[Federal Register Volume 77, Number 247 (Wednesday, December 26, 2012)]
[Notices]
[Pages 75975-75978]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-31078]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
International Trade Administration
[C-580-869]
Large Residential Washers From the Republic of Korea: Final
Affirmative Countervailing Duty Determination
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (the Department) determines that
countervailable subsidies are being provided to producers and exporters
of large residential washers (washing machines) from the Republic of
Korea (Korea). For information on the estimated subsidy rates, see the
``Suspension of Liquidation'' section of this notice.
DATES: Effective December 26, 2012.
FOR FURTHER INFORMATION CONTACT: Justin M. Neuman or Milton Koch, AD/
CVD Operations, Office 6, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-
0486 and (202) 482-2584, respectively.
SUPPLEMENTARY INFORMATION:
Background
The U.S. producer that filed the petition for this investigation is
Whirlpool Corporation (hereafter, Whirlpool, or ``petitioner''). The
mandatory respondents in this investigation are: (1) Samsung
Electronics Co., Ltd., and its cross-owned affiliates Samsung
Electronics Service and Samsung Electronics Logitech (collectively,
Samsung); (2) LG Electronics and its cross-owned affiliate, ServeOne
Co., Ltd. (ServeOne) (collectively, LG); and (3) Daewoo Electronics
Corporation (Daewoo).
Period of Investigation
The period of investigation for which we are measuring subsidies is
January 1, 2011, through December 31, 2011.
Case History
The following events have occurred since the Department published
the Preliminary Determination.\1\ From May through September 2012, the
Department issued several supplemental questionnaires to participating
respondents. Those parties timely responded to the Department's
supplemental questionnaires. In addition, on August 6, 2012, the
Department published the Scope Amendment.\2\
---------------------------------------------------------------------------
\1\ See Large Residential Washers From the Republic of Korea:
Preliminary Affirmative Countervailing Duty Determination and
Alignment of Final Determination With Final Antidumping
Determination, 77 FR 33181 (June 5, 2012) (Preliminary
Determination).
\2\ Large Residential Washers From the Republic of Korea:
Amendment to the Scope of the Countervailing Duty Investigation, 77
FR 46715 (August 6, 2012) (Scope Amendment).
---------------------------------------------------------------------------
On September 7, 11, and 13, the Department issued verification
outlines to the Government of Korea (GOK), LG, and Samsung,
respectively. The Department conducted verification from September 17,
2012, through September 27, 2012. On October 22, 2012, the Department
issued verification reports for the GOK, Samsung, and LG. On October
31, 2012, the GOK filed its case brief. LG and Samsung filed case
briefs on November 2, 2012. On November 7, 2012, the petitioner filed a
rebuttal brief. The Department held a public hearing on November 17,
2012, based on the timely requests of the petitioner, Samsung, and LG.
[[Page 75976]]
As explained in the Memorandum from the Assistant Secretary for
Import Administration, the Department has exercised its discretion to
toll deadlines for the duration of the closure of the Federal
Government from October 29, through October 30, 2012. Thus, all
deadlines in this segment of the proceeding have been extended by two
days. The revised deadline for this final countervailing duty (CVD)
determination is December 18, 2012.\3\
---------------------------------------------------------------------------
\3\ See Memorandum to the Record from Paul Piquado, Assistant
Secretary for Import Administration, regarding ``Tolling of
Administrative Deadlines As a Result of the Government Closure
During Hurricane Sandy''' (October 31, 2012).
---------------------------------------------------------------------------
Scope Comments
In the Preliminary Determination, the Department stated that it was
evaluating comments filed by the parties regarding the scope in the
companion antidumping duty investigation. That analysis was placed on
the record of this investigation in the Scope Amendment, in which we
modified the description of the scope of the investigations in the
manner requested by the petitioner to exclude top-load washing machines
with a vertical rotational axis and a rated capacity of less than 3.70
cubic feet. On July 25, 2012, LG requested a modification to the scope.
The petitioner filed its opposition to LG's request on August 27, 2012.
We did not modify the scope as requested by LG for purposes of this
final determination.\4\ In the briefs filed by parties, LG and the
petitioner commented on the Scope Amendment and LG's request to alter
the scope of the investigation.
---------------------------------------------------------------------------
\4\ See accompanying Memorandum to Paul Piquado, Assistant
Secretary for Import Administration, Issues and Decision Memorandum
for the Final Determination in the Countervailing Duty Investigation
of Large Residential Washers from the Republic of Korea (Decision
Memorandum) at Comment 2.
