UNITED STATES — ANTI-DUMPING DUTY ON DYNAMIC RANDOM ACCESS MEMORY SEMICONDUCTORS (DRAMS) OF ONE MEGABIT OR ABOVE FROM KOREA
Document: Recourse by Korea to Article 21.5 of the DSU
Date: 10 March 2000
Document codes: WT/DS99/7; WT/DS99/R
Complainant: South Korea
Respondent: U.S.
Third parties: EU
Dispute stage: Mutually Agreed Solution
Agreements cited: Art. 2, 3, 5.8, 6, 11, 17, 17.6(i)  Anti-dumpingArt. I, VI, X  GATT 1994

UNITED STATES — ANTI-DUMPING DUTY ON
DYNAMIC RANDOM ACCESS MEMORY SEMICONDUCTORS (DRAMS)
OF ONE MEGABIT OR ABOVE FROM KOREA

Recourse by Korea to Article 21.5 of the DSU

The following communication, dated 9 March 2000, from the Permanent Mission of Korea to
the Chairman of the Dispute Settlement Body, is circulated in accordance with Article 21.5 of the
DSU.

On 19 March 1999 the Dispute Settlement Body adopted the report of the Panel on "United
States - Anti-Dumping Duty on DRAMS From Korea " (). The Panel found that both the
US regulation regarding revocation of anti-dumping orders and the US application of that regulation
in the anti-dumping proceeding on DRAMS from Korea were inconsistent with Article 11 of the Anti-
Dumping Agreement.

On 19 May 1999, pursuant to Article 21.3(b) of the Understanding on Rules and Procedures
Governing the Settlement of Disputes (DSU), Korea and the United States mutually agreed that the
reasonable period of time for the United States to implement the recommendations and rulings of the
DSB and to bring its measures into conformity with the Anti-Dumping Agreement should end on
19 November 1999.

The United States did not comply with the recommendations and rulings of the DSB by that
date. Instead, in 2 September 1999 amendment of its regulation (section 351.222(b) of 19 C.F.R.;
published at 64 FR 51236; Attachment A’), the United States did not adopt a revocation standard
conforming to the Panel’s findings and rulings. In addition, the United States also failed to implement
the Panel’s findings in applying the altered, yet still flawed, standard in the DRAMS proceeding. In
its “Final Results of Redetermination in.the Third Administrative Review,” issued on 4 November
1999, but never published in the Federal Register (Attachment B'), the United States continued to
apply the anti-dumping order on DRAMS from Korea without the necessary demonstration by
substantial, positive evidence that the order needs to be maintained in order to offset dumping.

More specifically, Korea submits that the measures taken by the United are not consistent
with the Anti-Dumping Agreement for the following reasons:

First, instead of adopting a standard conforming to the Panel’s findings and rulings, the
United States adopted a very general standard that could be, and in fact was, misapplied. The
amended regulation does not impose on the United States the burden to establish that continued
imposition of the anti-dumping duty is necessary. While not using the words “burden of proof,” the

' Attachments A and B in English only.

Panel Report, in requiring a “demonstrable basis on which to reliably conclude that the continued
imposition of the duty is necessary” (Panel Report at para. 6.50), clearly imposes the burden on the
US administering authority. Rather than limiting the administering authority’s discretion so as to
conform US law to Article 11 of the Anti-Dumping Agreement, the amended regulation increases its
discretion, in disregard of the Panel decision. In doing so, the United States perpetuated the WTO
inconsistency of the original standard that the Panel had declared inconsistent with Article 11 of the
Anti-Dumping Agreement. Also, the “standard” of the amended regulation that replaces the not likely
criteria — “otherwise necessary to offset dumping” (/d.) — effectively is not a standard at all. This is
inconsistent with the Panel Report, which requires the regulation to provide “a demonstrable basis for
consistently and reliably determining” that maintaining the anti-dumping duty remains necessary to
offset injurious dumping (Panel Report at paras. 6.47 and 6.50). Moreover, the amended regulation
ignores the Panel’s direction that the standard adopted ensure that the conclusions reached are based
on “a foundation of positive evidence” and that circumstances demand maintaining the duty.

Second, in applying the altered, yet-still-flawed, standard for revocation, the United States
continues to apply the antidumping order to Korean DRAMS without demonstrating by substantial,
positive evidence that the anti-dumping duty order needs to be maintained in order to offset dumping,
as required by the Panel. The US Department of Commerce failed to conduct any new analysis in its
redetermination. The unpublished Final Results simply restate the analysis in the Department’s
earlier determination not to revoke the anti-dumping duty order. Indeed, the Results repeat verbatim
much of the text of the original determination. Moreover, the Results are not based on “substantial,
positive evidence” that the order is necessary to offset dumping (see Attachment B at page 13). Like
the original results of the third administrative review, they are based merely on conjecture and
supposition.

