Making Co., Ltd. (‘‘Resources Steel’’), 

and Jiangsu Xigang Group Co., Ltd. 

(‘‘Xigang Group’’). These companies are 

cross-owned within the meaning of 19 

CFR 351.525(b)(6)(vi) by virtue of 

common ownership.7

Hengyang reports the following roles 

for each of the seven companies: 8

• Hengyang Valin: a parent company 

to Hengyang MPM and Hengyang 

Trading, and a producer of subject 

merchandise; 

• Hengyang MPM: a producer of 

subject merchandise, as well as a 

producer and supplier of an input to 

Hengyang Valin for production of 

subject merchandise; 

• Hengyang Trading: an exporter of 

subject merchandise on behalf of 

Hengyang Valin and Hengyang MPM; 

• Xigang Seamless: a producer and 

exporter of subject merchandise; 

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9Hengyang Trading did not export subject 

merchandise produced by unaffiliated producers to 

the United States during the POI. See the HQR at 

Volume 1, page 7. The percentage of Xigang 

Seamless’s exports of subject merchandise to the 

United States from unaffiliated producers is 

business proprietary information. See the HQR at 

Volume 5, page 8. 

10See 19 CFR 351.505(a)(3)(i). 

11See 19 CFR 351.505(a)(3)(ii). 

12See CFS Decision Memorandum at Comment 

10. 

13See Notice of Final Affirmative Countervailing 

Duty Determination and Final Negative Critical 

Circumstances Determination: Certain Softwood 

Lumber Products From Canada, 67 FR 15545 (April 

2, 2002) (‘‘Softwood Lumber from Canada’’) and 

accompanying Issues and Decision Memorandum at 

‘‘Analysis of Programs, Provincial Stumpage 

Programs Determined to Confer Subsidies, Benefit.’’ 

14See CFS Decision Memorandum at Comment 

10. 

15See Lightweight Thermal Paper From the 

People’s Republic of China: Final Affirmative 

Countervailing Duty Determination, 73 FR 57323 

(October 2, 2008) (‘‘LWTP from the PRC’’) and 

accompanying Issues and Decision Memorandum 

(‘‘LWTP Decision Memorandum’’) at 8–10. 

16See The World Bank Country Classification, 

http://econ.worldbank.org/. 

• Special Pipe: a producer of subject 

merchandise; 

• Resources Steel: a producer and 

supplier of an input to Xigang Seamless 

and Special Pipe for production of 

subject merchandise; and 

• Xigang Group: a holding company, 

and the parent of Xigang Seamless, 

Special Pipe, and Resources Steel. 

Because Hengyang Valin, Hengyang 

MPM, Xigang Seamless, and Special 

Pipe are producers of subject 

merchandise, we are preliminarily 

attributing subsidies received by any of 

these companies to the sales of all four 

(excluding sales between the 

companies), in accordance with 19 CFR 

351.525(b)(6)(ii). 

During the POI, Hengyang Trading 

exported subject merchandise produced 

by Hengyang Valin and Hengyang MPM. 

Thus, we are preliminarily cumulating 

the benefit from subsidies received by 

Hengyang Trading with the benefit from 

subsidies provided to Hengyang Valin 

and MPM, in accordance with 19 CFR 

351.525(c). 

Hengyang identified Resources Steel 

as a producer and supplier of steel billet 

to Xigang Seamless and Special Pipe. 

Because steel billet is primarily 

dedicated to the production of the 

downstream product, we are 

preliminarily attributing subsidies 

received by Resources Steel to 

Resources Steel, Xigang Seamless, and 

Special Pipe, in accordance with 19 CFR 

351.525(b)(6)(iv). 

Xigang Group was the parent of 

Xigang Seamless, Special Pipe, and 

Resources Steel during the POI. Thus, 

we are preliminarily attributing 

subsidies received by Xigang Group to 

the consolidated sales of Xigang Group 

and its subsidiaries, in accordance with 

19 CFR 351.525(b)(6)(iii). 

In a supplemental questionnaire dated 

January 28, 2010, we asked Hengyang to 

provide responses on behalf of certain 

affiliates that met the cross-ownership 

standard under 19 CFR 351.525(b)(6)(vi) 

and one or more of the attribution 

standards under 19 CFR 

351.525(b)(6)(ii)–(v). Hengyang is 

scheduled to provide this response on 

February 22, 2010. We intend to address 

this response in a post-preliminary 

determination. 

At Volume 1, page 7 of the HQR, 

Hengyang stated that Hengyang Trading 

also exports subject merchandise 

produced by an unaffiliated producer, 

although Hengyang stated that 

Hengyang Trading did not export this 

merchandise to the United States during 

the POI. At Volume 5, pages 7–8 of the 

HQR, Hengyang stated that Xigang 

Seamless purchased and exported 

subject merchandise produced by 

unaffiliated companies during the POI. 

Although any subsidies to the 

unaffiliated producers would normally 

be cumulated with subsidies provided 

to these trading companies pursuant to 

19 CFR 351.525(c), the Department has, 

in some instances, limited the number 

of producers it examines where their 

merchandise was not exported to the 

United States during the POI or 

accounted for a very small share of 

respondent’s exports to the United 

States. In this investigation, we have not 

sent CVD questionnaires to the 

unaffiliated suppliers because their 

merchandise was not exported to the 

United States during the POI or 

accounted for a minor share of 

Hengyang’s exports to the United 

States.9 See, e.g., Pasta From Italy, in 

which one of the mandatory 

respondents was a trading company that 

exported pasta produced by multiple 

pasta manufacturers, but the 

Department limited its analysis to the 

two major pasta manufacturers that 

supplied the trading company during 

the period of review. See Certain Pasta 

from Italy: Final Results of the Fourth 

Countervailing Duty Administrative 

Review, 66 FR 64214 (December 12, 

2001) (‘‘Pasta from Italy’’), and 

accompanying Issues and Decision 

Memorandum at ‘‘Attribution.’’ 

Benchmarks and Discount Rates 

Benchmarks for Short-Term RMB 

Denominated Loans 

Section 771(5)(E)(ii) of the Act 

explains that the benefit for loans is the 

‘‘difference between the amount the 

recipient of the loan pays on the loan 

and the amount the recipient would pay 

on a comparable commercial loan that 

the recipient could actually obtain on 

the market.’’ Normally, the Department 

uses comparable commercial loans 

reported by the company as a 

benchmark.10 If the firm did not have 

any comparable commercial loans 

during the period, the Department’s 

regulations provide that we ‘‘may use a 

national average interest rate for 

comparable commercial loans.’’ 11

As noted above, section 771(5)(E)(ii) 

of the Act indicates that the benchmark 

should be a market-based rate. For the 

reasons explained in CFS from the 

PRC,12 loans provided by Chinese banks 

reflect significant government 

intervention in the banking sector and 

do not reflect rates that would be found 

in a functioning market. Because of this, 

any loans received by respondents from 

private Chinese or foreign-owned banks 

would be unsuitable for use as 

benchmarks under 19 CFR 

351.505(a)(2)(i). Similarly, we cannot 

use a national interest rate for 

commercial loans as envisaged by 19 

CFR 351.505(a)(3)(ii). Therefore, 

because of the special difficulties 

inherent in using a Chinese benchmark 

for loans, the Department is selecting an 

external market-based benchmark 

interest rate. The use of an external 

benchmark is consistent with the 

Department’s practice. For example, in 

Softwood Lumber from Canada, the 

Department used U.S. timber prices to 

measure the benefit for governmentprovided timber in Canada.13

We are calculating the external 

benchmark using the regression-based 

methodology first developed in CFS 

from the PRC14 and more recently 

updated in LWTP from the PRC.15 This 

benchmark interest rate is based on the 

inflation-adjusted interest rates of 

countries with per capita gross national 

incomes (‘‘GNIs’’) similar to the PRC, 

and takes into account a key factor 

involved in interest rate formation, that 

of the quality of a country’s institutions, 

that is not directly tied to the stateimposed distortions in the banking 

sector discussed above. 

Following the methodology 

developed in CFS from the PRC, we first 

determined which countries are similar 

to the PRC in terms of GNI, based on the 

World Bank’s classification of countries 

as: low income; lower-middle income; 

upper-middle income; and high income. 

The PRC falls in the lower-middle 

income category, a group that includes 

55 countries.16 As explained in CFS 

from the PRC, this pool of countries 

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captures the broad inverse relationship 

between income and interest rates. 

Many of these countries reported 

lending and inflation rates to the 

International Monetary Fund, and they 

are included in that agency’s 

international financial statistics (‘‘IFS’’). 

With the exceptions noted below, we 

have used the interest and inflation 

rates reported in the IFS for the 

countries identified as ‘‘low middle 

income’’ by the World Bank. First, we 

did not include those economies that 

the Department considered to be nonmarket economies for AD purposes for 

any part of the years in question, for 

example: Armenia, Azerbaijan, Belarus, 

Georgia, Moldova, Turkmenistan. 

Second, the pool necessarily excludes 

any country that did not report both 

lending and inflation rates to IFS for 

those years. Third, we removed any 

country that reported a rate that was not 

a lending rate or that based its lending 

rate on foreign-currency denominated 

instruments. For example, Jordan 

reported a deposit rate, not a lending 

rate, and the rates reported by Ecuador 

and Timor L’Este are dollardenominated rates; therefore, the rates 

for these three countries have been 

excluded. Finally, for each year the 

Department calculated an inflationadjusted short-term benchmark rate, we 

have also excluded any countries with 

aberrational or negative real interest 

rates for the year in question. 

The resulting inflation-adjusted 

benchmark lending rates are provided in 

the respondents’ preliminary 

calculation memoranda. See 

Memorandum to File, ‘‘Preliminary 

Determination Calculation 

Memorandum for (TPCO),’’ (February 

22, 2010) (‘‘TPCO Calculation Memo’’); 

see also Memorandum to File, 

‘‘Preliminary Determination Calculation 

Memorandum for (Hengyang),’’ 

(February 22, 2010) (‘‘Hengyang 

Calculation Memo’’). Because these are 

inflation-adjusted benchmarks, it is 

necessary to adjust the respondents’ 

interest payments for inflation. This was 

done using the PRC inflation figure as 

reported in the IFS. See TPCO 

Calculation Memo and Hengyang 

Calculation Memo. 

