1930, as amended, by reason of the regional incentive payments mentioned above.

An amendment to "Notice of Preliminary Countervailing Duty Determination" was published in the Federal Register, 40 F.R. 34423 on August 15, 1975, extending the time within which the public could make submissions. On January 7, 1976, a "Notice of Final Countervailing Duty Determination" was published in the Federal Register, 41 F.R. 1300, and provides:

Information has now been received that permits a more complete analysis of the alleged bounties and grants. Under various regional development programs administered by the Federal and State Governments, low interest loans and investment subsidies in the form of cash grants and tax credits have been given to producers of float glass. The German Government has advised the Treasury Department that these benefits have the effect of offsetting disadvantages which would discourage industry from moving to and expanding in less prosperous regions. Inasmuch as the recipient glass producers sell a preponderance of their production in the West German home market (not less than 80 percent and up to 99 percent), the level of exports to the United States is a small percentage of the amount exported, and the amount of assistance provided by the regional incentive programs is less than 2 percent of the value of float glass produced, these benefits are not regarded as bounties or grants within the meaning of section 303 of the Tariff Act of 1930, as amended (19 U.S.C. 1303). All other allegations alleged in the petition are found not to be applicable to the manufacturer, producer or exporter.

Accordingly, for the reasons stated above, it is hereby determined that no bounty or grant is being paid or bestowed, directly or indirectly, within the meaning of section 303, Tariff Act of 1930, as amended (19 U.S.C. 1303), upon the manufacture, production, or exportation of float glass from West Germany.

On January 28, 1976, plaintiffs, pursuant to section 516(d) of the Tariff Act of 1930, as amended by section 321 (f) (1), filed a timely notice of their desire to contest the negative countervailing duty determination by the Secretary. The Secretary then caused publication of plaintiffs' notice in the Federal Register of March 10, 1976, 41 F.R. 10236 (1976). Plaintiffs, on March 15, 1976, commenced action by the filing of a summons with this court.

The facts relating to the two producers of float glass in the Federal Republic of Germany and the assistance given by the federal and state governments in Germany establish that Vereinigte Glaswerke GMBH (Vereinigte) and Flchglas/Delog/Detal (Flachglas) are the two manufactures of float glaas in West Germany. In January 1971 Vereinige completed construction of a float glass facility at Herzogenrath, West Germany, which is in the state of North Rhine-Westphalia, and Flachglas completed construction of its facility in Gladbeck, which is also

in the state of North Rhine-Westphalia in 1973. The state of North Rhine-Westphalia was in an area qualifying for certain federal and state regional development assistance programs. Section 32 of the Coal Mining Adjustment Law of Germany permits eligible firms to apply for an investment premium of 10 percent of the production cost for plants established between April 30, 1967, and December 31, 1971, or for plants whose construction had been started before January 1, 1973. This investment premium was in the form of a tax credit which could have been utilized to the extent that the deduction exceeded the tax payable in the year of construction. However, it could have been carried forward against such taxes payable for the succeeding four fiscal years after which any remaining tax credits were lost. These tax credits amounted to 10 percent of the depreciable assets as defined by law and were granted to Vereinigte in 1973 and retroactively applied to the 1970 and 1971 corporate taxes. Flachglas also received a credit of 10 percent of the depreciable assets as defined by law.

In addition to the above, the state of North Rhine-Westphalia provided taxable assistance from funds of the federal and state governments for the improvement of regional economic structures in economically weak regions. Vereinigte, on January 30, 1970, was provided with investment assistance which was utilized to partially finance the cost of its Herzogenrath facility. Flachglas also received said assistance in December 1972 and December 1973, which was used to partially finance the cost of its Gladbeck facility.

Under the European recovery program eligible enterprises could obtain loans at the interest rate of 6 percent per annum for a period from July 21, 1967, to the end of 1971. Vereinigte received a 12-year loan at the rate of 6 percent in 1970, the first 2 years free of redemption. The available commercial interest rate for similar issues was 8.5 percent per annum. Flachglas also received a 10-year loan at 6 percent interest in 1972, the first 18 months being free of redemption.