Third, by failing to publish the Final Results of Redetermination in the Federal Register,
Korea believes the United States has failed to fulfill its obligations under Article X:1 of the GATT
1994 and Article 12.3 of the Anti-Dumping Agreement. |

As a result of the standard contained in amended regulation section 351.222(b) and the
actions taken by the United States in the “Final Results of Redetermination in the Third
Administrative Review,” there is a disagreement between the United States and Korea as to whether
the United States has taken measures to comply with the 19 March 1999 recommendations and rulings
of the DSB and whether the measures taken are consistent with the Anti-Dumping Agreement.

In view of the above, Korea hereby requests that this matter be referred to the original Panel
pursuant to Article 21.5 of the DSU. Korea further requests that the Panel find that the United States
has not taken measures to comply with the 19 March 1999 recommendations and rulings of the DSB.
Korea requests that the Panel have the standard terms of reference as set out in Article 7 of the DSU.

1 Attachments A and B in English only.

ATTACHMENT A

31236 Federal Register/Vol. 64, No. 183/Wednesday, September 22, 1999/Rules and Regulations

prohibited off-the-record
communication,

(2) Ifa person knowingly makes er
causes to be made a prohibited off-the-
record communication, the Commission
may disqualtfy and deny the person,
cemporarily or permanently, the
priviiege of practicing or appearing
before it, in accordance with Rule 2102
(Suspension).

{3) Commission employees who are
found to have knowingly violated this
rule may be subject to the disciplinary
actions prescribed by the agency's
administrative directives,

(j) Section not exclusive. (1) The
Commission may, by rule or order,
modify any provision of this section as
it applies to all or part of a proceeding,
to the extent permitted by law,

(2) The provisions of this section are
not intended to Himit the authority of a
decisional employee to decline to
engage in permitted off-the-record
communications, or where not required
by any law, statute or regulation, to
make a public disclosure of any
exempted off-the-record
communication.

6. The heading of § 385.2202 js
cevised to read as follows;

§ 385.2202 Separation of Functions (Rule
2202),

Note: This Appendix will not appear In the
Code of Federal Regulatians

Appendix A~Lisct of Commenters

Adicandack Mountain Club

Advisory Council on Historie Preservation
(ACHP)

American Gas Assaclation (AGA}

AWR Plpeline Company/Colorado Interstate
Gas Company (ANR/CIG) ,

Bonneville Power Administradon (BPA)

California Electric Oversight Board (Cal
Board)

Chevron Pipe Line Company (Chevron)

Edison Elecwric Institutes (EE])

Elecwrie Power Supply Association (EPSA)

Envirantnental Protection Agency (EPA)

Executive Office of the Presiden’/Council on
Environmental Quality (CEQ)

Hydropower Reform Coalltton (HRC)

Indicated Shippers

Interstace Natura! Gus Association of America
GNGAA)

Louisiana Department of Wildilfe And
Fisheciss (La WEF)

National Association of Regulatory Udlity
Commissioners (NARUC)

National Marine Fisheries Services (NMFS)

National Hydropower Associadon (NHIA)

National Rural Electric. Cooperutive
Assoclation/American

Public Power Supply Association Qoint
Commenters}

Natural Gas Supply Association (NGSA)

Public Service Commission of New York
(PSCNY)

Public Utilities Commission of State of
Californla (PUCCAL)

Public Utilities Cominission of Stace of
Callfornia/Independent (Cal-1SO) System
Operator

Process Gas Consumers Group (Process Gas)

Sacramento Municipal Unites District
(SMUD)

Sermpra Enargy Companies (Sempra)

Southem California Edison Company
(SoCalEd)

Southern Compantes Services, Inc. (SCS])

Southern Natural Gas Company (SeNat)

Unitad States Department of the Jaterior
(Interior)

Williams Companies (Williains)

Williston Basin [nterscate Pipeline Company
(Williston)

Wisconsin Public Power, Inc, (WPPI)

{FR Doc, 99-24616 Filed 3-21-99; 8:45 am]
BILLING CODE é717-01-P

DEPARTMENT OF COMMERCE
Intemational Trade Administration

19 CFR Part 351
(Docket No. $90521 142-9252-02)
RIN 0625-AA54

Amanded Regulation Concerning the
Ravacation af Antidumping and
Countervailing Duty Orders

AGENCY: Import Administration,
International Trade Administration,
Commerce,

ACTION: Final rule.

