16782 Federal Register / Vol. 62, No. 67 / Tuesday, April 8, 1997 / Notices

reimbursement of antidumping duties

prior to liquidation of the relevant

entries during this review period.

Failure to comply with this requirement

could result in the Secretary’s

presumption that reimbursement of

antidumping duties occurred and the

subsequent assessment of double

antidumping duties.

This administrative review and notice

are in accordance with section 751(a)(1)

of the Act (19 U.S.C. 1675(a)(1)) and 19

CFR 353.22(c)(5).

Dated: March 31, 1997.

Robert S. LaRussa,

Acting Assistant Secretary for Import

Administration.

[FR Doc. 97–8958 Filed 4–7–97; 8:45 am]

BILLING CODE 3510–DS–P

DEPARTMENT OF COMMERCE

International Trade Administration

[A–588–046]

Polychloroprene Rubber From Japan;

Termination of Antidumping

Administrative Review

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

ACTION: Notice of Termination of

Antidumping Duty Administrative

Review.

SUMMARY: In response to a request from

the petitioner, E.I. Du Pont de Nemours

& Company, Inc. (Du Pont), the

Department of Commerce (the

Department) published in the Federal

Register (62 FR 2647, January 17, 1997)

the notice of initiation of administrative

review of the antidumping duty order

on polychloroprene rubber from Japan

with respect to Denki Kagujo K.K.

(Denki), Denki/Hoei Sangyo Co. Ltd.

(Denki/Hoei Sangyo), Mitsui Bussan,

Showa Neoprene K.K. (Showa), Showa/

Hoei Sangyo Co. Ltd. (Showa/Hoei

Sangyo), Suzugo Corporation (Suzugo),

Tosoh (formerly Toyo Soda) Corporation

(Tosoh), and Tosoh/Hoei Sangyo Co.,

Ltd. (Tosoh/Hoei Sangyo), for the period

December 1, 1995, through November

30, 1996. We received a request for

withdrawal of this review from Du Pont

on February 5, 1997. Because this

request was timely submitted and

because no other interested parties

requested a review of these

manufacturers/exporters, we are

terminating this review. Unless

otherwise indicated, all citations to the

statute and to the Department’s

regulations are references to the

provisions as they existed after January

1, 1995.

EFFECTIVE DATE: April 8, 1997.

FOR FURTHER INFORMATION CONTACT:

Justin S. Jee, or Thomas F. Futtner,

Import Administration, International

Trade Administration, U.S. Department

of Commerce, 14th Street and

Constitution Avenue, N.W.,

Washington, D.C. 20230; telephone

(202) 482–2657 or 482–3814.

SUPPLEMENTARY INFORMATION:

Background

On December 6, 1973, the Department

of the Treasury published in the Federal

Register (38 FR 35393) the antidumping

finding on polychloroprene rubber

(rubber) from Japan. On December 3,

1996, the Department published a notice

of ‘‘Opportunity to Request

Administrative Review’’ (61 FR 64050).

On December 26, 1996, the petitioner,

E.I. Du Pont de Nemours & Company,

Inc. (Du Pont), requested that we

conduct an administrative review for

the period December 1, 1995, through

November 30, 1996, covering eight

producers and/or exporters: Denki

Kagujo (Denki), Denki/Hoei Sangyo Co.,

Ltd. (Denki/Hoei Sangyo), Mitsui

Bussan, Showa Neoprene K.K. (Showa),

Showa/Hoei Sangyo Co., Ltd. (Showa/

Hoei Sangyo), Suzugo Corporation

(Suzugo), Tosoh (formerly Toyo Soda)

Corporation (Tosoh), and Tosoh/Hoei

Sangyo Co., Ltd. (Tosoh/Hoei Sangyo).

We published a notice of initiation of

the antidumping administrative review

on these companies on January 17, 1997

(62 FR 2647). On February 5, 1997, we

received a withdrawal of request for

review from Du Pont.

Pursuant to 19 CFR 353.22(a)(5) of the

Department’s regulations, the

Department may allow a party that

requests an administrative review to

withdraw such request not later than 90

days after the date of publication of the

notice of initiation of the administrative

review.

Because Du Pont’s request for

termination was submitted within the

90 day time limit and there were no

requests for review from other interested

parties, we are terminating this review.

This notice is published in

accordance with 19 CFR 353.22(a)(5).

Dated: April 1, 1997.

Jeffrey P. Bialos,

Principal Deputy Assistant Secretary for

Import Administration.

[FR Doc. 97–8957 Filed 4–7–97; 8:45 am]

BILLING CODE 3510–DS–M

DEPARTMENT OF COMMERCE

International Trade Administration

[C–489–502]

Certain Welded Carbon Steel Pipes

and Tubes and Welded Carbon Steel

Line Pipe From Turkey; Preliminary

Results of Countervailing Duty

Administrative Reviews

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

ACTION: Notice of preliminary results of

countervailing duty administrative

reviews.

SUMMARY: The Department of Commerce

(‘‘the Department’’) is conducting

administrative reviews of the

countervailing duty orders on certain

welded carbon steel pipes and tubes and

welded carbon steel line pipe from

Turkey. For information on the net

subsidy for each reviewed company for

each class or kind of merchandise, as

well as for all non-reviewed companies,

see the Preliminary Results of Reviews

section of this notice. If the final results

remain the same as these preliminary

results of administrative reviews, we

will instruct the U.S. Customs Service to

access countervailing duties as detailed

in the Preliminary Results of Reviews

section of this notice. Interested parties

are invited to comment on these

preliminary results. (See Public

Comment section of this notice.)

EFFECTIVE DATE: April 8, 1997.

