RB2 2016 IN
Certain Concrete Reinforcing Bar
Statement of Reasons

[1] On June 30, 2016, AltaSteel Ltd. (AltaSteel) located in Edmonton, Alberta, ArcelorMittal Long Products Canada, g.p. (ArcelorMittal LCNA) located in Contrecoeur, Quebec and Gerdau Ameristeel Corporation (Gerdau) located in Whitby, Ontario (hereinafter the complainants) filed a written complaint with the Canada Border Services Agency’s (CBSA) Trade and Anti-dumping Programs Directorate alleging that imports of certain concrete reinforcing bar (rebar) originating in or exported from the Republic of Belarus (Belarus), Chinese Taipei, the Hong Kong Special Administrative Region of the People’s Republic of China (Hong Kong), Japan, the Portuguese Republic (Portugal) and the Kingdom of Spain (Spain) (subject goods) are being dumped. The complainants alleged that the dumping has caused injury and is threatening to cause injury to the Canadian industry producing the like goods. The complaint was supported by Max Aicher North America Ltd. (MANA), a producer of rebar located in Hamilton, Ontario.

[2] On July 21, 2016, pursuant to paragraph 32(1)(a) of the Special Import Measures Act (SIMA), the CBSA informed the complainants that the complaint was properly documented. The CBSA also notified the governments of Belarus, Chinese Taipei, Hong Kong, Japan, Portugal and Spain that a properly documented complaint had been received.

[3] The complainants provided evidence to support the allegations that rebar from Belarus, Chinese Taipei, Hong Kong, Japan, Portugal and Spain (named countries) has been dumped. The evidence also disclosed a reasonable indication that the dumping has caused injury and is threatening to cause injury to the Canadian industry producing the like goods.

[4] On August 19, 2016, pursuant to subsection 31(1) of SIMA, the CBSA initiated an investigation respecting the dumping of rebar from the named countries.

[5] Upon receiving notice of the initiation of the investigation, the Canadian International Trade Tribunal (CITT) commenced a preliminary injury inquiry, pursuant to subsection 34(2) of SIMA, into whether the evidence disclosed a reasonable indication that the alleged dumping of rebar from the named countries has caused injury or retardation or is threatening to cause injury to the domestic industry producing the like goods.

[6] On October 19, 2016, pursuant to subsection 37.1(1) of SIMA, the CITT made a preliminary determination that there was evidence that disclosed a reasonable indication that the dumping of certain concrete reinforcing bar originating in or exported from Belarus, Chinese Taipei, Hong Kong, Japan, Portugal and Spain has caused injury or is threatening to cause injury to the domestic industry.

[7] On November 4, 2016, due to the complexity and novelty of the issues presented by the investigation, the CBSA extended the 90-day period for making the preliminary determination or terminating all or part of the investigation to 135 days, pursuant to subsection 39(1) of SIMA.

[8] On November 7, 2016, the CBSA initiated a section 20 inquiry with respect to the rebar sector in Belarus.

9] On January 3, 2017, as a result of the CBSA’s preliminary investigation and pursuant to subsection 38(1) of SIMA, the CBSA made a preliminary determination of dumping respecting rebar originating in or exported from Belarus, Chinese Taipei, Hong Kong, Japan, Portugal and Spain and began imposing provisional duties on imports of the subject goods pursuant to subsection 8(1) of SIMA.

[10] On January 4, 2017, the CITT initiated a full inquiry pursuant to section 42 of SIMA to determine whether the dumping of the above-mentioned goods has caused injury or retardation or is threatening to cause injury to the domestic industry.

[11] The CBSA continued its investigation and, on the basis of the results, was satisfied that rebar originating in or exported from the named countries has been dumped and that the margins of dumping were not insignificant. Consequently, on April 3, 2017, the CBSA made a final determination of dumping pursuant to paragraph 41(1)(a) of SIMA.

[12] The CITT’s inquiry into the question of injury to the domestic industry is continuing. Provisional duties will continue to be imposed on the subject goods until the CITT renders its decision. The CITT has announced that it will issue its finding by May 3, 2017.

[13] The Period of Investigation (POI) covered all subject goods released into Canada from June 1, 2015 to May 31, 2016.

[14] The Profitability Analysis Period (PAP) covered domestic sales and costing information for goods sold from March 1, 2015 to May 31, 2016.

Complainants

[15] The complainants, AltaSteel, ArcelorMittal LCNA and Gerdau, are the major producers of rebar in Canada and account for a major proportion of the total domestic production of the like goods as defined in subsection 2(1) of SIMA.

[16] The names and addresses of the complainants are as follows:

AltaSteel Ltd.
9401 34 Street
Edmonton, Alberta
T6B 2X6

ArcelorMittal Long Products Canada, g.p.
4000 Routes des Acieries
Contrecoeur, Quebec
J0L 1C0

Gerdau Longsteel North America
Hopkins Street South
Whitby, Ontario
L1N 5T1

AltaSteel Ltd.

[17] The company now known as AltaSteel was founded in 1955. It has undergone various ownership changes and is now owned by Arrium Limited (previously known as OneSteel Limited).

[18] AltaSteel is a scrap-based mini-mill with melting and casting manufacturing facilities in Edmonton, Alberta. The company employs over 370 people. AltaSteel makes a variety of round, flat, and square bar shapes for use by downstream manufacturers in the mining, oil and gas, automotive, construction, agriculture and OEM industries.

ArcelorMittal Long Products Canada, g.p.

[19] ArcelorMittal LCNA is a subsidiary of ArcelorMittal and has eleven steel manufacturing facilities in Canada and the United States of America (U.S.). ArcelorMittal LCNA produces over 5 million metric tonnes (MT) per year and has 3,400 employees. It produces a range of products including rebar, billets, flats and wire rod.

[20] ArcelorMittal LCNA operations in Canada produce 2.2 million MT per year and have 1,680 employees. These facilities produce billets and slabs as primary products. For value added products, it produces rebar, wire rod and downstream wire products, flat bar and round bar, and other products.

[21] ArcelorMittal LCNA has three rebar manufacturing facilities in the province of Quebec, the Contrecoeur East facility produces rebar in coil form while the Contrecoeur West and the Longueuil facilities produce cut-to-length rebar.

Gerdau Longsteel North America

[22] The parent company of Gerdau is Gerdau S.A of Brazil. Gerdau entered the North American market in 1989 with the acquisition of Courtice Steel in Cambridge, Ontario. In 1995, Gerdau acquired MRM Steel in Selkirk, Manitoba. In 2002, Gerdau merged its North American operations with Co-Steel of Whitby, Ontario, and the combined entity became Gerdau Ameristeel Corporation. Gerdau acquired 100% ownership of Gerdau Ameristeel in 2010. Gerdau now operates these three Canadian plants, as well as six American plants producing rebar, as Gerdau Longsteel North America, a division of Gerdau Ameristeel.

[23] Gerdau has manufacturing facilities in Whitby and Cambridge, Ontario and in Selkirk, Manitoba. Gerdau’s three Canadian rebar-producing operations are capable of producing the full range of sizes and grades of rebar. The Whitby plant has produced straight rebar since 1964, as well as other bars and structural shapes. The Cambridge plant has produced straight rebar since 1986. It also produces rounds, squares, channels and angles. Gerdau MRM Steel in Selkirk has produced rebar for over 75 years.

Other Producer

Max Aicher North America Ltd.

[24] MANA, another producer of rebar, is located in Hamilton, Ontario. MANA’s bar mill produces both hot-rolled bar coils and cut bar lengths. MANA filed a letter in support of this complaint.^{Footnote 1}

Importers

[25] At the initiation of the investigation, the CBSA identified 28 potential importers of the subject goods based on both information provided by the complainants and CBSA import entry documentation.

[26] The CBSA sent an Importer Request for Information (RFI) to all potential importers of the goods. The CBSA received five responses to the Importer RFI.

