[Federal Register Volume 82, Number 81 (Friday, April 28, 2017)]
[Notices]
[Pages 19657-19659]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-08673]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-122-858]


Certain Softwood Lumber Products From Canada: Preliminary 
Affirmative Countervailing Duty Determination, and Alignment of Final 
Determination With Final Antidumping Duty Determination

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.
SUMMARY: The Department of Commerce (the Department) preliminarily 
determines that countervailable subsidies are being provided to 
producers and exporters of certain softwood lumber products (softwood 
lumber) from Canada. The period of investigation is January 1, 2015, 
through December 31, 2015.

DATES: Effective April 28, 2017.

FOR FURTHER INFORMATION CONTACT: Lana Nigro (Tolko), Toby Vandall 
(Canfor), Justin Neuman (JDIL), Patricia Tran (West Fraser), and 
Kristen Johnson (Resolute), AD/CVD Operations, Offices I and III, 
Enforcement and Compliance, International Trade Administration, U.S. 
Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 
20230; telephone: (202) 482-1779, (202) 482-1664, (202) 482-0486, (202) 
482-1503, and (202) 482-4793, respectively.

SUPPLEMENTARY INFORMATION:

Background

    This preliminary determination is made in accordance with section 
703(b) of the Tariff Act of 1930, as amended (the Act). The Department 
published the notice of initiation of this investigation on December 
22, 2017.\1\ On February 2, 2017, the Department postponed the 
preliminary determination of this investigation and the revised 
deadline is now April 24, 2017.\2\
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    \1\ See Certain Softwood Lumber Products from Canada: Initiation 
of Countervailing Duty Investigation, 81 FR 93897 (December 22, 
2016) (Initiation Notice).
    \2\ See Certain Softwood Lumber Products from Canada: 
Postponement of Preliminary Determination in the Countervailing Duty 
Investigation, 82 FR 9055 (February 2, 2017).
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    On April 13, 2017, the Department preliminarily determined that 
critical circumstances exist with respect to certain companies.\3\ For 
a complete description of the events that followed the initiation of 
this investigation, see the Preliminary Decision Memorandum.\4\ A list 
of topics discussed in the Preliminary Decision Memorandum is included 
as Appendix II to this notice. The Preliminary Decision Memorandum is a 
public document and is on file electronically via Enforcement and 
Compliance's Antidumping and Countervailing Duty Centralized Electronic 
Service System (ACCESS). ACCESS is available to registered users at 
http://access.trade.gov, and is available to all parties in the Central 
Records Unit, room B8024 of the main Department of Commerce building. 
In addition, a complete version of the Preliminary Decision Memorandum 
can be accessed directly at http://enforcement.trade.gov/frn/. The 
signed and electronic versions of the Preliminary Decision Memorandum 
are identical in content.
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    \3\ See Antidumping and Countervailing Duty Investigations of 
Certain Softwood Lumber Products from Canada: Preliminary 
Determinations of Critical Circumstances, signed April 13, 2017 
(Preliminary CC Determination).
    \4\ See Memorandum, ``Decision Memorandum for the Preliminary 
Determination in the Countervailing Duty Investigation of Certain 
Softwood Lumber Products from Canada,'' dated concurrently with, and 
hereby adopted by, this notice (Preliminary Decision Memorandum).
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Scope of the Investigation

    The product covered by this investigation is softwood lumber from 
Canada. For a complete description of the scope of this investigation, 
see Appendix I.

