[Federal Register Volume 82, Number 12 (Thursday, January 19, 2017)]
[Notices]
[Pages 6490-6491]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-01166]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-943; C-570-944]


Certain Oil Country Tubular Goods From the People's Republic of 
China: Notice of Court Decision Not in Harmony With Final Scope Ruling 
and Notice of Amended Final Scope Ruling Pursuant to Court Decision

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.

SUMMARY: The Department of Commerce (the Department) is notifying the 
public that the Court of International Trade's (CIT's or the Court's) 
final judgment in this case is not in harmony with the Department's 
final scope ruling. Therefore, the Department finds that neither the 
plain language of the scope nor an analysis of the scope language using 
the criteria outlined in the Department's regulations support a finding 
that seamless unfinished oil country tubular goods (OCTG) (i.e., green 
tubes) manufactured in the People's Republic of China (the PRC), and 
subsequently finished in a third country, are covered by the scope of 
the antidumping and countervailing duty orders.

DATES: Effective December 3, 2016.

FOR FURTHER INFORMATION CONTACT: John Drury, AD/CVD Operations, Office 
VI, Enforcement and Compliance,

[[Page 6491]]

International Trade Administration, U.S. Department of Commerce, 1401 
Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-
0195.

SUPPLEMENTARY INFORMATION: 

Background

    On February 7, 2014, the Department issued the Bell Supply Scope 
Ruling,\1\ in which it determined that green tubes that are finished in 
third countries are covered under the scope of the Orders based on an 
analysis of the factors under 19 CFR 351.225(k)(1).\2\ Bell Supply 
Company, LLC (Bell Supply) challenged the Department's final ruling 
before the CIT. On July 9, 2015, the Court issued its opinion on the 
Bell Supply Scope Ruling, remanding the Department's determination back 
to the agency for further analysis,\3\ as discussed in further detail 
in the Final Remand Results.\4\ The Department issued a redetermination 
on remand, under protest, which continued to find that the merchandise 
in question was within the scope of the Orders.\5\ On April 27, 2016, 
the Court issued its opinion on the First Remand Results, again 
remanding the Department's determination for further analysis.\6\ 
Specifically, the Court found that the language of the Orders does not 
necessarily include OCTG finished in third countries, even if processed 
using green tubes sourced from the PRC.\7\ The Court stated that the 
evidence on which the Department relied to make its determination 
(i.e., the petition and the injury analysis by the International Trade 
Commission) ``{d{time} oes not support'' the Department's conclusion 
that the merchandise in question is within the scope.\8\ The Court 
further stated that ``{a{time} bsent additional evidence from the 
descriptions of the merchandise found in the (k)(1) sources, Commerce 
was required to proceed to the next step of its interpretive analysis 
and evaluate the factors under 19 CFR 351.225(k)(2).'' \9\ The Court 
also stated that, in the event that the Department was unable to find 
that the scope of the Orders covers the merchandise at issue under 19 
CFR 351.225(k)(2), the Department was free to employ a circumvention 
analysis pursuant to 19 CFR 351.225(h) and section 781(b) of the Tariff 
Act of 1930, as amended (the Act).\10\
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    \1\ See Memorandum to Christian Marsh, Deputy Assistant 
Secretary for Antidumping and Countervailing Duty Operations, 
``Final Scope Ruling on Green Tubes Manufactured in the People's 
Republic of China and Finished in Countries Other than the United 
States and the People's Republic of China'' (February 7, 2014) (Bell 
Supply Scope Ruling).
    \2\ See Certain Oil Country Tubular Goods from the People's 
Republic of China: Amended Final Affirmative Countervailing Duty 
Determination and Countervailing Duty Order, 75 FR 3203 (January 20, 
2010) and Certain Oil Country Tubular Goods from the People's 
Republic of China: Amended Final Determination of Sales at Less Than 
Fair Value and Antidumping Duty Order, 75 FR 28551 (May 21, 2010) 
(together, Orders).
    \3\ See Bell Supply Co. v. United States, Court No. 14-00066, 
Slip Op. 15-73 (CIT 2015) (Bell Supply I).
    \4\ See Final Results of Second Redetermination Pursuant to 
Remand, dated August 11, 2016 (Final Remand Results) at 2-5.
    \5\ See Final Results of Redetermination Pursuant to Remand, 
dated November 9, 2015 (First Remand Results).
    \6\ See Bell Supply Co. v. United States, Court No. 14-00066, 
Slip Op. 16-41 (CIT 2016) (Bell Supply II).
    \7\ Id. at 13.
    \8\ Id. at 28.
    \9\ Id. at 33.
    \10\ Id. at 38-39.
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    Accordingly, the Department issued the Final Remand Results. 
Consistent with the Court's instructions in Bell Supply II, the 
Department determined that neither the plain language of the scope nor 
an analysis of the scope language using the criteria outlined in 19 CFR 
351.225(k)(1) supported a finding that green tubes manufactured in the 
PRC, and subsequently finished in a third country, are covered by the 
scope of the Orders.\11\ Additionally, the Department determined that, 
because the factors under 19 CFR 351.225(k)(2) did not indicate whether 
OCTG finished in third countries fell within the Orders, green tubes 
from the PRC that are subsequently heat-treated in third countries are 
not within the scope of the Orders.\12\ Finally, the Department also 
determined information on the record did not support a finding that 
merchandise produced by Citra Tubindo, a producer of finished OCTG in 
Indonesia who used unfinished green tubes produced in the PRC, 
circumvented the Orders.\13\
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    \11\ See Final Remand Results at 14-15.
    \12\ Id. at 15-19.
    \13\ Id. at 33-34.
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    In Bell Supply III, the Court sustained the Department's Final 
Remand Results in its entirety.\14\
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    \14\ See Bell Supply Co. v. United States, Court No. 14-00066, 
Slip Op. 16-109 (CIT 2016) (Bell Supply III) at 16.
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Timken Notice