[27] On November 7, 2016, as a result of the initiation of the section 20 inquiry, these 28 potential importers were sent a Section 20 RFI in relation to their re-sales in Canada of imports of rebar from any non named countries. One importer provided a response to the Section 20 RFI.^{Footnote 2}

Exporters

[28] At the initiation of the investigation, the CBSA identified 64 potential exporters of the subject goods from information provided by the complainants and CBSA import entry documentation. The CBSA sent an Exporter RFI – Dumping (Dumping RFI) to each of the potential exporters. Ten exporters^{Footnote 3} provided a response to the Dumping RFI.

[29] As a result of the initiation of a section 20 inquiry, the known rebar producer/exporter in Belarus, OJSC Byelorussian Steel Works (BMZ), was sent a Section 20 RFI. A response to the Section 20 RFI was received from BMZ.

[30] Lastly, on January 25, 2017, the CBSA also forwarded a Section 20 RFI to other potential exporters of rebar to countries other than Canada located in Belarus. These potential exporters were identified by the Government of Belarus.^{Footnote 4} One potential exporter provided a confidential response to the Section 20 RFI. The CBSA notified the potential exporter of its failure to comply with the requirement to submit a non-confidential version or summary of the information designated as confidential, and informed the potential exporter that the information would not be taken into account unless a non-confidential version or summary of the information was provided. However, the CBSA did not receive a non-confidential version of the confidential response to the RFI and the submission was not taken into account in this dumping investigation for purposes of the final determination.

Government of Belarus

[31] As a result of the initiation of a section 20 inquiry, the CBSA sent a Section 20 RFI to the Government of Belarus. A response to the Section 20 RFI was received from the Government of Belarus.

[32] For the purpose of this investigation, “Government of Belarus” refers to all levels of government, i.e. federal, central, provincial/state, regional, municipal, city, township, village, local, legislative, administrative or judicial, singular, collective, elected or appointed. It also includes any person, agency, enterprise, or institution acting for, on behalf of, or under the authority of, or under the authority of any law passed by, the government of that country or that provincial, state or municipal or other local or regional government.

Product Definition

[33] For the purpose of this investigation, subject goods are defined as:

Hot-rolled deformed steel concrete reinforcing bar in straight lengths or coils, commonly identified as rebar, in various diameters up to and including 56.4 millimeters, in various finishes, excluding plain round bar and fabricated rebar products, originating in or exported from the Republic of Belarus, Chinese Taipei, the Hong Kong Special Administrative Region of the People’s Republic of China, Japan, the Portuguese Republic and the Kingdom of Spain. Also excluded is 10 mm diameter (10M) rebar produced to meet the requirements of CSA G30 18.09 (or equivalent standards) that is coated to meet the requirements of epoxy standard ASTM A775/A 775M 04a (or equivalent standards) in lengths from 1 foot (30.48 cm) up to and including 8 feet (243.84 cm).

Additional Product Information

[34] For further clarity, the subject goods include all hot-rolled deformed bar, rolled from billet steel, rail steel, axle steel, low alloy-steel and other alloy steel that does not comply with the definition of stainless steel.

[35] Uncoated rebar, sometimes referred to as black rebar, is generally used for projects in non-corrosive environments where anti-corrosion coatings are not required. On the other hand, anti-corrosion coated rebar is used in concrete projects that are subjected to corrosive environments, such as road salt. Examples of anti-corrosion coated rebar are epoxy or hot dip galvanized rebar. The subject goods include uncoated rebar and rebar that has a coating or finish applied.

[36] Fabricated rebar products are generally engineered using Computer Automated Design programs, and are made to the customer’s unique project requirements. The fabricated rebar products are normally finished with either a protective or corrosion resistant coating. Fabricated rebar is not included in the product definition of subject goods. Rebar that is simply cut-to-length is not considered to be a fabricated rebar product and it is included in the definition of the subject goods.

Production Process

[37] Deformed steel concrete reinforcing bar can be produced in an integrated steel production facility, or in a mini mill using ferrous scrap metal as the principal raw material. Scrap metal is melted in an electric arc furnace and is further processed in a ladle arc refining unit. The molten steel is then continuously cast into rectangular billets of steel that are cut to length. An integrated facility would also produce billets from molten steel. The billets are then rolled into various sizes of rebar which are cut to various lengths depending on the customers’ requirements.

[38] Deformed rebar is rolled with deformations on the bar which provides gripping power so that concrete adheres to the bar and provides reinforcing value. The deformations must conform to requirements set out in national standards.

[39] More specifically, rebar is produced in Canada in accordance with the National Standard of Canada CAN/CSA-G30.18-M92 for Billet Steel Bars for Concrete Reinforcement (the “National Standard”) published by the CSA Group and approved by the Standards Council of Canada.

[40] The following are the most common bar designation numbers for the subject goods in Canada, with the corresponding diameter in millimetres (mm) in brackets: 10 (11.3), 15 (16.0), 20 (19.5), 25 (25.2), 30 (29.9) and 35 (35.7). Rebar sizes are commonly referred to as the bar designation number combined with the letter “M”. For example, 10M rebar is rebar with a bar designation number of 10 and a diameter of 11.3 mm. Other diameters may also be demanded, and other measurement systems employed. For example, Imperial measure #7 bar (approximately 22 mm) is a common designation used in the mine roofing industry.

[41] The National Standard identifies two grades of rebar, namely regular or “R” and weldable or “W”. R grades are intended for general applications while W grades are used where welding, bending or ductility is of special concern. Welded rebar was a premium product for the domestic industry, reflecting the higher cost of alloy steel; however, since all imports have been weldable products, Canadian production has shifted to weldable as a standard product. Weldable rebar is substitutable for regular rebar in all applications, though the reverse does not hold.

[42] The National Standard also identifies yield strength levels of 300, 400, and 500. This number refers to the minimum yield strength and is measured in megapascal (“MPa”). The grade and yield strength of rebar is identified by combining yield strength number with grade. Regular rebar with a yield strength of 400 MPa is 400R, and 400W is weldable rebar with a yield strength of 400 MPa. Yield strength is measured with an extensometer in accordance with the requirements of section 9 of the National Standard.

[43] The standard lengths for rebar are 6 metres (20 feet), 12 metres (40 feet) and 18 metres (60 feet), although rebar can be cut and sold in other lengths as specified by customers, or sold in coils.

Product Use

[44] Rebar is used in a number of applications, the most common of which is construction. Rebar is most commonly used to reinforce concrete and masonry structures. It enhances the compressional and tensional strength of concrete and helps prevent the concrete from cracking during curing or following changes in temperature. Rebar is also known as “reinforcing steel bar”. Residential markets primarily use rebar in smaller sizes, while the heavy construction and fabrication markets use most of the larger sizes of rebar.

Classification of Imports

[45] The subject goods are normally classified under the following Harmonized System (HS) classification numbers:

• 7213.10.00.00
• 7214.20.00.00
• 215.90.00.90
• 227.90.00.90

[46] The listing of HS classification numbers is for convenience of reference only. Refer to the product definition for authoritative details regarding the subject goods.

[47] Subsection 2(1) of SIMA defines “like goods” in relation to any other goods, as goods that are identical in all respects to the other goods, or in the absence of identical goods, goods the uses and other characteristics of which closely resemble those of the other goods.

[48] Based on the CITT’s findings in past proceedings involving rebar, the CBSA is of the opinion that domestically produced rebar are like goods to the subject goods and the subject goods and like goods constitute only one class of goods.^{Footnote 5}

[49] In its preliminary injury inquiry, the CITT confirmed that subject goods and like goods constitute only one class of goods.^{Footnote 6}

[50] As previously stated, the complainants, AltaSteel, ArcelorMittal LCNA and Gerdau, account for a major proportion of all domestic production of the like goods in Canada.

[51] In addition to the complainants, there is one other domestic producer of rebar, MANA, who supports the complaint.

[52] During the final phase of the investigation, the CBSA refined the volume of imports based on information from CBSA import entry documentation and other information received from exporters and importers.