In 1970, the Federal Department of Labor of West Germany granted Vereinigte a 12-year loan with interest payable at the rate of 4 percent per annum, with the first 2 years free of redemption.

Vereinigte and Flachglas sold a preponderance of their production in the West German home market (not less than 80 percent and up to 99 percent). The amount of assistance provided by the regional incentive programs was less than 2 percent of the value of the float glass produced.

As indicated infra, float glass may be classified under nine item. numbers of the Tariff Schedules of the United States. The "Summaries of Trade and Tariff Information," schedule 5, volume 5, TC publication 365 (1971), contain the following pertinent information:

Ordinary glass is defined as flat glass other than special or colored glass and is usually clear or nearly clear glass whose

coloring or opacifying content is so low that light transmittance is virtually unhindered.

Plate glass and float glass are types of flat glass that have plane and parallel surfaces and show no distortion when objects are viewed through them. The two types of glass are virtually indistinguishable, differing principally in method of manufacture and cost of production. They are used inter-changeably in most applications although float glass is not produced as yet in all the thicknesses in which plate glass is made.

Plate glass is manufactured principally by using_the_rolled glass process that turns out a continuous ribbon of flat glass of the desired thickness and width. The sheet of glass, after passing through an annealing lehr to remove internal stresses, is cut to standard sizes before being subjected to grinding and polishing operations. In the finishing process, the surfaces of the plate glass are ground by machine to a very smooth flat surface, which is then polished by buffing. The plate glass may be ground or polished on one side at a time or on both sides simultaneously. In the process of grinding and polishing, the plate glass acquires perfectly plane and parallel surfaces.

1

Float glass is a relatively new type of flat glass (available commercially since 1959) which has virtually parallel surfaces similar to those of plate glass. The parallel surfaces of float glass, however, are achieved by floating the molten glass over molten metal rather than by grinding and polishing as is done with plate glass. Float glass is less costly to produce than plate glass principally because the float process does not require grinding and polishing operations.

*

Nearly all of the plate and float glass shipped by U.S. producers has consisted of glass ranging in thickness from one-eighth inch to one-fourth inch inclusive. In terms of square feet, considerably more than half of both the plate glass and the float glass shipped by U.S. producers in 1968 was one-eighth inch glass. *

"U.S. Industrial Outlook 1978" published by the United States Department of Commerce under the heading "Flat Glass" (p. 23) indicates the replacement of plate glass by float glass and makes the following statement:

The major products of the industry are float glass, tempered glass, and laminated glass. Tempered and laminated glasses are float glass that has received additional processing. Plate and sheet glass are made in small quantities, and have been replaced for all practical purposes by float glass. *** [See also "U.S. Industrial Outlook 1977."]

It is further noted that "Modern Glass Practice" by Samuel R. Scholes, Ph.D. (seventh revised ed. 1975), page 240, states float glass "is replacing conventional plate glass because of the great economy of its manufacture."

1 The float-glass process is patented, and U.S. producers of float glass are licensed by the British firm that invented the process.

The pertinent statutory provisions herein provide as follows: Section 303 (a), Tariff Act of 1930, as amended by section 331(a) of the Trade Act of 1974, 88 Stat. 1978, 2049-50:

(a) LEVY OF COUNTERVAILING DUTIES.-(1) Whenever any country, dependency, colony, province, or other political subdivision of government, person, partnership, association, cartel, or corporation, shall pay or bestow, directly or indirectly, any bounty or grant upon the manufacture or production or export of any article or merchandise manufactured or produced in such country, dependency, colony, province, or other political subdivision of government, then upon the importation of such article or merchandise into the United States, whether the same shall be imported directly from the country of production or otherwise, and whether such article or merchandise is imported in the same condition as when exported from the country of production or has been changed in condition by remanufacture or otherwise, there shall be levied and paid, in all such cases, in addition to any duties otherwise imposed, a duty equal to the net amount of such bounty or grant, however the same be paid or bestowed.

