[Federal Register Volume 83, Number 232 (Monday, December 3, 2018)]
[Notices]
[Pages 62297-62300]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-26172]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-570-089]


Certain Steel Racks From the People's Republic of China: 
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 (Commerce) preliminarily determines 
that countervailable subsidies are being provided to producers and 
exporters of certain steel racks (steel racks) from the People's 
Republic of China (China) for the period of investigation (POI) January 
1, 2017 through December 31, 2017. Interested parties are invited to 
comment on this preliminary determination.

DATES: Applicable December 3, 2018.

FOR FURTHER INFORMATION CONTACT: Eli Lovely, Aleksandras Nakutis or 
Robert Galantucci, AD/CVD Operations, Office IV, Enforcement and 
Compliance, International Trade Administration, U.S. Department of 
Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: 
(202) 482-1593, (202) 482-3147 or (202) 482-2923, 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). Commerce 
published the notice of initiation of this investigation on July 10, 
2018.\1\ On August 28, 2018, pursuant to a request from the Coalition 
for Fair Racks Imports (the petitioner),\2\ Commerce postponed the 
preliminary determination of this investigation to November 19, 
2018.\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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    \1\ See Certain Steel Racks from the People's Republic of China: 
Initiation of Countervailing Duty Investigation, 83 FR 33201 (July 
10, 2018) (Initiation Notice).
    \2\ See Letter, ``Certain Steel Racks from the People's Republic 
of China: Request to Postpone Preliminary Determination,'' dated 
August 9, 2018.
    \3\ See Countervailing Duty Investigation of Steel Racks from 
the People's Republic of China: Postponement of Preliminary 
Determination, 83 FR 43848 (August 28, 2018).
    \4\ See Memorandum, ``Decision Memorandum for the Preliminary 
Determination of the Countervailing Duty Investigation of Certain 
Steel Racks from the People's Republic of China,'' dated 
concurrently with, and hereby adopted by, this notice (Preliminary 
Decision Memorandum).
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Scope of the Investigation

    The products covered by this investigation are steel racks from 
China. For a complete description of the scope of this investigation, 
see Appendix I.

Scope Comments

    In accordance with the preamble to Commerce'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. Commerce intends to issue its 
preliminary decision regarding comments concerning the scope of the 
antidumping duty and countervailing duty investigations in the 
preliminary determination of the companion antidumping duty (AD) 
investigation.
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    \5\ See Antidumping Duties; Countervailing Duties, Final Rule, 
62 FR 27296, 27323 (May 19, 1997).
    \6\ See Initiation Notice.
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Methodology

    Commerce is conducting this investigation in accordance with 
section 701 of the Act. For each of the subsidy programs found 
countervailable, Commerce 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.\7\ In making these findings, Commerce relied, in part, on 
facts available and, because it finds that certain respondents did not 
act to the best of their ability to respond to Commerce's requests for 
information, it drew an adverse

[[Page 62298]]

inference where appropriate in selecting from among the facts otherwise 
available.\8\ For further information, see ``Use of Facts Otherwise 
Available and Adverse Inferences'' in the Preliminary Decision 
Memorandum.
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    \7\ 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.
    \8\ See sections 776(a) and (b) of the Act.
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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), Commerce is 
aligning the final countervailing duty determination in this 
investigation with the final determination in the companion antidumping 
duty investigation of steel racks from China based on a request made by 
the petitioner.\9\ Consequently, the final countervailing duty 
determination will be issued on the same date as the final antidumping 
determination, which is currently scheduled to be issued no later than 
April 1, 2019, unless postponed.
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    \9\ See Letter, ``Certain Steel Racks from the People's Republic 
of China: Request to Align Final Countervailing Duty and Antidumping 
Determinations,'' dated October 31, 2018.
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All-Others Rate