[53] The following table presents the CBSA’s analysis of imports of rebar for purposes of the final determination:

Import Volumes of Rebar
(% of Volume)

Country	June 1, 2015 to May 31, 2016
Belarus	8.8%
Chinese Taipei	14.5%
Hong Kong	5.8%
Japan	3.5%
Portugal	17.7%
Spain	10.3%
All Other Countries	39.4%
Total Imports	100%

[54] Regarding the dumping investigation, information was requested from all known and potential exporters, producers, vendors and importers, concerning shipments of rebar released into Canada during the POI.

[55] Regarding the section 20 inquiry, information was requested from the known producer/exporter of rebar to Canada located in Belarus and from the Government of Belarus as well as from potential exporters of rebar to countries other than Canada located in Belarus. Potential importers were also requested to provide information respecting re-sales in Canada of like goods imported from non-named countries.

[56] Several parties requested an extension to respond to their respective RFIs.^{Footnote 7} The CBSA reviewed each request in order to determine whether unforeseen circumstances or unusual burdens justified the granting of an extension and granted an extension where warranted.^{Footnote 8}

[57] After reviewing the responses to the RFIs, Supplemental RFIs were sent to responding parties to clarify information provided in the submissions and request any additional information considered necessary for the dumping investigation, including the section 20 inquiry.

[58] Details pertaining to the information submitted by the exporters, producers, and the Government of Belarus in response to the RFIs as well as the results of the CBSA’s dumping investigation, including the section 20 inquiry, are provided in the “Dumping Investigation” section of this document.

[59] As part of the final phase of the investigation, case briefs and reply submissions were provided by the complainants, exporters/vendors and governments. Details of all representations are provided in Appendix 1.

[60] The CBSA received responses to the Dumping RFI, by the due date of September 26, 2016, from one exporter of subject goods in each of Belarus, Hong Kong, Japan and Portugal, four exporters in Chinese Taipei and two exporters in Spain.

[61] On December 12, 2016, the CBSA received responses to the Section 20 RFI from the Government of Belarus and from the producer/exporter, BMZ.

Normal Values

[62] Normal values are generally determined based on the domestic selling prices of like goods in the country of export, in accordance with section 15 of SIMA, or on the aggregate of the cost of production of the goods, a reasonable amount for administrative, selling and all other costs, plus a reasonable amount for profits, in accordance with paragraph 19(b) of SIMA.

[63] Where the CBSA is of the opinion that section 20 conditions exist in the sector under investigation, normal values cannot be determined on the basis of domestic selling prices of like goods or on the full cost of the goods plus an amount for profits. Section 20 provides that the normal values be determined using the selling prices or the full cost and profits of like goods in a “surrogate” country, or using re-sales in Canada of goods imported from a “surrogate” country.

[64] Where, in the opinion of the CBSA, sufficient information has not been furnished or is not available, normal values are determined pursuant to a ministerial specification in accordance with subsection 29(1) of SIMA.

Export Prices

[65] The export price of goods sold to importers in Canada is generally based on the lesser of the adjusted exporter’s sale price for the goods or the adjusted importer’s purchase price. These prices are adjusted where necessary by deducting the costs, charges, expenses, duties and taxes resulting from the exportation of the goods as provided for in subparagraphs 24(a)(i) to 24(a)(iii) of SIMA.

[66] Where, in the opinion of the CBSA, sufficient information has not been furnished or is not available, export prices are determined pursuant to a ministerial specification under subsection 29(1) of SIMA.

Margin of Dumping

[67] The CBSA determined a margin of dumping for each of the exporters by comparing the total normal value with the total export price of the goods. When the total export price was less than the total normal value, the difference was the margin of dumping for that specific exporter.

[68] The determination of the volume of dumped goods was calculated by taking into consideration each exporter’s net aggregate dumping results. If it was determined that an exporter was dumping on an overall or net basis, then the total quantity of exports attributable to that exporter (i.e. 100%) was considered to have been dumped. Similarly, if an exporter’s net aggregate dumping results were zero, then the total quantity of exports considered to have been dumped by that exporter was zero.

[69] In determining the margin of dumping for the country, the margin of dumping found in respect of each exporter was weighted according to each exporter’s volume of subject goods released into Canada during the POI.

[70] Details relating to the margin of dumping for each of the exporters are presented in a summary table in Appendix 2, while the margins of dumping for the named countries can be found in the summary of results table at the end of this section.

Results of the Dumping Investigation by Named Country

Belarus

Section 20 Inquiry

[71] Section 20 of SIMA may be applied to determine the normal value of goods subject to a dumping investigation where certain conditions prevail in the domestic market of the exporting country. Normal values are to be determined under section 20 of SIMA where, in the opinion of the CBSA, the government of a country has a monopoly or substantial monopoly of its export trade, it substantially determines domestic prices and there is sufficient reason to believe that the domestic prices are not substantially the same as they would be if they were determined in a competitive market.

[72] For purposes of a dumping investigation, the CBSA proceeds on the presumption that section 20 of SIMA is not applicable to the sector under investigation absent sufficient information to the contrary. The CBSA may form an opinion where there is sufficient information that the conditions set forth in paragraph 20(1)(b) of SIMA exist in the sector under investigation.

[73] During the preliminary phase of the dumping investigation, based on information on the administrative record, the CBSA had reason to believe that the Government of Belarus may have a monopoly or substantial monopoly of its export trade of rebar, that the domestic prices in the rebar sector in Belarus may have been substantially determined by the government and there was sufficient reason to believe that these prices were not substantially the same as they would be if they were determined in a competitive market.

[74] Accordingly, on November 7, 2016, the CBSA initiated a section 20 inquiry to examine the extent to which the conditions of paragraph 20(1)(b) of SIMA exist in the rebar sector in Belarus and sent Section 20 RFIs to the Government of Belarus and to the known producer/exporter of rebar to Canada located in Belarus, BMZ. Furthermore, on January 25, 2017, the CBSA sent Section 20 RFIs to other potential exporters of rebar to countries other than Canada located in Belarus to obtain information on the matter.

[75] The Government of Belarus provided a substantially complete response to the Section 20 RFI as well as to the subsequent Supplemental RFIs. Officers of the CBSA met with representatives of the Government of Belarus at the office of the Ministry of Industry in Minsk, Belarus to verify information provided by the Government of Belarus as well as BMZ.

[76] BMZ provided a substantially complete response to the Section 20 RFI as well as to the subsequent Supplemental RFIs. Officers of the CBSA met with representatives of BMZ at their offices and facilities in Belarus to verify information provided by the company.

Results of the Section 20 Inquiry

Government Monopoly or Substantial Monopoly of Export Trade

[77] As a result of the CBSA’s on-site verification meetings with the Government of Belarus and BMZ, the CBSA confirmed that BMZ is the only producer of rebar in Belarus and is 100% owned by the Ministry of Industry.

[78] The submissions of the Government of Belarus and BMZ contained information respecting the management hierarchy of the company, the roles and responsibilities of the management team, and the government’s role in appointing members of the management team. The government appoints two of the five directors, who have the majority vote, to the Supervisory Board of Directors. The government also approves the appointment of the General Director of the company, who oversees the day to day operations of the company. The information also indicates that these directors and the General Director report to and are responsible to the sole shareholder, who is the Ministry of Industry. This evidence demonstrates that the Supervisory Board of Directors and the General Director of BMZ, the only producer of rebar located in Belarus, are vested with governmental authority and are acting on behalf of the Government of Belarus.

[79] With respect to exports of rebar, the Government of Belarus submitted that BMZ is the exporter of the majority of rebar from Belarus and provided information with respect to other companies that may have also exported small amounts of rebar to countries other than Canada during the POI. As previously mentioned, the CBSA sent RFIs to the other companies identified by the government to determine if these companies had exported rebar, but did not receive any complete responses from these companies. Therefore, the CBSA could not determine whether there were any other exporters of rebar in Belarus during the POI, nor could it determine whether these companies were privately owned or whether they were owned to some degree by the Government of Belarus.

