[Federal Register Volume 81, Number 16 (Tuesday, January 26, 2016)]
[Notices]
[Pages 4256-4258]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-01509]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-601]


Tapered Roller Bearings and Parts Thereof, Finished and 
Unfinished, From the People's Republic of China: Notice of Court 
Decision Not in Harmony With Final Results of Antidumping Duty 
Administrative Review and Notice of Amended Final Results of 
Antidumping Duty Administrative; 2008-2009

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.
SUMMARY: On December 21, 2015, the United States Court of International 
Trade (``CIT'' or ``Court'') issued its final judgment \1\ sustaining 
the Department of Commerce's (the ``Department'') final results of 
redetermination \2\ issued pursuant to the CIT's remand order in Peer 
Bearing Co.-Changshan v. United States, 986 F. Supp. 2d 1389 (CIT 2014) 
(``CPZ 08-09 II''), with respect to the Department's final results \3\ 
of the twenty-second administrative review of the antidumping duty 
order on tapered roller bearings and parts thereof, finished and 
unfinished (``TRBs''), from People's Republic of China (``PRC''). 
Consistent with the decision of the United States Court of Appeals for 
the Federal Circuit (``CAFC'') in Timken Co. v. United States, 893 F.2d 
337 (Fed. Cir. 1990) (``Timken''), as clarified by Diamond Sawblades 
Mfrs. Coalition v. United States, 626 F.3d 1374 (Fed. Cir. 2010) 
(``Diamond Sawblades''), the Department is notifying the public that 
the final judgment in this case is not in harmony with the Department's 
Final Results and is amending the Final Results with respect to the 
dumping margins determined for Peer Bearing Company- Changshan and 
Changshan Peer Bearing Co., Ltd.\4\
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    \1\ See, Peer Bearing Company--Changshan v. United States, 
Consol. Court No. 11-00022, Slip Op. 15-143 (CIT 2015) (``CPZ 08-09 
III''), and accompanying judgment order.
    \2\ See Final Results of Redetermination Pursuant to Court 
Remand, Peer Bearing Company--Changshan v. United States, Consol. 
Court No. 11-00022, Slip Op. 14-62 (CIT 2014) (``Second Remand 
Redetermination'').
    \3\ See Tapered Roller Bearings and Parts Thereof, Finished and 
Unfinished, From the People's Republic of China: Final Results of 
the 2008-2009 Antidumping Duty Administrative Review, 76 FR 3086 
(January 19, 2011) (``Final Results'') and accompanying Issues and 
Decision Memorandum (``IDM'').
    \4\ Prior to September 11, 2008, Peer Bearing Company-Changshan 
was majority-owned by the Spungen family (``PBCD/CPZ''). On 
September 11, 2008, two and a half months into the period of review 
(``POR''), PBCD/CPZ, the sole respondent in the prior 2007-2008 POR, 
and its Illinois-based U.S. sales affiliate, Peer Bearing Company 
(``PBCD/Peer'') (collectively, ``PBCD''), were each purchased by 
certain companies owned by SKF. In the underlying review, we found 
that the post-acquisition respondent was not the successor-in-
interest to the pre-acquisition respondent and, thus, were each 
legally distinct entities for the purposes of this antidumping duty 
(``AD'') review. The post-acquisition respondent is referred to as 
the SKF-owned Changshan Peer Bearing Company, Ltd. (``SKF/CPZ'') and 
its Illinois-based affiliate is referred to as Peer Bearing Company 
(``SKF/Peer'') (collectively ``SKF''). For ease of reference, the 
two respondents are referred to by their collective names ``PBCD'' 
and ``SKF'' throughout this document. For the purpose of generally 
referencing the physical facilities in question during the POR in 
its entirety, without consideration of ownership, the Changshan-
based TRB production facility is referred to as ``CPZ'' and the 
Illinois-based U.S. sales affiliate is referred to as ``Peer.''

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DATES: Effective Date: December 31, 2015.

FOR FURTHER INFORMATION CONTACT: Keith A. Haynes, Office III, 
Enforcement and Compliance, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue NW., 
Washington, DC 20230; telephone: (202) 482-5139.

SUPPLEMENTARY INFORMATION: On December 21, 2012, the Court issued its 
initial opinion and remanded the Final Results, ordering that the 
Department: (1) redetermine the surrogate value (``SV'') applied to 
PBCD/CPZ's input of bearing-quality steel bar; (2) reconsider its 
determination to calculate the normal value (``NV'') of subject 
merchandise that was imported by PBCD/Peer prior to its acquisition by 
SKF, but sold by SKF/Peer subsequent to the acquisition, using SKF/
CPZ's factors of production (``FOPs''); and (3) reconsider, and modify 
as appropriate, its determination of the country of