Benchmarks for Long-Term Loans 

The lending rates reported in the IFS 

represent short- and medium-term 

lending, and there are not sufficient 

publicly available long-term interest rate 

data upon which to base a robust 

benchmark for long-term loans. To 

address this problem, the Department 

has developed an adjustment to the 

short- and medium-term rates to convert 

them to long-term rates using Bloomberg 

U.S. corporate BB-rated bond rates. See, 

e.g., Light-Walled Rectangular Pipe and 

Tube From People’s Republic of China: 

Final Affirmative Countervailing Duty 

Investigation Determination, 73 FR 

35642 (June 24, 2008) and 

accompanying Issues and Decision 

Memorandum (‘‘LWRP Decision Memo’’) 

at 8. In Citric Acid from the PRC, this 

methodology was revised by switching 

from a long-term mark-up based on the 

ratio of the rates of BB-rated bonds to 

applying a spread which is calculated as 

the difference between the two-year BB 

bond rate and the n-year BB bond rate, 

where n equals or approximates the 

number of years of the term of the loan 

in question. See Citric Acid and Certain 

Citrate Salts From the People’s Republic 

of China: Final Affirmative 

Countervailing Duty Determination, 74 

FR 16836 (April 13, 2009) (‘‘Citric Acid 

from the PRC’’) and accompanying 

Issues and Decision Memorandum 

(‘‘Citric Acid Decision Memorandum’’) 

at Comment 14. Finally, because these 

long-term rates are net of inflation as 

noted above, we adjusted the PRC 

respondents’ payments to remove 

inflation. 

Benchmarks for Foreign CurrencyDenominated Loans 

For foreign currency-denominated 

short-term loans, the Department used 

as a benchmark the one-year dollar 

interest rates for the London Interbank 

Offering Rate (‘‘LIBOR’’), plus the 

average spread between LIBOR and the 

one-year corporate bond rates for 

companies with a BB rating. See LWTP 

Decision Memo at 10. For long-term 

foreign currency-denominated loans, the 

Department added the applicable shortterm LIBOR rate to a spread which is 

calculated as the difference between the 

one-year BB bond rate and the n-year BB 

bond rate, where n equals or 

approximates the number of years of the 

term of the loan in question. 

Discount Rates 

Consistent with 19 CFR 

351.524(d)(3)(i)(A), we have used, as our 

discount rate, the long-term interest rate 

calculated according to the methodology 

described above for the year in which 

the government agreed to provide the 

subsidy. 

Analysis of Programs 

Based upon our analysis of the 

petition and the responses to our 

questionnaires, we preliminarily 

determine the following: 

I. Programs Preliminarily Determined 

To Be Countervailable 

A. Policy Loans to the Seamless Pipe 

Industry 

The Department is examining whether 

seamless pipe producers receive 

preferential lending through stateowned commercial or policy banks. 

According to the allegation, preferential 

lending to the seamless pipe industry is 

supported by the GOC through the 

issuance of national and provincial fiveyear plans; industrial plans for the steel 

sector; catalogues of encouraged 

industries, and other government laws 

and regulations. Based on our review of 

the information and responses of the 

GOC, we preliminarily determine that 

loans received by the seamless pipe 

industry from state-owned commercial 

banks (‘‘SOCBs’’) were made pursuant to 

government directives. 

Record evidence demonstrates that 

the GOC, through its directives, has 

highlighted and advocated the 

development of the seamless pipe 

industry. At the national level, the GOC 

has placed an emphasis on the 

development of high-end, value-added 

steel products through foreign 

investment as well as through 

technological research, development, 

and innovation. In laying out this 

strategy, the GOC has identified the 

specific products it has in mind. For 

example, an ‘‘objective’’ of The 10th 

Five-Year Plan for the Metallurgical 

Industry (‘‘Plan’’) was to develop key 

steel types that were mainly imported; 

high strength, anticrushing and 

corrosion resistant petroleum pipe was 

among the listed products. Moreover, 

among the ‘‘Policy Measures’’ set out in 

the Plan for achieving its objectives was 

the encouragement of enterprises to 

cooperate with foreign enterprises, 

particularly in the production and 

development of high value-added 

products and high-tech products. See 

Memorandum to File from Yasmin Nair, 

Analyst regarding ‘‘Additional 

Documents Placed on the Record’’ 

(February 22, 2010) (‘‘Additional 

Documents Memo’’). 

Similarly, in the Development Policies 

for the Iron and Steel Industry (July 

2005) at Article 16, the GOC states that 

it will ‘‘* * * enhance the R&D, design, 

and manufacture level in relation to the 

key technology, equipment and facilities 

for the Chinese steel industry.’’ To 

accomplish this, the GOC states it will 

provide support to key steel projects 

relying on domestically produced and 

newly developed equipment and 

facilities, through tax and interest 

assistance, and scientific research 

expenditures. See Petition at Exhibit III– 

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17See Citric Acid from the PRC, and Citric Acid 

Decision Memo, at Comment 5. 

10. Later in 2005, the GOC implemented 

the Decision of the State Council on 

Promulgating the ‘‘Interim Provisions on 

Promoting Industrial Structure 

Adjustment’’ for Implementation (No. 40 

(2005)) (‘‘Decision 40’’) in order to 

achieve the objectives of the Eleventh 

Five-Year Plan. See Additional 

Documents Memo. Decision 40 

references the Directory Catalogue on 

Readjustment of Industrial Structure 

(‘‘Industrial Catalogue’’), which outlines 

the projects which the GOC deems 

‘‘encouraged,’’ ‘‘restricted,’’ and 

‘‘eliminated,’’ and describes how these 

projects will be considered under 

government policies. Steel tube for oil 

well pipe, high-pressure boiler pipe, 

and long-distance transmission pipe 

was named in the Industrial Catalogue 

as an ‘‘encouraged project.’’ See Petition 

at Exhibit III–44. For the ‘‘encouraged’’ 

projects, Decision 40 outlines several 

support options available to the 

government, including financing. 

Turning to the provincial and 

municipal plans, the Department has 

described the inter-relatedness of 

national level plans and directives with 

those at the sub-national level. See 

LWTP Decision Memo at Comment 6. 

Based on our review of the sub-national 

plans submitted by the GOC in this 

investigation, we find that they mirror 

the national government’s objective of 

supporting and promoting the 

production of innovative and high-value 

added products, including seamless 

pipe. Examples from the five-year plans 

of the provinces and/or municipalities 

where each of the respondents is located 

follow: 

Outline of the 10th Five-Year Plan for the 

National Economic and Social Development 

of Tianjin Municipality: ‘‘For metallurgical 

industry, we attach importance to the 

development of high quality and efficiency 

steel products and high grade metal products, 

such as seamless steel tube and cold rolled 

sheet, and carry out the oil steel pipe 

extension and east-movement project of 

steel.’’ See GQR at Exhibit GOC–12. 

Outline of the 11th Five-Year Program of 

Social and Economic Development of Tianjin 

Municipality: ‘‘Build a pipe production base, 

mainly producing seamless pipes * * * 

Develop a production capacity of 2600 

seamless pipes, 10 million plates, and 1 

million first class metal products by 2010.’’ 

See GQR at Exhibit GOC–13. 

10th Five-Year Plan for Industrial 

Development in Tianjin: ‘‘Surrounding the 

object of establishing a national 

manufacturing base for seamless steel tube 

and metallic products, metallurgy industries 

will actively optimize structure, properly 

adjust layout, and develop advantageous 

products. We shall let the backward 

techniques and facilities give way to latest 

applicable technologies to treat pollution 

properly, promote development of quality 

steel and metallic products with high added 

value and huge domestic demand 

represented by seamless steel tube and cold 

rolled sheet * * *’’ See GQR at Exhibit GOC– 

16. 

Outline of the 11th Five-Year Program for 

the Development of the Industrial Economy 

of Tianjin: ‘‘Development objective: * * * 

Production capacities of major products: 

* * * production of rolled steel exceeds 30 

million tons, including 2.6 million tons of 

seamless steel tubes * * * One of the world 

largest technical equipment leading seamless 

steel tube production base and important 

domestic high grade sheet and metal 

products production base shall be established 

here * * * Key projects and investment: 

There shall be a total investment of 32.5 

billion Yuan during the period of the 11th 

Five-Year Program, mainly including the 

project of seamless steel tube, stainless steel 

tube and heavy caliber welding steel tubes 

with a total investment of 3.6 billion Yuan 

contributed by TPCO, Shuangjie Steel Tubes 

and other companies * * *’’ See GQR at 

Exhibit GOC–17. 

Outline of the 10th Five-Year Plan for 

National Economy and Social Development 

of Tianjin Binhai New Area: ‘‘Complete the 

eastward movement of Tianjin Steel Factory 

relying on the current conditions of Steel 

Pipe Company and No.3 Gas Factory, 

establish the manufacturing base and 

metallurgical casting base for steel of quality 

and efficiency and its hot-processed 

products.’’ See G1SR at Exhibit 1. 

Notice of Tianjin Municipal People’s 

Government Concerning the Printing and 

Distribution of the Outline for the 11th FiveYear Program for the National Economic and 

social Development in Tianjin Binhai New 

Area: ‘‘4. Constructing deep processing base 

of petroleum steel pipe and high quality steel 

material—We shall quicken technology 

innovation and structural adjustment, extend 

industrial link, enhance the concentration 

effort, strive the commanding point of the 

industry, consolidate and develop the 

leading position of deep processing of 

petroleum steel pipe and high quality steel 

material.’’ See G1SR at Exhibit 2. 

Outlines of the 10th and 11th Five-Year 

Program for Industrial Structural Adjustment 

and Development in Jiangsu: ‘‘Emphasize on 

the development of high-quality steel 

products with high added value and high 

technological content such as motor plates, 

shipbuilding steel plates, * * * pinion steel, 

oil well billet, special pipes and sticks, and 

highly qualified high-carbon hard wires.’’ See 

GQR at Exhibit GOC–14 and 15. 

Outline of the 11th Five-Year Plan of 

Social and Economic Development of Jiangsu 

Province: ‘‘We shall lay emphasis upon the 

development of competitive industries * * * 

By setting up industrial bases of integrated 

circuit, photoelectric display, petrochemical 

industry, metallurgy, shipbuilding, and paper 

making, we shall increase shares of 

competitive industries in the manufacturing 

industry. Focus shall be put on developing 

special metallurgy, petrochemical, new 

building material and other basic industries. 

We shall actively speed up development of 

special steel, * * *’’ See GQR at Exhibit 

GOC–9. 

Outline of the 10th Five-Year Plan of 

Social and Economic Development of Wuxi 

Municipality: ‘‘We should insist on the 

guidance of market, support the consumer 

products with big market share, fill the 

blanket area in domestic market, replace the 

exported products, high class facility class, 

upgrade and update products with 

competitive and high added value, new 

products with good industrialization base 

and comparative relativeness and dragging 

force, endeavor to construct 10 distinctive 

product group of electronic devices, * * * 

steel & iron and metal products and form a 

batch of international renowned brand and 

brands famous in China and Jiangsu.’’ See 

GQR at Exhibit GOC–10. 