Scope Comments

    In accordance with the preamble to the Department's regulations,\5\ 
the Initiation Notice set aside a period of time for parties to raise 
issues regarding product coverage, (i.e., scope).\6\ Certain interested 
parties commented on the scope of the investigation as it appeared in 
the Initiation Notice as well as on additional language proposed by the 
Department. On March 29, 2017, a letter presenting a proposal for 
company exclusions was filed on behalf of the Government of Canada 
(GOC), Canadian provincial and territorial governments, as well as the 
Canadian industry associations.\7\ The Department finds that it lacks 
the authority to conduct the requested company exclusion process in the 
context of this countervailing duty investigation (CVD) on softwood 
lumber from Canada.\8\
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    \5\ See Antidumping Duties; Countervailing Duties, Final Rule, 
62 FR 27296, 27323 (May 19, 1997).
    \6\ See Initiation Notice.
    \7\ See letter from the Government of Canada, ``Proposal for 
Company Exclusions,'' dated March 29, 2017; see also letter from the 
Government of New Brunswick, ``Softwood Lumber from Canada: 
Proposals for Product- or Company-Based Exclusions from the CVD 
Investigation,'' dated March 31, 2017; letter from Government of 
British Columbia, ``Certain Softwood Lumber Products from Canada: 
Comments in Support of Clarifying and Exclusionary Language Proposed 
by Canada Regarding the Scope of these Investigations,'' dated April 
3, 2017.
    \8\ See Memorandum from Gary Taverman, Associate Deputy 
Assistant Secretary for Antidumping and Countervailing Duty 
Operations, to Ronald K. Lorentzen, Acting Assistant Secretary for 
Enforcement and Compliance, dated April 24, 2017.
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    With respect to other proposed scope exclusions, including the 
request to exclude merchandise from certain provinces, the Department 
is inviting comments on those proposed exclusions and will incorporate 
the decisions into the final CVD and AD determinations after 
considering any relevant comments submitted in case and rebuttal 
briefs. Comments on any proposed scope exclusions are due no later than 
seven days of publication of this notice in the Federal Register. 
Please note that the Department will not accept any new factual 
information in these submissions. The Department intends to set the 
same deadline on the record of the companion AD investigation. For 
further information regarding proposed scope excusions, see the 
Preliminary Decision Memorandum accompanying this notice.

Methodology

    The Department is conducting this investigation in accordance with 
section 701 of the Act. For each of the subsidy programs found 
countervailable, the Department preliminarily determines that there is 
a subsidy, i.e., a financial contribution by an ``authority'' that 
gives rise to a benefit to the recipient, and that the subsidy is 
specific.\9\
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    \9\ See sections 771(5)(B) and (D) of the Act regarding 
financial contribution; section 771(5)(E) of the Act regarding 
benefit; and section 771(5A) of the Act regarding specificity.
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Alignment

    As noted in the Preliminary Decision Memorandum, in accordance with 
section 705(a)(1) of the Act and 19 CFR 351.210(b)(4), the Department 
is aligning the final CVD determination in this investigation with the 
final determination in the companion AD

[[Page 19658]]

investigation of softwood lumber from Canada based on a request made by 
the petitioner.\10\ Consequently, the final CVD determination will be 
issued on the same date as the final AD determination, which is 
currently scheduled to be issued no later than September 6, 2017, 
unless postponed.
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    \10\ See Letter from the petitioner, ``Certain Softwood Lumber 
Products from Canada: Request for Alignment of the Countervailing 
Duty Final Determination with the Companion Antidumping Duty Final 
Determination'' dated April 13, 2017.
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All-Others Rate

    Sections 703(d) and 705(c)(5)(A) of the Act provide that in the 
preliminary determination, the Department shall determine an estimated 
all-others rate for companies not individually examined. This rate 
shall be an amount equal to the weighted average of the estimated 
subsidy rates established for those companies individually examined, 
excluding any zero and de minimis rates and any rates based entirely 
under section 776 of the Act.
    In this investigation, the Department calculated individually 
estimated countervailable subsidy rates for Canfor Corporation 
(Canfor), J.D. Irving, Limited (JDIL),\11\ Resolute FP Canada Inc. 
(Resolute), Tolko Marketing and Sales Ltd. (Tolko), and West Fraser 
Timber Co. Ltd. (West Fraser), that are not zero, de minimis, or based 
entirely on facts otherwise available. The Department calculated the 
all-others rate using a weighted-average of the individually estimated 
subsidy rates calculated for the examined respondents using each 
company's business proprietary data for the merchandise under 
consideration.\12\
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    \11\ See MacLean-Fogg Co. v. United States, 753 F.3d 1237 (Fed. 
Cir. 2014) (holding that voluntary respondents are considered 
``individually investigated'' for purposes of calculating the all-
others rate). The Department accepted JDIL as a voluntary respondent 
in this investigation.
    \12\ See Memorandum to the File, ``Calculation of the ``All-
Others'' Rate in the Preliminary Determination of the Countervailing 
Duty Investigation of Softwood Lumber Products from Canada'' (April 
24, 2017).
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Preliminary Determination

    The Department preliminarily determines that the following 
estimated countervailable subsidy rates exist:

------------------------------------------------------------------------
                                                           Subsidy rate
                         Company                                (%)
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Canfor Corporation and its cross-owned affiliates \13\..           20.26
J.D. Irving, Limited and its cross-owned affiliates \14\            3.02
Resolute FP Canada Inc. and its cross-owned affiliates             12.82
 \15\...................................................
Tolko Marketing and Sales Ltd. and its cross-owned                 19.50
 affiliates \16\........................................
West Fraser Mills Ltd. and its cross-owned affiliates              24.12
 \17\...................................................
All-Others:.............................................           19.88
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Suspension of Liquidation