FOR FURTHER INFORMATION CONTACT:

Stephanie Moore or Cameron Cardozo,

Office of Countervailing Duty/

Antidumping Enforcement VI, Import

Administration, International Trade

Administration, U.S. Department of

Commerce, 14th Street and Constitution

Avenue, NW., Washington, DC 20230;

telephone (202) 482–2849 or (202) 482–

2786.

SUPPLEMENTARY INFORMATION:

Background

On March 7, 1986, the Department

published in the Federal Register (51

FR 7984) the countervailing duty orders

on certain welded carbon steel pipes

and tubes (pipe and tube) and certain

welded carbon steel line pipe (line pipe)

from Turkey. On March 4, 1996, the

Department published a notice of

‘‘Opportunity to Request Administrative

Review’’ (61 FR 8238) of these

countervailing duty orders. We received

timely requests for reviews, and we

initiated the reviews, covering the

period January 1, 1995 through

December 31, 1995, on April 25, 1996

(61 FR 18378).
Federal Register / Vol. 62, No. 67 / Tuesday, April 8, 1997 / Notices 16783

In accordance with 19 CFR 355.22(a),

the review on pipe and tube covers

Erciyas Boru Sanayii ve Ticaret A.S.

(Erbosan), a pipe and tube producer and

exporter, who specifically requested the

review. The review on line pipe covers

Mannesmann-Sumerbank Boru

Endustrisi T.A.S. (Mannesmann), a line

pipe producer and exporter, who

specifically requested the review. These

reviews also cover 28 programs.

On November 6, 1996, we extended

the period for completion of the

preliminary results pursuant to section

751(a)(3) of the Tariff Act of 1930, as

amended. We extended the preliminary

results to no later than March 31, 1997

(see 61 FR 57398). The final results will

be issued no later than 120 days from

the date on which the preliminary

results are published.

Applicable Statute

Unless otherwise indicated, all

citations to the statute are references to

the provisions of the Tariff Act of 1930,

as amended by the Uruguay Round

Agreements Act (‘‘URAA’’) effective

January 1, 1995 (the Act). The

Department is conducting this

administrative review in accordance

with section 751(a) of the Act.

Scope of Reviews

Imports covered by these reviews are

shipments from Turkey of two classes or

kinds of merchandise: (1) Certain

welded carbon steel pipe and tube,

having an outside diameter of 0.375

inch or more, but not over 16 inches, of

any wall thickness. These products,

commonly referred to in the industry as

standard pipe and tube or structural

tubing, are produced to various

American Society for Testing and

Materials (ASTM) specifications, most

notably A–53, A–120, A–135, A–500, or

A–501; and (2) certain welded carbon

steel line pipe with an outside diameter

of 0.375 inch or more, but not over 16

inches, and with a wall thickness of not

less than .065 inch. These products are

produced to various American

Petroleum Institute (API) specifications

for line pipe, most notably API–L or

API–LX. These products are classifiable

under the harmonized Tariff Schedule

of the United States (HTSUS) item

numbers 7306.30.10 and 7306.30.50.

The HTSUS item numbers are provided

for convenience and Customs purposes.

The written description remains

dispositive.

Verification

As provided in section 782(i) of the

Act, we verified information submitted

by the Government of Turkey (GOT),

Erbosan, and Mannesmann, We

followed standard verification

procedures, including meeting with

government and company officials and

examination of relevant accounting and

financial records and other original

source documents. Our verification

results dated March 17 and March 25,

1997, are outlined in the public versions

of the verification reports, which are on

file in the Central Records Unit (CRU)

(Room B–099 of the Main Commerce

Building).

Analysis of Programs

I. Programs Conferring Subsidies

A. Programs Previously Determined To

Confer Subsidies

1. Pre-Shipment Export Credit. The

Export Credit Bank of Turkey (Turk

Eximbank) provides short-term preshipment export loans to exporters

through intermediary commercial

banks. The program is designed to

support export-related industries from

the initial stage of production. Loans are

made to exporters who commit to export

within a specified period of time.

Generally, loans are extended for 120

days for industrial goods and cover 50

to 75 percent of the FOB export value.

During the period of review (POR), both

companies under review were eligible

for pre-shipment export loans

amounting to 50 percent of the FOB

value of exports, for a maximum of 120

days. These loans are denominated in

Turkish Lira (TL) and repaid in TL. The

interest rate charged on these preshipment loans is established by Turk

Eximbank and is tied to the Central

Bank’s rediscount rate.

In the Final Affirmative

Countervailing Duty Determination:

Certain Pasta from Turkey 61 FR 30366

(June 14, 1996) (Pasta), the Department

found this program specific and,

therefore, countervailable because

receipt of the loans is contingent upon

export performance and the interest rate

paid on these loans is less than the

amount the recipient would pay on a

comparable commercial loan. In Pasta,

we found that these loans were tied to

specific destinations; however, in these

reviews, we find these loans to be

untied. Although an exporter files a loan

application in which the export

destination is listed, we verified that the

actual destination of the shipments may

be different from the one(s) stated in the

loan application. The exporter has to

only show that an export has taken

place, and provide the foreign currency

exchange receipts from the commercial

bank to close out the loan with Turk

Eximbank. Because the loans are not

specifically tied to a particular

destination at the time of approval, we

preliminarily determine that the preshipment loan program is an untied

export loan program. For further

discussion, see the GOT and the

company Verification Reports (Public

Versions) dated March 17 and March 25,

1997, which are on file in the CRU.