Outline of the 11th Five-Year Plan of 

Social and Economic Development of Wuxi 

Municipality: ‘‘We will take such industries 

as metallurgy, chemical industry and so on 

as the foundation, prioritize products of 

several domains such as new composition 

material and high polymer material, new 

ceramic material, special steel and product, 

***’’ See GQR at Exhibit GOC–11. 

Outline of the 10th Five-Year Plan of 

Social and Economic Development of Hunan 

Province: ‘‘We shall optimize the structure, 

form the characteristics and enlarge the 

production of high quality plate and strip 

material, seamless tube, rigid line, 

manganese and other deep processing and 

special alloy products.’’ See GQR at Exhibit 

GOC–4. 

Outline of the 11th Five-Year Program of 

Social and Economic Development of Hunan 

Province: ‘‘We shall vigorously import 

advanced technological equipment and 

production techniques * * *; concentrate on 

development of high-quality excellent steel 

materials such as plates, tubes and bars etc 

***’’ See GQR at Exhibit GOC–5. 

Outline of the 10th Five-Year Plan of 

Social and Economic Development of 

Hengyang Municipality: ‘‘Focus shall be put 

on singling out these six pillar industries for 

support such as metallurgy, machinery, 

* * * We shall attach great importance to ten 

key enterprises and ten knock-out products. 

The ten key enterprises include: * * * 

Hengyang Steel Tube Group Corporation 

***’’ See GQR at Exhibit GOC–6. 

Outline of the 11th Five-Year Program of 

Social and Economic Development of 

Hengyang Municipality: ‘‘We shall stress the 

development of such major industries such 

as iron and steel smelting and tube 

processing, * * * we shall introduce 

international strategic investment, promote 

tube processing and manufacturing * * * Up 

to 2010, the smelting of steel and iron and 

the output for affiliated industrial clusters of 

tube processing shall reach 14 billion.’’ See 

GQR at Exhibit GOC–7. 

As noted in Citric Acid from the 

PRC: 17

In general, the Department looks to 

whether government plans or other policy 

directives lay out objectives or goals for 

developing the industry and call for lending 

to support those objectives or goals. Where 

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18See CFS Decision Memorandum, at 49; and 

LWTP Decision Memorandum, at 98. 

19See CFS Decision Memorandum, at Comment 

8. 

20See Certain New Pneumatic Off-The-Road Tires 

from the People’s Republic of China: Final 

Affirmative Determination of Sales at Less Than 

Fair Value and Partial Affirmative Determination of 

Critical Circumstances, 73 FR 40485 (July 15, 2008) 

(‘‘OTR Tires from the PRC’’), and the accompanying 

Issues and Decision Memorandum (‘‘OTR Tires 

Decision Memo’’) at 15; and LWTP Decision 

Memorandum, at 11. 

21We have addressed the proprietary details of 

this loan in the TPCO Calculation Memo. 

22See HQR at 14. 

such plans or policy directives exist, then we 

will find a policy lending program that is 

specific to the named industry (or producers 

that fall under that industry).18 Once that 

finding is made, the Department relies upon 

the analysis undertaken in CFS from the 

PRC19 to further conclude that national and 

local government control over the SOCBs 

results in the loans being a financial 

contribution by the GOC.20

Therefore, on the basis of the record 

information described above, we 

preliminarily determine that the GOC 

has a policy in place to encourage the 

development of production of seamless 

pipe through policy lending. The loans 

to seamless pipe producers from Policy 

Banks and SOCBs in the PRC constitute 

a direct financial contribution from the 

government, pursuant to section 

771(5)(D)(i) of the Act, and they provide 

a benefit equal to the difference between 

what the recipients paid on their loans 

and the amount they would have paid 

on comparable commercial loans (see 

section 771(5)(E)(2) of the Act). Finally, 

we determine that the loans are de jure 

specific within the meaning of section 

771 of the Act because of the GOC’s 

policy, as illustrated in the government 

plans and directives, to encourage and 

support the growth and development of 

the seamless pipe industry. 

To calculate the benefit under the 

policy lending program, we used the 

benchmarks described under ‘‘Subsidies 

Valuation—Benchmarks and Discount 

Rates’’ above. See also 19 CFR 

351.505(c). On this basis, we 

preliminarily determine that Hengyang 

received a countervailable subsidy of 

1.44 percent ad valorem and TPCO 

received a countervailable subsidy of 

0.88 percent ad valorem. 

B. Export Loans From the Export-Import 

Bank of China 

TPCO 

On page 20 of the GQR, the GOC 

reported that the Export-Import Bank of 

China (‘‘EIBC’’) provided TPCO with 

three loans that were outstanding during 

the POI. The GOC claimed that none of 

the loans related to exportation of 

subject merchandise. 

Based on the proprietary description 

of these loans at page 21 of the GOC’s 

response, however, we preliminarily 

find that one of the loans is a 

countervailable export loan from the 

EIBC.21 As a loan from a government 

policy bank, this loan constitutes a 

direct financial contribution from the 

government, pursuant to section 

771(5)(D)(i) of the Act. We further 

determine that the export loan is 

specific under section 771(5A)(B) of the 

Act because receipt of the financing is 

contingent upon export. Also, we 

determine that the export loan confers a 

benefit within the meaning of section 

771(5)(E)(ii) of the Act. 

To calculate the benefit under this 

program, we compared the amount of 

interest paid against the export loan to 

the amount of interest that would have 

been paid on a comparable commercial 

loan. As our benchmark, we used the 

short-term interest rates discussed above 

in the ‘‘Benchmarks and Discount Rates’’ 

section. To calculate the net 

countervailable subsidy rate, we divided 

the benefit by TPCO’s export sales value 

for the POI. On this basis, we 

preliminarily determine the net 

countervailable subsidy rate to be 0.08 

percent ad valorem. 

Hengyang 

On page 14 of the HQR, Hengyang 

reported two loans made to Hengyang 

Valin that are ‘‘contingent on the loans 

being used for anticipated activities that 

generate exports of high-tech 

products.’’ 22 On page 15 of the HQR, 

Hengyang stated that all of Hengyang 

Valin’s exports benefit from these loans. 

On page 28 of the GQR, the GOC 

stated, ‘‘Hengyang Valin received 

{proprietary amount of} export 

contingent loans from {the EIBC}.’’ 

We preliminarily find that Hengyang’s 

loans from the EIBC that were 

outstanding during the POI are 

countervailable export loans. As a loan 

from a government policy bank, these 

loans constitute a direct financial 

contribution from the government, 

pursuant to section 771(5)(D)(i) of the 

Act. We further determine that the 

export loans are specific under section 

771(5A)(B) of the Act because receipt of 

the financing is contingent upon export. 

Also, we determine that the export loans 

confer a benefit within the meaning of 

section 771(5)(E)(ii) of the Act. 

To calculate the benefit under this 

program, we compared the amount of 

interest paid against the export loans to 

the amount of interest that would have 

been paid on a comparable commercial 

loan. As our benchmark, we used the 

short-term interest rates discussed above 

in the ‘‘Benchmarks and Discount Rates’’ 

section. To calculate the net 

countervailable subsidy rate, we divided 

the benefit by Hengyang’s export sales 

value for the POI. On this basis, we 

preliminarily determine the net 

countervailable subsidy rate to be 1.03 

percent ad valorem. 

C. Provision of Steel Rounds for Less 

Than Adequate Remuneration 

As discussed under ‘‘Use of Facts 

Otherwise Available and Adverse 

Inferences,’’ above, we are preliminarily 

relying on ‘‘adverse facts available’’ 

(‘‘AFA’’) for our analysis regarding the 

GOC’s provision of steel rounds and 

billets to seamless pipe producers. First, 

as a result of the GOC’s failure to 

provide requested ownership 

information for the companies that 

produced the steel rounds and billets 

purchased by the mandatory 

respondents in this investigation, we are 

treating all unaffiliated producers of 

steel rounds and billets as ‘‘authorities’’ 

within the meaning of section 771(5)(B) 

of the Act. Therefore, we preliminarily 

determine that seamless pipe producers 

have received a financial contribution 

from the government in the form of the 

provision of a good. See section 

771(5)(D)(iii) of the Act. 

To determine whether this financial 

contribution results in a subsidy to the 

seamless pipe producers, we followed 

19 CFR 351.511(a)(2) for identifying an 

appropriate market-based benchmark for 

measuring the adequacy of the 

remuneration for the steel rounds and 

billets. The potential benchmarks listed 

in this regulation, in order of preference 

are: (1) Market prices from actual 

transactions within the country under 

investigation for the governmentprovided good (e.g., actual sales, actual 

imports, or competitively run 

government auctions) (‘‘tier one’’ 

benchmarks); (2) world market prices 

that would be available to purchasers in 

the country under investigation (‘‘tier 

two’’ benchmarks); or (3) prices 

consistent with market principles based 

on an assessment by the Department of 

the government-set price (‘‘tier three’’ 

benchmarks). As we explained in 

Softwood Lumber from Canada, the 

preferred benchmark in the hierarchy is 

an observed market price from actual 

transactions within the country under 

investigation because such prices 

generally would be expected to reflect 

most closely the prevailing market 

conditions of the purchaser under 

investigation. See Softwood Lumber 

from Canada and accompanying Issues 

and Decision Memorandum at ‘‘Analysis 

of Programs, Provincial Stumpage 

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Programs Determined to Confer 

Subsidies, Benefit.’’ 

Beginning with tier one, we must 

determine whether the prices from 

actual sales transactions involving 

Chinese buyers and sellers are 

significantly distorted. As explained in 

the CVD Preamble: ‘‘Where it is 

reasonable to conclude that actual 

transaction prices are significantly 

distorted as a result of the government’s 

involvement in the market, we will 

resort to the next alternative {tier two} 

in the hierarchy.’’ See Countervailing 

Duties; Final Rule, 63 FR 65348, 65377 

(November 25, 1998) (‘‘CVD Preamble’’). 

The CVD Preamble further recognizes 

that distortion can occur when the 

government provider constitutes a 

majority, or in certain circumstances, a 

substantial portion of the market. 

As explained under ‘‘Use of Facts 

Otherwise Available and Adverse 

Inferences,’’ above, we are preliminarily 

relying on AFA to determine that GOC 

authorities play a predominant role in 

the PRC market for steel rounds and 

billets. Because of the predominant role 

played by GOC authorities in the 

production of steel rounds and billets, 

we preliminarily determine that the 

prices actually paid in the PRC for steel 

rounds and billets during the POI are 

not appropriate tier one benchmarks 

under our regulations. 

Turning to tier two benchmarks, i.e., 

world market prices available to 

purchasers in the PRC, we have placed 

on the record the benchmark price 

information that we used in the final 

determination of OCTG from the PRC. 