SUMMARY: The Department of Commerce
(the “Department” or ''DOC"} is
amending its regulation, which governs
the revocadion of antidumping and
countervalling duty orders, in whole or
in pact, and the termination of
suspended antidumping and
countervailing duty Investigations,
based upon an absence of dumping or
subsidization, respectively, The
amended regulation conforms the
existing regulation to the United States’
obligations under Article 11 of the
Agreement on the Implementation of
Article VI of the General Agreement on
Tariffs and Trade 1994 (“Antidumping
Agreement’) and Article 21 of the
Agreement on Subsidies and
Countervailing Measures (“SCM
Agreement"). The amended paragraph
relating to revocation or termination
based on absence of dumping provides
that the Secretary, upon considering
whether producers or exporters have
sold subject merchandise at not less
than normal value for at least three
consecutive years, and whether the
continued application of the
antidumping duty order is otherwise
necessary to offset dumping. WLi revoke
an antidumping duty order If warranted,
The amended paragraph relating to

revocetion cr termination based on
absence of countervailable subsidy
provides that the Secretary, upon
considering whether the government of
the affecced country has eliminated all
countervailable subsidy programs
covering the subject merchand}se far at
least three consecutive years, or
exporters cr producers have nat applied
for of received countervailable subsidies
for at least five consecutive years, and
whethe: the continued application of
the countervailing duty order is
otherwise necessary to offset
Subsidization, will revoke a
countervailing duty order if warranted.
EFFECTIVE DATE: November 1, 1999.

FOR FURTHER INFORMATION CONTACT:
Melissa G. Skinner, Office of Policy,
Impor: Administration, U.S, Department
of Commerce, at (202) 482-1560, or
Myles S. Gedlan, Office of the Chief
Counse! for Import Administration, U.S.
Department of Commerce, at (202) 482~
5052.

SUPPLEMENTARY INFORMATION:

Background

On June 3, 1999, the Department
published a Notice of Proposed
Rulemaking which proposed ta amend
19 CFR 351.222(b}.! See 64 FR 29818
(the ‘Proposed Rule’’). The Deparrment
explzeined that the process of amending
this regulation arose from the findings
of a cispute settlement panel convened
under the auspices of the World Trade
Organization ("WTO") that considered
various aspects of the Department's Final
results of administrative review in
Dynamic Random Access Memory
Semiconductors (DRAMS) Of One
Megabit Or Above From Korea (62 FR
39869, July 24, 1997) ("DRAMs From
Korea”).

On January 29, 1999, the Panel
determined that the Department’s
standard for revoking an antidumping
duty order contained in ]9 CFR
353.25(a)(2} (the precursor to 19 CFR
351.222(b)) was Inconsistent with the
United States’ obligations under Article
11.2 cf the WTO Antidumping
Agreement. See United States—Anti-
Dumping Duty on Dynamic Random
Access Memory Semiconductors
(DRAMS) of One Megabit or Above
From Korea, WT/DS99/R (‘'Panel
Repor:'): Specifically, the Panel
determined that requiring the Secretary

' This amendment docs pot affect the
Deparnnent’s regulations at 19 CFR $5),2]8, which
im picmocus {Nc statutory provision at 19 U.S.C,
1675ic) and goweens the Deparument’s flur-ycar
aunsct covtews, Je which the Department
determines whether revocation of wn order “would
be Jksty to lead to continuaUon or recurrence of
dumping o: 3 countervajisble subsidy (as the case
may bx) and of matctlal injury.”

Federal Register/Vol. 64, No. 183/Wednesday, September 22, 1999/Rules and Regulations

51237

a

to conclude that “ic is not likely” that
the persons requesting revocation will
dump merchandise subject to an
antidumping ducy order in the future
did not implement properly Article 11.2
of the Antidumping Agreement. This
provision requires an administering
authority to consider whether “the
continued imposition of [an
antidumping} duty is necessary to offset
dumping” in determining whether to
revoke an antidumping duty order.
Thus, the Pane! recommended that the
United States “bring section
353.25(a) (2) (ii) af the DOC regulations

* * * into conformity with its
obligations under Article 11.2 of the AD
Agreement.” The Dispute Settlement
Body (“DSB”) adopted the Panel Report
on March 19, 1999. On April 15, 1999,
the United States announced its
intention to implement tne
recommendations and rulings of the
DSB. Consistent with section 123(g) of
the Uruguay Round Agreements Act
(“URAA"). which governs the
Department's implementation of adverse
panel reports, the Departrnent is
revising 19 CFR 351.222(b) and (c).

Explanation of the Fina] Rule

The proposed amendment to the
Department's revocation regulation
concerned only antidumping
proceedings, as the Department focused
upon implementing the specific
findings contained in the Panel Report.
Consequently, at that time, the
Department did not prapose amending
the companion revocation provision
applicable to countervailing duty
proceedings, However, we helieve that a
decision not to amend the
countervsiling duty provision would
render the revocation standards in
antidumping and countervailing duty
cases Inconsistent with each other, The
“not likely” standard in 19 CFR
351.222{b), which governs the
revocation of antidumping duty orders,
is Identical to the standard in 19 CFR
351.222(c), which governs revocation in
countervailing duty cases, In addition,
the “necessary” standard in Article 11
of the Antidumping Agreement, to
which we have conformed the
antidumping regulation, is identical to
the standard in Article 21 of the SCM
Agreement which regulates the duration
of countervailing duties. Since the
revocation standards Ln the two WTO
agreements are jdentical, and since at
least one party commented on this issue
during the public comment period, we
conclude that the public was on notice
chat the countervailing duty regulation
could similarly be revised, Therefore,
we are making conforming amendments
to Che countervailing duty provision as

well in order to maintain consistency
between the Department's procedures
governing revocation in both
antidumping and countervailing duty
cases and the standards in both the
Antidumping Agreement and SCM
Agreement.