---------------------------------------------------------------------------
Scope of the Investigation
The products covered by this investigation are all large
residential washers and certain subassemblies thereof.
For purposes of this investigation, the term ``large residential
washers'' denotes all automatic clothes washing machines, regardless of
the orientation of the rotational axis, except as noted below, with a
cabinet width (measured from its widest point) of at least 24.5 inches
(62.23 cm) and no more than 32.0 inches (81.28 cm).
Also covered are certain subassemblies used in large residential
washers, namely: (1) All assembled cabinets designed for use in large
residential washers which incorporate, at a minimum: (a) At least three
of the six cabinet surfaces; and (b) a bracket; (2) all assembled
tubs\5\ designed for use in large residential washers which
incorporate, at a minimum: (a) a tub; and (b) a seal; (3) all assembled
baskets \6\ designed for use in large residential washers which
incorporate, at a minimum: (a) a side wrapper;\7\ (b) a base; and (c) a
drive hub; \8\ and (4) any combination of the foregoing subassemblies.
---------------------------------------------------------------------------
\5\ A ``tub'' is the part of the washer designed to hold water.
\6\ A ``basket'' (sometimes referred to as a ``drum'') is the
part of the washer designed to hold clothing or other fabrics.
\7\ A ``side wrapper'' is the cylindrical part of the basket
that actually holds the clothing or other fabrics.
\8\ A ``drive hub'' is the hub at the center of the base that
bears the load from the motor.
---------------------------------------------------------------------------
Excluded from the scope are stacked washer-dryers and commercial
washers. The term ``stacked washer-dryers'' denotes distinct washing
and drying machines that are built on a unitary frame and share a
common console that controls both the washer and the dryer. The term
``commercial washer'' denotes an automatic clothes washing machine
designed for the ``pay per use'' market meeting either of the following
two definitions:
(1)(a) It contains payment system electronics; \9\ (b) it is
configured with an externally mounted steel frame at least six inches
high that is designed to house a coin/token operated payment system
(whether or not the actual coin/token operated payment system is
installed at the time of importation); (c) it contains a push button
user interface with a maximum of six manually selectable wash cycle
settings, with no ability of the end user to otherwise modify water
temperature, water level, or spin speed for a selected wash cycle
setting; and (d) the console containing the user interface is made of
steel and is assembled with security fasteners; \10\ or
---------------------------------------------------------------------------
\9\ ``Payment system electronics'' denotes a circuit board
designed to receive signals from a payment acceptance device and to
display payment amount, selected settings, and cycle status. Such
electronics also capture cycles and payment history and provide for
transmission to a reader.
\10\ A ``security fastener'' is a screw with a non-standard head
that requires a non-standard driver. Examples include those with a
pin in the center of the head as a ``center pin reject'' feature to
prevent standard Allen wrenches or Torx drivers from working.
---------------------------------------------------------------------------
(2)(a) it contains payment system electronics; (b) the payment
system electronics are enabled (whether or not the payment acceptance
device has been installed at the time of importation) such that, in
normal operation,\11\ the unit cannot begin a wash cycle without first
receiving a signal from a bona fide payment acceptance device such as
an electronic credit card reader; (c) it contains a push button user
interface with a maximum of six manually selectable wash cycle
settings, with no ability of the end user to otherwise modify water
temperature, water level, or spin speed for a selected wash cycle
setting; and (d) the console containing the user interface is made of
steel and is assembled with security fasteners.
---------------------------------------------------------------------------
\11\ ``Normal operation'' refers to the operating mode(s)
available to end users (i.e., not a mode designed for testing or
repair by a technician).
---------------------------------------------------------------------------
Also excluded from the scope are automatic clothes washing machines
with a vertical rotational axis and a rated capacity of less than 3.70
cubic feet, as certified to the U.S. Department of Energy pursuant to
10 CFR Sec. 429.12 and 10 CFR Sec. 429.20, and in accordance with the
test procedures established in 10 CFR Part 430.
The products subject to this investigation are currently
classifiable under subheading 450.20.0090 of the Harmonized Tariff
System of the United States (HTSUS). Products subject to this
investigation may also enter under HTSUS subheadings 8450.11.0040,
8450.11.0080, 8450.90.2000, and 8450.90.6000. Although the HTSUS
subheadings are provided for convenience and customs purposes, the
written description of the merchandise subject to this scope is
dispositive.