[80] Based on the information available to the CBSA, BMZ exported the majority of rebar from Belarus during the POI. As BMZ is the majority exporter, and the Government of Belarus, through the Ministry of Industry, owns 100% of BMZ and exerts control over BMZ through the Supervisory Board of Directors and the General Director, the CBSA is of the opinion that the Government of Belarus has a substantial monopoly of the export trade of rebar, and that the conditions of subparagraph 20(1)(b)(i) are therefore met.

Domestic Selling Prices are Substantially Determined by the Government

[81] Subparagraph 20(1)(b)(ii) requires the CBSA to examine whether domestic prices of rebar are substantially determined by the Government of Belarus, either directly or indirectly, in law or in practice.

[82] Governments can indirectly determine domestic prices through a variety of mechanisms that can involve the supply or price of the inputs (goods and services) used in the production of the subject goods or by influencing the supply of the subject goods in order to affect their price.

[83] Information on the administrative record indicates that the Government of Belarus regulates the domestic price of scrap, and that BMZ purchases a majority of scrap domestically at regulated prices. The price of scrap makes up a significant portion of the cost of producing rebar and the price of rebar therefore tends to fluctuate with the price of scrap in the market.

[84] The CBSA analyzed the regulated price of scrap in Belarus and the domestic selling price of rebar. The CBSA found that these prices did not fluctuate during the POI, which indicates that the price of scrap had an effect on the price of rebar during the POI. Since scrap represents a significant proportion of the cost of production of rebar and, the Government of Belarus regulates the price of scrap, the government indirectly affects the domestic prices of rebar in Belarus.

[85] Furthermore, confidential information on the administrative record provides details into the pricing procedures of BMZ.^{Footnote 9} As previously stated, the CBSA confirmed that BMZ is the only producer of rebar in Belarus. Information on the administrative record indicates that the Supervisory Board and General Director of the company are vested with governmental authority, and are therefore acting on behalf of the Government of Belarus. In this regard, the CBSA is of the opinion that BMZ’s selling prices of rebar are set by the Government of Belarus.

[86] Based on the Government of Belarus’ direct and indirect influence on the domestic prices of rebar, the CBSA is of the opinion that the domestic prices of rebar are substantially determined by the Government of Belarus, and that the first condition of subparagraph 20(1)(b)(ii) is therefore satisfied.

Prices not Substantially the Same as in a Competitive Market

[87] In addition to the requirement that the CBSA be of the opinion that the government of the country substantially determines domestic prices, subparagraph 20(1)(b)(ii) of SIMA provides that the CBSA must be of the opinion that there is sufficient reason to believe that the domestic prices are not substantially the same as they would be in a competitive market.

[88] The CBSA analyzed confidential information on the administrative record provided by BMZ, which indicated that BMZ made minimal adjustments to their selling prices and sold rebar to unrelated parties exclusively according to prices which, in the opinion of the CBSA, were set by the Government of Belarus during the PAP. The CBSA reviewed information for a common type of rebar sold in Belarus in terms of specification, grade and length for purposes of comparison to other markets, and found that BMZ sold this item at the same price for most of the PAP.

[89] The CBSA examined other named countries’ domestic selling prices for rebar where prices of scrap and rebar were established through market forces during the PAP to perform a comparison to the domestic selling prices of rebar in Belarus. The CBSA analyzed confidential information for similar goods to those analyzed in the rebar market in Belarus from companies located in Chinese Taipei, Portugal and Spain who provided a complete response to the Dumping RFI. The information provided by those companies indicated that domestic selling prices of the similar goods in those respective domestic markets fluctuated significantly during the same time period.

[90] In comparison to the domestic selling prices in Belarus, which remained stagnant throughout most of the period before an increase occurred in the last two months of the PAP, the domestic selling prices of the analyzed companies in Chinese Taipei, Portugal and Spain indicated a pattern of a decrease in selling prices before an upward correction occurred in the last three months of the PAP.

[91] Based on the above, there is sufficient reason to believe that the prices in the rebar sector in Belarus are not substantially the same as they would be if they were determined in a competitive market, and that the second condition of subparagraph 20(1)(b)(ii) of SIMA is therefore satisfied.

Section 20 Inquiry Conclusion

[92] Based on the information on the administrative record for this investigation, the CBSA is of the opinion that the Government of Belarus has a substantial monopoly of its export trade of the rebar sector; that domestic prices of rebar are substantially determined by the Government of Belarus; and that there is sufficient reason to believe that the domestic prices of rebar are not substantially the same as they would be in a competitive market.

Section 20 Normal Values

[93] Based on the opinion that conditions of paragraph 20(1)(b) of SIMA exist with respect to the rebar sector in Belarus, normal values were calculated pursuant to subparagraph 20(1)(c)(i) of SIMA, using the selling prices of like goods in a “surrogate” country.

[94] At the initiation of the section 20 inquiry, it was decided that, in the eventuality that normal values were to be determined in accordance with paragraph 20(1)(c) of SIMA using either the selling prices or costs of like goods in a “surrogate country”, the appropriate countries to serve as potential “surrogate” were already included as part of this dumping investigation.

[95] The CBSA designated Chinese Taipei, Portugal and Spain as surrogate countries. These countries were selected as they are named countries in this dumping investigation and the CBSA received substantially complete and verified responses to the Dumping RFI from exporters/producers in these countries. Given that more than one country was designated as a surrogate country and that those countries do not have a common currency, the normal values were calculated in U.S. dollars.

OJSC Byelorussian Steel Works

[96] BMZ is a producer and exporter of the subject goods to Canada and is located in Belarus. During the POI, all of BMZ’s export sales to Canada were made through a related company, Bel Kap Steel LLC (Belkap), a vendor of subject goods located in the U.S.

[97] BMZ provided a response to the Dumping RFI. Supplemental RFIs were sent to BMZ to gather additional information and seek clarification. Officers of the CBSA met with representatives of BMZ at their offices and facilities in Belarus to verify information provided by the company. BMZ’s submission was considered substantially complete for purposes of the final determination.

[98] Normal values for BMZ were determined pursuant to subparagraph 20(1)(c)(i) of SIMA, based on the weighted average selling prices of like goods sold by producers located in the surrogate countries.

[99] For the subject goods exported by BMZ to Canada during the POI, export prices were determined in accordance with section 24 of SIMA, based on the exporter’s selling price less all costs, charges and expenses resulting from the exportation of the goods.

[100] For the final determination, the total normal value compared with the total export price results in a margin of dumping of 37.5% for BMZ, expressed as a percentage of export price.

Chinese Taipei

Feng Hsin Steel Co., Ltd.

[101] Feng Hsin Steel Co., Ltd. (Feng Hsin) is a producer and exporter of the subject goods and is located in Chinese Taipei.

[102] Feng Hsin provided a response to the Dumping RFI. Supplemental RFIs were sent to Feng Hsin to gather additional information and seek clarification. A desk audit was completed to review and verify the submission provided by the exporter. Feng Hsin’s submission was considered substantially complete for the purposes of the final determination.

[103] Feng Hsin had a sufficient number of domestic sales of like goods during the PAP. Consequently, normal values were determined in accordance with section 15 of SIMA based on domestic selling prices of like goods.

[104] For the subject goods exported by Feng Hsin to Canada during the POI, export prices were determined in accordance with section 24 of SIMA, based on the exporter’s selling price less all costs, charges and expenses resulting from the exportation of the goods.

[105] For the final determination, the total normal value compared with the total export price results in a margin of dumping of 0% for Feng Hsin, expressed as a percentage of export price.

Lo-Toun Steel & Iron Works Co., Ltd.

[106] Lo-Toun Steel & Iron Works Co., Ltd. (Lo-Toun) is a producer and exporter of the subject goods to Canada and is located in Chinese Taipei.

[107] Lo-Toun provided a response to the Dumping RFI. Supplemental RFIs were sent to Lo Toun to gather additional information and seek clarification. A desk audit was completed to review and verify the submission provided by the exporter.