[[Page 4257]]

origin of TRBs that were finished, and assembled in Thailand from TRB 
component parts both finished (i.e., cups and cones) and unfinished 
(i.e., rollers and cages) initially produced in and subsequently 
exported from the PRC.\5\
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    \5\ See Peer Bearing Company-Changshan v. United States, 884 F. 
Supp. 2d 1313 (CIT 2012) (``CPZ 08-09 I'').
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    In the First Remand Redetermination,\6\ pursuant to CPZ 08-09 I, 
the Department: (1) determined that Thai import data under Harmonized 
Tariff Schedule subheading 7228.30.90 are the best available 
information on the record with which to value PBCD/CPZ's bearing-
quality steel bar inputs, and adjusted the margin program accordingly; 
and (2) re-calculated the weighted-average dumping margin for SKF so 
that PBCD/CPZ's FOPs (not SKF/CPZ's FOPs) were used to determine the NV 
of SKF/Peer's post-acquisition sales of pre-acquisition inventory.\7\ 
With respect to the Court's directive to reconsider the country of 
origin finding from the Final Results and modify its determination, as 
necessary, the Department reconsidered its determination in its 
entirety, applying its established criteria for determining whether 
merchandise is substantially transformed in another country. The 
Department expanded upon and further supported the existing findings as 
to the physical/chemical properties/essential character,\8\ nature/
sophistication of processing,\9\ level of investment,\10\ and cost of 
production (``COP'')/value-added,\11\ finding that these factors 
continued to support an overall finding that the third-country 
processing was not substantial so as to confer Thai origin. Consistent 
with the Court's remand order, the Department also discussed and 
further explained the relevance of the class-kind/scope \12\ and 
ultimate use \13\ criteria used in the underlying analysis. The 
Department did not ``reach a determination as to whether circumvention 
has occurred or may occur and, thus, {found{time}  that this element 
{did{time}  not preclude or support a finding of substantial 
transformation.'' \14\ Based on the totality of circumstances, the 
Department determined in the First Remand Redetermination that:
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    \6\ See Final Results of Redetermination Pursuant to Remand, 
Consol. Court No. 11-00022, Slip Op. 12-125 (CIT 2012), dated May 
13, 2013 (``First Remand Redetermination'').
    \7\ See First Remand Redetermination at 36-40.
    \8\ Id., at 16-20.
    \9\ Id., at 13-15.
    \10\ Id., at 26-32.
    \11\ Id., at 20-26.
    \12\ Id., at 10-13.
    \13\ Id., at 34-35.
    \14\ Id., at 34.

    {T{time} he Thai processing does not substantially transform the 
TRB parts and that the TRBs remain of PRC-origin. The nature and 
sophistication of processing indicate that the finishing processes 
in Thailand serve only to further refine the cup and cone's finished 
measurements, polish the raceway, and assemble the components 
together. The physical/chemical properties and essential component 
are imparted in the PRC, with the properties added in Thailand 
marginal in comparison. The COP/value added in Thailand is 
insignificant when compared to the COP of the finished TRB. The 
level of investment in Thailand was not as significant as the 
investment in the PRC. The ultimate use of TRB parts and final, 
finished TRBs is the same. These factors weigh in favor of a finding 
that the TRBs which are finished in Thailand are of PRC-origin. The 
class or kind/scope criterion is not determinative to our finding, 
although the fact that the upstream product is within the same class 
or kind and scope as the downstream product is relevant to our 
country-of-origin determination.\15\
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    \15\ Id., at 35-36.