Analysis of Subsidy Programs and Comments Received
The subsidy programs under investigation and the issues raised in
the case and rebuttal briefs by parties in this investigation are
discussed in the Decision Memorandum, which is hereby adopted by this
notice. A list of the subsidy programs and the issues that parties
raised and to which we responded in the Decision Memorandum is attached
to this notice as an Appendix. The Decision Memorandum is a public
document and is on file electronically via Import Administration's
Antidumping and Countervailing Duty Centralized Electronic Service
System (IA ACCESS). IA ACCESS is available to registered users at
http://iaaccess.trade.gov and in the Central Records Unit, room 7046 of
the main Department of Commerce building. In addition, a complete
version of the Decision Memorandum is also accessible on the Web at
http://www.trade.gov/ia/. The signed Decision Memorandum and the
electronic versions of the Decision Memorandum are identical in
content.
[[Page 75977]]
Use of Facts Otherwise Available, Including Adverse Inferences
For purposes of this final determination, we have continued to rely
on facts available and have continued to apply adverse inferences in
accordance with sections 776(a) and (b) of the Tariff Act of 1930, as
amended (Act), to determine the countervailable subsidy rate for one
respondent, Daewoo. A full discussion of our decision to apply adverse
facts available (AFA) is presented in the Decision Memorandum in the
section ``Application of Facts Available, Including the Application of
Adverse Inferences.''
Suspension of Liquidation
In accordance with section 705(c)(1)(B)(i)(I) of the Act, we have
calculated an individual countervailable subsidy rate for each
respondent. Section 705(c)(5)(A)(i) of the Act states that for
companies not individually investigated, we will determine an all-
others rate equal to the weighted average of the countervailable
subsidy rates established for exporters and producers individually
investigated, excluding any zero and de minimis countervailable subsidy
rates, and any rates based entirely on AFA under section 776 of the
Act.
In this investigation, the only non-de minimis rate not based
entirely on AFA is the rate calculated for Samsung. Consequently, the
rate calculated for Samsung is also assigned as the ``all-others''
rate. For Daewoo, which did not participate in this investigation, we
have determined the subsidy rate based solely on AFA, in accordance
with sections 776(a) and (b) of the Act.\12\ Therefore, we determine
the total estimated net countervailable subsidy rates to be:
---------------------------------------------------------------------------
\12\ See the ``Application of Facts Available, Including the
Application of Adverse Inferences'' section of the Decision
Memorandum.
------------------------------------------------------------------------
Ad valorem net
Company subsidy rate
------------------------------------------------------------------------
Daewoo Electronics Corporation.......................... 72.30 percent
LG Electronics Inc...................................... 0.01 percent
Samsung Electronics Co., Ltd............................ 1.85 percent
All-Others.............................................. 1.85 percent
------------------------------------------------------------------------
As a result of our Preliminary Determination and pursuant to
section 703(d) of the Act, we instructed U.S. Customs and Border
Protection (CBP) to suspend liquidation of all entries of subject
merchandise from Korea, other than those produced/exported by LG, which
received a de minimis countervailable subsidy rate in the Preliminary
Determination, entered or withdrawn from warehouse, for consumption on
or after June 5, 2012, the date of the publication of the Preliminary
Determination in the Federal Register. In accordance with section
703(d) of the Act, we subsequently issued instructions to CBP to
discontinue the suspension of liquidation for CVD purposes for subject
merchandise entered, or withdrawn from warehouse, on or after October
3, 2012, but to continue the suspension of liquidation of all entries
from June 5, 2012, through October 2, 2012.
If the ITC issues a final affirmative injury determination, we will
issue a CVD order and reinstate the suspension of liquidation, and we
will require a cash deposit for such entries of merchandise in the
amounts indicated above. If the ITC determines that material injury, or
threat of material injury, does not exist, this proceeding will be
terminated and all estimated duties deposited or securities posted as a
result of the suspension of liquidation will be refunded or canceled.
ITC Notification
In accordance with section 705(d) of the Act, we will notify the
ITC of our determination. In addition, we are making available to the
ITC all non-privileged and non-proprietary information relating to this
investigation. We will allow the ITC access to all privileged and
business proprietary information in our files, provided the ITC
confirms that it will not disclose such information, either publicly or
under an administrative protective order, without the written consent
of the Assistant Secretary for Import Administration.