[108] The CBSA’s review and verification of Lo-Toun’s submission uncovered inconsistencies and discrepancies in certain submitted information. Although Lo-Toun was accorded opportunities to address the inconsistencies and discrepancies, sufficient information was not provided by Lo Toun to address the issues. As a result, Lo-Toun’s submission was considered to be unreliable and was not taken into account in this dumping investigation for the purposes of the final determination.

[109] For the subject goods exported by Lo-Toun to Canada during the POI, export prices were determined in accordance with section 24 of SIMA, based on the exporter’s selling price less all costs, charges and expenses resulting from the exportation of the goods

[110] For the final determination, the normal values for Lo Toun were determined using the methodologies explained in the “All Other Exporters” section later in this document. Based on these methodologies, the margin of dumping for Lo Toun is 108.5%, expressed as a percentage of the export price.

Power Steel Co., Ltd.

[111] Power Steel Co., Ltd. (Power Steel) is a producer and exporter of the subject goods to Canada and is located in Chinese Taipei.

[112] Power Steel provided a response to the Dumping RFI. Supplemental RFIs were sent to Power Steel to gather additional information and seek clarification. Officers of the CBSA met with representatives of Power Steel at their offices and facilities in Chinese Taipei to verify information provided by the company.

[113] The CBSA’s review and verification of Power Steel’s submission uncovered inconsistencies and discrepancies in certain submitted information. Although Power Steel was accorded opportunities to address the inconsistencies and discrepancies, sufficient information was not provided by Power Steel to address the issues. Power Steel’s submission was considered to be unreliable and was not taken into account in this dumping investigation for the purposes of the final determination.

[114] For the final determination, the normal values and export prices for Power Steel were determined using the methodologies explained in the “All Other Exporters” section later in this document. Based on these methodologies, the margin of dumping for Power Steel is 108.5%, expressed as a percentage of the export price.

Tung Ho Steel Enterprise Corporation

[115] Tung Ho Steel Enterprise Corporation (Tung Ho) is a producer and exporter of the subject goods and is located in Chinese Taipei.

[116] Tung Ho provided a response to the CBSA’s Dumping RFI. Supplemental RFIs were sent to Tung Ho to gather additional information and seek clarification. Officers of the CBSA met with representatives of Tung Ho at their offices and facilities in Chinese Taipei to verify information provided by the company. Tung Ho’s submission was considered substantially complete for the purposes of the final determination.

[117] Tung Ho had a sufficient number of domestic sales of like goods during the PAP. Consequently, normal values were determined in accordance with section 15 of SIMA based on domestic selling prices of like goods.

[118] For the subject goods exported by Tung Ho to Canada during the POI, export prices were determined in accordance with section 24 of SIMA, based on the exporter’s selling price less all costs, charges and expenses resulting from the exportation of the goods.

[119] For the final determination, the total normal value compared with the total export price results in a margin of dumping of 5.9% for Tung Ho, expressed as a percentage of export price.

Hong Kong

Shiu Wing Steel Limited

[120] Shiu Wing Steel Limited (Shiu Wing) is a producer and exporter of the subject goods to Canada and is located in Hong Kong.

[121] Shiu Wing provided a response to the CBSA’s Dumping RFI. Supplemental RFIs were sent to Shiu Wing to gather additional information and seek clarification. Officers of the CBSA met with representatives of Shiu Wing at their offices and facilities in Hong Kong to verify information provided by the company. Shiu Wing’s submission was considered substantially complete for the purposes of the final determination.

[122] Although Shiu Wing had domestic sales of like goods during the PAP, normal values for Shiu Wing could not be determined in accordance with section 15 of SIMA as there were not such a number of sales of like goods that complied with all the terms and conditions referred to in sections 15 and 16 of SIMA as to permit a proper comparison with the sales of the goods to the importer in Canada. As such, normal values were determined pursuant to paragraph 19(b) of SIMA, based on the aggregate of the cost of production of the goods, a reasonable amount for administrative, selling and all other costs and a reasonable amount for profits.

[123] In this regard, the amount for profits was determined in accordance with subparagraph 11(1)(b)(ii) of the Special Import Measures Regulations (SIMR) by using Shiu Wing’s profitable domestic sales of goods that were of the same general category as the subject goods exported to Canada during the POI.

[124] For the subject goods exported by Shiu Wing to Canada during the POI, export prices were determined in accordance with section 24 of SIMA, based on the exporter’s selling price less all costs, charges and expenses resulting from the exportation of the goods.

[125] For the final determination, the total normal value compared with the total export price results in a margin of dumping of 54% for Shiu Wing, expressed as a percentage of export price.

Japan

Marubeni-Itochu Steel Inc.

[126] Marubeni-Itochu Steel Inc. (MISI) is an exporter of the subject goods to Canada and is located in Japan. During the POI, MISI purchased subject goods that it exported to Canada from three producers, Jonan Steel Corporation, Sanko Seiko Co., Ltd. and Chiyoda Steel Co., Ltd., all located in Japan.

[127] MISI provided a response to the Dumping RFI. Supplemental RFIs were sent to MISI to gather additional information and seek clarification. A desk audit was completed to review and verify the submission provided by the exporter.

[128] Although MISI’s submission was considered substantially complete for the purposes of the final determination, sufficient information has not been provided from the producers’ of the goods exported by MISI in order to determine normal values.

[129] For the subject goods exported by MISI to Canada during the POI, export prices were determined in accordance with section 24 of SIMA, based on the exporter’s selling price less all costs, charges and expenses resulting from the exportation of the goods.

[130] For the final determination, the normal values and export prices for MISI will be determined using the methodologies explained in the “All Other Exporters” section later in this document. Based on these methodologies, the margin of dumping for MISI is 108.5%, expressed as a percentage of the export price.

Portugal

Metalurgica Galaica, S.A.

[131] Metalurgica Galaica, S.A. (MEGASA) is a producer and exporter of the subject goods located in Portugal with its head office in Spain.

[132] MEGASA provided a response to the Dumping RFI. Supplemental RFIs were sent to MEGASA to gather additional information and seek clarification. Officers of the CBSA met with representatives of MEGASA at their offices and facilities in Portugal and Spain to verify information provided by the company. MEGASA’s submission was considered substantially complete for the purposes of the final determination.

[133] MEGASA had domestic sales of like goods during the PAP. Where applicable, normal values were either determined in accordance with section 15 of SIMA, based on domestic selling prices of like goods or in accordance with paragraph 19(b) of SIMA, based on the aggregate of cost of production, a reasonable amount for administrative, selling and all other costs, and a reasonable amount for profits.

[134] In this regard, the amount for profits was determined in accordance with subparagraph 11(1)(b)(ii) of SIMR by using MEGASA’s profitable domestic sales of goods that were of the same general category as the subject goods exported to Canada during the POI.

[135] For the subject goods exported by MEGASA to Canada during the POI, export prices were determined in accordance with section 24 of SIMA, based on the exporter’s selling price less all costs, charges and expenses resulting from the exportation of the goods.

[136] For the final determination, the total normal value compared with the total export price results in a margin of dumping of 2.4% for MEGASA, expressed as a percentage of export price.

Spain

Celsa Atlantic, S.L.

[137] Celsa Atlantic, S.L. (Celsa Atlantic) is a producer and exporter of the subject goods and is located in Spain.

[138] Celsa Atlantic provided a response to the Dumping RFI. Supplemental RFIs were sent to Celsa Atlantic to gather additional information and seek clarification. Officers of the CBSA met with representatives of Celsa Atlantic at their offices and facilities in Spain to verify information provided by the company. Celsa Atlantic’s submission was considered substantially complete for the purposes of the final determination.

[139] Celsa Atlantic had domestic sales of like goods during the PAP. Where applicable, normal values were either determined in accordance with section 15 of SIMA, based on domestic selling prices of like goods or in accordance with paragraph 19(b) of SIMA, based on the aggregate of cost of production, a reasonable amount for administrative, selling and all other costs, and a reasonable amount for profits.

