[Federal Register Volume 83, Number 162 (Tuesday, August 21, 2018)]
[Notices]
[Pages 42254-42256]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-17784]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-928]


Uncovered Innerspring Units From the People's Republic of China: 
Preliminary Affirmative Determination of Circumvention of the 
Antidumping Duty Order

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

SUMMARY: The Department of Commerce (Commerce) preliminarily determines 
that imports of uncovered innerspring units (innersprings) into the 
United States exported from Macau, which were assembled or completed in 
Macau by the Macao Commercial Group using materials sourced from the 
People's Republic of China (China), are circumventing the antidumping 
duty (AD) order on innersprings from China.

DATES: Applicable August 21, 2018.

FOR FURTHER INFORMATION CONTACT: Matthew Renkey AD/CVD Operations, 
Office V, Enforcement and Compliance, International Trade 
Administration, U.S. Department of Commerce, 1401 Constitution Avenue 
NW, Washington, DC 20230; telephone: (202) 482-2312.

SUPPLEMENTARY INFORMATION: 

Background

    On December 31, 2007, Leggett and Platt, Incorporated (the 
petitioner) filed a petition seeking imposition of antidumping duties 
on imports of uncovered innerspring units from, among other countries, 
China.\1\ Following the completion of investigations by Commerce and 
the U.S. International Trade Commission (ITC), Commerce issued an 
antidumping duty order on innersprings from China.\2\
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    \1\ See Uncovered Innerspring Units from the People's Republic 
of China, South Africa, and the Socialist Republic of Vietnam: 
Initiation of Antidumping Duty Investigations, 73 FR 4817 (January 
28, 2008).
    \2\ See Uncovered Innerspring Units from the People's Republic 
of China: Notice of Antidumping Duty Order, 74 FR 7661 (February 19, 
2009) (Order).
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    In the sixth administrative review of the Order,\3\ the petitioner 
requested that Commerce review Macao Commercial and Industrial Spring 
Mattress Manufacturer (Macao Commercial) and East Grace Corporation. 
Commerce initiated the review on April 3, 2015,\4\ and sent 
questionnaires to both of the respondents under review. During the 
course of the sixth administrative review, and in response to 
Commerce's original and supplemental questionnaires, Macao Commercial 
acknowledged that it imports innerspring unit components from China for 
use in the production of innerspring units in Macau, but that it had no 
shipments of completed innerspring units from China to the United 
States.\5\ In the final results, Commerce found that Macao Commercial 
failed to demonstrate that it had no shipments of Chinese-origin 
innersprings, and assigned a rate to Macao Commercial using facts 
available with an adverse inference. Commerce stated that this 
determination applied only with respect to Macao Commercial's Chinese-
origin subject merchandise, but explained that it intended to evaluate 
whether self-initiation of a circumvention inquiry would be warranted 
based upon information submitted during the review and in light of 
Commerce's prior circumvention findings in this proceeding.\6\
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    \3\ The sixth administrative review covered the period of review 
(POR) February 1, 2014, through January 31, 2015. See Initiation of 
Antidumping and Countervailing Duty Administrative Reviews, 80 FR 
18202, 18212 (April 3, 2015).
    \4\ Id.
    \5\ See, e.g., Memorandum to the File ``Factual Information from 
the Sixth Administrative Review,'' dated November 22, 2016 (AR6 
Factual Information Memo), at Attachment 1, Macao Commercial's July 
21, 2016 Supplemental Response. In the AR6 Final Results, we found 
that ``Macao Commercial submitted . . . an invoice for not just raw 
materials but PRC-origin innerspring components from Company X.'' 
See Uncovered Innerspring Units from the People's Republic of China: 
Final Results of Antidumping Duty Administrative Review; 2014-2015, 
81 FR 62729 (September 12, 2016) (AR6 Final Results), and 
accompanying Issues and Decision Memorandum at Comment 1.
    \6\ See AR6 Final Results, and accompanying Issues and Decision 
Memorandum at Comment 1.
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    Commerce self-initiated an anti-circumvention inquiry pursuant to 
section 781(b) of the Tariff Act of 1930, as amended, (the Act) and 19 
CFR 351.225(h) to determine whether innersprings produced by Macao 
Commercial in Macao from materials

[[Page 42255]]

originating in China and exported to the United States from Macao are 
circumventing the Order.\7\ For a complete description of the events 
that followed the initiation of this inquiry, see the Preliminary 
Decision Memorandum.\8\ A list of topics included in the Preliminary 
Decision Memorandum is included as Appendix I 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 https://access.trade.gov, 
and to all parties in the Central Records Unit, Room B8024 of the main 
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 the electronic versions of 
the Preliminary Decision Memorandum are identical in content.
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    \7\ See Uncovered Innerspring Units from the People's Republic 
China: Initiation of Anticircumvention Inquiry on Antidumping Duty 
Order, 81 FR 83801 (November 22, 2016).
    \8\ See Preliminary Decision Memorandum for the Anti-
circumvention Inquiry of the Antidumping Duty Order on Uncovered 
Innerspring Units from the People's Republic of China, dated 
concurrently with, and hereby adopted by, this notice (Preliminary 
Decision Memorandum).
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Affiliation and Collapsing

    As explained further in the Preliminary Decision Memorandum, we 
find, based on the record evidence, that Macao Commercial is 
affiliated, pursuant to sections 771(33)(A), (E) and (F), of the Act, 
with Tai Wa Machinery, Tai Wa Commercial, Wa Cheong Hong, and Heshan 
Tai Hua Jian Ye Machinery Co., Ltd. Further, based on Macao 
Commercial's own statements and record evidence, we find that, pursuant 
to 19 CFR 351.401(f), these companies should be treated as a single 
entity, the Macao Commercial Group.