Return or Destruction of Proprietary Information
In the event that the ITC issues a negative final injury
determination, this notice serves as the only reminder to parties
subject to an administrative protective order (APO) of their
responsibility concerning the destruction of proprietary information
disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely
written notification of the return/destruction of APO materials or
conversion to judicial protective order is hereby requested. Failure to
comply with the regulations and terms of an APO is a violation which is
subject to sanction.
This determination is issued and published pursuant to sections
705(d) and 777(i) of the Act.
Dated: December 18, 2012.
Paul Piquado,
Assistant Secretary for Import Administration.
Appendix
Subsidy Valuation Information
Cross-Ownership and Attribution of Subsidies
Allocation Period
Interest Rate Benchmarks For Loans
Application of Facts Available, Including the Application of Adverse
Inferences
Analysis of Programs
Programs Determined To Be Countervailable
o KDB and IBK Short-Term Discounted Loans for Export Receivables
o Income Tax Programs
[squf] Research, Supply, or Workforce Development Investment Tax
Deductions for ``New Growth Engines'' under RSTA Article 10(1)(1)
[squf] Research, Supply, or Workforce Development Expense Tax
Deductions for ``Core Technologies'' under RSTA Article 10(1)(2)
[squf] Tax Reduction for Research and Manpower Development: RSTA
10(1)(3)
[squf] RSTA Article 25(2) Tax Deductions for Investments in
Energy Economizing Facilities
[squf] RSTA Article 26 Tax Deduction for Facilities Investment
o Gwangju Metropolitan City Production Facilities Subsidies: Tax
Reductions/Exemptions under Article 276 of the Local Tax Act
o Grant Programs
[squf] GOK Subsidies for ``Green Technology R&D'' and its
Commercialization
[squf] GOK 21st Century Frontier R&D Program/Information Display
R&D Center Program
[squf] Support for SME ``Green Partnerships''
[squf] Grants Discovered at Verification
Program Determined To Be Not Countervailable
o K-SURE--Short-term Export Credit Insurance
Programs Determined To Be Not Used''o Daewoo Restructuring
[squf] GOK-Directed Equity Infusions under the Daewoo Workout
[squf] GOK-Directed Ongoing Preferential Lending under the
Daewoo Workout
o IBK Preferential Loans to Green Enterprises
o KEXIM Export Factoring
o GOK Supplier Support Fund Tax Deduction
Analysis of Comments
Comment 1: Scope Exclusion of Smaller Top-Load Washers
Comment 2: Request To Exclude Larger-Width Washers From the Scope
Comment 3: Whether Samsung's Export Receivables That Were Negotiated
With KDB and IBK Are Loans
[[Page 75978]]
Comment 4: Whether the Department Erred in Selecting a Benchmark
Interest Rate To Measure the Benefit to Samsung Under the KDB/IBK
Loan Program
Comment 5: Whether Premiums Charged by K-SURE Are Adequate to Cover
the Long-Term Operating Costs and Losses of the Program
Comment 6: Whether RSTA Article 10(1)(3) Is de Facto Specific
Comment 7: Whether Income Tax Credits Should Be Attributed to Non-
Subject Merchandise
Comment 8: Whether RSTA Article 25(2) Is de Facto Specific
Comment 9: Whether RSTA Article 26 is Regionally Specific
Comment 10: Whether the Department Should Offset Exempted
Acquisition or Registration Taxes by the Amount of Special Rural
Development Tax Paid
Comment 11: Whether the Green Technology R&D Program Is
Countervailable
Comment 12: Whether Grants Received by Samsung under the ``21st
Century Frontier and Other R&D Programs'' Program Are
Countervailable
Comment 13: Whether the Department Should Adjust Samsung's Total
Sales Denominator to Exclude Sales of Services or Goods Manufactured
Outside of Korea
Comment 14: Whether the Department Erred in Its Calculation of the
Subsidy Rate for LG's Use of the ``Green Technology R&D'' Program
Comment 15: Whether the Department Erred in Finding That the ``SME
Green Partnerships'' Program Provides a Benefit to LG
Comment 16: Whether the Department Erred in Attributing Subsidies
Received by ServeOne to LG
Comment 17: Whether the Department Should Continue To Find Other
Programs To Be Not Countervailable
Comment 18: Whether the Department Should Countervail Other Grants
Received by Samsung That Were Identified at Verification
[FR Doc. 2012-31078 Filed 12-21-12; 4:15 pm]
BILLING CODE 3510-DS-P