    Sections 703(d) and 705(c)(5)(A) of the Act provide that in the 
preliminary determination, Commerce 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, Commerce preliminarily assigned rates based 
entirely on facts available for Jiangsu Kingmore Storage Equipment 
Manufacturing Co., Ltd., Nanjing Huade Storage Equipment Manufacture 
Co., Ltd., Tangshan Apollo Energy Equipment Company, Ltd., and 13 
companies that failed to respond to our quantity and value (Q&V) 
questionnaire.\10\ Commerce calculated individual estimated 
countervailable subsidy rates for Nanjing Dongsheng Shelf Manufacturing 
Co., Ltd. (Nanjing Dongsheng) and Xiamen Aifei Metal Manufacturing Co., 
Ltd. (Aifeimetal). Therefore, Commerce calculated the all-others'' rate 
using a weighted average of the individual estimated subsidy rates 
calculated for Aifeimetal and Nanjing Dongsheng using each company's 
publicly-ranged values for the merchandise under consideration.\11\
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    \10\ The companies that did not respond to our Q&V questionnaire 
are: Designa Inc.; Dongguan Baike Electronic Co., Ltd.; Ezidone 
Display Corp. Ltd.; Fenghua Huige Metal Products Co., Ltd.; Formost 
Plastic Metal Works (Jiaxing) Co., Ltd.; Ningbo Bocheng Home 
Products Co., Ltd.; Ningbo Joys Imp. & Exp. Co., Ltd.; Ningbo Li 
Zhan Import & Export Co.; Qingdao Haineng Hardware Products Co., 
Ltd.; Qingdao Huatian Hand Truck Co., Ltd.; Qingdao Zeal-Line 
Stainless Steel Products Co., Ltd.; Seven Seas Furniture Industrial 
(Xiamen) Co., Ltd.; and Shijiazhuang Wells Trading & Mfg. Co., Ltd.
    \11\ With two respondents under examination, Commerce normally 
calculates (A) a weighted-average of the estimated subsidy rates 
calculated for the examined respondents; (B) a simple average of the 
estimated subsidy rates calculated for the examined respondents; and 
(C) a weighted-average of the estimated subsidy rates calculated for 
the examined respondents using each company's publicly-ranged U.S. 
sale quantities for the merchandise under consideration. Commerce 
then compares (B) and (C) to (A) and selects the rate closest to (A) 
as the most appropriate rate for all other producers and exporters. 
See, e.g. , Ball Bearings and Parts Thereof from France, Germany, 
Italy, Japan, and the United Kingdom: Final Results of Antidumping 
Duty Administrative Reviews, Final Results of Changed-Circumstances 
Review, and Revocation of an Order in Part, 75 FR 53661, 53663 
(September 1, 2010). As complete publicly ranged sales data was 
available, Commerce based the all-others rate on the publicly ranged 
sales data of the mandatory respondents. For a complete analysis of 
the data, please see the All-Others'' Rate Calculation Memorandum.
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Preliminary Determination

    Commerce preliminarily determines that the following estimated 
countervailable subsidy rates exist:

------------------------------------------------------------------------
                                                           Subsidy rate
                         Company                             (percent)
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Designa Inc.............................................          150.49
Dongguan Baike Electronic Co., Ltd......................          150.49
Ezidone Display Corp. Ltd...............................          150.49
Fenghua Huige Metal Products Co., Ltd...................          150.49
Formost Plastic Metal Works (Jiaxing) Co., Ltd..........          150.49
Jiangsu Kingmore Storage Equipment Manufacturing Co.,             150.49
 Ltd....................................................
Nanjing Dongsheng Shelf Manufacturing Co., Ltd..........            5.04
Nanjing Huade Storage Equipment Manufacture Co., Ltd....          150.49
Ningbo Bocheng Home Products Co., Ltd...................          150.49
Ningbo Joys Imp. & Exp. Co., Ltd........................          150.49
Ningbo Li Zhan Import & Export Co.......................          150.49
Qingdao Haineng Hardware Products Co., Ltd..............          150.49
Qingdao Huatian Hand Truck Co., Ltd.....................          150.49
Qingdao Zeal-Line Stainless Steel Products Co., Ltd.....          150.49
Seven Seas Furniture Industrial (Xiamen) Co., Ltd.......          150.49
Shijiazhuang Wells Trading & Mfg. Co., Ltd..............          150.49
Tangshan Apollo Energy Equipment Company................          150.49
Xiamen Aifei Metal Manufacturing Co., Ltd \12\..........           10.45
All-Others..............................................            8.81
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Suspension of Liquidation
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    \12\ As discussed in the Preliminary Decision Memorandum, 
Commerce has found Xiamen Massive Joy Industry Co., Ltd. and Xiamen 
Aifei Health-Tech Co., Ltd. to be cross-owned with Xiamen Aifei 
Metal Manufacturing Co., Ltd.
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    In accordance with section 703(d)(1)(B) and (d)(2) of the Act, 
Commerce 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), 
Commerce will instruct CBP to require a cash deposit equal to the rates 
indicated above.