In addition, in response to comments,
the final rule incorporates several
changes to the Proposed Rule. First, the
language which read “(t]he Secretary
may revoke an antidumping order
* * *" has been altered to read “[thhe
Secretary will revoke the antidumping
duty order.”’ Second, the inal rule neo
longer states that the Secretary will
consider whether the continued
application of the order is “na longer
necessary to offset dumping.” Instead,
the final rule provides that, inter alia,
the Secretary will consider ‘whether the
continued application of the
antidumping duty order Is otherwise
necessary to offset dumping,” These
changes are discussed in more detail
below.

We received comments concerning
the Proposed Rule from various patties,
One commenter believes that the
proposed revision ta the Department's
regulation, which incorporates the
standard set forth in Article 11.2 of the
WTO Antidumping Agreement,
responds appropriately to the concerns
articulated by the WTO panel decision
and represents a fair implementation of
the panel's recommendation. Moreover,
this commenter States that the proposed
revision should not negatively affect the
protection afforded U.S. industries
against unfairly traded imports.

Several commenters insist that the
revised “necessity” standard is
“effectively not a standard at all.” In
this respect, these commenters note the
Panel's finding that there must be a
demonstrable basis for consistently and
rellably determining that the
maintenance of an order is necessary to
offset injurious dumpling, These
commenters contend that the Propesed
Rule contains no guidelines or
definitions of the “evidence” that would
be relevant to the cantinued necessily of
an order. Consequently, these
commenters argue that the Propased
Rule will not improve the
demonstrability, consistency, and
reliabllity of revocation decisions or
ensure that decisions to maintain
antidumping or countervailing duty
orders are based upon positive evidence
demonstrating the continued need for
the order. One commenter suggests that
uSing a “likely to recur’ standard
“would have been the most logical, :
direct means to meet the WIO
requirement that a positive finding is

necessary to support continuation of an
fanddumping duty] order.”

However, another commenter noted
that the amended regulation establishes
a ‘necessity’ standard which reflects
the same standard established in the
Antidumping Agreement. Thus, this
commenter believes the revised
standard dees in fact provide the
“demonstrable basis upon which to
reliably conclude that the continued
imposition of the duty is necessary to
offset dumping.”

We disagree with those commenters
who State that the revised “necessity”
standard is “effectively nota standard at
all.” Article 11,2 of the Antidumping
Agreement allows interested parties ta
request authorities to examine whether
the continued Imposition of the duty is
“necessary” to offset dumping. To say
that the “necessity” standard contained
in the Department's revised regulation is
effectively no standard at all is to say
that Article 11.2 contains no standard.
This is illogical given that this process
of revising the revocation regulation
stems fram a panel finding that the
Department's existing regulation did not
properly implement the “necessary”
standard contained in Article 11.2. On
the other hand, we agree that each
determination made pursuant to this
new regulation will need to be
supported by positive evidence,
Moreover, we are confident that the
revised standard, along with our
established practice of considering
evidence relating to the likelihood of
future dumping, will provide for
consistent and reliable decisions
regarding revocation.

One commenter urges the Department
to discentinue Its practice of applying a
presumption in favor of revocation in
the absence of dumping for three
consecutive years, As support, this
commenter refers to the Court of
International Trade’s ("“CIT’’}
characterization of the Department's
regulation as a three-part test for
revocation and states that the “not
likely” (or the revised necessary”)
prong censtitutes an independent
criterion that must be established to
attain revocation. See Hyundai
Electronics Co., Ltd. v. United States,
Slip, Op, 99-44 (Cr, Int'l Trade, May 19.
19$9). ‘nis commenter believes thac the
presumztion nullifies the satisfaction of
the second (‘necessary’) prong.

In this regard, nwa commenters assert
that a presumption favoring revocation
unfairly and improperly shifts the
burden te petitioners to come forward
with affirmative evidence, Since
respondents are in possession of
information relevant to revocation, as
argued by these commenters, the burden

31238 Federal Register/Vol. 64, No. 183/Wednesday, September 22, 1999/Rules and Regulations
a anne afer a et Afi ances ener nem ahdamae mamma ememmmn ananassae eee a

of producing such evidence should rest
with the respondents. One commenter
racuested that the Department include
in its iniclal questionnaire a solicitation
of dara and other information from the
respondent seexing revocation on why
the antidumping duty order in the
responcent’s opinion jis no longer
needed to offset dumping. While this
commenter conceded that this
procedural element could be
implemented without regulatory
modification, the commenter contended
that there was no reason that such a
provision could not be incorporated In
the regulations.