See OCTG from the PRC, and 

accompanying Issues and Decision 

Memorandum at Comment 13a; see also 

Memorandum to the File dated February 

22, 2010, ‘‘Steel Rounds Benchmark 

Prices.’’ The benchmark price that we 

used in OCTG from the PRC is a 

compilation of the following prices: 

Export prices from Steel Business 

Briefing (‘‘SBB’’) for billet from Latin 

America, Turkey, the Black Sea/Baltic 

region; SBB East Asia import prices; and 

two series of London Metal Exchange 

prices. 

The benchmark price from OCTG 

from the PRC represents an average of 

commercially-available world market 

prices for steel rounds and billets that 

would be available to purchasers in the 

PRC. We note that, in addition to OCTG 

from the PRC, the Department has relied 

on pricing data from industry 

publications such as SBB in other recent 

CVD proceedings involving the PRC. 

See, e.g., CWP Decision Memorandum 

at 11 and LWRP Decision Memo at 9. 

Also, 19 CFR 351.511(a)(2)(ii) states that 

where there is more than one 

commercially available world market 

price, the Department will average the 

prices to the extent practicable. 

Therefore, we have averaged the prices 

to calculate an overall benchmark. 

Under 19 CFR 351.511(a)(2)(iv), when 

measuring the adequacy of 

remuneration under tier one or tier two, 

the Department will adjust the 

benchmark price to reflect the price that 

a firm actually paid or would pay if it 

imported the product, including 

delivery charges and import duties. 

Regarding delivery charges, we have 

included the freight charges that would 

be incurred to deliver steel rounds to 

the respondents’ plants. We have also 

added import duties, as reported by the 

GOC, and the value-added tax (‘‘VAT’’) 

applicable to imports of steel rounds 

and billet into the PRC. We have 

compared these prices to the 

respondents’ actual purchase prices, 

including any taxes and delivery 

charges incurred to deliver the product 

to the respondents’ plants. 

Comparing the adjusted benchmark 

prices to the prices paid by the 

respondents for their steel rounds and 

billet, we preliminarily determine that 

the GOC provided steel rounds and 

billet for less than adequate 

remuneration, and that a benefit exists 

in the amount of the difference between 

the benchmark and what the 

respondents paid. See 19 CFR 

351.511(a). 

Finally, with respect to specificity, 

the GOC at page 91 of the GQR stated, 

‘‘Steel rounds (billets in round shape 

that can be used to produce seamless 

pipe) are {used} by the seamless pipe 

industry.’’ Therefore, we preliminarily 

determine that this subsidy is specific 

because the recipients are limited in 

number. See section 771(5A)(D)(iii)(I) of 

the Act. 

Based on the above, we preliminarily 

determine that the GOC conferred a 

countervailable subsidy on TPCO and 

Hengyang through the provision of steel 

rounds for less than adequate 

remuneration. To calculate the subsidy, 

we took the difference between the 

delivered world market price and what 

each respondent paid for steel rounds, 

including delivery charges, during the 

POI. On this basis, we preliminarily 

calculated a net countervailable ad 

valorem subsidy rate of 4.98 percent for 

TPCO and 2.82 percent for Hengyang. 

D. Provision of Electricity for Less Than 

Adequate Remuneration 

For the reasons explained in the ‘‘Use 

of Facts Otherwise Available and 

Adverse Facts Available’’ section above, 

we are basing our determination 

regarding the government’s provision of 

electricity in part on AFA. 

In a CVD case, the Department 

requires information from both the 

government of the country whose 

merchandise is under investigation and 

the foreign producers and exporters. 

When the government fails to provide 

requested information concerning 

alleged subsidy programs, the 

Department, as AFA, typically finds that 

a financial contribution exists under the 

alleged program and that the program is 

specific. However, where possible, the 

Department will normally rely on the 

responsive producer’s or exporter’s 

records to determine the existence and 

amount of the benefit to the extent that 

those records are useable and verifiable. 

Consistent with this practice, the 

Department finds that the GOC’s 

provision of electricity confers a 

financial contribution, under section 

771(5)(D)(iii) of the Act, and is specific, 

under section 771(5A) of the Act. To 

determine the existence and amount of 

any benefit from this program, we relied 

on the companies’ reported information 

on the amounts of electricity they 

purchased and the amounts they paid 

for electricity during the POI. We 

compared the rates paid by TPCO and 

Hengyang for their electricity to the 

highest rates that they would have paid 

in the PRC during the POI. Specifically, 

we have selected the highest rates for 

‘‘large industrial users’’ for the peak, 

valley and normal ranges. The valley 

and normal ranges were selected from 

the GQR at Exhibit 85, Electricity Sale 

Rate Schedule of Zhejiang Grid. The 

peak rate is the electricity rate for 

Dongguan City as reported in the GOC’s 

March 12, 2009 supplemental 

questionnaire response at Exhibit S2–4 

in the CVD investigation of ‘‘Certain 

Kitchen Appliance Shelving and Racks 

from the People’s Republic of China.’’ 

See Memorandum to File from Yasmin 

Nair, International Trade Compliance 

Analyst, Office 1, ‘‘Electricity Rate Data’’ 

(February 22, 2010). This benchmark 

reflects the adverse inference we have 

drawn as a result of the GOC’s failure to 

act to the best of its ability in providing 

requested information about its 

provision of electricity in this 

investigation. 

On this basis, we preliminarily 

determine the countervailable subsidy 

to be 1.53 percent ad valorem for TPCO 

and 3.91 percent ad valorem for 

Hengyang. 

E. The State Key Technology Project 

Fund 

TPCO reported that it received funds 

from the State Key Technology 

Renovation Fund in 2003. In Exhibit V– 

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23See Laminated Woven Sacks From the People’s 

Republic of China: Final Affirmative Countervailing 

Duty Determination and Final Affirmative 

Determination, in Part, of Critical Circumstances, 

73 FR 35639 (June 24, 2008) (‘‘LWS’’), and the 

accompanying Issues and Decision Memorandum at 

Comment 8. 

1 of the GQR, the GOC provided the 

notice for implementation of the fund. 

The notice states that the purpose of the 

program is to ‘‘support the technological 

renovation of key industries, key 

enterprises and key products * * *’’ 

The notice also states, ‘‘The enterprises 

shall be mainly selected from largesized state-owned enterprises and largesized state holding enterprises among 

the 512 key enterprises, 120 pilot 

enterprise groups and the leading 

enterprises of the industries.’’ 

The Department has previously found 

this program to be countervailable. See, 

e.g., Certain New Pneumatic Off-theRoad Tires From the People’s Republic 

of China: Final Affirmative 

Countervailing Duty Determination and 

Final Negative Determination of Critical 

Circumstances, 73 FR 40480 (July 15, 

2008), and the accompanying Issues and 

Decision Memorandum at page 23 and 

Comment G.7. 

We preliminarily determine that 

TPCO received a countervailable 

subsidy under the State Key Technology 

Renovation Fund. We find that this 

grant is a direct transfer of funds within 

the meaning of section 771(5)(D)(i) of 

the Act, providing a benefit in the 

amount of the grant. See 19 CFR 

351.504(a). Further, we preliminarily 

determine that the grant provided under 

this program is limited as a matter of 

law to certain enterprises; i.e., largesized state-owned enterprises and largesized state holding enterprises among 

the 512 key enterprises. Hence, we 

preliminarily find that the subsidy is 

specific under section 771(5A)(D)(i) of 

the Act. 

To calculate the countervailable 

subsidy, we used our standard 

methodology for non-recurring grants. 

See 19 CFR 351.524(b). Because the 

grant exceeded 0.5 percent of TPCO’s 

sales in the year the grant was approved 

(i.e., 2003), we have allocated the 

benefit over the 15-year AUL using the 

discount rate described under the 

‘‘Benchmarks and Discount Rates’’ 

section above. On this basis, we 

preliminarily determine the 

countervailable subsidy to be 0.01 

percent ad valorem for TPCO. 

F. Subsidies Provided in the Tianjin 

Binhai New Area and the Tianjin 

Economic and Technological 

Development Area 

TPCO reported that it used two 

programs for companies in the Tianjin 

Binhai New Area (‘‘TBNA’’): the Science 

and Technology Fund Program and the 

Accelerated Depreciation Program. 

TPCO received a grant under the 

Science and Technology Fund Program 

and paid reduced income taxes under 

the Accelerated Depreciation Program. 

TPCO also reported that it purchased 

land-use rights and rented land-use 

rights for different plots of land within 

the TBNA during the POI and prior to 

the POI. 

Science and Technology Fund 

The GOC’s measures for the Science 

and Technology Fund, which the GOC 

provided at 134 of the GQR, describe the 

fund’s purpose as follows: (1) Promote 

the construction of the sciencetechnology infrastructure in TBNA; (2) 

enhance science-technology renovation 

and service abilities; (3) improve the 

business environment of renovation 

entrepreneurship; and 4) construct a 

new science-technology renovation 

system. On page 138 of the GQR, the 

GOC stated that eligibility for the 

program is limited to enterprises within 

the TBNA Administrative Committee’s 

jurisdiction. 

We preliminarily determine that 

TPCO received a countervailable 

subsidy during the POI under the TBNA 

Science and Technology Fund Program. 

We find that this grant is a direct 

transfer of funds within the meaning of 

section 771(5)(D)(i) of the Act, providing 

a benefit in the amount of the grant. See 

19 CFR 351.504(a). We further 

determine preliminarily that grants 

under this program are limited to 

enterprises located in a designated 

geographic region (i.e., the TBNA). 

Hence, the grants are specific under 

section 771(5A)(D)(iv) of the Act. 

To calculate the countervailable 

subsidy, we used our standard 

methodology for non-recurring grants. 

See 19 CFR 351.524(b). Because the 

benefit was less than 0.5 percent of 

TPCO’s consolidated sales during the 

POI, we have preliminarily expensed 

the entire amount to the POI. See 19 

CFR 351.524(b)(2). On this basis, we 

preliminarily determine the 

countervailable subsidy to be 0.03 

percent ad valorem for TPCO. 

Accelerated Depreciation Program 

Regarding the Accelerated 

Depreciation program, the GOC circular 

for the program (Exhibit 109 of the GQR) 

stipulates that enterprises in the TBNA 

may shorten the depreciation period of 

certain fixed assets by a maximum of 40 

percent of the present depreciation 

period. On page 147 of the GQR, the 

GOC stated that eligibility for the 

program is limited to enterprises within 

the TBNA. 