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

that, in the case of a loan, if there is a

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, then a countervailable

benefit is bestowed. In this case, as the

benchmark interest rates, we are using

company-specific interest rates on

comparable commercial loans to

calculate the benefit for any preshipment loans that were taken out by

Erbosan or Mannesmann in 1994 and

repaid in 1995, and any pre-shipment

loans that were taken out in 1995 and

repaid in 1995. (See company

Verification Reports). Because the

Department considers Turkey to be

hyper-inflationary based on a Consumer

Price Index rate of approximately 67

percent during the POR. (see Pasta at

page 30367; see, also, Preliminary

Results of Antidumping Duty

Administrative Review: Gray Portland

Cement and Clinker from Mexico, 61 FR

51676, 51681 (October 3, 1996)), we also

preliminarily determine that it is

appropriate to use monthly average

short-term interest rates. Where monthly

company-specific interest rates for

Erbosan or Mannesmann are

unavailable, we have used the monthly

average interest rates charged by a

commercial bank in Turkey on domestic

TL loans. See commercial bank

Verification Report (Public Version) on

file in CRU. Using these benchmarks,

we continue to find these pre-shipment

export loans countervailable because the

interest rate charged is less than the rate

for comparable commercial loans that

the company could actually obtain in

the market.

Government Resolution Number: 94/

5782, Article 4, effective June 13, 1994,

allows for the exemption of certain fees

that are normally charged on loans

provided that the loans are used in

financing exportation and other foreign

exchange earning activities. For preshipment loans, which are denominated

in TL, the fees that are exempted are the

Bank and Insurance and Services Tax

(BIST) of 5 percent of the interest rate,

and the Resource Utilization Support

Fund (RUSF) fee of 6 percent of the

interest rate. The Department’s current

practice is normally to compare

effective interest rates rather than

nominal rates. The ‘‘effective’’ interest
16784 Federal Register / Vol. 62, No. 67 / Tuesday, April 8, 1997 / Notices

rates are intended to take account of the

actual cost of the loan, including the

amount of any fees, commissions,

compensating balances, government

charges or penalties paid in addition to

the ‘‘nominal’’ interest rate. Therefore,

we have added the exempted customary

banking fees to the commercial bank’s

benchmark interest rates. See e.g.,

Certain Iron-Metal Castings from India:

Final Results of Countervailing Duty

Administrative Review, 60 FR 44843

(August 29, 1995) (Castings).

To determine the benefit, we

calculated the countervailable subsidy

as the difference between actual interest

paid on pre-shipment loans during the

POR and the interest that would have

been paid using the benchmark interest

rates plus the customary banking fees.

This difference was divided by the

company’s total export sales during the

POR. On this basis, we preliminarily

determine the countervailable subsidy

to be 1.77 percent ad valorem for

Erbosan, the pipe and tube producer,

and 0.73 percent ad valorem for

Mannesmann, the line pipe producer.

B. Other Programs Preliminarily

Determined To Confer Subsidies

1. Investment Allowance. The General

Incentives Program (GIP) is designed to

increase investment in Turkey and to

expand the Turkish economy. Under the

GIP, companies may apply to the

Undersecretariat of Treasury (UT) for

investment incentive certificates. The

investment incentive certificates entitle

the holders to a number of specified

benefits, such as investment allowances,

related to an investment project. The

investment allowance provides

companies with a corporate tax

exemption of between 30 percent and

100 percent of their total fixed

investment depending upon the

geographical location, sector and the

value of the investment. During the

POR, for purposes of GIP, Turkey was

divided into four types of geographic

regions: (1) Developed; (2) normal; (3)

priority two; and (4) priority one.

Companies located in first or second

priority regions for development within

Turkey, which are lesser-developed

regions, are entitled to higher rates of

deduction than companies located in

the developed or normal regions.

Both companies were approved in

1994 for GIP investment certificates.

They claimed an investment allowance

on their corporate income tax returns

filed during the POR. Erbosan, because

it is located in a normal region, is

eligible for an investment allowance of

40 percent, while Mannesmann, because

it is located in a development region, is

only eligible for the minimum

investment allowance of 30 percent,

which is the minimum investment

allowance provided to all companies

under GIP regardless of location or type

of industry. See e.g., Certain Welded

Carbon Steel Pipe and Tube Products

from Turkey; Preliminary Results of

Countervailing Duty Administrative

Review, 52 FR 47621, 47622 (December

15, 1987) and Certain Welded Carbon

Steel Pipe and Tube Products from

Turkey; Final Results of Countervailing

Duty Administrative Review, 53 FR

9791 (March 25, 1988), Because the 30

percent investment tax is not limited to

a specific enterprise or industry or

group thereof, nor limited to companies

located in specific regions, pursuant to

section 771(5A)(D) we preliminarily

determine that the 30 percent minimum

investment allowance under GIP is not

countervailable.

However, because the investment

allowance of 40 percent received by

Erbosan (designated for companies

located in a normal region) is 10 percent

higher than the minimum 30 percent

allowance provided to all sectors and

geographic regions within Turkey, the

difference results in a higher tax savings

to the company due to its geographic

location. Therefore, we preliminarily

determine that the provision of a higher

investment allowance of 40 percent to

certain regions is specific and, therefore,

countervailable within the meaning of

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

also Industrial Phosphoric Acid from

Israel; Preliminary Results of

Countervailing Duty Administrative

Reviews, 61 FR 8255, 8257 (March 4,

1996) and Industrial Phosphoric Acid

from Israel; Final Results of

Countervailing Duty Administrative

Reviews, 61 FR 28841 (June 6, 1996).

We preliminarily determine that the

benefits under the investment allowance

program are ‘‘recurring’’ because once a

company has a fixed asset investment

project approved, it becomes eligible to

deduct an investment allowance from

its corporate income tax returns;

therefore, the receipt of the benefit is

automatic and continues year to year.