[140] In this regard, the amount for profits was determined in accordance with subparagraph 11(1)(b)(ii) of SIMR by using Celsa Atlantic’s profitable domestic sales of goods that were of the same general category as the subject goods exported to Canada during the POI.

[141] For the subject goods exported by Celsa Atlantic to Canada during the POI, export prices were determined in accordance with section 24 of SIMA, based on the exporter’s selling price less all costs, charges and expenses resulting from the exportation of the goods.

[142] For the final determination, the total normal value compared with the total export price results in a margin of dumping of 37% for Celsa Atlantic, expressed as a percentage of export price.

Nervacero S.A.

[143] Nervacero S.A. (Nervacero) is a producer and exporter of the subject goods and is located in Spain.

[144] Nervacero provided a response to the Dumping RFI. Supplemental RFIs were sent to Nervacero to gather additional information and seek clarification. Officers of the CBSA met with representatives of Nervacero at their offices and facilities in Spain to verify information provided by the company. Nervacero’s submission was considered substantially complete for the purposes of the final determination.

[145] Nervacero had a sufficient number of domestic sales of like goods during the PAP. Consequently, normal values were determined in accordance with section 15 of SIMA based on domestic selling prices of like goods.

[146] For the subject goods exported by Nervacero to Canada during the POI, export prices were determined in accordance with section 24 of SIMA, based on the exporter’s selling price less all costs, charges and expenses resulting from the exportation of the goods.

[147] For the final determination, the total normal value compared with the total export price results in a margin of dumping of 39.6% for Nervacero, expressed as a percentage of export price.

All Other Exporters

[148] At the initiation of the investigation, all known and potential exporters were sent a Dumping RFI in order to solicit information required for purposes of determining normal values and export prices of subject goods in accordance with the provisions of SIMA. As such, all exporters were given the opportunity to participate in the investigation. In the RFI, the exporters were notified that failure to submit all required information and documentation, including non confidential versions, or failure to permit verification of any information, may result in the normal values of the subject goods exported by their company being based on the facts available. It was further stated that such a decision would be less favourable to their company than if complete and verifiable information were made available.

[149] Where, in the opinion of the CBSA, sufficient information was not provided to enable the determination of normal values or export prices, normal values and export prices were determined under a ministerial specification pursuant to subsection 29(1) of SIMA on the basis of facts available. In establishing the methodology for determining normal values and export prices under the ministerial specification, the CBSA examined all information on the record, including information from the complaint, information provided by exporters, publicly available information and customs documentation.

[150] The CBSA considered that the normal values and export prices determined for the exporters whose submission was verified and substantially complete for the final determination, rather than the information provided in the complaint, was the best information on which to base the methodology for determining normal values since it reflects exporters’ trading practices during the POI. The CBSA examined the difference between the normal value and export price of each individual transaction for the exporters where sufficient information was provided in order to obtain an appropriate amount for the normal value methodology. The transactions were also examined to ensure that no anomalies were considered, however, no anomalies were identified.

[151] The CBSA considers that the highest amount by which the normal value exceeded the export price found on an individual transaction (expressed as a percentage of the export price), is an appropriate basis for determining normal values for all other exporters. This method of determining normal values is based on information on the record and limits the advantage that an exporter may gain from not providing necessary information requested in a dumping investigation as compared to an exporter that did provide the necessary information. Therefore, the normal values were determined under a ministerial specification pursuant to subsection 29(1) of SIMA, based on the export price as determined under section 24, 25 or 29 of SIMA, plus an amount equal to 108.5% of that export price.

[152] The CBSA considered that the information submitted on the CBSA customs entry documentation was the best information on which to determine the export price of the goods as it reflects actual import data. This information is more comprehensive than what was available in the complaint.

[153] Based on the above methodologies, the subject goods exported to Canada by all other exporters were found to be dumped by a margin of dumping of 108.5%, expressed as a percentage of the export price.

Summary of Results – Dumping

[154] A summary of the results of the dumping investigation respecting all subject goods released into Canada during the POI follows:

Summary of Results – Dumping
Period of Investigation (June 1, 2015, to May 31, 2016)

Named Country	Volume of Dumped Goods as Percentage of Country Imports	Margins of Dumping as Percentage of Export Price	Volume of Goods as Percentage of Total Imports	Volume of Dumped Goods as Percentage of Total Imports
Belarus	100%	37.5%	8.8%	8.8%
Chinese Taipei	98.3%	97.5%	14.5%	14.2%
Hong Kong	100%	54%	5.8%	5.8%
Japan	100%	108.5%	3.5%	3.5%
Portugal	100%	2.4%	17.7%	17.7%
Spain	100%	38.2%	10.3%	10.3%

[155] Under paragraph 41(1)(a) of SIMA, the CBSA shall make a final determination of dumping when it is satisfied that the goods have been dumped and that the margin of dumping of the goods of a country is not insignificant. Pursuant to subsection 2(1) of SIMA, a margin of dumping of less than 2% of the export price of the goods is defined as insignificant.

[156] The margins of dumping of rebar from the named countries are above 2% of the export price of the goods and are, therefore, not insignificant.

[157] On the basis of the results of the dumping investigation, the CBSA is satisfied that certain concrete reinforcing bar originating in or exported from Belarus, Chinese Taipei, Hong Kong, Japan, Portugal and Spain has been dumped and that the margins of dumping are not insignificant. Consequently, on April 3, 2017, the CBSA made a final determination of dumping pursuant to paragraph 41(l)(a) of SIMA.

[158] The provisional period began on January 3, 2017, and will end on the date the CITT issues its finding. The CITT is expected to issue its decision by May 3, 2017. Subject goods imported during the provisional period will continue to be assessed provisional duties as determined at the time of the preliminary determination. For further details on the application of provisional duties, refer to the Statement of Reasons issued for the preliminary determination, which is available through the CBSA’s website at: www.cbsa-asfc.gc.ca/sima-lmsi/menu-eng.html.

[159] If the CITT finds that the dumped goods have not caused injury and do not threaten to cause injury, all proceedings relating to this investigation will be terminated. In this situation, all provisional duties paid or security posted by importers will be returned.

[160] If the CITT finds that the dumped goods have caused injury, the anti dumping duty payable on subject goods released by the CBSA during the provisional period will be finalized pursuant to section 55 of SIMA. Imports released by the CBSA after the date of the CITT’s finding will be subject to anti-dumping duty equal to the margin of dumping.

[161] The importer in Canada shall pay all applicable duties. If the importers of such goods do not indicate the required SIMA code or do not correctly describe the goods in the customs documents, an administrative monetary penalty could be imposed. The provisions of the Customs Act apply with respect to the payment, collection or refund of any duty collected under SIMA.^{Footnote 10} As a result, failure to pay duty within the prescribed time will result in the application of interest.

[162] In the event of an injury finding by the CITT, normal values have been provided to the named exporters for future shipments to Canada and these normal values would come into effect the day after an injury finding. Information regarding normal values of the subject goods should be obtained from the exporter.

[163] Exporters of subject goods who did not respond to the RFI or who did not provide sufficient information or whose submission was considered to be unreliable in the dumping investigation will have normal values established by advancing the export price by 108.5% based on a ministerial specification pursuant to subsection 29(1) of SIMA. Anti-dumping duty will apply based on the amount by which the normal value exceeds the export price of the subject goods.

[164] For purposes of the preliminary determination of dumping, the CBSA is responsible for determining whether the actual and potential volume of goods is negligible. After the preliminary determination of dumping, in accordance with subsection 42(4.1) of SIMA, the CITT is required to terminate its inquiry in respect of any goods if it determines that the volume of dumped goods from a country is negligible.

[165] Under certain circumstances, anti-dumping duty can be imposed retroactively on subject goods imported into Canada. When the CITT conducts its inquiry on material injury to the domestic industry, it may consider if dumped goods that were imported close to or after the initiation of the investigation constitute massive importations over a relatively short period of time and have caused injury to the domestic industry. Should the CITT issue a finding that there were recent massive importations of dumped goods that caused injury, imports of subject goods released by the CBSA in the 90 days preceding the day of the preliminary determination could be subject to anti-dumping duty.

