SecProbe.io

June 22 , 2016

Mail Stop 4631

Via E -mail
Paulo Rogério Caffarelli
Principal Financial Officer
National Steel Company
Av. Brigadeiro Faria Lima, 3,400 – 20th floor
04538 -132, São Paulo -SP, Brazil

Re: National Steel Company
Form 20 -F for Fiscal Year Ended December 31, 201 5
Filed May 16, 2016
Respon se Letter Dated May 6, 2016
File No. 1 -14732

Dear Mr. Caffarelli :

We have reviewed your filing and response and have the following comments.  In some
of our comments, we may ask you to provide us with information so we may better understand
your disclosure.

Please respond to this letter within ten business days by amending your filing, by
providing the requested information, or by advising us when you will provide the requested
response.   If you do not believe our comments apply to your facts and circumstances or do not
believe an amendment is appropriate, please tell us why in your response.

After reviewing any amendment to your filing and the information you provide in
response to these  comments, we may have  additional comments.

Form 20 -F for Fiscal Year Ended December 31, 2015

Operating and Financial Review and Prospects, page 74

Critical Accounting Esti mates, page 82

Deferred Tax Assets, page 84

1. We note the disclosures you have provided in Note 15.b. regarding the realizability of
your deferred tax assets.  Please provide a more detailed description of the  positive and
negative evidence you  considered in making your determination of realizability of these
assets and how  that evidence was weighted.

Paulo Rogério Caffarelli
National Steel Compan y
June 22, 2016
Page 2

 For example, describe the nature of the underlying deferred tax assets that were reduced
in accordance with IAS 12.56 and explain how you determined that those remaining
balances will be utilized.  If you are relying on the reversal of your deferred tax liabilities,
please disclose as such and confirm that the deferred tax liabilities will reverse in the
same period, are for the same jurisdiction, and are o f the same character as the temporary
differences giving rise to the deferred tax assets.  If you are relying on the recognition of
future pre -tax income, please disclose the amount of pre -tax income that you need to
generate to realize the deferred tax as sets.  If you are relying on tax planning strategies,
please disclose the nature of your tax planning strategies, how each strategy supports the
realization of deferred tax assets, and any uncertainties, risks, or assumptions related to
these tax -planning strategies.   Refer to Section 501.14 of the Financial Reporting
Codification for guidance.

Results of Operations, page 86

Income Taxes, page 92

2. You indicate that your effective tax rate was positively impacted by a n R$829,265 benefit
related to results of subsidiaries taxed at different rates or not taxed.  We note that for
2014 this benefit was only R$1,772.  Please expand your disclosures to discuss the
underlying factors that contributed to this change so that readers can understand this
variance and assess any continuing impact of subsidiaries taxed at different rates or not
taxed.  To the extent material factors in your foreign operations include changes in your
jurisdictional mix of income that may be impacting your effective tax rate, explain the
changes and factors.

3. You indicate your effective tax rate was negatively impacted by a n R$177 million
adjustment related to tax loss and negative basis for which the tax credit was not recorded
and a negative impact of R$1,143 million related to tax credi ts not recorded in the year.
Please expand your disclosures to provide the underlying facts and circumstances that led
to these adjustments so that readers can full y understand the nature of these items.

Financial Statements

Statements of Income, page  F-3

4. We note that R$358,008 of your $1,615,951 profit for the year ended December 31, 2015
was allocated to non -controlling interests.  Please provide the disclosures required by
IFRS 12.12, and discuss the underlying reasons for changes in the profit or loss allocated
to non -controlling interests.

Paulo Rogério Caffarelli
National Steel Compan y
June 22, 2016
Page 3

 Statements of Changes in Stockholders’ Equity, page F -6

5. Please explain to us the nature of the R$674,354 non -controlling interests’ earnings
reserve adjustment recognized in your Consolidated Statement of  Changes in
Shareholder’s Equity.

Note 2 - Summary of Significant Accounting Policies, page F -8

2.a.a) Restatement of accounting balances, page F -23

6. Please explain the difference in the reclassification amounts you made on your balance
sheet to those mad e on your statements of cash flows for 2014 and 2013.

2.n) Concessions, page F -16

7. We have read your response to prior comment 1 from our letter to you dated February 8,
2016.  As previously requested, please quantify the amount of your assets which are
subject to reversion to the grantor.

2.r) Income tax and social contribution, page F -17

8. We note that you have revised your accounting for the calculation of current and deferred
income taxes to no longer base those amounts on substantially enacted laws.  With
reference to IAS 12.46 please explain this apparent change in your accounting.