We preliminarily determine that 

TPCO received a countervailable 

subsidy during the POI under the 

Accelerated Depreciation program. The 

Accelerated Depreciation program 

constitutes a financial contribution in 

the form of revenue forgone that is 

otherwise due within the meaning of 

section 771(5)(D)(ii) of the Act, with the 

benefit equaling the income tax savings 

(see 19 CFR 351.509(a)). The program 

affected TPCO’s income taxes for the 

2007 tax year. Thus, under the normal 

standard in 19 CFR 351.509(b), TPCO 

received a benefit from this program in 

2008, when it filed its 2007 annual tax 

return. Further, we determine 

preliminarily that the reduction 

afforded by this program is limited to 

enterprises located in designated 

geographic regions and, hence, is 

specific under section 771(5A)(D)(iv) of 

the Act. 

To calculate the benefit, we divided 

the reduction in TPCO’s income taxes 

resulting from the program by TPCO’s 

consolidated sales, in accordance with 

19 CFR 351.524(c)(1) and 19 CFR 

351.525(b)(6)(iii). On this basis, we 

preliminarily determine the 

countervailable subsidy to be 0.58 

percent ad valorem for TPCO. 

Land 

Regarding land, TPCO and its 

reporting cross-owned affiliates are all 

located in the TBNA, and TPCO, TPCO 

Iron, and Yuantong have purchased 

‘‘granted’’ land-use rights within the 

TBNA. At page 86 of the GQR, the GOC 

reported that TPCO obtained its landuse rights in accordance with Article 11 

of Decree 21 of the Ministry of Land and 

Resources. Article 11, at Exhibit 73 of 

the GQR, establishes provisions for the 

‘‘agreement-based assignment of the 

right to use state-owned land.’’ Article 

11 states that the ‘‘agreement-based 

assignment of the right to use stateowned land’’ refers to the land user’s 

right to use state-owned land for a 

certain period, and to the land user’s 

payment of a fee to the state for the 

land-use right. TPCO and TPCO Iron 

purchased their land-use rights from the 

Dongli District Land and Resource 

Administration Bureau, and Yuantong 

purchased its land-use rights from the 

Tianjin Port Bonded Zone Land and 

Resource Administration Bureau. 

The Department determined in LWS 

that the provision of land-use rights 

constitutes the provision of a good 

within the meaning of section 

771(5)(D)(iii) of the Act.23 The 

Department also found that when the 

land is in an industrial park located 

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24 Id. at Comment 9. 

25 Id. at Comment 10. 

26 Id. at section IV.A.1, ‘‘Analysis of Programs— 

Government Provision of Land for Less Than 

Adequate Remuneration.’’ 

27 Id. at Comment 10. 

28The information on this party is business 

proprietary. Thus, we have addressed this 

information in the TPCO Calculation Memo. 29See OTR Tires Decision Memo at Comment 

F.12. 

within the seller’s (e.g., county’s or 

municipality’s) jurisdiction, the 

provision of the land-use rights is 

regionally specific (see section 

771(5A)(D)(iv) of the Act).24 In the 

instant investigation, the TBNA is a 

designated area within the jurisdictions 

that provided land-use rights to TPCO 

and its cross-owned affiliates since 

December 11, 2001. Therefore, 

consistent with LWS, we preliminarily 

find that TPCO’s purchases of granted 

land-use rights give rise to 

countervailable subsidies to the extent 

that the purchases conferred a benefit. 

We will continue to evaluate for the 

final determination the circumstances 

under which TPCO received land for 

LTAR pursuant to its location in this 

zone. 

To determine whether TPCO received 

a benefit, we have analyzed potential 

benchmarks in accordance with 19 CFR 

351.511(a). First, we look to whether 

there are market-determined prices 

within the country. See 19 CFR 

351.511(a)(2)(i). In LWS, the Department 

determined that ‘‘Chinese land prices 

are distorted by the significant 

government role in the market’’ and, 

hence, that usable tier one benchmarks 

do not exist.25 The Department also 

found that tier two benchmarks (world 

market prices that would be available to 

purchasers in the PRC) are not 

appropriate.26 See 19 CFR 

351.511(a)(2)(ii). Therefore, the 

Department determined the adequacy of 

remuneration by reference to tier 3 and 

found that the sale of land-use rights in 

the PRC was not consistent with market 

principles because of the overwhelming 

presence of the government in the landuse rights market and the widespread 

and documented deviation from the 

authorized methods of pricing and 

allocating land.27 See 19 CFR 

351.511(a)(2)(iii). There is insufficient 

new information on the record of this 

investigation to warrant a change from 

the findings in LWS. 

For these reasons, we are not able to 

use Chinese or world market prices as 

a benchmark. Therefore, we are 

preliminarily comparing the price that 

TPCO paid for its granted land-use 

rights with comparable market-based 

prices for land purchases in a country 

at a comparable level of economic 

development that is reasonably 

proximate to, but outside of, the PRC. 

Specifically, we are preliminarily 

comparing the price TPCO paid to sales 

of certain industrial land in industrial 

estates, parks, and zones in Thailand, 

consistent with LWS. 

To calculate the benefit, we computed 

the amount that TPCO would have paid 

for its granted land-use rights and 

subtracted the amount TPCO actually 

paid for each purchase. For purchases in 

which the subsidy amount exceeded 0.5 

percent of TPCO’s sales in the year of 

purchase, we have used the discount 

rate described under the Benchmarks 

and Discount Rates section above to 

allocate the benefit over the life of the 

land-use rights contract. For these 

purchases, we divided the amount 

allocated to the POI by TPCO’s 

consolidated sales during the POI. For 

purchases in which the benefit was less 

than 0.5 percent of TPCO’s consolidated 

sales in the year of the purchase, we 

have preliminarily expensed the entire 

amount to the year in which TPCO 

purchased the land-use rights. See 19 

CFR 351.524(b)(2). On this basis, we 

preliminarily determine the total 

countervailable subsidy for all of 

TPCO’s land-use rights purchases to be 

0.11 percent ad valorem during the POI. 

TPCO also reported that it rented 

certain land parcels within the TBNA 

from TPCO Holding during the POI. 

Specifically, on pages 45–46 of the TQR, 

TPCO reported that it operates on the 

largest of these three parcels under a 

lease agreement that it signed with 

TPCO Holding in 2005. TPCO also 

stated that it will compensate TPCO 

Holding for the lease of two other 

parcels under terms that TPCO and 

TPCO Holding will memorialize in 

2009. Finally, TPCO explained that it 

rented office space in the TBNA from 

another party during the POI.28

As we explained above in the 

‘‘Attribution of Subsidies’’ section, we 

preliminarily determine that TPCO 

Holding was an authority within the 

meaning of section 771(5)(B) of the Act 

at the time of the lease agreement and 

throughout the POI. Moreover, we 

preliminarily determine that this 

subsidy is de facto specific because it is 

limited to TPCO (section 

771(5A)(D)(iii)(I) of the Act). Therefore, 

consistent with OTR Tires from the 

PRC, we preliminarily find that TPCO’s 

lease of land under the 2005 lease gives 

rise to a countervailable subsidy to the 

extent that the lease conferred a 

benefit.29

To determine whether TPCO received 

a benefit, we are following the same 

steps outlined above for the purchase of 

land-use rights. Specifically, we are 

preliminarily comparing the rent TPCO 

paid to industrial rental rates for factory 

space in Thailand during the POI. We 

are preliminarily attributing the subsidy 

to TPCO’s consolidated sales, in 

accordance with 19 CFR 

351.525(b)(6)(iii). 

On this basis, we preliminarily 

determine the countervailable subsidy 

to be 2.55 percent ad valorem for TPCO. 

G. Other Subsidies Received by TPCO 

For the reasons explained in the ‘‘Use 

of Facts Otherwise Available and 

Adverse Facts Available’’ section above, 

we are basing our determination 

regarding the government’s provision of 

other subsidies received by TPCO in 

part on AFA. 

The information submitted by TPCO 

in its February 16, 2010, response 

regarding these subsidies is business 

proprietary. Consequently, we have 

addressed these subsidies in the TPCO 

Calculation Memo. 

We preliminarily determine that 

TPCO received countervailable 

subsidies. We find that these subsidies 

are a direct transfer of funds within the 

meaning of section 771(5)(D)(i) of the 

Act, providing a benefit in the amount 

of the grant. See 19 CFR 351.504(a). We 

determine, in the absence of a response 

from the GOC, that the subsidies 

received under this program are limited 

to TPCO. Hence, we find that these 

subsidies are specific under section 

771(5A)(D)(i) of the Act. 

To calculate the countervailable 

subsidy, we used our standard 

methodology for non-recurring grants. 

See 19 CFR 351.524(b). Because the 

benefit was less than 0.5 percent of 

TPCO’s consolidated sales during the 

POI, we have preliminarily expensed 

the entire amount to the POI. See 19 

CFR 351.524(b)(2). On this basis, we 

preliminarily determine the 

countervailable subsidy to be 0.03 

percent ad valorem for TPCO. 

H. Import Tariff and VAT Exemptions 

for FIEs Using Imported Equipment in 

Encouraged Industries 

Enacted in 1997, the Circular of the 

State Council on Adjusting Tax Policies 

on Imported Equipment (GUOFA No. 

37) (Circular No. 37) exempts both FIEs 

and certain domestic enterprises from 

the VAT and tariffs on imported 

equipment used in their production so 

long as the equipment does not fall into 

prescribed lists of non-eligible items. 

The National Development and Reform 

Commission or its provincial branch 

provides a certificate to enterprises that 

receive the exemption. The objective of 

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30See GQR at 51. 31See HQR at Volume 5, page 37. 

the program is to encourage foreign 

investment and to introduce foreign 

advanced technology equipment and 

industry technology upgrades. 

TPCO Group, through TPCO 

International, received VAT and tariff 

exemptions under this program. TPCO 

received these exemptions due to its 

status as a qualified domestic enterprise 

that received a Certificate for StateEncouraged Projects, according to the 

GQR at page 70. Hengyang Valin and 

Hengyang MPM also reported using this 

program during the POI. 

We preliminarily determine that VAT 

and tariff exemptions on imported 

equipment confer a countervailable 

subsidy. The exemptions are a financial 

contribution in the form of revenue 

forgone by the GOC and they provide a 

benefit to the recipient in the amount of 

the VAT and tariff savings. See section 

771(5)(D)(ii) of the Act and 19 CFR 

351.510(a)(1). 

As described above, FIEs and certain 

domestic enterprises are eligible to 

receive VAT and tariff exemptions 

under this program. In CFS from the 

PRC, the Department found the 

beneficiaries of this program to be 

specific within the meaning of section 

771(5A)(D)(iii)(I) of the Act. See CFS 

Decision Memorandum at Comment 16 

(discussing and affirming the 

preliminary determination that this 

program is specific under section 

771(5A)(D)(iii)(I) of the Act despite the 

fact that the ‘‘pool of companies eligible 

for benefits is larger than FIEs’’). No 

information has been provided in this 

investigation to demonstrate that the 

beneficiary companies are a nonspecific group. Therefore, consistent 

with the determination in CFS from the 

PRC, we preliminarily find that the VAT 

and tariff exemptions extended under 

this program are provided to a group of 

industries and that the subsidy is 

specific. 