To calculate the benefit for Erbosan, we

first multiplied its total fixed

investment by 10 percent, the amount

Erbosan receives about the 30 percent

allowance available throughout the

country. We then computed the

company’s tax rate. The company paid

four separate corporate taxes. These

included a 25 percent corporate tax, an

interim tax in the amount of 10 percent

of the corporate tax, a ‘‘stopaj’’ tax equal

to 10 percent of 75 percent of its net

taxable income and a fund tax equal to

10 percent of the ‘‘stopaj’’ tax. The sum

of these taxes equals a total corporate

tax rate of 35.75 percent. We the

multiplied the countervailable portion

of the investment allowance deduction

by the tax rate of 35.75 percent, and

obtained the tax savings for the

company. Next, we divided the tax

savings by the company’s total sales. On

this basis, we preliminarily determine

the countervailable subsidy to be 0.02

percent ad valorem for Erbosan, for pipe

and tube.

2. Export Incentive Certificate

Customs Duty and Other Tax

Exemptions. Under Turkey’s duty

drawback program, companies are

permitted to import spare parts free of

customs duties and other taxes levied

on imports used in the manufacture of

goods to be exported. To obtain these

benefits, companies must file a project

application with the Undersecretariat

for Foreign Trade (UFT) that describes

the spare parts to be imported and the

FOB value of the exports that they will

be used to produce. The CIF value of the

imported spare parts cannot exceed two

percent of the FOB export commitment.

On July 17, 1995, the program was

changed to permit spare parts to be

imported provided that the CIF value of

the spare parts did not exceed 5 percent

of the FOB export commitment. The

UFT subsequently issues duty drawback

certificates to the companies that

describe the spare parts and instructed

Customs that these items are to be free

of duties. However, the companies must

pay value added tax on the imports.

We preliminarily determine that this

program is a subsidy and is specific

within the meaning of section

771(5A)(B) of the Act, because eligibility

for the program is contingent upon

export performance and the spare parts

imported under this program were

utilized in machinery that produces,

among other things, the subject

merchandise. See e.g., Ball Bearings and

Parts Thereof from Thailand: Final

Results of Countervailing Duty

Administrative Review, 62 FR 728, 731

(January 6, 1997).

To calculate the benefit, we divided

the total amount of duties and taxes

exempted on spare parts imported

during the POR for each company under

review, by the total value of exports

during the POR. On this basis, we

preliminarily determine the benefit from

this program to be 0.06 percent ad

valorem for Erbosan for pipe and tube,

and 0.02 percent ad valorem for

Mannesmann for line pipe.

3. Foreign Exchange Loan Assistance.

The GOT Resolution Number: 94/5782,

Article 4, effective June 13, 1994

concerning the encouragement of

exportation, allows commercial banks to

exempt certain fees provided that the
Federal Register / Vol. 62, No. 67 / Tuesday, April 8, 1997 / Notices 16785

loans are used in the financing of

exportation and other foreign exchange

earning activities. We preliminarily

determine that this program is specific

and, therefore, countervailable within

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

because the exemption of the fees is

contingent upon export performance.

Both companies received and paid

interest on foreign currency loans from

commercial banks and were exempted

from paying the customary BIST of 5

percent of the interest rate and the

RUSF fee of 6 percent of the principal.

Unlike pre-shipment loans that are

denominated in TL where the RUSF fee

is 6 percent of the interest rate, the

RUSF fee for foreign currency loans is

calculated as 6 percent of the principal.

At verification, we found that

Mannesmann’s foreign currency loans

were tied to destinations other than to

the United States. We found that

Erbosan’s foreign currency loans were

provided for both U.S. and non-U.S.

shipments, and were not tied to a

particular destination. For further

discussion, see the companies’

Verification Reports.

We preliminarily determine that these

fee exemptions are a direct transfer of

funds from the GOT providing a benefit

in the amount of the exemption. (See

discussion of the ‘‘Pre-shipment Loans’’

program above). See also, Castings at

44843. We also preliminarily determine

that the benefits are recurring because

once the company obtains a foreign

currency loan it is automatically

exempted from paying the fees. To

calculate the benefit for this program,

we computed the exempted fees on the

interest or principal of Erbosan’s foreign

currency loans. These loans are dollar

denominated. Therefore, we converted

these exempted fee amounts to TL using

the exchange rate in effect during the

month in which the loans were repaid

or interest paid, and divided the result

by the company’s total exports. On this

basis, we preliminarily determine the

net subsidy to be 1.14 percent ad

valorem for Erbosan for pipe and tube.

4. Freight Program. The GOT Decree

number 93/43, effective October 13,

1993, provided freight rebate payments

to exporters in the amount of $50 per

ton for merchandise exported on

Turkish vessels, and $30 per ton for

merchandise exported on non-Turkish

vessels, capped at 10 percent of the FOB

value of the goods. In February 1994,

Decree number 94/4 raised the cap to 15

percent of the FOB value of the goods.

Benefits under this program were

provided in the form of 30 percent cash

and 70 percent treasury bonds with a

two-year maturity. Companies were

eligible to receive interest on bonds on

the one-year anniversary date of the

issuance of the bonds and on the date

of the maturity of the bonds. The

program was terminated on December

31, 1994, and there will be no payments

on shipments made after January 1,

1995.

We preliminarily determine that these

export grants and bonds are

countervailable export subsidies within

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

Act. The grants and bonds are a direct

transfer of funds from the GOT

providing a benefit in the amount of the

cash grants and bonds. We further

preliminarily determine that the

benefits under the Freight Program are

‘‘recurring.’’ Once a company has

exported and submitted documentation

to the Central Bank it becomes eligible

for the cash grants or bonds. The receipt

of benefits is automatic and continued

throughout the life of the program.