    In accordance with section 703(d)(1)(B) and (d)(2) of the Act, the 
Department will direct U.S. Customs and Border Protection (CBP) to 
suspend liquidation of entries of subject merchandise as described in 
the scope of the investigation section entered, or withdrawn from 
warehouse, for consumption on or after the date of publication of this 
notice in the Federal Register. Further, pursuant to 19 CFR 351.205(d), 
the Department will instruct CBP to require a cash deposit equal to the 
rates indicated above.
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    \13\ The Department preliminarily has found the following 
companies to be cross-owned with Canfor Corporation: Canadian Forest 
Products, Ltd., and Canfor Wood Products Marketing, Ltd.
    \14\ The Department preliminarily has found the following 
companies to be cross-owned with JDIL: Miramichi Timber Holdings 
Limited, The New Brunswick Railway Company, Rothesay Paper Holdings 
Ltd., St. George Pulp & Paper Limited, and Irving Paper Limted.
    \15\ The Department preliminarily has found the following 
companies to be cross-owned with Resolute: Resolute Growth Canada 
Inc., Resolute Sales Inc., Abitibi-Bowater Canada Inc., Bowater 
Canadian Ltd., Resolute Forest Products Inc., Produits Forestiers 
Maurice S.E.C., and 9192-8515 Quebec Inc.
    \16\ The Department preliminarily has found the following 
companies to be cross-owned with Tolko: Tolko Industries Ltd., and 
Meadow Lake OSB Limited Partnership.
    \17\ The Department preliminarily has found the following 
companies to be cross-owned with West Fraser: West Fraser Timber Co. 
Ltd., West Fraser Alberta Holdings, Ltd., Blue Ridge Lumber Inc., 
Manning Forest Products, Ltd., Sunpine Inc., and Sundre Forest 
Products Inc.
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    Section 703(e)(2) of the Act provides that, given an affirmative 
determination of critical circumstances, any suspension of liquidation 
shall apply to unliquidated entries of merchandise entered, or 
withdrawn from warehouse, for consumption on or after the later of (a) 
the date which is 90 days before the date on which the suspension of 
liquidation was first ordered, or (b) the date on which notice of 
initiation of the investigation was published. As discussed in 
Preliminary CC Determination, the Department preliminarily found that 
critical circumstances exist for imports of subject merchandise 
produced and/or exported by JDIL and the companies subject to the All-
Others rate.\18\ Accordingly, in accordance with section 703(e)(2)(A) 
of the Act, the suspension of liquidation shall apply to unliquidated 
entries of merchandise from the exporters/producers identified in this 
paragraph that were entered, or withdrawn from warehouse, for 
consumption on or after the date which is 90 days before the 
publication of this notice.
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    \18\ See Antidumping and Countervailing Duty Investigations of 
Certain Softwood Lumber Products from Canada: Preliminary 
Determinations of Critical Circumstances, signed April 12, 2017 
(Preliminary CC Determination).
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Disclosure

    The Department intends to disclose its calculations and analysis 
performed to interested parties in this preliminary determination 
within five days of its public announcement or within five days of the 
date of this notice in accordance with 19 CFR 351.224(b).

Verification

    As provided in section 782(i)(1) of the Act, the Department intends 
to verify the information relied upon in making its final 
determination.

Public Comment

    Case briefs or other written comments may be submitted to the 
Assistant Secretary for Enforcement and Compliance no later than seven 
days after the date on which the last verification report is issued in 
this investigation. Rebuttal briefs, limited to issues raised in case 
briefs, may be submitted no later than five days after the deadline 
date for case briefs.\19\ Pursuant to 19 CFR 351.309(c)(2) and (d)(2), 
parties who submit case briefs or rebuttal briefs in this investigation 
are encouraged to submit with each argument: (1) A statement of the 
issue; (2) a brief summary of the argument; and (3) a table of 
authorities.
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    \19\ See 19 CFR 351.309; see also 19 CFR 351.303 (for general 
filing requirements).
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    Pursuant to 19 CFR 351.310(c), interested parties who wish to 
request a hearing, limited to issues raised in the

[[Page 19659]]

case and rebuttal briefs, must submit a written request to the 
Assistant Secretary for Enforcement and Compliance, U.S. Department of 
Commerce within 30 days after the date of publication of this notice. 
Requests should contain the party's name, address, and telephone 
number, the number of participants, whether any participant is a 
foreign national, and a list of the issues to be discussed. If a 
request for a hearing is made, the Department intends to hold the 
hearing at the U.S. Department of Commerce, 1401 Constitution Avenue 
NW., Washington, DC 20230, at a time and date to be determined and 
interested parties will be notified by the Department, via letter. 
Parties should confirm by telephone the date, time, and location of the 
hearing two days before the scheduled date.