Normally, we treat exemptions from 

indirect taxes and import charges, such 

as the VAT and tariff exemptions, as 

recurring benefits, consistent with 19 

CFR 351.524(c)(1) and allocate the 

benefits to the year in which they were 

received. However, when an indirect tax 

or import charge exemption is provided 

for, or tied to, the capital structure or 

capital assets of a firm, the Department 

may treat it as a non-recurring benefit 

and allocate the benefit to the firm over 

the AUL. See 19 CFR 351.524(c)(2)(iii) 

and 19 CFR 351.524(d)(2). 

In the instant investigation, TPCO and 

Hengyang have provided a list of VAT 

and tariff exemptions that they received 

for imported capital equipment during 

the 15-year AUL period. In light of our 

preliminary determination to find 

subsidies only after December 11, 2001, 

we have not examined VAT and tariff 

exemptions prior to this date. To 

calculate the countervailable subsidy, 

we used our standard methodology for 

non-recurring grants. See 19 CFR 

351.524(b). For certain years prior to the 

POI, TPCO and Hengyang reported VAT 

and tariff exemptions that were more 

than 0.5% of their sales. Based on 

TPCO’s and Hengyang’s information, we 

preliminarily determine that the VAT 

and tariff exemptions were for capital 

equipment. We have allocated the 

benefit over the 15-year AUL using the 

discount rate described under the 

‘‘Benchmarks and Discount Rates’’ 

section above. 

For TPCO and Hengyang, the total 

amount of VAT and tariff exemptions 

received during the POI did not exceed 

0.5% of their POI sales. Based on 

TPCO’s and Hengyang’s information, we 

preliminarily determine that the VAT 

and tariff exemptions were for capital 

equipment. Thus, we have preliminarily 

expensed the entire amount to the POI. 

See 19 CFR 351.524(b)(2). 

To calculate the countervailable 

subsidy, we used our standard 

methodology for non-recurring grants. 

See 19 CFR 351.524(b). Specifically, we 

used the discount rate described above 

in the ‘‘Benchmarks and Discount Rates’’ 

section to calculate the amount of the 

benefit for the POI. On this basis, we 

preliminarily determine that a 

countervailable benefit of 0.18 percent 

ad valorem exists for TPCO, and that a 

countervailable benefit of 0.44 percent 

ad valorem exists for Hengyang. 

I. Income Tax Credits for Domestically 

Owned Companies Purchasing 

Domestically Produced Equipment 

According to the Provisional 

Measures on Enterprise Income Tax 

Credit for Investment in Domestically 

Produced Equipment for Technology 

Renovation {Projects} (CAI SHU ZI 

{1999} No. 290), a domestically 

invested company may claim tax credits 

on the purchase of domestic equipment 

if the project is compatible with the 

industrial policies of the GOC. 

Specifically, a tax credit up to 40 

percent of the purchase price of the 

domestic equipment may apply to the 

incremental increase in tax liability 

from the previous year.30 The 

Department has previously found this 

program countervailable. See, e.g., Line 

Pipe from the PRC and accompanying 

Issues and Decision Memorandum at 

25–26. 

Hengyang reported that Hengyang 

MPM received this benefit during the 

POI. See HQR at 24. 

We preliminarily determine that 

income tax credits for the purchase of 

domestically produced equipment are 

countervailable subsidies. The tax 

credits are a financial contribution in 

the form of revenue forgone by the 

government and provide a benefit to the 

recipients in the amount of the tax 

savings. See section 771(5)(D)(ii) of the 

Act and 19 CFR 351.509(a)(1). We 

further preliminarily determine that 

these tax credits are contingent upon 

use of domestic over imported goods 

and, hence, are specific under section 

771(5A)(C) of the Act. 

To calculate the benefit, we treated 

the income tax savings enjoyed by 

Hengyang MPM as a recurring benefit, 

consistent with 19 CFR 351.524(c)(1), 

and divided the company’s tax savings 

by the combined total sales of Hengyang 

Valin, Hengyang MPM, Xigang 

Seamless, and Special Pipe, minus 

inter-company sales, during the POI. On 

this basis, we preliminarily determine 

that a countervailable subsidy of 0.34 

percent ad valorem exists for Hengyang 

under this program. 

J. ‘‘Two Free, Three Half’’ Program 

Under Article 8 of the FIE Tax Law, 

an FIE that is ‘‘productive’’ and is 

scheduled to operate for more than ten 

years may be exempted from income tax 

in the first two years of profitability and 

pay income taxes at half the standard 

rate for the next three years. See GOC’s 

January 25, 2010, cross-owned 

companies submission at Exhibit P–1. 

The Department has previously found 

this program countervailable. See, e.g., 

CFS Decision Memorandum at 10–11. 

Hengyang reported that Special Pipe 

and Resources Steel used this program 

during the POI.31

We preliminarily determine that the 

exemption or reduction of the income 

tax paid by productive FIEs under this 

program confers a countervailable 

subsidy. The exemption/reduction is a 

financial contribution in the form of 

revenue forgone by the GOC, and it 

provides a benefit to the recipient in the 

amount of the tax savings. See section 

771(5)(D)(ii) of the Act and 19 CFR 

351.509(a)(1). We also preliminarily 

determine that the exemption/reduction 

afforded by this program is limited as a 

matter of law to certain enterprises, i.e., 

‘‘productive’’ FIEs, and, hence, is 

specific under section 771(5A)(D)(i) of 

the Act. See CFS Decision 

Memorandum at Comment 14. 

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32See HQR at Volume 5, page 39. 

To calculate the benefit, we treated 

the income tax savings enjoyed by 

Special Pipe and Resources Steel as a 

recurring benefit, consistent with 19 

CFR 351.524(c)(1). To compute the 

amount of the tax savings, we compared 

the income tax rate the above companies 

would have paid in the absence of the 

program with the income tax rate the 

company actually paid. We divided 

Special Pipe’s tax savings during the 

POI by the combined sales of Special 

Pipe, Xigang Seamless, Hengyang Valin, 

and Hengyang MPM (exclusive of intercompany sales). We divided Resources 

Steel’s tax savings during the POI by the 

combined sales of Resources Steel, 

Special Pipe, and Xigang Seamless 

(exclusive of inter-company sales). On 

this basis, we preliminarily determine 

that Hengyang received a 

countervailable subsidy of 0.27 percent 

ad valorem under this program. 

K. Local Income Tax Exemption and 

Reduction Programs for ‘‘Productive’’ 

FIEs 

Under Article 9 of the FIE Tax Law, 

the provincial governments have the 

authority to exempt FIEs from the local 

income tax of three percent. See the 

GOC’s January 25, 2010, cross-owned 

companies submission at Exhibit P–1. 

The Department has previously found 

this program to be countervailable. See, 

e.g., CFS Decision Memorandum at 

pages 12–13; see also Citric Acid 

Decision Memorandum at page 21. 

Hengyang reported that Seamless Pipe 

and Resources Steel used this program 

during the POI.32

We preliminarily determine that the 

exemption from or reduction in the 

local income tax received by 

‘‘productive’’ FIEs under this program 

confers a countervailable subsidy. The 

exemption or reduction is a financial 

contribution in the form of revenue 

forgone that is otherwise due by the 

government, and it provides a benefit to 

the recipient in the amount of the tax 

savings, per section 771(5)(D)(ii) of the 

Act and 19 CFR 351.509(a)(1). We also 

preliminarily determine that the 

exemption or reduction afforded by this 

program is limited as a matter of law to 

certain enterprises, i.e., ‘‘productive’’ 

FIEs, and, hence, is specific under 

section 771(5A)(D)(i) of the Act. 

To calculate the benefit for Special 

Pipe and Resources Steel, we treated the 

income tax savings enjoyed by the 

companies as a recurring benefit, 

consistent with 19 CFR 351.524(c)(1). 

To compute the amount of the tax 

savings, we compared the local income 

tax rate that the companies would have 

paid in the absence of the program (i.e., 

three percent) with the income tax rate 

the companies actually paid (i.e., zero 

percent). 

For Special Pipe, we divided the 

company’s tax savings received during 

the POI by the combined POI sales of 

Special Pipe, Xigang Seamless, 

Hengyang Valin, and Hengyang MPM, 

minus inter-company sales. For 

Resources Steel, we divided the 

company’s tax savings received during 

the POI by the combined sales of 

Resources Steel, Special Pipe, and 

Xigang Seamless. On this basis, we 

preliminarily determine that Hengyang 

received a countervailable subsidy of 

0.07 percent ad valorem. 

L. Government Debt Forgiveness 

TPCO 

On pages 26–27 of the TQR, TPCO 

reported that in 2006 and 2008 it settled 

claims related to loans that continued to 

be outstanding after a debt-to-equity 

transaction occurring in 2001. TPCO 

settled debt held by China Orient Asset 

Management Corporation and Cinda. 

See TPCO Calculation Memo. 

We preliminarily determine that 

through this settlement the GOC forgave 

debt owed by TPCO and, thus, provided 

a financial contribution to TPCO in the 

form of a direct transfer of funds 

(section 771(5)(D)(i) of the Act). The 

benefit to TPCO is the amount of the 

debt forgiven (section 771(5)(D)(i) of the 

Act and 19 CFR 351.508(a)). 

Additionally, we preliminarily 

determine that this subsidy is de facto 

specific because it is limited to TPCO 

(section 771(5A)(D)(iii)(I) of the Act). 

Forgiveness of part of the debt 

occurred in 2006, and approval for 

forgiveness of the remainder of the debt 

occurred in 2008. To calculate the 

countervailable subsidy for the debt 

forgiveness approved in each year, we 

used our standard methodology for nonrecurring benefits. See 19 CFR 

351.524(b). Because the amount of the 

2006 portion of the debt forgiveness 

exceeded 0.5 percent of TPCO’s sales in 

2006, we have allocated the benefit over 

the 15-year AUL using the discount rate 

described under the Benchmarks and 

Discount Rates section above. We 

attributed the subsidy amount for the 

POI to TPCO’s consolidated sales. On 

this basis, we preliminarily determine 

the countervailable subsidy to be 0.04 

percent ad valorem for TPCO. 

For the debt forgiveness approved in 

2008, the benefit was less than 0.5 

percent of TPCO’s consolidated sales 

during the POI. Thus, we have 

preliminarily expensed the entire 

amount to the POI. See 19 CFR 

351.524(b)(2). On this basis, we 

preliminarily determine the 

countervailable subsidy to be 0.11 

percent ad valorem for TPCO. The 

Department may seek further 

information following this preliminary 

determination regarding the extent of 

forgiveness. 