Scope of the Order

    The products covered by the Order are uncovered innerspring units. 
For a complete description of the scope of the Order, see the 
Preliminary Decision Memorandum.

Scope of the Anti-Circumvention Inquiry

    The products covered by this inquiry are innersprings that are 
manufactured in Macau by the Macao Commercial Group with Chinese-origin 
components and materials and are then subsequently exported from Macau 
to the United States.

Methodology

    Commerce is conducting this anti-circumvention inquiry in 
accordance with section 781(b) of the Act. For a full description of 
the methodology underlying the Commerce's preliminary determination, 
see the Preliminary Decision Memorandum.

Preliminary Finding

    As detailed in the Preliminary Decision Memorandum, we 
preliminarily determine that innersprings exported from Macau, which 
were manufactured in Macau by the Macao Commercial Group using 
components and/or materials from China, are circumventing the Order. 
Therefore, we preliminarily determine that it is appropriate to include 
this merchandise within the Order and to instruct U.S. Customs and 
Border Protection (CBP) to suspend any entries of innersprings from 
Macau, which were manufactured in Macau by the Macao Commercial Group 
using components and/or materials from China.

Suspension of Liquidation

    As stated above, Commerce has made a preliminary affirmative 
finding of circumvention of the Order by exports to the United States 
of innersprings exported from Macau, which were manufactured in Macau 
by the Macao Commercial Group using components and/or materials from 
China. In accordance with section 19 CFR 351.225(l)(2), Commerce will 
direct CBP to suspend liquidation and to require a cash deposit of 
estimated duties on unliquidated entries of innersprings assembled or 
completed in Macau from Chinese-origin components or materials that 
were entered, or withdrawn from warehouse, for consumption on or after 
November 22, 2016, the date of initiation of the anti-circumvention 
inquiry.
    The suspension of liquidation instructions will remain in effect 
until further notice. Commerce will instruct CBP to require AD cash 
deposits equal to the China-wide rate of 234.51 percent, unless the 
importer/exporter can demonstrate to CBP that the Chinese-origin 
innersprings assembled or completed in Macau by the Macao Commercial 
Group were supplied by a Chinese manufacturer with a separate rate. In 
that instance, the cash deposit rate will be the rate of the Chinese 
innersprings manufacturer that has its own rate.\9\
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    \9\ See Glycine from the People's Republic of China: Preliminary 
Partial Affirmative Determination of Circumvention of the 
Antidumping Duty Order and Initiation of Scope Inquiry, 77 FR 21532, 
21535 (April 10, 2012).
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Public Comment

    Case briefs or other written comments may be submitted to the 
Assistant Secretary for Enforcement and Compliance no later than 14 
days after the publication of this preliminary determination in the 
Federal Register, unless the Secretary alters the time limit. Rebuttal 
briefs, limited to issues raised in case briefs, may be submitted no 
later than five days after the deadline date for case briefs.\10\ 
Pursuant to 19 CFR 351.309(c)(2) and (d)(2), parties who submit case 
briefs or rebuttal briefs in this anti-circumvention inquiry 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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    \10\ 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 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, 
Commerce 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. Parties should confirm by telephone the 
date, time, and location of the hearing two days before the scheduled 
date.

ITC Notification

    Commerce, consistent with section 781(e)(1)(B) of the Act and 19 
CFR 351.225(f)(7)(i)(B), has notified the ITC of this preliminary 
determination to include the merchandise subject to this anti-
circumvention inquiry within the scope of the Order. Pursuant to 
section 781(e)(2) of the Act, the ITC may request consultations 
concerning Commerce's proposed inclusion of the merchandise. If, after 
consultations, the ITC believes that a significant injury issue is 
presented by the proposed inclusion, it will have 60 days from the date 
of notification by Commerce to provide written advice.\11\
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    \11\ See section 781(e)(3) of the Act.

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[[Page 42256]]

Notification to Interested Parties

    This determination is issued and published in accordance with 
section 781(b) of the Act and 19 CFR 351.225(f).

    Dated: August 9, 2018.
James Maeder,
Associate Deputy Assistant Secretary for Antidumping and Countervailing 
Duty Operations performing the duties of Deputy Assistant Secretary for 
Antidumping and Countervailing Duty Operations.

Appendix I--List of Topics Discussed in the Preliminary Decision 
Memorandum

I. Summary
II. Background
III. Scope of the Order
IV. Scope of the Anti-circumvention Inquiry
V. Period of Anticircumvention Inquiry
VI. Affiliation and Collapsing
VII. Statutory Framework
VIII. Application of Adverse Facts Available With an Adverse 
Inference
IX. Statutory Analysis
X. Recommendation

[FR Doc. 2018-17784 Filed 8-20-18; 8:45 am]
 BILLING CODE 3510-DS-P