[Federal Register Volume 84, Number 100 (Thursday, May 23, 2019)]
[Notices]
[Pages 23760-23763]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-10799]
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DEPARTMENT OF COMMERCE
International Trade Administration
[C-570-085]
Certain Quartz Surface Products From the People's Republic of
China: Final Affirmative Countervailing Duty Determination, and Final
Affirmative Determination of Critical Circumstances
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (Commerce) determines that
countervailable subsidies are being provided to producers and exporters
of certain quartz surface products (quartz surface products) from the
People's Republic of China (China).
DATES: Applicable May 23, 2019.
FOR FURTHER INFORMATION CONTACT: Darla Brown or Joshua Tucker, AD/CVD
Operations, Office II, Enforcement and Compliance, International Trade
Administration, U.S. Department of Commerce, 1401 Constitution Avenue
NW, Washington, DC 20230; telephone: (202) 482-1791 or (202) 482-2044,
respectively.
SUPPLEMENTARY INFORMATION:
Background
The petitioner in this investigation is Cambria Company, LLC. In
addition to the Government of China (GOC), the mandatory respondents in
this investigation are Fasa Industrial Corporation Limited (Fasa
Industrial), Foshan Hero Stone Co., Ltd. (Hero Stone), and Foshan Yixin
Stone Co., Ltd. (Foshan Yixin).
The events that occurred since Commerce published the Preliminary
Determination \1\ on September 21, 2018; the post-preliminary analysis
\2\ on November 6, 2018; and the Preliminary Critical Circumstances
Determination \3\ on November 15, 2018, are discussed in the Issues and
Decision Memorandum,
[[Page 23761]]
which is hereby adopted by this notice.\4\ The Issues and Decision
Memorandum also details the changes we made since the Preliminary
Determination to the subsidy rates calculated for the mandatory
respondents and all other producers/exporters. The Issues and 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 Issues and
Decision Memorandum can be accessed directly at http://enforcement.trade.gov/frn/index.html. The signed Issues and Decision
Memorandum and the electronic version of the Issues and Decision
Memorandum are identical in content.
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\1\ See Certain Quartz Surface Products from the People's
Republic of China: Preliminary Affirmative Countervailing Duty
Determination, and Alignment of Final Determination with Final
Antidumping Duty Determination, 83 FR 47881 (September 21, 2018)
(Preliminary Determination), and accompanying Preliminary Decision
Memorandum.
\2\ See Memorandum, ``Post-Preliminary Analysis of
Countervailing Duty Investigation: Certain Quartz Surface Products
from the People's Republic of China,'' dated November 6, 2018.
\3\ See Certain Quartz Surface Products from the People's
Republic of China: Preliminary Affirmative Determination of Critical
Circumstances, in Part, in the Countervailing Duty Investigation, 83
FR 57419 (November 15, 2018) (Preliminary Critical Circumstances
Determination).
\4\ See Memorandum, ``Issues and Decision Memorandum for the
Final Determination in the Countervailing Duty Investigation of
Certain Quartz Surface Products from the People's Republic of
China,'' dated concurrently with, and hereby adopted by, this notice
(Issues and Decision Memorandum).
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Commerce exercised its discretion to toll all deadlines affected by
the partial Federal government closure from December 22, 2018, through
the resumption of operations on January 29, 2019.\5\ The revised
deadline for the final determination of this investigation is now May
14, 2019.
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\5\ See Memorandum to the Record from 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, ``Deadlines
Affected by the Partial Shutdown of the Federal Government,'' dated
January 28, 2019. All deadlines in this segment of the proceeding
have been extended by 40 days.
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Period of Investigation
The period of investigation is January 1, 2017, through December
31, 2017.
Scope of the Investigation
The products covered by this investigation are quartz surface
products from China. For a complete description of the scope of the
investigation, see Appendix I.
Scope Comments
During the course of this investigation and the concurrent less-
than-fair-value (LTFV) investigation of quartz surface products from
China, Commerce received scope comments from interested parties.
Commerce issued a Preliminary Scope Decision Memorandum to address
these comments and set aside a period of time for parties to address
scope issues in scope case and rebuttal briefs.\6\ We received comments
from interested parties on the Preliminary Scope Decision Memorandum,
which we addressed in the Final Scope Decision Memorandum.\7\ In
addition, on February 14, 2019, the petitioner submitted a proposed
clarification to the scope of this and the concurrent LTFV
investigation.\8\ In response to the petitioner's proposed scope
clarification, Commerce established a separate scope briefing schedule
and received case and rebuttal briefs regarding the proposed
clarification, which we addressed in the Proposed Scope Clarification
Decision Memorandum.\9\ As a result, for this final determination, we
made certain changes to the scope of these investigations from that
published in the Preliminary Determination.\10\ See Appendix I.