(Pasta at page 30369). See also

Allocation Section of the General Issues

Appendix in Final Affirmative

Countervailing Duty Determination:

Certain Steel Products from Austria (58

FR 37217, 37268–69, July 9, 1993)

(‘‘General Issues Appendix’’).

During the POR, Erbosan received

cash and bonds under the freight rebate

program based on exports made in 1994.

The bonds were received by Erbosan on

May 1, 1995 and mature on May 1,

1997; interest was payable on May 1,

1996 and on the date of maturity.

During the POR, Mannesmann received

cash and bonds for exports made in

1994, but we verified that the company

did not receive any payments under the

freight program during the POR for

exports to the United States.

The Department’s practice has been to

deem the benefit to be received at the

time of export countervailable if the

benefit is calculated as a percentage of

the FOB value and the amount of the

benefit is known at the time of export.

See e.g., Castings at 44843. Although the

benefit under the freight program is

calculated based on tonnage and not the

percent of exports, we note that a

benefit determined by the amount of the

tonnage may also be known at the time

of export.

However, the facts in this case

establish that the exporter did not know

the amount of benefit at the time of

export. Although the freight payments

were stated in U.S. dollars per ton, the

exporter received the benefit in TL. The

exporter did not know at the time of

export what exchange rate would be

used to convert the dollar equivalent

payments into TL. Given the high

inflation rate in Turkey (based on a CPI

rate of approximately 65 percent in

1993, and 114 percent in 1994), there

was no way for the exporter to predict

at the time of export what the dollar

equivalent in TL would be. In February

1995, the GOT announced that it would

convert the dollar amount of the freight

payments using the exchange rate that

was in effect on December 31, 1994.

Thus, the exporter did not know the

amount of the benefit at the time of

export. See the GOT Verification Report

(page 12). This position is consistent

with the Department’s analysis of a

similar program in Pasta where we

determined that the benefit should be

treated as having been bestowed when

the cash was received rather than

earned. (See discussion of Payments for

Exports on Turkish Ships program in

Pasta at 30369). As such, we

preliminarily determine that the

benefits under this program are

bestowed when the cash is received

with respect to the cash payments, and

not when the benefit is earned.

With regard to the bonds portion of

the rebate, we preliminarily determine

that the benefits from the bonds are

bestowed on the date of maturity. This

is due to the fact that, even though there

were not restrictions on the sale or

transfer of the bonds, because of the rate

of inflation, there was no secondary

market to allow exporters to convert

their bonds to cash (see GOT, company,

and commercial bank Verification

Reports). Therefore, the exporters have

no choice but to hold the bonds until

maturity. (Pasta at page 30368).

The benefits under the freight

program are made on a shipment-byshipment basis. Because the benefits are

shipment-specific, and we are able to

segregate the shipments according to the

country of destination, we preliminarily

determine that they are tied to a

particular destination. Therefore, where

a benefit is tied or can be tied to exports

to the United States, we calculate the ad

valorem subsidy rate by dividing the

benefit by the firm’s total exports to the

United States. See, e.g., Notice of Final

Results of Countervailing Duty

Administrative Review: Roses and Other

Cut Flowers from Columbia, 52 FR

48847, 48848 (December 28, 1987). We

have preliminarily calculated Erbosan’s

benefit from this program by dividing

the total amount of grants received for

exports to the United States during the

POR by Erbosan’s total exports to the

United States during the POR. On this

basis, we preliminarily determine the

net subsidy to be 1.02 percent ad

valorem for Erbosan for pipe and tube.

5. Resource Utilization Support

Premium. a. Program Description.

Under the Resource Utilization Support

Premium program (RUSP), a company

can request benefits for a proposed
16786 Federal Register / Vol. 62, No. 67 / Tuesday, April 8, 1997 / Notices

investment project, as well as other

General Incentives Program (GIP)

benefits, at the time it submits an

application to the General Directorate of

Incentive and Applications (GDIA) for

an investment incentive certificate (see

discussion of the ‘‘Investment

Allowance’’ program above). If the GDIA

approves the investment project

described in the application, it will

issue to the company an investment

incentive certificate which lists the GIP

benefits bestowed. During the POR,

Erbosan received RUSP payments for an

investment project related to the

production of standard pipe and tube.

RUSP payments were given to

companies to encourage them to use

their own equity, rather than loans or

credit, to finance their GIP investment

project. The amount of the benefit is

applied to that portion of the fixed

investment which is financed by the

investor’s own resources. Erbosan is

located in a region designated as a

normal region by the GDIA. All

companies located in normal regions are

eligible for RUSP payments of 15

percent of their investment. Companies

located in developed regions are not

eligible for RUSP payments.

Mannesmann is located in a developed

region and is not eligible for RUSP

payments, and we also verified that

Mannesmann never received RUSP

payments.

The RUSP was terminated in 1991,

and GIP investment incentive

certificates issued after 1991 were no

longer eligible to receive RUSP

payments. Erbosan’s investment

incentive certificate was issued in 1990

and expired on December 31, 1994.

Erbosan received its RUSP benefits in

1994 in the form of treasury bonds with

a maturity date in 1995. During the

POR, Erbosan received the full amount

of the face value of the bonds, plus

interest.

Because RUSP assistance is provided

by the GOT only to industries located

within specifically designated

geographical regions of Turkey—i.e., in

this case, the normal region—we

preliminarily determine that this

program provides a countervailable

regional subsidy within the meaning of

section 771(5A)(D)(iv).

b. Claim for ‘‘Green Light’’ Subsidy

Treatment of RUSP. Section 771(5B) of

the Act describes subsidies that are noncountervailable (‘‘green light’’

subsidies). Among these green light

subsidies are subsidies to disadvantaged

regions. The GOT requested that the

RUSP program be considered noncountervailable under section

771(5B)(C) of the Act because the

benefit is provided only to

disadvantaged regions.