[166] A notice of this final determination of dumping will be published in the Canada Gazette pursuant to paragraph 41(3)(a) of SIMA.

[167] This Statement of Reasons has been provided to persons directly interested in this proceeding. It is also available through the CBSA’s website at the address below. For further information, please contact the officers identified as follows:

Case briefs were received, by the due date of March 1, 2017, on behalf of:

• AltaSteel Ltd. (AltaSteel) and ArcelorMittal Long Products Canada, g.p. (ArcelorMittal LCNA) (complainants)^{Footnote 11};
• Gerdau Ameristeel Corporation (Gerdau) (complainant)^{Footnote 12};
• Embassy of Spain in Ottawa (government)^{Footnote 13};
• Power Steel Co., Ltd. (Power Steel) (exporter)^{Footnote 14};
• European Commission (government)^{Footnote 15};
• Feng Hsin Steel Co., Ltd. (Feng Hsin) (exporter)^{Footnote 16};
• Government of Hong Kong (government)^{Footnote 17};
• Shiu Wing Steel Limited (Shiu Wing) (exporter/vendor)^{Footnote 18};
• OJSC Byelorussian Steel Works (BMZ) (exporter), Bel Kap Steel LLC (Belkap) (vendor) and the Government of Belarus^{Footnote 19}; and
• Celsa Atlantic, S.L. (Celsa Atlantic) and Nervacero S.A. (Nervacero (exporters)^{Footnote 20}.

Reply submissions were received, by the due date of March 8, 2017, on behalf of:

• AltaSteel and ArcelorMittal LCNA^{Footnote 21};
• Gerdau^{Footnote 22};
• Shiu Wing^{Footnote 23}; and
• BMZ, Belkap and the Government of Belarus^{Footnote 24}.

On March 3, 2017, after the due date of the case briefs, counsel for Power Steel submitted a document relating to the announcement of the Department of Commerce of the International Trade Administration of the United States of America’s preliminary determination of dumping of imports of steel concrete reinforcing bar from Japan, Taiwan (Chinese Taipei) and Turkey. The Canada Border Services Agency (CBSA) does not consider any new information submitted by parties subsequent to the closing of the record date, except in certain exceptional circumstances. In this case, the new information was not taken into account in this investigation because it was not considered relevant or material in nature to warrant consideration.

Certain details provided in case briefs and reply submissions were designated as confidential information by the submitting parties. Consequently, this public Statement of Reasons does not disclose or discuss parts of representations where such a designation was made.

The material issues raised by parties through case briefs for which sufficient information was disclosed in the public versions are summarized below along with the CBSA’s consideration of and response to those arguments.

Completeness of Exporters submissions

Case Briefs

Counsel for the complainants is of the view that the responses to the Dumping Request for Information (RFI) and to the Supplemental RFIs from all the exporters in this investigation are incomplete, inaccurate and unreliable. As a result, the CBSA should not determine company specific margins of dumping and should determine normal values for the exporters by ministerial specification under subsection 29(1) of the Special Import Measures Act (SIMA).

Counsel for Power Steel argued that the submitted information for this investigation by Power Steel should be declared to have been verified and should be used for the purposes of determining normal values and export prices for the final determination.

Reply Submissions

Counsel for Shiu Wing submitted that the CBSA should disregard the legal submissions made by the complainants as they are without merit. Shiu Wing has cooperated in this investigation and was verified on-site by the CBSA of its responses to the Dumping RFI and Supplemental RFIs.

Counsel for the complainants argued that the declaration made by Power Steel that its information had been verified is not warranted and reiterated that Power Steel had resubmitted completely new appendices and the CBSA had treated these changes as being a completely new submission. Counsel for the complainants concluded that the deficiencies and inconsistencies identified in their case briefs continue to justify the determination of normal values for the exporters under subsection 29(1) of SIMA.

CBSA’s Response

The CBSA has reviewed the responses from the exporters to the RFIs and to the Supplemental RFIs. The CBSA has also conducted both on-site verifications and desk audits of the exporters’ submissions. In instances where an exporter’s submission was considered substantially complete for the purposes of the final determination, the CBSA determined normal values, export prices and a margin of dumping on the basis of the exporter’s submission. For exporters who did not respond to the RFI or who did not provide sufficient information or whose submissions were considered unreliable, the CBSA determined normal values based on a ministerial specification pursuant to subsection 29(1) of SIMA.

Model-specific costs

Case Brief

Counsel for the complainants submitted that each exporter that failed to provide monthly or model specific costs should have its normal values determined by ministerial specification.

Reply Submission

Counsel for Shiu Wing stated, that as per Canada’s obligations under the World Trade Organization’s (WTO) Anti-Dumping Agreement (ADA), the CBSA is to calculate costs on the basis of records kept by the exporter provided that these records accord with generally accepted accounting principles of the exporting country and reasonably reflect the costs associated with the production and sale of the product under consideration and as per SIMA, the exporter is to provide the CBSA with its costs that are attributable to, or in manner related to, the production of the goods. As such, Shiu Wing’s costs should be accepted on the basis of its records kept.

CBSA’s Response

The CBSA conducted on-site verifications or desk audits of the exporters whose submissions were used to determine normal values. The CBSA verified the costs provided in response to the Dumping RFI for each of these exporters, reconciled them to the accounting records and then to the financial statements.

As a result, the CBSA is satisfied that the costs of production for these exporters are complete and represent the full cost of production.

All Other Exporter Rate

Case Briefs

The Embassy of Spain in Ottawa submitted that the CBSA should take into account only the information submitted by the exporters in Spain who responded in the CBSA’s investigation in order to calculate the “residual margin” for the other exporters from Spain and not use the highest margin calculated for an exporter who is located in another named country.

The European Commission (EC) submitted that the CBSA acted inconsistently with the WTO ADA when establishing the dumping margin and duty rate for “all other exporters”, and referred to the findings of the panel in Mexico – Definitive Anti-Dumping Measures on Beef and Rice (DS295) and Canada – anti-dumping measures on imports of certain carbon steel welded pipe from the separate customs territory of taiwan, penghu, kinmen and matsu (DS482) in support of its argument. The EC urged the CBSA to align its determination with regard to the duty rate for all other exporters with the relevant WTO requirements.

Reply Submission

Counsel for the complainants noted that the EC appears to recognize that the WTO Panel did not find that applying the highest margin on an individual transaction for determining the all other exporters rate is inconsistent with the ADA. They concluded that the CBSA is justified in maintaining the methodology of the all other exporters rate so long that it provides an explanation as to why it was chosen. Non-cooperative exporters should not be placed in a position where they stand to benefit from refusing to cooperate with the CBSA in an investigation.

CBSA’s Response

In December 2016, the WTO Dispute Settlement Body adopted the panel’s findings and recommendations in DS482. The panel found that certain aspects of the CBSA’s calculation of the duty rate on “all other exporters” were inconsistent with the ADA.

The CBSA is considering the implications of the panel’s findings in DS482 on its practice. Canada is required to implement the recommendations of the panel by March 25, 2018.

Other issues

Case Briefs

Counsel for Celsa Atlantic and Nervacero submitted arguments relating to certain adjustments that the CBSA did or did not allow to the total cost of the goods at the preliminary determination.

Counsel for Feng Hsin argued as to the inclusion or exclusion of certain non operating incomes and expenses for purposes of calculating other expenses.

Counsel for Shiu Wing made submissions with regards to the following issues: treatment of raw material costs, certain overhead expenses, trade level and reasonable amount for profits.

Counsel for Power Steel argued that the volume of dumped goods from Chinese Taipei is negligible and the investigation should be terminated against Chinese Taipei.

The Government of Hong Kong Special Administrative Region submitted that there is insufficient evidence to support the allegation of injury caused by the subject goods exported from Hong Kong.