Disclosure

    Commerce intends to disclose its calculations and analysis 
performed to interested parties in this preliminary determination 
within five days of its public announcement, or if there is no public 
announcement, within five days of the date of this notice in accordance 
with 19 CFR 351.224(b).

[[Page 62299]]

Verification

    As provided in section 782(i)(1) of the Act, Commerce 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.\13\ 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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    \13\ 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.

International Trade Commission Notification

    In accordance with section 703(f) of the Act, Commerce 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: November 19, 2018.
Gary Taverman,
Deputy Assistant Secretary for Antidumping and Countervailing Duty 
Operations, performing the non-exclusive functions and duties of the 
Assistant Secretary for Enforcement and Compliance.

Appendix

Scope of the Investigation

    The merchandise covered by this investigation is steel racks and 
parts thereof, assembled, to any extent, or unassembled, including 
but not limited to, vertical components (e.g., uprights, posts, or 
columns), horizontal or diagonal components (e.g., arms or beams), 
braces, frames, locking devices (i.e., end plates and beam 
connectors), and accessories (including, but not limited to, rails, 
skid channels, skid rails, drum/coil beds, fork clearance bars, 
pallet supports, column and post protectors, end row and end aisle 
protectors, corner guards, row spacers, and wall ties). Subject 
steel racks and parts thereof are made of steel, including, but not 
limited to, cold and/or hot-formed steel, regardless of the type of 
steel used to produce the components and may, or may not, include 
locking tabs, slots, or bolted, clamped, or welded connections.
    Steel rack components can be assembled into structures of 
various dimensions and configurations by welding, bolting, clipping, 
or with the use of devices such as clips, end plates, and beam 
connectors, including, but not limited to the following 
configurations: (1) Racks with upright frames perpendicular to the 
aisles that are independently adjustable, with positive locking 
beams parallel to the aisle spanning the upright frames with braces; 
and (2) cantilever racks with vertical components parallel to the 
aisle and cantilever beams or arms connected to the vertical 
components perpendicular to the aisle. Steel racks may be referred 
to as pallet racks, storage racks, stacker racks, retail racks, pick 
modules, selective racks, or cantilever racks and may incorporate 
moving components and be referred to as pallet-flow racks, carton-
flow racks, push-back racks, movable-shelf racks, drive-in racks, 
and drive-through racks. While steel racks may be made to ANSI 
MH16.l or ANSI MH16.3 standards, all steel racks and parts thereof 
meeting the description set out herein are covered by the scope of 
this investigation, whether or not produced according to a 
particular standard.
    The scope includes all steel racks and parts thereof meeting the 
description above, regardless of
    (1) Dimensions, weight, strength, gauge, or load rating;
    (2) vertical components or frame type (including structural, 
roll-form, or other);
    (3) horizontal support or beam/brace type (including but not 
limited to structural, roll-form, slotted, unslotted, Z-beam, C-
beam, L-beam, step beam, and cantilever beam);
    (4) number of supports;
    (5) number of levels;
    (6) surface coating, if any (including but not limited to paint, 
epoxy, powder coating, zinc, or other metallic coatings);
    (7) shape (including but not limited to rectangular, square, 
corner, and cantilever);
    (8) the method by which the vertical and horizontal supports 
connect (including but not limited to locking tabs or slots, 