9. We note that you have revised your accounting for your annual review of your deferred
income tax and social contribution assets such that , rather than recognizing a loss w hen
the realization of these assets is no longer probable , you now provide a provision when
their realization is not likely in less than 10 years.  With reference to IAS 12.56, please
address the appropriateness of this apparent change in your accounting.  Also, explain if
this apparent change in your accounting impacted how and when you recognized a loss
on these assets.

Note 3 - Business Combinations – Acquisition of control of Nacional Minerios (Namisa) , page
F-25

3.3b.1 Fair value of the assets and liabilities acquired , page F -29

10. Please explain the nature of the R$7,870,627 fair value allocated to the line item ROM
and port advance – Congonhas  and the appropriateness of allocating a portion of the
purchase price to this line item.  We note that the explanation on page FS -30 indicates
that this asset is related to an agreement between Namisa and Congonhas.  Further, we
note that Namisa’s financi al statements indicate that this line item reflects advances to
CSN for the purchase of raw material and port services.  It is unclear why this receivable
is not eliminated upon CSN’s acquisition of Namisa.

Paulo Rogério Caffarelli
National Steel Compan y
June 22, 2016
Page 4

 11. Please explain why the entire balance of Namisa ’s R$1,156,800 dividends proposed
liability has been reflected in the purchase price allocation.  In this regard, we note from
Namisa’s financial statements that R$694,000 of those dividends relate to payments due
to CSN.

3.4 Effects reflected in CSN pa rent company – Transaction between partners recorded in equity,
page F -30

12. We note that as indicated on F -38, the fair value of the 12.48% change in CSN’s
shareholding in Congonhas Minerios was R$2,619.  Please explain the apparent disparity
of this fair v alue in light of CSN’s R$2727 payment for 4.16% of Congonhas Minerios
shares held by the Consortium.

9.c Rollforward of investment balances in joint ventures, associates and other investments, page
F-35

13. With reference to the items you refer to in Note (1 ) and (4), please explain how you
determined Namisa’s R$10,160,981 investment balance and why that amount was not
used in the determination of the gain on your 60% interest in Namisa as presented in Note
3.

Note 15 - Income Tax and Social Contribution, p age F -57

14. We note that you have reflected a n R$632,030 adjustment related to the fair value on
Namisa sta ke of 60% as part of your rate reconciliation on page F -58.  Please explain
why this adjustment is not reflected in deferred tax liability movements on  page F -59.  In
this regard, also explain why the R$317,041 deferred tax liability movement related to
the fair value adjustment of the mining business combination reflected on page F -59 does
not appear to impact your rate reconciliation.

15. On page F -59, yo u indicate in the (*) footnote to your tabular presentation of movements
in your deferred tax assets and liabilities that you tax foreign exchange differences on a
cash basis to calculate income tax and social contribution.  We have the following
comments regarding this disclosure:

 Please explain what you mean by this statement in light of the fact that we see no
adjustment related to foreign exchange differences in your rate reconciliation on page
F-58; and

 Please explain how you determined the R$1,416,919 profit or loss movement and
how that amount relates to exchange differences, net reflected in your financial
statements.

Paulo Rogério Caffarelli
National Steel Compan y
June 22, 2016
Page 5

 16. We note from your disclosures that your study indicated probable future taxable income
to compensate the deferred income  tax and social contribution balances recognized until
June 30, 2015 , and your Board of Directors agreed to not record the deferred income tax
and social contribution as from the 3rd quarter of 2015.  Please address the following
comments:

 Explain the nat ure of your R$1,143,365 deferred taxes on temporary differences –
non computed adjustment in your rate reconciliation on page F -58, as well as your
R$1,133,091 deferred taxes non computed movement in your tabular presentation on
page F -59.  In this regard,  if these amounts relate to the application of IAS12.56 and
your determination that it is no longer probable that sufficient taxable profit will be
available to allow the benefit of a portion of your deferred tax assets to be utilized,
revise your disclosu re to clarify;

 Explain what you mean by your statement “If the tax credit for the second quarter
was constituted, the amount would be R$1.09 billion ;” and

 In light of your statement that you did not recognize deferred income tax and social
contributions  as from the 3rd quarter of 2015, provide the disclosures required by IAS
12.81f.

You may contact Tracie Mariner , Staff Accountant , at (202) 551 -3744 , or Jeanne Baker,
Assistant Chief Accountant, at (202) 551 -3691 , if you have questions regarding comments on the
financial s tatements and related matters .  You may contact me at (2 02) 551 -3355  with any other
questions.

Sincerely,

 /s/ Terence O ’Brien

 Terence O’Brien
Branch Chief
Office of Manufacturing and
Construction