*

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(5) The Secretary shall from time to time ascertain and determine, or estimate, the net amount of each such bounty or grant, and shall declare the net amount so determined or estimated.

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Section 516 (d), Tariff Act of 1930, as amended by section 321 (f) (1) of the Trade Act of 1974, 88 Stat. 1978, 2048-49:

(d) Within 30 days after a determination by the Secretary

(1) under section 201 of the Antidumping Act, 1921 (19 U.S.C. 160), that a class or kind of foreign merchandise is not being, nor likely to be, sold in the United States at less than its fair value, or

(2) under section 303 of this Act that a bounty or grant is not being paid or bestowed,

an American manufacturer, producer, or wholesaler of merchandise of the same class or kind as that described in such determination may file with the Secretary a written notice of a desire to contest such determination. Upon receipt of such notice the Secretary shall cause publication to be made thereof and of such manufacturer's, producer's, or wholesaler's desire to contest the determination. Within 30 days after such publication, such manufacturer, producer, or wholesaler may commence an action in the United States Customs Court contesting such determination.

(g) If the cause of the action is sustained in whole or in part by a decision of the United States Customs Court or of the United States Court of Customs and Patent Appeals, merchandise of the character covered by the published decision of the Secretary, which is entered for consumption or withdrawn from warehouse

for consumption after the date of publication of the court decision, shall be subject to appraisement, classification, and assessment of duty in accordance with the final judicial decision in the action, and the liquidation of entries covering the merchandise so entered or withdrawn shall be suspended until final disposition is made of the action, whereupon the entries shall be liquidated, or if necessary, reliquidated in accordance with the final decision. Based upon the foregoing, it would appear that bounties or grants were bestowed on the production of float glass in the Federal Republic of Germany. Accordingly, the threshold issue for determination is whether the importations are subject to countervailing duties under the statute.

The statutory provision of section 303 (a) (1) requiring the assessment of such duties in using the language "there shall be levied and paid, in all such cases, in addition to any duties otherwise imposed, a duty equal to the net amount of such bounty or grant" is couched in mandatory language. However, if Congress intended that all assistance given by foreign governments are bounties or grants, there would be no reason to have given the Secretary authority to make a determination of whether a bounty or a grant had been bestowed. This is clearly evidenced by the following language utilized in United States (Ralph Valls, Party-in-Interest) v. Hammond Lead Products, Inc., 58 CCPA 129, C.A.D. 1017, 440 F. 2d 1024 (1971), cert. denied, 404 U.S. 1005 (1971):

The Congress is, of course, well aware of these problems, and it would seem it elects to rely on executive discretion to avoid making the United States ridiculous by penalizing imports from foreign countries which have taken reasonable action, action our own government takes or counsels. Countervailing duties are strong medicine, well calculated to arouse violent resentment in countries whose trade practices are branded by the court as unethical. In what has been hitherto the regular practice of the Treasury Department making the decision to assess countervailing duties, the decisions, not necessarily partisan political, but political in a broad sense, legislative, or of a policy nature, can be made by an agency that is equipped and staffed to make them. There can be no doubt that the Secretary is under a legal duty to assess countervailing duties if he sees a bounty or grant being paid, but we think he does and must exercise some discretion in defining what acts of foreign governments confer bounties or grants, when the case is doubtful.***

It is the function of the courts in interpreting statutory provisions to carry out the intent of Congress in enacting the law. In order to ascertain intent courts may resort to legislative history. Train v. Colorado Public Interest Research Group, 426 U.S. 1 (1976); A. N. Deringer, Inc. v. United States, 63 CCPA 37, C.A.D. 1161 (1975). Chief Judge Markey, speaking for the court in United States v.