    On June 10, 2014, the CIT issued CPZ 08-09 II, in which it 
sustained the Department's re-determined SV for bearing-quality steel 
bar. However, the Court remanded, for a second time, the Department's 
country of origin determination.\16\ Specifically, the Court found that 
``the method and criteria applied in the Remand Redetermination caused 
Commerce to ignore critical record evidence'' and that ``the record 
lacked substantial evidence to support the ultimate finding Commerce 
reached in the {First{time}  Remand Redetermination.''\17\ The Court 
further noted that the product at issue (i.e., merchandise completed or 
assembled in a third country, Thailand) was ``of a type Congress 
contemplated would be the subject of an anti-circumvention inquiry, 
without actually conducting such an inquiry.''\18\ In so doing, the 
Court found that the Department ``exceeded its authority to interpret, 
without expanding, the scope language'' of the TRBs order.\19\ Finally, 
though the Court held that the Department provided adequate reasoning 
for using PBCD/CPZ's FOP data to calculate the NV for pre-acquisition 
PBCD/CPZ-produced merchandise subsequently sold by SKF/Peer during the 
post-acquisition portion of the POR in the First Remand 
Redetermination, the Court remanded for further explanation the 
Department's use of PBCD/CPZ's FOP data from the twenty-second POR, 
rather than PBCD/CPZ's FOP data from the prior POR.\20\
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    \16\ See CPZ 08-09 II, 986 F. Supp. 2d at 1414.
    \17\ Id., at 1406.
    \18\ Id., at 1402-03.
    \19\ Id., at 1406.
    \20\ Id.
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    In compliance with the Court's instructions, the Department under 
protest re-determined the country of origin for certain merchandise 
under review, and revised the dumping margin calculations to exclude 
U.S. sales of TRBs further processed in Thailand, finding those TRBs to 
be Thai-origin.\21\ In particular, the Department explained that it 
``did not conduct a circumvention analysis pursuant to section 781(b) 
of the {Tariff Act of 1930, as amended (``the Act''){time} '' and thus 
could not ``find that the TRBs in question are of Chinse origin.''\22\ 
With respect to the remaining issue on remand, the Department explained 
that it is consistent with section 773(c)(4) of the Act, to use 
production data from the POR in which the merchandise is sold, because 
this best reflects the producer's production experience from the period 
in which the Department is determining the margin of dumping; 
therefore, the Department did not find that PBCD/CPZ's FOP data from 
the prior POR is a more accurate reflection of PBCD's production of 
merchandise sold by SKF during the POR.\23\ Therefore, to determine the 
margin for SKF/Peer's sales of merchandise produced by PBCD/CPZ, the 
Department continued to use PBCD/CPZ's POR-contemporaneous FOPs to 
calculate NV. Along with the SV changes sustained in CPZ 08-09 II, the 
Department calculated weighted-average dumping margins for PBCD of 
21.65 percent and SKF of 19.45 percent.\24\
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    \21\ See Second Remand Redetermination at 8.
    \22\ Id.
    \23\ Id, at 12-13.
    \24\ Id., at 17.
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    On December 21, 2015, the CIT issued its decision in CPZ 08-09 III, 
in which it sustained the Department's Second Remand Redetermination. 
Specifically, the Court sustained the Department's decision regarding 
selection of the FOP data used to value post-acquisition sales of pre-
acquisition inventory.\25\ Furthermore, with respect to the country of 
origin finding, the Court concluded that the Department reached an 
ultimate determination that is supported by substantial evidence on the 
record that accords with a reasonable, rather than expansive, 
interpretation of the scope of the antidumping duty order. The Court 
found that the Department's analysis presented in the Second Remand 
Redetermination, although suffering from some flaws in the 
interpretation of the Court's holding in CPZ 08-09 II, was

[[Page 4258]]

sufficient to allow the Court to sustain the Department's ultimate 
determination.\26\
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    \25\ See CPZ 08-09 III, at 7.
    \26\ Id., at 15-19.
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Timken Notice

    In its decision in Timken, 893 F.2d at 341, as clarified by Diamond 
Sawblades, the CAFC held that, pursuant to section 516A(e) of the Act, 
the Department must publish a notice of a court decision that is not 
``in harmony'' with a Department determination and must suspend 
liquidation of entries pending a ``conclusive'' court decision. The 
CIT's December 21, 2015, judgment in this case constitutes a final 
court decision that is not in harmony with the Department's Final 
Results. This notice is published in fulfillment of the publication 
requirements of Timken.

Amended Final Results

    As a result, of the Court's final decision with respect to this 
case, the Department is amending the Final Results with respect to 
PBCD/SKF and SKF/CPZ in this case. The revised weighted-average dumping 
margins for the June 1, 2008, through May 31, 2009, period of review 
are as follows:

------------------------------------------------------------------------
                                                           Final percent
                        Exporter                              margin
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Peer Bearing Company--Changshan (Spungen-owned, PBCD)...           21.65
Changshan Peer Bearing Company, Ltd. (SKF-owned, SKF)...           19.45
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    The Department will continue the suspension of liquidation of the 
subject merchandise pending the expiration of the period of appeal or, 
if appealed, pending a final and conclusive court decision. In the 
event the Court's ruling is not appealed or, if appealed, upheld by the 
CAFC, the Department will instruct U.S. Customs and Border Protection 
to assess antidumping duties on unliquidated entries of subject 
merchandise exported by the above listed exporters at the rate listed 
above.

Cash Deposit Requirements

    Since the Final Results, the Department has established a new cash 
deposit rate for SKF/CPZ.\27\ Therefore, the cash deposit rate for SKF 
does not need to be updated as a result of these amended final results.
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    \27\ See Tapered Roller Bearings and Parts Thereof, Finished and 
Unfinished, From the People's Republic of China: Final Results of 
the Antidumping Duty Administrative Review and Final Results of the 
New Shipper Review; 2012-2013, 80 FR 4244 (January 27, 2015).
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    Since the Final Results, the Department has not established a new 
cash deposit rate for PBCD/CPZ. However, as explained above, in 
September 2008, PBCD/CPZ was acquired by AB SKF, and the Department 
determined via a successor-in-interest analysis that SKF/CPZ was not 
its successor in interest. As a consequence, PBCD/CPZ effectively no 
longer exists, and its cash deposit rate does not need to be updated as 
a result of these amended final results.

Notification to Interested Parties

    This notice is issued and published in accordance with sections 
516A(e), 751(a)(1), and 777(i)(1) of the Act.

    Dated: January 13, 2016.
Paul Piquado,
Assistant Secretary for Enforcement and Compliance.
[FR Doc. 2016-01509 Filed 1-25-16; 8:45 am]
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