[Federal Register Volume 64, Number 250 (Thursday, December 30, 1999)]
[Notices]
[Pages 73575-73576]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-33902]


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INTERNATIONAL TRADE COMMISSION

[Investigation No. TA-201-70]


Circular Welded Carbon Quality Line Pipe

Determination

    On the basis of the information in the investigation, the 
Commission--(1) Determines, pursuant to section 202(b) of the Trade Act 
of 1974, that circular welded carbon quality line pipe (hereinafter 
line pipe) 1 is being imported into the United States in 
such increased quantities as to be a substantial cause of serious 
injury or the threat of serious injury 2 to the domestic 
industry producing an article like or directly competitive with the 
imported article; and (2) makes negative findings, pursuant to section 
311(a) of the North American Free-Trade Agreement (NAFTA) 
Implementation Act (19 U.S.C. 3371(a)), with respect to imports of line 
pipe from Canada and Mexico.3
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    \1\ The imported article covered by this investigation is welded 
carbon quality line pipe of circular cross section, of a kind used 
for oil and gas pipelines, whether or not stencilled. For purposes 
of this investigation, ``carbon quality'' is defined to mean: 
products in which (1) iron predominates, by weight, over each of the 
other contained elements, (2) the carbon content is 2 percent or 
less, by weight, and (3) none of the elements listed below exceeds 
the quantity, by weight, respectively indicated: 1.80 percent of 
manganese, or 2.25 percent of silicon, or 1.00 percent of copper, or 
0.50 percent of aluminum, or 1.25 percent of chromium, or 0.30 
percent of cobalt, or 0.40 percent of lead, or 1.25 percent of 
nickel, or 0.30 percent of tungsten, or 0.10 percent of molybdenum, 
or 0.10 percent of niobium, or 0.15 percent of vanadium, or 0.15 
percent of zirconium.
    Such line pipe is currently classified in subheadings 7306.10.10 
and 7306.10.50 of the Harmonized Tariff Schedule of the United 
States (HTS). Although the HTS categories are provided for 
convenience and Customs purposes, the written description of the 
merchandise under investigation is dispositive. The investigation 
excludes certain merchandise described as arctic grade line pipe, 
defined as welded line pipe that (1) has an outer diameter of 4.5 
inches or more and a wall thickness equal to or less than 0.75 
inches; and (2) when subjected to a Charpy V-notch test performed at 
minus 50 degrees Fahrenheit or below applied to three specimens 
taken from the well area, has a ft-lbs rating of no less than 17 ft-
lbs for each sample, with an average for all three at no less than 
19 ft-lbs; and (3) using at least three samples, has a minimum 
average shear area of 85 percent in the base metal and 50 percent in 
the weld; and (4) when subjected to a hydrogen induced cracking test 
to be performed as per NACE (National Association of Corrosion 
Engineers) TM0284 test with solution A, has a crack length ratio 
that does not exceed 15 percent, a crack sensibility ratio that does 
not exceed 2 percent, and a crack thickness ratio that does not 
exceed 5 percent.
    \2\ Vice Chairman Marcia E. Miller and Commissioners Jennifer A. 
Hillman and Stephen Koplan found serious injury. Chairman Lynn M. 
Bragg and Commissioner Thelma J. Askey found a threat of serious 
injury. Commissioner Carol T. Crawford made a negative 
determination.
    \3\ Chairman Bragg dissenting with respect to Mexico. Chairman 
Bragg finds that imports of welded line pipe from Mexico account for 
a substantial share of total imports and contribute importantly to 
the threat of serious injury to the domestic industry.
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Recommendations with Respect to Remedy 4

    The Commission \5\ (Vice Chairman Miller and Commissioners Hillman 
and Koplan) recommends:
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    \4\ Commissioner Crawford, having made a negative determination 
on injury, was not eligible to vote on remedy. In light of her 
negative determination, Commissioner Crawford does not believe any 
import relief is appropriate in this investigation.
    \5\ The Commission notes that, pursuant to section 330(d)(2) of 
the Tariff Act of 1930 (19 U.S.C. 1330(d)(2)), the remedy 
recommendation of Vice Chairman Miller and Commissioners Hillman and 
Koplan in this investigation is to be treated as the remedy finding 
of the Commission for purposes of section 203 of the Trade Act.
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    (1) That the President impose a tariff-rate quota for a 4-year 
period on imports of line pipe, with the in-quota amount set at 151,124 
short tons in the first year, and with that amount to be increased by