The RUSP program is one of many

programs that distribute benefits on a

regional basis under the umbrella of the

General Incentives Program (GIP).

Under GIP, provinces were categorized

by the GOT into one of the following

four types of development regions:

developed; normal; priority two; and

priority one according to their level of

development. By offering an increasing

level of benefits to lesser developed

regions, regional assistance programs

under GIP were designed not only to

further development, particularly in the

two priority regions, but also to reduce

the disparities among the four regions.

As stated in the Fifth Five Year

Development Plan (1984–1989), the

GOT’s goal was to ‘‘develop the Priority

Development areas * * * and reduce

and, in time, eradicate, the difference of

development existing between these and

other regions.’’ (See Attachment 1 of

January 21, 1997 GOT response.) The

various economic incentive programs

would complement other development

activities such as housing and

infrastructure projects.

According to the questionnaire

responses, Turkish provinces are

classified into these development

regions based on the results of the

Principal Component Analysis, an

econometric model that generates a

development coefficient based on the

selected socioeconomic development

variables. The State Planning

Organization (SPO) conducts a Principal

Component Analysis for every province

and creates an index that ranks the

provinces from most to least developed

according to the development

coefficients generated by the Principal

Component Analysis.

Section 771(5B)(C) of the Act specifies

the conditions that must be met for a

program to qualify for green light status:

it is part of a general regional

development policy and each region is

a clearly designated contiguous

geographical area with a definable

economic and administrative identity;

the assistance is generally available; the

assistance is not for regions suffering

only temporary disadvantage; the

eligibility criteria are clearly stated in

law or an official document and capable

of verification; and the eligibility

criteria are neutral and objective, and

include a measurement of economic

development. The SAA states that the

green light provision governing

assistance for disadvantaged regions

must be strictly construed and that the

Department must determine that all of

these statutory criteria have been

satisfied. (See Statement of

Administrative Action accompanying

the URAA, reprinted in H.R. Doc. No.

316, 103d Cong., 2d Sess. 919 (1994))

(SAA).

In order to examine the criteria

regarding economic development,

section 771(5B)(C)(ii) of the Act

instructs the Department to examine the

respondent’s measurement of economic

development over a three-year period.

Although it received benefits under this

program during the POR, Erbosan was

approved for receipt of these benefits in

1991. The Department’s standard

practice when analyzing the

countervailability of programs is to

examine data from the time period

when the subsidy was approved. In this

case, the RUSP was in effect from 1989–

1991, and this time period serves as our

three-year period for analysis.

In their January 29, 1997

questionnaire response, the GOT

provided an excerpt from a 1991 SPO

publication which listed the 53

economic and social variables used in

the Principal Component Analysis to

generate the socioeconomic

development index that is the basis for

the SPO’s ranking of the provinces from

most to least developed. The excerpt

also included a list of 67 provinces

ranked by the SPO from most to least

developed. Respondents claimed that

this list, originally published in a 1973

SPO publication, was still valid for the

1989–1991 period.

At verification, we requested to see

documentation, such as the index

generated by the Principal Component

Analysis, the Principal Component

Analysis for that period, or SPO

publications or reports that supported

the ranked list of 67 provinces described

above and the classification of provinces

into the four development regions

during the relevant 1989–1991 period.

Although respondents had supporting

documentation for a 1996 Principal

Component Analysis used to reexamine

the regional designations, no supporting

documentation was available for the

Principal Component Analysis used to

designate provinces into development

regions during the applicable 1989–

1991 period. According to respondents,

the supporting documentation for that

period was no longer available. For

further discussion, see the GOT

Verification Report (pages 10–11).

Using the limited information

provided in the response and at

verification, the team sought to examine

whether the 1989–1991 Principal

Component Analysis rankings (based on

the list from the January 29, 1997

submission) corresponded with the

provinces’ regional designations for

1989–1991. The provinces were rank
Federal Register / Vol. 62, No. 67 / Tuesday, April 8, 1997 / Notices 16787

ordered from first, most developed, to

67th, least developed. Presumably, the

actual designations of the provinces—

developed, normal, first priority, and

second priority—should have closely

followed the Principal Component

Analysis index of economic

development. However, the designation

of provinces into development regions

did not track closely to the Principal

Component Analysis rankings. For

example, Bilecik and Ordu provinces,

respectively ranked at 52 and 58 (out of

a possible 67) were listed as normal

regions, while Zonguldak, ranked at 13,

was listed as Priority One in 1990 and

1991. In addition, four provinces,

Zonguldak, Erzincan, Artvin and

Sanliurfa, were reclassified between

1989 and 1991 without any Principal

Component Analysis being undertaken.

GOT officials accounted for these

discrepancies by explaining that the

Principal Component Analysis is not the

only basis for determining a province’s

regional designation. The Principal

Component Analysis is only one step

(albeit the primary one) toward

determining the regional designations.

The final determination is made by the

Council of Ministers, taking into

account factors that cannot be

enumerated by the Principal Component

Analysis, including the promotion of

other development policies and goals

(e.g., privatization,), the impacts upon,

and relationships with, other regional

and non-regional development policies

and programs, and the Ministers

experience in development issues and

programs. (For a further discussion, see

the GOT Verification Report (page 11).)

In order for a subsidy to be considered

non-countervailable because it is

provided in a disadvantaged region,

section 771(5B)(C)(i)(II) of the Act states

that ‘‘[e]ach region is considered a

disadvantaged region on the basis of

neutral and objective criteria indicating

that the region is disadvantaged * * *.’’

