In a recent development, the U.S. Department of Commerce has released preliminary findings regarding countervailable subsidies provided to producers and exporters of certain hot-rolled steel flat products from the Republic of Korea. The period under review spans from January 1, 2022, to December 31, 2022. The Department of Commerce's International Trade Administration is responsible for this review, and the findings have been published in the Federal Register under document number 2024-26251.
The background of this review is rooted in a request received by Commerce in October 2023 for an administrative review of the countervailing duty order on hot-rolled steel from Korea. By December 6, 2023, Commerce had initiated this review, focusing on two major Korean companies: Hyundai Steel Company and POSCO. These companies were selected as mandatory respondents, meaning their data and practices were thoroughly examined to determine if they benefited from unfair subsidies that could harm U.S. industries.
The review process encountered some delays, with the deadline for preliminary results being extended to November 6, 2024. This extension allowed Commerce to meticulously analyze data and ensure comprehensive results. The methodology used in this review aligns with section 751(a)(l)(A) of the Tariff Act of 1930, emphasizing the identification of financial contributions by an authority that confer a specific benefit to the recipient, thus qualifying as a countervailable subsidy.
Interestingly, Commerce decided to rescind the review for 13 companies, as there were no entries of subject merchandise from these entities during the period of review. This decision, made on October 8, 2024, was based on the absence of suspended entries, meaning these companies did not engage in activities that warranted further scrutiny under the countervailing duty order. No parties opposed this decision, allowing Commerce to proceed with the partial rescission.
The scope of the order covers hot-rolled steel products from Korea, which are essential in various industries due to their versatility and strength. The preliminary results indicate that Hyundai Steel Company and other involved parties received countervailable subsidies, which could potentially distort market competition. These subsidies are measured as a percentage of the product's value, known as the ad valorem subsidy rate.