Hengyang 

In the HQR at Volume 5, pages 24–27, 

Hengyang reported that Xigang Group 

and Resources Steel underwent loan 

restructurings since December 11, 2001, 

through the POI. The information on 

these loan restructurings is business 

proprietary. Thus, we have addressed 

the information in the Hengyang 

Calculation Memo. 

We preliminarily determine that 

through this settlement the GOC forgave 

debt owed by Xigang Group and 

Resources Steel and, thus, provided a 

financial contribution to Xigang Group 

and Resources Steel in the form of a 

direct transfer of funds (section 

771(5)(D)(i) of the Act). The benefit to 

Xigang Group and Resources Steel is the 

amount of the debt forgiven (19 CFR 

351.508(a)). Additionally, we 

preliminarily determine that this 

subsidy is de facto specific as it is 

limited to Xigang Group and Resources 

Steel (section 771(5A)(D)(iii)(I) of the 

Act). 

Approval for forgiveness of debt 

occurred in 2005, 2006, 2007, and 2008. 

To calculate the countervailable subsidy 

for the debt forgiveness approved in 

each year, we used our standard 

methodology for non-recurring benefits. 

See 19 CFR 351.524(b). Because the 

amount of the 2005 and 2007 portions 

of the debt forgiveness exceeded 0.5 

percent of Xigang Group’s sales in 2005 

and 2007, respectively, we have 

allocated the benefit for each year over 

the 15-year AUL using the discount rate 

described under the Benchmarks and 

Discount Rates section above. We 

attributed the subsidy amount for the 

POI to Xigang Group’s consolidated 

sales. 

For the debt forgiveness approved in 

2006, the benefit was less than 0.5 

percent of Xigang Group’s consolidated 

sales. Thus, we have preliminarily 

expensed the entire amount to 2006. See 

19 CFR 351.524(b)(2). 

For the debt forgiveness approved 

during the POI, the benefit was less than 

0.5 percent of Xigang Group’s and 

Resources Steel’s consolidated sales 

during the POI. Thus, we have 

preliminarily expensed the entire 

amount to the POI. See 19 CFR 

351.524(b)(2). 

On this basis, we preliminarily 

determine the countervailable subsidy 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 75, No. 39 / Monday, March 1, 2010 / Notices 9179 

33See OCTG from the PRC, and accompanying 

Issues and Decision Memorandum at Comment 32. 

34See the Department’s February 16, 2010, letter 

to Hengyang, ‘‘Third Supplemental Questionnaire.’’ 

35See the Department’s February 17, 2010, letter 

to Hengyang, ‘‘Request for Extension of Time to File 

a Response to the Department’s Supplemental 

Questionnaire.’’ 

to be 2.66 percent ad valorem for 

Hengyang. The Department may seek 

further information following this 

preliminary determination regarding the 

extent of forgiveness. 

II. Program Preliminarily Determined 

Not Countervailable 

A. Export Restrictions on Coke 

Petitioners alleged that the GOC 

imposed export restrictions on coke in 

the form of export quotas, related export 

licensing and export duties. Petitioners 

maintain that such export restraints had 

a direct and discernible effect on the 

Chinese domestic prices of coke, 

thereby, artificially lowering them 

compared to world market prices. 

Accordingly, petitioners asserted that 

the GOC’s export restraints on coke 

provided a countervailable subsidy to 

Chinese seamless pipe producers during 

the POI. 

The Department has countervailed 

export restraint allegations in only a 

limited number of cases. In Final 

Affirmative Countervailing Duty 

Determination and Countervailing Duty 

Order; Leather From Argentina, 55 FR 

40212 (October 2, 1990), we found an 

embargo on hide exports to provide a 

countervailable subsidy to Argentine 

leather producers based on a long-term 

historical price comparison that 

demonstrated a clear link between the 

imposition of the embargo and the 

divergence of prices. In Coated Free 

Sheet Paper from Indonesia: Final 

Affirmative Countervailing Duty 

Determination, 72 FR 60642 (October 

25, 2007), and accompanying Issues and 

Decision Memorandum at Comment 24, 

we found that a log embargo provided 

a countervailable benefit to paper 

producers, in part, based upon 

independent studies that stated that the 

log embargo provided a subsidy to 

downstream producers. 

At Exhibit 31 of their February 12, 

2010, pre-preliminary determination 

comments, Petitioners submitted an 

economic study from the Brattle Group 

on the economic effects of export 

restraints on the price of coke in the 

PRC. Given the relatively recent 

submission date, the Department has 

not had sufficient time to fully consider 

the information presented in this study. 

However, based on an initial analysis of 

this study as well as the other record 

evidence, we preliminarily find that the 

record does not support a finding that 

this program is countervailable. The 

study provides an economic model that 

explains, in theory, how export 

restraints might have an impact on 

quantities and prices. The economic 

model and the other limited data on the 

record do not demonstrate that the GOC 

is entrusting or directing private entities 

to provide coke to the respondents and, 

therefore, the record does not support a 

finding of a government financial 

contribution. Moreover, the record 

evidence does not sufficiently 

demonstrate a link between the 

particular export restraints pertaining to 

coke and the historic trends in domestic 

and world coke supply and prices, and 

does not address other possible 

contributing factors behind the trends in 

those quantities and prices. In 

particular, the study provides data for 

the period January 2006 through May 

2009 for Chinese domestic coke prices 

and Chinese export coke prices. 

Although the data show that domestic 

Chinese prices have been lower than 

export prices from the PRC, the data do 

not show a connection between the 

export restraints and this price 

difference. Therefore, consistent with 

our findings in OCTG from the PRC,33

we preliminarily continue to find the 

program to be not countervailable. 

B. Export Incentive Payments 

Characterized as ‘‘VAT Rebates’’ 

The Department’s regulations state 

that in the case of an exemption upon 

export of indirect taxes, a benefit exists 

only to the extent that the Department 

determines that the amount exempted 

‘‘exceeds the amount levied with respect 

to the production and distribution of 

like products when sold for domestic 

consumption.’’ See 19 CFR 351.517(a); 

see also 19 CFR 351.102 (for a definition 

of ‘‘indirect tax’’). 

To determine whether the GOC 

provided a benefit under this program, 

we compared the VAT exemption upon 

export to the VAT levied with respect to 

the production and distribution of like 

products when sold for domestic 

consumption. On page 39 of the GQR, 

the GOC reported that the VAT levied 

on seamless pipe sales in the domestic 

market (17 percent) exceeded the 

amount of VAT exempted upon the 

export of seamless pipe (13 percent). 

There is, therefore, no excess VAT 

exemption. Thus, we preliminarily 

determine that the VAT exempted on 

the export of seamless pipe is not 

countervailable. 

III. Program for Which More 

Information Is Required 

Deed Tax Exemption for SOEs 

Undergoing Mergers or Restructuring 

In Hengyang’s February 16, 2010, 

supplemental questionnaire response at 

page 14, Hengyang reported that 

Hengyang Valin received a one-time 

benefit from this program. Because 

Hengyang did not report this potential 

subsidy until its February 16, 2010, 

submission, we did not have enough 

time to request further information from 

the GOC regarding this program. 

Further, to determine whether any 

potential benefit from this program 

exceeded 0.5 percent of Hengyang’s 

sales in the year of approval, we 

requested Hengyang’s 2003 sales 

figures.34 We granted Hengyang an 

extension until February 22, 2010, to 

submit this information.35 Because we 

lack necessary information from the 

GOC and Hengyang, we intend to 

address the countervailability of this 

program in a post-preliminary 

determination. 

IV. Programs Preliminarily Determined 

To Be Not Used by Respondents or To 

Not Provide Benefits During the POI 

A. Sub-central Government Programs To 

Promote Famous Export Brands and 

China World Top Brands 

TPCO reported that it received a grant 

under this program in 2007. On page 50 

of the TQR, TPCO stated that the 

program relates to TPCO’s trademark 

and does not relate to any specific 

merchandise. 

We preliminarily determine that the 

total amount of the grant was less than 

0.5 percent of TPCO’s consolidated and 

unconsolidated sales in 2007. Thus, 

without prejudice to whether this is a 

countervailable subsidy, we 

preliminarily have allocated the benefit 

exclusively to 2007 pursuant to 19 CFR 

351.524(b)(2). As a result, we 

preliminarily determine that TPCO 

received no benefit from this program 

during the POI. 

B. Exemptions for SOEs From 

Distributing Dividends to the State 

In the HQR at Vol. 5, page 23, 

Hengyang reported a potential 

exemption under this program. All of 

the details of this potential exemption, 

including the Hengyang company that 

received the benefit, are business 

proprietary. Thus, we have addressed 

the information in the Hengyang 

Calculation Memo. 

We preliminarily determine that the 

benefit from this potential exemption 

was less than 0.5 percent of the 

appropriate sales denominator in the 

year of approval, which was prior to the 

mstockstill on DSKH9S0YB1PROD with NOTICES

9180 Federal Register / Vol. 75, No. 39 / Monday, March 1, 2010 / Notices 

36We have found company-specific debt 

forgiveness for TPCO and Hengyang under the 

Government Debt Forgiveness program, as described 

above. 

POI. Thus, without prejudice to whether 

this is a countervailable subsidy, we 

preliminarily have allocated any benefit 

exclusively to the year of approval 

pursuant to 19 CFR 351.524(b)(2). As a 

result, we preliminarily determine that 

Hengyang received no benefit from this 

program during the POI. 

C. Other Programs 

Based upon responses by the GOC, 

TPCO, and Hengyang, we preliminarily 

determine that TPCO and Hengyang did 

not apply for or receive benefits during 

the POI under the programs listed 

below. 