International Trade Commission Notification

    In accordance with section 703(f) of the Act, the Department will 
notify the International Trade Commission (ITC) of its determination. 
If the final determination is affirmative, the ITC will determine 
before the later of 120 days after the date of this preliminary 
determination or 45 days after the final determination.

Notification to Interested Parties

    This determination is issued and published pursuant to sections 
703(f) and 777(i) of the Act and 19 CFR 351.205(c).

    Dated: April 24, 2017.
Ronald K. Lorentzen,
Acting Assistant Secretary for Enforcement and Compliance.

Appendix I

Scope of the Investigation

    The merchandise covered by this investigation is softwood 
lumber, siding, flooring and certain other coniferous wood 
(``softwood lumber products''). The scope includes:
     Coniferous wood, sawn, or chipped lengthwise, sliced or 
peeled, whether or not planed, whether or not sanded, or whether or 
not finger-jointed, of an actual thickness exceeding six 
millimeters.
     Coniferous wood siding, flooring, and other coniferous 
wood (other than moldings and dowel rods), including strips and 
friezes for parquet flooring, that is continuously shaped 
(including, but not limited to, tongued, grooved, rebated, 
chamfered, V-jointed, beaded, molded, rounded) along any of its 
edges, ends, or faces, whether or not planed, whether or not sanded, 
or whether or not end-jointed.
     Coniferous drilled and notched lumber and angle cut 
lumber.
     Coniferous lumber stacked on edge and fastened together 
with nails, whether or not with plywood sheathing.
     Components or parts of semi-finished or unassembled 
finished products made from subject merchandise that would otherwise 
meet the definition of the scope above.
    Softwood lumber product imports are generally entered under 
Chapter 44 of the Harmonized Tariff Schedule of the United States 
(``HTSUS''). This chapter of the HTSUS covers ``Wood and articles of 
wood.'' Softwood lumber products that are subject to this 
investigation are currently classifiable under the following ten-
digit HTSUS subheadings in Chapter 44: 4407.10.01.01; 4407.10.01.02; 
4407.10.01.15; 4407.10.01.16; 4407.10.01.17; 4407.10.01.18; 
4407.10.01.19; 4407.10.01.20; 4407.10.01.42; 4407.10.01.43; 
4407.10.01.44; 4407.10.01.45; 4407.10.01.46; 4407.10.01.47; 
4407.10.01.48; 4407.10.01.49; 4407.10.01.52; 4407.10.01.53; 
4407.10.01.54; 4407.10.01.55; 4407.10.01.56; 4407.10.01.57; 
4407.10.01.58; 4407.10.01.59; 4407.10.01.64; 4407.10.01.65; 
4407.10.01.66; 4407.10.01.67; 4407.10.01.68; 4407.10.01.69; 
4407.10.01.74; 4407.10.01.75; 4407.10.01.76; 4407.10.01.77; 
4407.10.01.82; 4407.10.01.83; 4407.10.01.92; 4407.10.01.93; 
4409.10.05.00; 4409.10.10.20; 4409.10.10.40; 4409.10.10.60; 
4409.10.10.80; 4409.10.20.00; 4409.10.90.20; 4409.10.90.40; and 
4418.90.25.00.
    Subject merchandise as described above may also be classified as 
stringers, square cut box-spring-frame components, fence pickets, 
truss components, pallet components, flooring, and door and window 
frame parts under the following ten-digit HTSUS subheadings in 
Chapter 44: 4415.20.40.00; 4415.20.80.00; 4418.90.46.05; 
4418.90.46.20; 4418.90.46.40; 4418.90.46.95; 4421.90.70.40; 
4421.90.94.00; and 4421.90.97.80.
    Although these HTSUS subheadings are provided for convenience 
and customs purposes, the written description of the scope of the 
investigation is dispositive.

Appendix II

List of Topics Discussed in the Preliminary Decision Memorandum

I. Summary
II. Background
III. Scope Comments and Requests for Exclusion
IV. Scope of the Investigation
V. Subsidies Valuation
VI. Analysis of Programs
VII. Calculation of the All-Others Rate
VIII. ITC Notification
IX. Disclosure and Public Comment
X. Verification
XI. Conclusion

[FR Doc. 2017-08673 Filed 4-27-17; 8:45 am]
BILLING CODE 3510-DS-P