On this basis, the RUSP assistance is not

entitled to green light treatment. The

information on the record indicates that

the designations of disadvantaged

regions do not correspond with an

analysis based on neutral and objective

criteria, purportedly the Principal

Component Analysis. Rather, the GOT

can make the final decisions regarding

the designation of economic

development regions based on criteria

that are neither neutral nor objective.

Since the SAA states that all of the

green light criteria, listed above, must be

met, we do not intend to analyze the

GOT’s compliance with the remaining

criteria. As a result, benefits provided

under the RUSP program do not qualify

as non-countervailable green light

subsidies. See e.g., Preliminary

Affirmative Countervailing Duty

Determination; Certain Pasta from Italy,

60 FR 53739, 53742 (October 17, 1995)

and Final Affirmative Countervailing

Duty Determination: Certain Pasta from

Italy, 61 FR 30288 (June 14, 1996).

c. Subsidy Calculation. Although

Erbosan received the RUSP bonds in

1994, the cash flow was realized in 1995

when the principal and interest from the

bonds were paid. We verified that there

is no secondary market for the resale of

treasury bonds in Turkey and, therefore,

Erbosan could not realize a cash flow

until 1995 (the POR) when the bonds

reached maturity. See Erbosan

Verification Report (page 7). We also

preliminarily determine that the RUSP

benefits are non-recurring because they

are exceptional and the recipient cannot

expect to receive benefits on an ongoing

basis. However, because the amount

received under this program is less than

0.50 percent of Erbosan’s total sales, we

are allocating the total benefit to the

POR. See e.g., Industrial Phosphoric

Acid from Israel; Preliminary Results of

Countervailing Duty Administrative

Review, 61 FR 28845, 28847 (June 6,

1996) and Industrial Phosphoric Acid

from Israel; Final Results of

Countervailing Duty Administrative

Review, 61 FR 53351 (October 11, 1996).

We calculated the benefit for the POR by

dividing the RUSP payments by

Erbosan’s total sales of subject

merchandise during the POR. On this

basis, we preliminarily determine the

benefit from this program to be 0.05

percent ad valorem for the POR.

The GOT terminated the RUSP

program in 1991 and GIP investment

incentive certificates issued after 1991

were no longer eligible to receive RUSP

payments. We verified that Erbosan has

no investment incentive certificates that

were issued before 1991 that are still

valid. Therefore, we consider this

program terminated with no residual

benefits. The termination of RUSP

constitutes a program-wide change; and

because there are no residual benefits,

the cash deposit rate for Erbosan will be

adjusted to zero for this program. See

e.g., Pasta, 61 FR 30370.

II. Programs Preliminarily Determined

To Be Not Used

We examined the following programs

and preliminarily determine that the

producers and/or exporters of the

subject merchandise did not apply for or

receive benefits under these programs

during the period of review:

1. Resource Utilization Support Fund

2. State Aid for Exports Program

3. Advance Refunds of Tax Savings

4. Export Credit Through the Foreign Trade

Corporate Companies Rediscount Credit

Facility (Eximbank)

5. Past Performance Related Foreign

Currency Export Loans (Eximbank)

6. Export Credit Insurance (Eximbank)

7. Subsidized Turkish Lira Credit Facilities

8. Subsidized Credit for Proportion of Fixed

Expenditures

9. Fund Based Credit

10. Regional Subsidies

a. Additional Refunds of VAT (VAT+10%)

b. Postponement of VAT on Imported

Goods

c. Incentive Premium on Domestically

Obtained Goods (Rebate of VAT on

Domestically-Sourced Machinery and

Equipment)

d. Land Allocation (GIP)

e. Taxes, Fees (Duties), Charge Exemption

(GIP)

III. Programs Preliminarily Determined

To Be Terminated

We preliminarily determine that the

following programs have been

terminated and there are no residual

benefits:

1. Export Performance Credits

The Export Performance Credit program,

which was administered by the Central Bank

of Turkey, provided credits to manufacturers

and exporters based on a percentage of the

FOB value of their exports. The certificates

were issued for shipments made between

March 7, 1994 and December 31, 1994. It is

the Department’s practice in the case of an

export benefit provided as a percentage of the

value of the exported merchandise that the

benefit is bestowed on the date of the export.

See e.g., Castings at 44843. Under this

program, the exporters received the TL

equivalent of a fixed percentage of their U.S.

dollar exports. Although at the time of

receipt, the exporters received more TL than

at the time of export, the value of the TL

amount remained the same in U.S. dollar

terms. Therefore, we preliminarily determine

that the benefit occurred at the time of export

in 1994.

2. Deduction from Taxable Income for Export

Revenues

3. Preferential Export Financing Under

Decree 84/8861

4. Interest Spread Return Program (GIP)

5. Export Credits Under Communique No. 1

6. Corporate Tax Deferral

7. Payment of Certain Obligations of Firms

Undertaking Large Investments

8. Subsidized Credit in Foreign Currency

Preliminary Results of Review

In accordance with 19 C.F.R.

355.22(c)(4)(ii), we calculated an

individual subsidy rate for each

producer/exporter subject to each

administrative review. For the period

January 1, 1995 through December 31,

1995, we preliminarily determine the

net subsidy to be as follows:
16788 Federal Register / Vol. 62, No. 67 / Tuesday, April 8, 1997 / Notices

Manufacturer/exporter of line pipe

Assessment rate

(percent)

Mannesmann ................................ 0.75

Manufacturer/exporter of line pipe

and tube

Assessment rate

(percent)

Erbosan ......................................... 4.06

If the final results of these reviews

remain the same as these preliminary

results, the Department intends to

instruct the U.S. Customs Service

(‘‘Customs’’) to assess countervailing

duties as indicated above.