1. Preferential Loan Programs 

a. Treasury Bond Loans to Northeast 

b. Preferential Loans for State-Owned 

Enterprises 

c. Preferential Loans for Key Projects 

and Technologies 

d. Preferential Lending to Seamless 

Pipe Producers and Exporters 

Classified as ‘‘Honorable 

Enterprises’’ 

e. Loans and Interest Subsidies 

Provided Pursuant to the Northeast 

Revitalization Program 

2. Equity Programs 

a. Debt-to-Equity Swap for TPCO 

b. Equity Infusion in TPCO 

c. Exemptions for SOEs From 

Distributing Dividends to the State 

d. Loan and Interest Forgiveness for 

SOEs 36

3. Tax Benefit Programs 

a. Preferential Income Tax Policy for 

Enterprises in the Northeast Region 

b. Forgiveness of Tax Arrears For 

Enterprises in the Old Industrial 

Bases of Northeast China 

c. Reduction in or Exemption from 

Fixed Assets Investment 

Orientation Regulatory Tax 

d. Preferential Tax Programs for 

Foreign-Invested Enterprises 

Recognized as High or New 

Technology Enterprises 

e. Income Tax Reductions for ExportOriented Foreign-Invested 

Enterprises 

4. Tariff and Indirect Tax Programs 

a. Stamp Exemption on Share 

Transfers Under Non-Tradable 

Share Reform 

b. Export Incentive Payments 

Characterized as ‘‘VAT Rebates’’ 

5. Land Grants and Discounts 

a. Provision of Land to SOEs for Less 

Than Adequate Remuneration 

6. Provision of Inputs for Less than 

Adequate Remuneration 

a. Provision of Electricity and Water at 

Less than Adequate Remuneration 

to Seamless Pipe Producers Located 

in Jiangsu Province 

b. Provision of Coking Coal for Less 

than Adequate Remuneration 

7. Grant Programs 

a. Foreign Trade Development Fund 

(Northeast Revitalization Program) 

b. Export Assistance Grants in 

Zhejiang Province 

c. Program to Rebate Antidumping 

Fees in Zhejiang Province Subsidies 

for Development of Famous Export 

Brands and China World Top 

Brands 

d. Grants to Loss-Making SOEs 

e. Export Interest Subsidies in 

Liaoning Province 

8. Other Regional Programs 

a. High-Tech Industrial Development 

Zones 

Verification 

In accordance with section 782(i)(1) of 

the Act, we will verify the information 

submitted by the respondents prior to 

making our final determination. 

Suspension of Liquidation 

In accordance with section 

703(d)(1)(A)(i) of the Act, we have 

calculated a rate for each individually 

investigated producer/exporter of the 

subject merchandise. Section 

705(c)(5)(A)(i) of the Act states that for 

companies not investigated, we will 

determine an ‘‘all others’’ rate equal to 

the weighted average countervailable 

subsidy rates established for exporters 

and producers individually 

investigated, excluding any zero and de 

minimis countervailable subsidy rates, 

and any rates determined entirely under 

section 776 of the Act. 

Notwithstanding the language of 

section 705(c)(1)(B)(i)(I) of the Act, we 

have not calculated the ‘‘all others’’ rate 

by weight averaging the rates of TPCO 

and Hengyang, because doing so risks 

disclosure of proprietary information. 

Therefore, we have calculated a simple 

average of the two responding firms’ 

rates. Since both TPCO and Hengyang 

received countervailable export 

subsidies and the ‘‘all others’’ rate is a 

simple average based on the 

individually investigated exporters and 

producers, the ‘‘all others’’ rate includes 

export subsidies. 

We preliminarily determine the total 

estimated net countervailable subsidy 

rates to be: 

Exporter/manufacturer Net subsidy 

rate 

Tianjin Pipe (Group) Co., Tianjin Pipe Iron Manufacturing Co., Ltd., Tianguan Yuantong Pipe Product Co., Ltd., Tianjin Pipe International Economic and Trading Co., Ltd., and TPCO Charging Development Co., Ltd. .................................................................. 11.06 

Hengyang Steel Tube Group Int’l Trading, Inc., Hengyang Valin Steel Tube Co., Ltd., Hengyang Valin MPM Tube Co., Ltd., 

Xigang Seamless Steel Tube Co., Ltd., Wuxi Seamless Special Pipe Co., Ltd., Wuxi Resources Steel Making Co., Ltd., and 

Jiangsu Xigang Group Co., Ltd. ........................................................................................................................................................ 12.97 

All Others ............................................................................................................................................................................................... 12.02 

In accordance with sections 

703(d)(1)(B) and (d)(2) of the Act, we are 

directing U.S. Customs and Border 

Protection (‘‘CBP’’) to suspend 

liquidation of all entries of seamless 

pipe from the PRC that are entered, or 

withdrawn from warehouse, for 

consumption on or after the date of the 

publication of this notice in the Federal 

Register, and to require a cash deposit 

or bond for such entries of merchandise 

in the amounts indicated above. 

Moreover, in accordance with section 

703(e)(2)(A) of the Act, for Hengyang 

and ‘‘all other’’ Chinese exporters of 

seamless pipe, we are directing CBP to 

apply the suspension of liquidation to 

any unliquidated entries entered, or 

withdrawn from warehouse for 

consumption, on or after the date 90 

days prior to the date of publication of 

this notice in the Federal Register. 

ITC Notification 

In accordance with section 703(f) of 

the Act, we will notify the ITC of our 

determination. In addition, we are 

making available to the ITC all nonprivileged and non-proprietary 

information relating 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 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 75, No. 39 / Monday, March 1, 2010 / Notices 9181 

publicly or under an administrative 

protective order, without the written 

consent of the Assistant Secretary for 

Import Administration. 

In accordance with section 705(b)(2) 

of the Act, if our final determination is 

affirmative, the ITC will make its final 

determination within 45 days after the 

Department makes its final 

determination. 

Disclosure and Public Comment 

In accordance with 19 CFR 

351.224(b), we will disclose to the 

parties the calculations for this 

preliminary determination within five 

days of its announcement. Due to the 

anticipated timing of verification and 

issuance of verification reports, case 

briefs for this investigation must be 

submitted no later than one week after 

the issuance of the last verification 

report. See 19 CFR 351.309(c)(i) (for a 

further discussion of case briefs). 

Rebuttal briefs must be filed within five 

days after the deadline for submission of 

case briefs, pursuant to 19 CFR 

351.309(d)(1). A list of authorities relied 

upon, a table of contents, and an 

executive summary of issues should 

accompany any briefs submitted to the 

Department. Executive summaries 

should be limited to five pages total, 

including footnotes. See 19 CFR 

351.309(c)(2) and (d)(2). 

Section 774 of the Act provides that 

the Department will hold a public 

hearing to afford interested parties an 

opportunity to comment on arguments 

raised in case or rebuttal briefs, 

provided that such a hearing is 

requested by an interested party. If a 

request for a hearing is made in this 

investigation, the hearing will be held 

two days after the deadline for 

submission of the rebuttal briefs, 

pursuant to 19 CFR 351.310(d), at the 

U.S. Department of Commerce, 14th 

Street and Constitution Avenue, NW., 

Washington, DC 20230. Parties should 

confirm by telephone the time, date, and 

place of the hearing 48 hours before the 

scheduled time. 

Interested parties who wish to request 

a hearing, or to participate if one is 

requested, must submit a written 

request to the Acting Assistant Secretary 

for Import Administration, U.S. 

Department of Commerce, Room 1870, 

14th Street and Constitution Avenue, 

NW., Washington, DC 20230, within 30 

days of the publication of this notice, 

pursuant to 19 CFR 351.310(c). Requests 

should contain: (1) The party’s name, 

address, and telephone; (2) the number 

of participants; and (3) a list of the 

issues to be discussed. Oral 

presentations will be limited to issues 

raised in the briefs. See id. 

This determination is published 

pursuant to sections 703(f) and 777(i) of 

the Act. 

Dated: February 22, 2010. 

Ronald K. Lorentzen, 

Deputy Assistant Secretary for Import 

Administration. 

[FR Doc. 2010–4192 Filed 2–26–10; 8:45 am] 

BILLING CODE 3510–DS–P 

DEPARTMENT OF COMMERCE 

International Trade Administration 

Secretarial China Clean Energy 

Business Development Mission; 

Application Deadline Extended 

AGENCY: International Trade 

Administration, Department of 

Commerce. 

ACTION: Notice. 

Timeframe for Recruitment and 

Applications 

Mission recruitment will be 

conducted in an open and public 

manner, including publication in the 

Federal Register, posting on the 

Commerce Department trade mission 

calendar (http://www.ita.doc.gov/ 

doctm/tmcal.html) and other Internet 

Web sites, press releases to general and 

trade media, direct mail, broadcast fax, 

notices by industry trade associations 

and other multiplier groups, and 

publicity at industry meetings, 

symposia, conferences, and trade shows. 

The Commerce Department’s Office of 

Business Liaison and the International 

Trade Administration will explore and 

welcome outreach assistance from other 

interested organizations, including other 

U.S. Government agencies. 

Recruitment for this mission will 

begin immediately upon approval. 

Applications can be completed on-line 

at the Clean Energy Business 

Development Missions’ Web site at 

http://www.trade.gov/ 

CleanEnergyMission or can be obtained 

by contacting the U.S. Department of 

Commerce Office of Business Liaison 

(202–482–1360 or 

CleanEnergyMission@doc.gov). The 

application deadline has been extended 

to Friday, March 12, 2010. Completed 

applications should be submitted to the 

Office of Business Liaison. Applications 

received after Friday, March 12, 2010 

will be considered only if space and 

scheduling constraints permit. 

Contacts 

The Office of Business Liaison, 1401 

Constitution Avenue, NW., Room 5062, 

Washington, DC 20230, Tel: 202–482– 

1360, Fax: 202–482–4054, E-mail: 

CleanEnergyMission@doc.gov. 

Sean Timmins, 

Global Trade Programs, Commercial Service 

Trade Missions Program. 

[FR Doc. 2010–4104 Filed 2–26–10; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF COMMERCE 

International Trade Administration 

Secretarial Indonesia Clean Energy 

Business Development Mission: 

Application Deadline Extended 

AGENCY: International Trade 

Administration, Department of 

Commerce. 

ACTION: Notice. 

Timeframe for Recruitment and 

Applications 

Mission recruitment will be 

conducted in an open and public 

manner, including publication in the 

Federal Register, posting on the 

Commerce Department trade mission 

calendar (http://www.ita.doc.gov/ 

doctm/tmcal.html) and other Internet 

web sites, press releases to general and 

trade media, direct mail, broadcast fax, 

notices by industry trade associations 

and other multiplier groups, and 

publicity at industry meetings, 

symposia, conferences, and trade shows. 

The Commerce Department’s Office of 

Business Liaison and the International 

Trade Administration will explore and 

welcome outreach assistance from other 

interested organizations, including other 

U.S. Government agencies. 

Recruitment for this mission will 

begin immediately upon approval. 

Applications can be completed on-line 

at the Clean Energy Business 

Development Missions’ Web site at 

http://www.trade.gov/ 

CleanEnergyMission or can be obtained 

by contacting the U.S. Department of 

Commerce Office of Business Liaison 

(202–482–1360 or 

CleanEnergyMission@doc.gov). The 

application deadline has been extended 

to Friday, March 12, 2010. Completed 

applications should be submitted to the 

Office of Business Liaison. Applications 

received after Friday, March 12, 2010 

will be considered only if space and 

scheduling constraints permit. 

Contacts 

The Office of Business Liaison, 1401 

Constitution Avenue, NW., Room 5062, 

Washington, DC 20230, Tel: 202–482– 

mstockstill on DSKH9S0YB1PROD with NOTICES