By contrast, several commenters
stated that the revised regulation
continues to place a burden on
respondents to prove eligibility for
revocation, rather than placing the
burden on the Department to find
positive evidence establishing that the
maintenance of the order is necessary...
These commenters contend that placing
the burden on the Deparement
necessitates a reformulation of the
regulation, such that the revised
regulation should not treat maintaining
the order as the norm, Thus, these
commenters Suggested that the new
regulation require the Secretary to
revoke if the respondent has not
dumped for three consecutive years and
has furnished the required
reinstatement agreement, “unless the
Secratary reliably demonstrates on the
basis of a foundation of positive
evidence that the continued application
of the antidumping duty order as to the
experter or producer is necessary to
offset dumping.”

However, one commenter welcomed
the Deparument’'s confirmation that the
regulation reflects a rebuttable
presumption that favors revoking an
order when there is an absence of
dumping far three or more years. In this
regard, this commenter states that the
iniuial burden should clearly rest on the
petitioners, as the beneficiaries of rhe
continuation of the order, to provide
evidence that the order is still
necessary. Thus, this commenter states
thac che Department should not request
information from a respondent until
petitioners make allegations supported!
by tangible evidence that the order is
still necessary.

As discussed in the Proposed Rule, in
Situations where there js an absence of
dumping (or subsidization) for three (or
five) cansecutive years, the Department
intends to presume that an order is not
necessary in the absence of additional
evidence, We believe that sucha
presumption is consistent with prior.
Department practice as well as U.S.
obligations under Article 11.2 of the

Antidumping Agreernent and Article
21.2 of the SCM Agreement. As the
Panel recognized, a decision to maintain
an order must be substantialed by
positive evidence. [If the only evidence
on cecerd is a respondent's ability to sell
subject merchandise at nat less than
norma} value for three consecutive
years, the record would not support a
decision to malntain the order in light
of the requirement in Article 11.2, as
interpreted by the Panel, that there be
positive evidence reflecting the
continued necessity of the order.

We decline at this time to adopt the
commenter's suggestion that we solicit
information fram respondents at the
outset of an administrative review. The
absence of dumping for three
consecutive years,? while satisfying the
first prong of the regulatory standard, is
also sufficient evidence relevant to the
continued necessity of the order to shift
the burden of production to the
petitioners. However, if a party raises an
issue relating to the necessity of an
order, the Departrnent may seek
additional information relevant to that
issue, Nonetheless, since the manner in
which we collect evidence is not
necessarily a cegulatory matter, we may
revisit this issue at a later time in the
development of aur practice in applying
the revised regulation,

We disagree with those commenters
who suggest that the revised regulation
continues to place a burden on
respondents, rather than the
Department, to prove eligibility for
revocation. The threshold requirement
for revocation continues to be that
respondents not sell at less than normal
value for at least three consecutive years
and that, during each of those years,
respondents exported subject
merchandise to the United States in
commercial quantities. See 19 CFR
351.222(d)(1). The Panel did not disturb
this aspect of the Department's
revocation practice, Moreover, we re-
emphasize our staternent in the
Prapased Rule that ‘the absence of
dumping for three consecutive years
served as a presumption in Favor of
revoking the order, which could be
rebutted by positive evidence indicating
that dumping may recur if the order
were revoked."' Thus, we disagree that
an impermissible burden is placed on
respondents. Instead, a thorough
analysis of all relevant information
requires a system in which there is a
shifting burden of production such that
the parties in the best pasilion to

2 In accordance with 19 CFR 34).222(¢} (i), ta be
considered for revocation, the producers and
exporters must have sold the subject merchandise
in commercial quantides tn cach of che Gece years.

provide relevant information are
compelled to do so. All partles may be
in a position to provide information
concerning trends in prices and costs,
curtency movements, and other market
and economic factors that may be
relevant to the likelihcod of future
dumping. if no party provides
information addressing these issues, we
rest with the presumption that an order
is not necessary in the absence of
dumping. If the petitioner comes
forward with information demonstrating
that the maintenance of the order is
necessary, that initial presumption js
rebutted, and the burden of production
shifts to respondents, While the burden
of praducing evidence shifts among the
parties, we emphasize that the
Department does not impose a burden of
proof on any party. The Department
rust weigh all of the evidence on the
record and determine whether the
continued application of the order is
necessary to offset dumping (or
subsidization). Each revocation
determination must be based upon
substantial, positive evidence and be
otherwise in accordance with law.

One commenter stated that, unlike the
“not likely” standard, necessity” is a
minimum standard that has no shades
or degrees within it. Stated differently,
something that is nat “no longer
necessary” is necessary.

However, another commenter claimed
that the Department's revised standard
retains the negative and passive
elernents which rendered the prior
regulatory standard inconsistent with
the Antidumping Agreement This
commenter noted the Panel's distinction
between failing to establish something
as a negative finding and establishing
something as a positive finding in the
context of the ‘‘not likely” criterion and
concluded that this same principle
applies to the praposed regulation.