The Department also intends to

instruct Customs to collect cash

deposits of estimated countervailing

duties as indicated below of the f.o.b.

invoice price on all shipments of each

class or kind of merchandise from

reviewed companies, entered, or

withdrawn from warehouse, for

consumption on or after the date of

publication of the final results of these

reviews.

Manufacturer/exporter of line pipe

Cash deposit rate

(percent)

Mannesmann ................................ 0.75

Manufacturer/exporter of pipe and

tube

Cash deposit rate

(percent)

Erbosan ......................................... 4.01

Because the URAA replaced the

general rule in favor of a country-wide

rate with a general rule in favor of

individual rates for investigated and

reviewed companies, the procedures for

establishing countervailing duty rates,

including those for non-reviewed

companies, are now essentially the same

as those in antidumping cases, except as

provided for in section 777A(e)(2)(B) of

the Act. The requested review will

normally cover only those companies

specifically named. See 19 CFR section

355.22(a). Pursuant to 19 CFR 355.22(g),

for all companies for which a review

was not requested, duties must be

assessed at the cash deposit rate, and

cash deposits must continue to be

collected, at the rate previously ordered.

As such, the countervailing duty cash

deposit rate applicable to a company

can no longer change, except pursuant

to a request for a review of that

company. See Federal-Mogul

Corporation and The Torrington

Company v. United States, 822 F.Supp.

782 (CIT 1993) and Floral Trade Council

v. United States, 822 F.Supp. 766 (CIT

1993) (interpreting 19 CFR 353.22(e),

the antidumping regulation on

automatic assessment, which is

identical to 19 CFR section 355.22(g)).

Therefore, the cash deposit rates for all

companies except those covered by

these reviews will be unchanged by the

results of these reviews.

We will instruct Customs to continue

to collect cash deposits for nonreviewed companies under each order at

the most recent company-specific or

country-wide rate applicable to the

company under that order. Accordingly,

the cash deposit rates that will be

applied to non-reviewed companies

covered by these orders are those

established in the most recently

completed administrative proceeding.

See Certain Welded Carbon Steel Pipe

and Tube Products from Turkey; Final

Results of Countervailing Duty

Administrative Review, 53 FR 9791.

These rates shall apply to all nonreviewed companies until a review of a

company assigned these rates is

requested. In addition, for the period

January 1, 1995 through December 31,

1995, the assessment rates applicable to

all non-reviewed companies covered by

these orders are the cash deposit rates

in effect at the time of entry.

Public Comments

Parties to the proceeding may request

disclosure of the calculation

methodology and interested parties may

request a hearing not later than 10 days

after the date of publication of this

notice. Interested parties may submit

written arguments in case briefs on

these preliminary results within 30 days

of the date of publication. Rebuttal

briefs, limited to arguments raised in

case briefs, may be submitted seven

days after the time limit for filing the

case brief. Parties who submit argument

in this proceeding are requested to

submit with the argument (1) a

statement of the issue and (2) a brief

summary of the argument. Any hearing,

if requested, will be held seven days

after the scheduled date for submission

of rebuttal briefs. Copies of case briefs

and rebuttal briefs must be served on

interested parties in accordance with 19

CFR 355.38.

Representatives of parties to the

proceeding may request disclosure of

proprietary information under

administrative protective order no later

than 10 days after the representative’s

client or employer becomes a party to

the proceeding, but in no event later

than the date the case briefs, under 19

CFR 355.38, are due. The Department

will publish the final results of these

administrative reviews, including the

results of its analysis of issues raised in

any case or rebuttal brief or at a hearing.

These administrative reviews and

notice are in accordance with section

751(a)(1) of the Act (19 U.S.C.

1675(a)(1)).

Dated: March 31, 1997.

Robert S. LaRussa,

Acting Assistant Secretary for Import

Administration.

[FR Doc. 97–8955 Filed 4–7–97; 8:45 am]

BILLING CODE 3510–DS–M

DEPARTMENT OF COMMERCE

National Institute of Standards and

Technology

[Docket No. 970326070–7070–01]

RIN 0693–XX31

Notice of Termination of Validation

Services for Federal Information

Processing Standards (FIPS)

AGENCY: National Institute of Standards

and Technology (NIST), Commerce.

ACTION: Notice; termination of

validation services.

SUMMARY: The NIST is terminating

validation services for: FIPS 127–2,

Database Language SQL, and FIPS 128–

2, Computer Graphics Metafile,

Continuous Acquisition and Life-Cycle

Support Profile (CGM (CALS)), and

considering terminating validation

services for FIPS 21–4, COBOL; FIPS

69–1, Fortran; FIPS 128–2, Computer

Graphics Metafile, Air Transport

Association Profile (CGM (ATA)); FIPS

151–2, POSIX; and FIPS 160, C.

Comments are solicited.

NIST announced by Department

Organization Order 30–2B the formation

of the Information Technology

Laboratory (ITL). Under the new ITL

organization, NIST is refocusing its

program for information technology,

concentrating on the development of

conformance tests for emerging

information technologies rather than the

operation of software testing services.

Therefore, the NIST is terminating

validation services for FIPS 127–2, SQL,

and FIPS 128–2, CGM (CALS), effective

July 1, 1997. The NIST is considering

terminating validation services for FIPS

21–4, COBOL; FIPS 69–1, Fortran; FIPS

128–2 CGM (ATA); FIPS 151–2, POSIX;

and FIPS 160, C, effective September 30,

1997. Advance notice of this

termination is given so that interested

parties may establish testing services if

they wish to do so. Federal, state, and

local government agencies requiring

validation of implementations for

conformance to the above standards