Reply Submission

Counsel for the complainants submitted that given Feng Hsin had not been verified on site, the CBSA should not rely on its submission for purposes of calculating normal values at the final determination.

CBSA’s Response

The CBSA conducted on-site verifications of Celsa Atlantic, Nevacero and Shiu Wing and a desk audit for Feng Hsin and is satisfied as to the completeness of the submissions from these exporters. Based on the information on the record and in accordance with SIMA and the Special Import Measures Regulations, the CBSA has taken the representations on these issues into account when determining normal values.

The CBSA notes that subsequent to the preliminary determination, the Canadian International Trade Tribunal (CITT) assumes the responsibility for determining if the volume of dumped goods from a country is negligible. Furthermore, the CBSA does not address the allegation of injury in its final determination. These issues are currently being examined by the CITT.

Application of Section 20 of SIMA with respect to the rebar sector in Belarus

Case Brief

Counsel for the complainants submitted that the evidence on the CBSA’s record continues to support the existence of the conditions of section 20(1)(b) of SIMA in the rebar sector in Belarus, and that the CBSA did not receive any information following the preliminary determination that would justify altering its preliminary findings under section 20 of SIMA, including any information from potential other exporters in Belarus. Counsel for the complainants outlined several key factors, including information contained in the CBSA’s preliminary section 20 report and other information contained in the exporter and Government of Belarus responses to RFIs, which establish that the conditions of paragraph 20(1)(b) of SIMA are met with respect to rebar.

Counsel for BMZ, Belkap and the Government of Belarus submitted that in its preliminary determination, the CBSA erroneously concluded that the conditions of section 20 of SIMA exist in Belarus, and provided case law and provided other examples with respect to the following issues:

• Legal Overview of Section 20(1)(b): Historical context and international law underpinnings of section 20 make clear that the present scenario is not the type of situation that the section was designed to address.
• Responsibilities of the President as Administrative Decision-maker: Findings must be based on “positive evidence”, not assumptions. Evidence available on the record must be examined. The CBSA must follow the decision-making procedures set out in the SIMA Handbook.
• Analysis of Evidence – Legal Test: Sub-paragraph (i) of section 20(1)(b) is a test of whether a monopoly on exports exists in law (a legal monopoly), not in practice (a "de facto" monopoly). Sub-paragraph (ii) of section 20(1)(b), on the other hand, is a test of whether the government controls prices in practice and whether there is evidence that the control resulted in material differences in pricing. The CBSA must apply these tests correctly to the record evidence and determine whether a conclusion that a section 20 condition exists is supportable based on the facts.
• Analysis of Evidence – 20(1)(b)(i): The verified evidence on the record confirms that there is no export monopoly present in the rebar sector in Belarus.
• Analysis of Evidence – 20(1)(b)(ii): The verified evidence on the record reveals no supporting evidence to conclude that the Government of Belarus in fact controls prices of rebar, or that domestic rebar prices were substantially different than they would have been in a competitive market.

Reply Submissions

Counsel for the complainants submitted that there is no basis for the CBSA to consider prospective or ongoing efforts that may or may not result in economic reform in Belarus. They further submitted that counsel for the Government of Belarus and BMZ misinterpreted and misquoted the SIMA Handbook’s guidance on forming an opinion under section 20 of SIMA in its case brief. They submitted that counsel for the Government of Belarus and BMZ have misinterpreted the “test” on whether the government has a monopoly or substantial monopoly of its export trade, and that the CBSA has wide discretion, as they are forming an opinion, not making a determination. They also submitted that the prices of scrap are regulated by the Government of Belarus, which furthers the argument that prices of rebar are substantially determined by the Government of Belarus. They also counter-argued that counsel’s description of the CBSA’s “connect the dots” methodology of considering whether the Government of Belarus substantially determines the prices of rebar has fewer dots than suggested, inferring that the CBSA’s opinion should be simply based on the evidence. Counsel for the complainants made mostly confidential counter-arguments with respect to whether prices in Belarus are substantially the same as they would be if they were determined in a competitive market.

Counsel for BMZ, Belkap and the Government of Belarus replied that counsel for the complainants’ approach to reaching the conclusions that the conditions of section 20 of SIMA exist is very simplistic, and reiterated that the formula “(one company in sector) + (state ownership) = export monopoly = non-market economy”^{Footnote 25} is not in accordance with the SIMA Handbook. They also deny allegations that the Government of Belarus’ submission was incomplete.

CBSA’s Response

The CBSA exercised its investigative function and conducted a section 20 inquiry to examine the extent to which the conditions of section 20 exist in the rebar sector.

The CBSA considered information provided by the complainants, the Government of Belarus, BMZ and obtained through its own research. Based on this information, the CBSA formed the opinion that the conditions of paragraph 20(1)(b) of SIMA exist in Belarus, with respect to the rebar sector.

Further explanation of the CBSA’s section 20 opinion can be found in the “Section 20 Inquiry” portion of this document.

With regards to the argument that the test of whether a monopoly on exports exists is limited to whether a monopoly exists in law, the CBSA considers whether the government controls its export trade, either in law or in practice, as indicated in the SIMA Handbook.

Application of Section 15 and 19 of SIMA in calculating normal values for exporter in Belarus

Case Briefs and Reply Submission

Counsel for BMZ, Belkap and the Government of Belarus submitted arguments that section 20 of SIMA does not apply in this investigation, and that the CBSA should rely on the verified domestic sales information to calculate normal values pursuant to section 15 of SIMA, or in the absence of such a sufficient number of sales required, that the CBSA should rely on the verified costing information to calculate normal values pursuant to section 19 of SIMA.

Counsel for the complainants submitted arguments and a reply submission with respect to the completeness and accuracy of the information provided by BMZ in the Dumping RFI. They also presented arguments as to why the domestic sales and costing information cannot be relied on, and submitted that if the CBSA did not form an opinion pursuant to subsection 20(1) of SIMA, that normal values should be determined pursuant to section 29 of SIMA, by way of ministerial specification.

CBSA’s Response

Based on the evidence on the administrative record, the CBSA has formed the opinion that the conditions of paragraph 20(1)(b) of SIMA exist in Belarus, with respect to the rebar sector.

Exporter	Margins of Dumping as a % of Export Price
Belarus
OJSC Byelorussian Steel Works	37.5%
Chinese Taipei
Feng Hsin Steel Co., Ltd.	0%
Lo-Toun Steel & Iron Works Co., Ltd.	108.5%
Power Steel Co., Ltd.	108.5%
Tung Ho Steel Enterprise Corp.	5.9%
Hong Kong
Shiu Wing Steel Limited	54%
Japan
Marubeni-Itochu Steel Inc.	108.5%
Portugal
Metalurgica Galaica, S.A.	2.4%
Spain
Celsa Atlantic, S.L.	37%
Nervacero S.A.	39.6%
All Other Exporters	108.5%

Note: The margins of dumping reported in the table above are the margins determined by the CBSA for purposes of the final determination of dumping. These margins may not reflect the amount of anti dumping duty to be levied on future importations of dumped goods. In the event of an injury finding by the CITT, specific normal values have been provided to the exporters which provided sufficient information for future shipments to Canada and these normal values would come into effect the day after an injury finding. Information regarding normal values of the subject goods should be obtained from the exporter. Imports from exporters/producers that did not provide sufficient information to the CBSA during the dumping investigation, including any exporters who are not listed in the table above will be subject to the All Other Exporters anti dumping duty rate of 108.5%, expressed as a percentage of the export price, pursuant to a ministerial specification. Please consult the SIMA Self-Assessment Guide for more detailed information explaining how to determine the amount of SIMA duties owing.

Normally, normal values will not be applied retroactively. However, normal values may be applied retroactively in cases where the parties have not advised the CBSA in a timely manner of substantial changes that affect values for SIMA purposes. Therefore, where substantial changes occur in prices, market conditions, costs associated with production and sales of the goods, the onus is on the concerned parties to advise the CBSA.