bolting, clamping, and welding); and
    (9) whether or not the steel rack has moving components 
(including but not limited to rails, wheels, rollers, tracks, 
channels, carts, and conveyors).
    Subject merchandise includes merchandise matching the above 
description that has been finished or packaged in a third country. 
Finishing includes, but is not limited to, coating, painting, or 
assembly, including attaching the merchandise to another product, or 
any other finishing or assembly operation that would not remove the 
merchandise from the scope of the investigation if performed in the 
country of manufacture of the steel racks and parts thereof. 
Packaging includes packaging the merchandise with or without another 
product or any other packaging operation that would not remove the 
merchandise from the scope of the investigation if performed in the 
country of manufacture of the steel racks and parts thereof.
    Steel racks and parts thereof are included in the scope of this 
investigation whether or not imported attached to, or included with, 
other parts or accessories such as wire decking, nuts, and bolts. If 
steel racks and parts thereof are imported attached to, or included 
with, such non-subject merchandise, only the steel racks and parts 
thereof are included in the scope.
    The scope of this investigation does not cover: (1) Decks, i.e., 
shelving that sits on or fits into the horizontal supports to 
provide the horizontal storage surface of the steel racks; (2) wire 
shelving units, i.e., shelves made from wire that incorporate both a 
wire deck and wire horizontal supports (taking the place of the 
horizontal beams and braces) into a single piece with tubular 
collars that slide over the posts and onto plastic sleeves snapped 
on the posts to create a finished unit; (3) pins, nuts, bolts, 
washers, and clips used as connecting devices; and (4) non-steel 
components.
    Specifically excluded from the scope of this investigation are 
any products covered by Commerce's existing antidumping and 
countervailing duty orders on boltless steel shelving units 
prepackaged for sale from the People's Republic of China. See 
Boltless Steel Shelving Units Prepackaged for Sale from the People's 
Republic of China: Antidumping Duty Order, 80 Fed. Reg. 63,741 
(October 21, 2017); Boltless Steel Shelving Units Prepackaged for 
Sale from the People's Republic of China: Amended Final Affirmative 
Countervailing Duty Determination and Countervailing Duty Order, 80 
Fed. Reg. 63,745 (October 21, 2017). Also excluded from the scope of 
this investigation are bulk-packed parts or components of boltless 
steel shelving units that were specifically excluded from the scope 
of the Boltless Steel Shelving Orders because such bulk-packed parts 
or components do not contain the steel vertical supports (i.e., 
uprights and posts) and steel horizontal supports (i.e., beams, 
braces) packaged together for assembly into a completed boltless 
steel shelving unit.
    Merchandise covered by this investigation is currently 
classified in the Harmonized

[[Page 62300]]

Tariff Schedule of the United States (HTSUS) under the following 
subheadings: 7326.90.8688, 9403.20.0080, and 9403.90.8041. Subject 
merchandise may also enter under subheadings 7308.90.3000, 
7308.90.6000, 7308.90.9590, and 9403.20.0090. The HTSUS subheadings 
are provided for convenience and U.S. Customs purposes only. The 
written description of the scope is dispositive.

Appendix II

List of Topics Discussed in the Preliminary Decision Memorandum

I. Summary
II. Background
III. Scope Comments
IV. Scope of the Investigation
V. Injury Test
VI. Application of the CVD Law to Imports From China
VII. Diversification of China's Economy
VIII. Use of Facts Otherwise Available and Adverse Inferences
IX. Subsidies Valuation
X. Benchmarks and Interest Rates
XI. Analysis of Programs
XII. Conclusion

 [FR Doc. 2018-26172 Filed 11-30-18; 8:45 am]
 BILLING CODE 3510-DS-P