We have formulated the final rule in
away that clarifies that thé Secretary
must make an affirmative finding of
necessity in arder to retain an
antidumping or countervailing duty
order. While this refermutation does not
affect tha precess by which the
Department considers revocation, the
reformulated regulaticn more clasely
tracks the wording of Article 11.2 of the
Antidumping Agreement and Article
21.2 of the SCM Agreement.

Several commenters argue that the
continued use of the discretionary term
“may” in the Proposed Rule conflicts
with the mandatory term “shall”
contained in Article 11.2 of che
Antidumping Agreement. These
commenters suggest that the Pane!
rejected the existing regulation, in part,
because the regulation allows the

Federal Register/Vol. 64, No. 183/Wednesday, September 22, 1999/Rules and Regulations

51239

Department to maintain an order where
Ardcle 11.2 of the Antidumping
Agreement requires revocation. Thus,
these commenters believe that the
Proposed Rule, which contains the
permissive “may"' and not the
mandatory ‘‘shall” or “must,” Is
inconsistent with the Panel's findings.

In the final rule, we have substituted
the term “will” for “may."” We do not
agree that the use of the term “may”
imbued the Department with unbridled
discretion In making revocation
determinations, as argued by these
commenters. The Department's
determinations are constrained by
general legal principles. Every decision
must be based upon substantial
evidence and otherwise in accordance
with law. In addition, each decision
must be consistent with prior practice
unless we reasonably explain the
departure from prior practice. However,
by adopting the “necessary” standard
contained in the Antidumping and SCM
Apreements, we are persuaded that it js
more appropriate to use the term “will”
instead of the term ‘‘may"' In the
amended regulation. The necessary”
standard represents the full spectrum of
circumstances under which the
Department could maintain an order
and be consistent with the United
States’ WTO obligations under Article
11.2 of the Antidumping Agreement and
Article 21.2 of che SCM Agreement. In
other words, considering the
comprehensive nature of the new
standard, the Secretary can only retain
an antidumping or countervailing duty
order if tnere is positive evidence on the
cecord indicating the continued
necessity of such order to offset
dumping or subsidization. Thus, tn
accordance with Article 11.2 of the
Antidumping Agreement and Article
21.2 of the SCM Agreement, we are
substituting the term “will” for “may”
in the amended regulation.

Several commenters took issue with
the Department's claim in the Proposed
Rule that the ''Panal’s ruling was not
based upon the Department's
application of tha standard in DRAMs
from Korea.’ These commenters note
chat the Panel specifically found that the
cepulation and the third review fina!
results in DRAMs were inconsistent
with Article 11.2 of tne Antidumping
Agreement

Vhile we accept that, based upon the
inconsistency of the revecation
regulation applied in DRAMs from
Korva with the Antidumping
Agreement, the Panel invalidated the
third review final results, we maintain
that several aspects of our practice were
not invalidated by the Panel and, thus,
do not require revision. As discussed

above and in the preamble to the
Proposed Rule, wa continue to belleve
that, while an absence of dumping for
three years is evidence that the
antidumping duty order Js no longer
necessary, il is not conclusive in all
cases, Evidence relating to the
likelihood of future dumping will stilt
be considered under the revised
regulation because such evidence relates
to the necessity of the order. Thus,
while the Panel decision necessitated
revising the standard by which the
Department considers revocation, it did
not necessitate changes to these specific
aspects of our practice,

One commenter, citing Hyundai
Eleconics, in which the CIT affirmed
the Departrnent's final results of
administrative review in DRAMs from
Korea, argued that it is unnecessary to
amend the regulation because the CIT
determined that the "not likely”
standard Js consistent with U.S.
international obligations and with U.S.

-obligations under Article 11.2 of the

Antidumping Agreement.

The CIT decision in Hyundai does not
preclude amending the regulation in
question. While the Court stated that the
Panel Report was nat binding
precedential authority on the Court, it
recognized that "Congress provided that
the response to an adverse WTO panel
repart Is the province of the executive
branch and, more particularly, the
Office of the U.S. Trade
Representative."” The United States
Trade Representative and the DOC have
decided to respond to the Panel Report
by amending the regulation in question,
and we are confident that the amended
regulation, if challenged, will be found
to be consistent with the statute as well
as U.S. obligations under the WTO
Antidumpling Agreement.

Another commenter expressed
concern with the Department's practice
of relating an absence of dumpling to
declining imports following the
impositlon of an order. Thls commenter
asserts that numerous factors, including
changes In the strengths of alternative
markets, exchange rates, changes in
production capacity, changes in
marketing strategies, and changes in the
technology of production, may
contribute to the decline in imports
rather than the exporter’s inability to
sellin the U.S. market without
dumping.