[[Page 73576]]

10 percent in each of the second, third, and fourth years, with over-
quota imports to be subject to a duty of 30 percent ad valorem in 
addition to current U.S. tariffs;
    (2) That the President, if he determines to allocate the overall 
quota, recognize the disproportionate growth and impact of the imports 
from Korea;
    (3) That the President initiate international negotiations with 
Korea to address the underlying cause of the import surge and the 
serious injury to the domestic industry;
    (4) Having made negative findings with respect to imports of line 
pipe from Canada and Mexico under section 311(a) of the NAFTA 
Implementation Act, that such imports be excluded from the tariff-rate 
quota; and
    (5) That the tariff-rate quota not apply to imports of line pipe 
from Israel, or to any imports of line pipe entered duty-free from 
beneficiary countries under the Caribbean Basin Economic Recovery Act 
or the Andean Trade Preference Act.
    Chairman Bragg and Commissioner Askey recommend:
    (1) That the President impose a duty, in addition to the current 
rate of duty, for a 4-year period, on imports of line pipe that are 
within the scope of this investigation as follows: 12.5 percent ad 
valorem in the first year of relief, 11 percent ad valorem in the 
second year of relief, 9.5 percent ad valorem in the third year of 
relief, and 8 percent ad valorem in the fourth year of relief;
    (2) That the increased rates of duty not apply to imports of line 
pipe from Canada, Israel, or to any imports of line pipe that entered 
duty-free from beneficiary countries under the Caribbean Basin Economic 
Recovery Act or the Andean Trade Preference Act;
    (3) Commissioner Askey, having made a negative finding with respect 
to imports of line pipe from Mexico under section 311(a) of the NAFTA 
Implementation Act, recommends that such imports from Mexico be 
excluded from the increased duty. Chairman Bragg, having made an 
affirmative finding under section 311(a) of the NAFTA Implementation 
Act, recommends that imports of line pipe from Mexico be subject to the 
duty increase.
    The Commissioners find that the respective actions that they have 
recommended will address the serious injury or threat of serious injury 
found to exist and be most effective in facilitating the efforts of the 
domestic industry to make a positive adjustment to import competition.

Background

    Following receipt of a petition properly filed on June 30, 1999, by 
counsel on behalf of Geneva Steel, Vineyard, UT; IPSCO Tubulars, Inc., 
Camanche, IA; Lone Star Steel Company, Dallas, TX; LTV Steel Tubular 
Products Company, Youngstown, OH; 6 Maverick Tube 
Corporation, Chesterfield, MO; Newport Steel, Newport, KY; Northwest 
Pipe Company, Portland, OR; Stupp Corporation, Baton Rouge, LA; and the 
United Steelworkers of America, AFL-CIO, Pittsburgh, PA, the Commission 
instituted investigation No. TA-201-70, Circular Welded Carbon Quality 
Line Pipe, under section 202 of the Trade Act of 1974 to determine 
whether circular welded carbon quality line pipe is being imported into 
the United States in such increased quantities as to be a substantial 
cause of serious injury, or the threat thereof, to the domestic 
industry producing an article like or directly competitive with the 
imported article.
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    \6\ Petitioners amended the petition on Sept. 14, 1999, to 
include LTV Steel.
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    Notice of the institution of the Commission's investigation and of 
the scheduling of public hearings to be held in connection therewith 
was given by posting copies of the notice in the Office of the 
Secretary, U.S. International Trade Commission, Washington, DC, and by 
publishing the notice in the Federal Register of August 4, 1999 (64 FR 
42414). The hearing in connection with the injury phase of the 
investigation was held on September 30, 1999, and the hearing on the 
question of remedy was held on November 10, 1999. Both hearings were 
held in Washington, DC; all persons who requested the opportunity were 
permitted to appear in person or by counsel.
    The Commission transmitted its determination in this investigation 
to the President on December 22, 1999. The views of the Commission are 
contained in USITC Publication 3261 (December 1999), entitled Circular 
Welded Carbon Quality Line Pipe: Investigation No. TA-201-70.

    Issued: December 23, 1999.

    By order of the Commission.
Donna R. Koehnke,
Secretary.
[FR Doc. 99-33902 Filed 12-29-99; 8:45 am]
BILLING CODE 7020-02-U