    In its decision in Timken,\15\ as clarified by Diamond 
Sawblades,\16\ the United States Court of Appeals for the Federal 
Circuit (CAFC) held that, pursuant to sections 516A(c) and (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 November 23, 2016, judgment in Bell Supply III, sustaining the 
Department's decision in the Final Remand Results that unfinished green 
tubes further processed in third countries into finished OCTG are not 
covered by the scope of the Orders and that merchandise processed in 
Indonesia into finished OCTG by Citra Tubindo, using unfinished green 
tubes produced in the PRC, does not constitute circumvention of the 
Orders, constitutes a final decision of the court that is not in 
harmony with the Bell Supply Scope Ruling. This notice is published in 
fulfillment of the publication requirements of Timken. Accordingly, the 
Department will continue the suspension of liquidation of the oil 
country tubular goods at issue pending expiration of the period to 
appeal or, if appealed, pending a final and conclusive court decision.
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    \15\ See Timken Co. v. United States, 893 F.2d 337 (Fed. Cir. 
1990) (Timken), at 341.
    \16\ See Diamond Sawblades Mfrs. Coalition v. United States, 626 
F.3d 1374 (Fed. Cir. 20 10) (Diamond Sawblades).
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Amended Final Scope Ruling

    Because there is now a final court decision with respect to the 
Bell Supply Scope Ruling, the Department is amending its final scope 
ruling. The Department finds that the scope of the Orders does not 
cover the products addressed in the Bell Supply Scope Ruling. The 
Department will instruct U.S. Customs and Border Protection (CBP) that 
the cash deposit rate will be zero percent for the OCTG finished in 
Indonesia using unfinished green tubes manufactured in the PRC. In the 
event that the CIT's ruling is not appealed, or if appealed, upheld by 
the CAFC, the Department will instruct CBP to liquidate entries of the 
OCTG at issue without regard to antidumping and/or countervailing 
duties, and to lift suspension of liquidation of such entries.

Notification to Interested Parties

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

    Dated: January 11, 2017.
Paul Piquado,
Assistant Secretary for Enforcement and Compliance.
[FR Doc. 2017-01166 Filed 1-18-17; 8:45 am]
BILLING CODE 3510-DS-P