This matter is appropriate for
consideration on a case-by-case basis,
rather than in a rulemaking proceeding
because, as the commenter suggests,
numerous factors underlying an absence
af dumping may be cansidered when
evidence relating ta those faccors is

develered on the record of each
proceeding,

Classification
Pxecutive Order 12856

This rule has been determined to be
not significant under Executive Order
12866.

Paperwork Reduction Act

This ruts contains ne new collection
of information subject to the Paperwork
Reduction Act, 44 U.S.C, Chapter 35.

Executive Order 12612

This rule does not contain federalism
implications warranting the preparation
of a Federallsm Assessment

Regulatery Flexibiltty Act

In issuing the proposed regulation,
the Chief Counsel for Regulation of the
Department of Commerce certlfled to
the Chief Counsel for Advocacy of the
Sma}l Business Administration that this
rule would not have a significant
economic Impact on a substantial
number ¢f sma} entities. The
Department's existing regulations
provide 2 procedural and substanave
process by which the Secretary
considers whether to revoke an
antidump!ng duty order. The rule
retains the current procedural process
and revises the substantive standard
used by the Secretary to make the
appropriate revocation determination.
As discussed above, the regulation
would net significantly change the
Department's practice in determining
whether; to maintaln an antidumping
duty crcer. Moreover, as the revised
regulation only changes the standard by
which the Department considers
whether to revoke an antidumping duty
order, this action, in and of itself, will
not have a significant economic impact.
Therefoce, the Chief Counsel conciuded
that the rule would not have a
significant impact on a substantial
number: cf small business entities, and
a regulatery flexibility analysis was not
prepared. We received no comments
concerning this conclusion.

List of Subjects in 19 CFR Part 351

Administrative practice and
procedure, Antidumping duties,
Business and industry, Cheese,
Confidential business information,
Countervailing duties, Investigations,
Reporting and recordkeeping
requirements.

51240 Federal Register/Vol. 64, No. 183/Wednesday, September 22, 1999/Rules and Regulations

Dated: September 16, 1999.
Richard W. Moreland,
Acting Assistant Secretary for Import
Administration.

For the reasons stated, 19 CFR part
35] is arnended to read as follows:

PART 351—ANTIDUMPING AND
COUNTERVAILING DUTIES

1. The authority eltation far part 351
continues to read as follows:

Authority: 5 U.S.C. 301, 19 U.S.C, 1202
note: 19 U.S.C. 1303 note: 19 U.S.C. 1671 et
segiand 19 U S.C, 3538.

Subpart B—Antidumping and
Countervailing Duty Procedures

2, Section 351.222 is amended by
revising paragraphs (b) and (c) to read
as follows:

§ 351.222 Revocatlon of ordars;
termination of suspended Investigations.
x * ° + a

(b) Revocation or termination based
on absence of dumping. (1){1) In
determining whether to revoke an
antidumping duty order or terminate a
suspended antidumping investigation,
thy Secretary will consider: °

(A) Whether all exporters and
producers covered at the time of
revocation by the order or the
suspension agreement have sald the
subject merchandise at not less than
norma) value for a period of at least
three consecutive years; and

(B) Whether the continued
application of the antidumping duty
order is otherwise necessary lo offset
dumping.

(ii) Lf the Secretary determines, based
upon the criteria in parageapns
(b)(1}(i) (A) and (B) of this section, that
the antidumping duty order or
suspension of the antidumping duty
investigation is no longer warranted, the
Secretary will revoke the order or
terminate the investigation.

(2) (i) In determining whether to
revoke an antidumping duty order in
part, the Secretary will consider:

(A) Whether one or more exporters or
producers covered by the order have
sold the merchandise at not Jess than
normal value for a period of at least
three consecutive years;

(B) Whether, for any exporter or
producer that the Secretary previously
has determined to have sold the subject
merchandise at less than normal value,
the exporter or producer agrees in
Writing to its immediate reinstatement
in the ardes, as long as any exporter or
producer is subject to the order, if the
Secretary concludes that the exporter or
producer, subsequent to the revocation,

sold tha subject merchandise at less
than normal value; and

(C) Whether the continued
application of the antidumplng duty
order is otherwise necessary to offset
dumping.

(ii) If the Secretary determines, based
upon the criteria in paragraphs
(b) (2)(i) (A} through (C) of this section,
that the antidumping duty order as to
those producers or exporters is no
longer warranted, the Secretary will
revoke the order as to those producers
or exporters.

(3) Revocation of nonproducing
exporter. In the case of an exporter that
is not the producer of subject
merchandise, the Secretary normally
will revoke an order in part under
paragraph (b)(2) of this section only
with respect to subject merchandise
produced or supplied by those
companies that supplied the exporter
during the time period that formed the
basis for the revocation.

(c) Revocation or termination based
on absence of countervallable subsidy.
(1) (i) In determining whether to revoke
a countervailing duty order or terminate
a suspended countervailing duty
investigation, the Secretary wlll
consider:

(A) Whether the government of the
affected country has eliminated all
countervallable subsidies on the subject
merchandise by abolishing for the
subject merchandise, for a period of at
least three consecutive years, all
programs that the Secretary hes found
countervailable:

(BE) Whether exporters and producers
of the subject mecchandlse are
continuing to recelve any net
countervallable subsidy from an
abolished program referred to in
paragcaph (c}{1){i)(A} of this section;
and

(C) Whether the conunued
2oplication of the countervailing duty
order or suspension of countervailing
duty investigation 1s otherwise
necessary to offset subsidization,

(il) lf che Secretary determines, based
upon the criterla in paragraphs
(c)(1)(){A) through (C) of this section,
that the countervalling duty order or
suspension of the countervailing duty
investlgauion is no longer warranted, the
Secretary will revoke the order or
terminate the suspended investigation,

(2) (i) [In determining whether to
revoke a countervailing duty order or
terminate a suspended countervalling
duty investigatlon, the Secretary will
consider:

(A) Whether all exporters and
producers covered al the time of
revocation by the order or the
suspenslon agreement have nat applied

for or received any net countervailable
subsidy or the subject merchandise for
a pericd cf atleast five consecutive
years; and

(B) Whether tie continued
application of the countervailing duty
order cr suzpension of the
countervailing duty investigation is
othenvise nacessary to offsat
subsidization.

(ii) lf che Secretary determines, based
upon the erlteria in paragraohs
(c)(2)( (A) end (8) of this section, thac
the countervailing duty order or the
suspensic7 of the countervailing duty
investigaticn is no longer warranted, the
Secretary will revoke the order or
terminate the suspended investigation.

(3) (1} ln dstermining whether to
revoke accuntervalling duty order in
part, the Secretary will consider:

(A) Whether cne or more exporters or
producess covered by the order have not
applied fer or received any net
counterveilable subsidy on the subject
merchandise for a period of at least five
consecutive years;

(B) Whether, for any exporter or
producer that the Secretary previously
has determined to have received any net
counterveilable subsidy on the subject
merchandise, the exporter or producer
agrees in writing to thelr immediate
reinstatement in the order, as long as
any exporter or producer ts subject to
the order, if. the Secretary concludes that
the experter or producer, subsequent to
the revocation, has received any net
countervaliable subsidy on the subject
merchandise; and

(C) Wherher the continued
application of the countervailing duty
order is cthervise necessary to offset
subsidization.

(ii) If the Secretary determines, based
upon the criteria in paragraphs
(c)(3)(i}{A) through (C) of this section,
that the countervailing duty order as to
those exserters or producers is no
longe: warranted, the Secretary will.
revoke the order as to (nose exporters oF
produces.

(4) Revocation cf nenproducing
exporter. In the case of an exporter that
is not the producer of subject
merchandise, the Secretary normally
will revoke an order in part under
paragsach (c)(3) of this secdon only
with resect to subject merchandise
produced of supplied by thase
companies that supplied the exporter
during the time perlod that formed the
basis fc: the revocadion,

e . . . °

[FR Dec. 92-24675 Filed 9-21-99; 8:45 am|

OILLMC COTE IG1C-OS-P

ATTACHMENT B

FINAL RESULTS OF REDETERMINATION
IN THE THIRD ADMINISTRATIVE REVIEW OF THE ANTIDUMPING DUTY
ORDER ON DYNAMIC RANDOM ACCESS MEMORY SEMICONDUCTORS
O¥ ONE MEGABIT OR ABOVE FROM KOREA
PURSUANT TO
SECTION 129 OF THE URUGUAY ROUND AGREEMENTS ACT

SUMMARY
The Department of Commerce ("the Department") has prepared these final results of

redetermination ("Redetermination") consistent with Section 129 of the Uruguay Round
Agreements Act CURAA”), This Redaterenination concerns the Depactment’s revocation
finding in the final results of the third adamlulsrative review of the antidumping duty ("AD")
order on Dynamic Random Access Memory Semiconductors Of One Megabit Or Above |
(‘DRAMs") From Korea, Consistent with Section 129 of the URAA, we have issued ancw
revocation finding under 19 CFR 351.222(b), as amended,
BACKGROUND

"On July 24, 1997, the Department Issued the final results of the third administrative
review of the AD order on DRAMs from Korea, covering tha period May 1, 1995 through April
30, 1996, in which the Department considered the respondents’ request that the Department
revoke the order, in pact, under 19 CFR 353.25(a){1996) (the precursor to 19 CFR 35i.222(0).

(July 24, 1997) ("Final Results"). This regulation provided that the Department may revoke an

order, in whole or in part, if (1) producers and/or exporters have sold subject merchandise st not
leas than normal value for three consecutive years; and (2) the Secretery concluded that it is not

likely that those producers and/or exporters will in the future sell subject merchandise at not less