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\6\ See Memorandum, ``Certain Quartz Surface Products from the
People's Republic of China: Scope Comments Decision Memorandum for
the Preliminary Determination,'' dated September 14, 2018
(Preliminary Scope Decision Memorandum).
\7\ See Memorandum, ``Certain Quartz Surface Products from the
People's Republic of China: Final Scope Comments Decision
Memorandum,'' dated May 10, 2019 (Final Scope Decision Memorandum).
\8\ See Petitioner's Letter, ``Certain Quartz Surface Products
from the People's Republic of China: Request to Extend Deadline to
Submit Factual Information,'' dated February 14, 2019.
\9\ See Memorandum, ``Certain Quartz Surface Products from the
People's Republic of China: Proposed Scope Clarification Decision
Memorandum,'' dated concurrently with this notice (Proposed Scope
Clarification Memorandum).
\10\ This scope modification will not apply to merchandise
entered prior to the publication of this notice in the Federal
Register.
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Final Affirmative Determination of Critical Circumstances
In the Preliminary Critical Circumstances Determination, Commerce
preliminarily determined, pursuant to section 703(e)(1) of the Tariff
Act of 1930, as amended (the Act), that critical circumstances exist
for Fasa Industrial and Hero Stone, but not for Foshan Yixin or the
companies covered by the all-others rate. For this final determination,
we continue to find that critical circumstances exist for Fasa
Industrial and Hero Stone pursuant to section 705(a)(2) of the Act.
Moreover, we now find that Foshan Yixin and its unaffiliated suppliers,
Foshan Nanhai Julang Quartz Co. (Foshan Nanhai) and Qinguan Yuefeng
Decoration Material Co. (Qinguan Yuefeng), as well as the companies
covered by the all-others rate received export-contingent
countervailable subsidies during the POI through the Export Buyer's
Credit program that are inconsistent with the Subsidies and
Countervailing Measures Agreement and had massive imports of the
subject merchandise over a relatively short period. Therefore, in
accordance with section 705(a)(2) of the Act, we also find that
critical circumstances exist with respect to Foshan Yixin, Foshan
Nanhai, Qinguan Yuefeng, and the companies covered by the all-others
rate. For the analysis of critical circumstances for this final
determination, see the Issues and Decision Memorandum at Comment 10.
Analysis of Subsidy Programs and Comments Received
In the Issues and Decision Memorandum, we address the subsidy
programs under investigation and all issues raised in parties' case and
rebuttal briefs, other than those issues related to scope. A list of
the issues that parties raised, and to which we responded in the Issues
and Decision Memorandum, is attached to this notice as Appendix II.
Methodology
Commerce conducted this investigation in accordance with section
701 of the Act. For each of the subsidy programs found countervailable,
Commerce 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.\11\ For a full description
of the methodology underlying our final determination, see the Issues
and Decision Memorandum.
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\11\ 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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Verification
As provided in section 782(i) of the Act, Commerce verified the
subsidy information reported by Foshan Yixin. We used standard
verification procedures, including an examination of relevant
accounting records and original source documents provided by the
respondent.\12\
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\12\ See Memorandum, ``Verification of the Questionnaire
Responses of Foshan Yixin Stone Co., Ltd.,'' dated December 14,
2018.
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Changes Since the Preliminary Determination
In addition to now finding critical circumstances for Foshan Yixin
and companies covered by the all-others rate, based on our review and
analysis of the comments received from parties and corrections
presented at verification, we made certain changes to the subsidy rate
calculations for Foshan Yixin. We also assigned individual
[[Page 23762]]
estimated subsidy rates based on adverse facts available to Foshan
Yixin's unaffiliated suppliers that failed to cooperate in this
investigation: Foshan Nanhai and Qinguan Yuefeng. As a result of the
changes to Foshan Yixin's calculated rate, Commerce has also revised
the all-others rate. For a discussion of these changes, see the Issues
and Decision Memorandum.\13\
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\13\ See Issues and Decision Memorandum.
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Final Determination
In accordance with section 705(c)(1)(B)(i)(I) of the Act, we
calculated an individual estimated subsidy rate for Foshan Yixin (for
entries produced and exported by Foshan Yixin), and established
individual estimated subsidy rates for Fasa Industrial, Foshan Nanhai,
Hero Stone, and Qinguan Yuefeng. Section 705(c)(5)(A)(i) of the Act
states that, for companies not individually investigated, we will
determine an ``all others'' rate equal to the weighted-average
countervailable subsidy rates established for exporters and producers
individually investigated, excluding any zero and de minimis
countervailable subsidy rates, and any rates determined entirely under
section 776 of the Act. In the final determination of this
investigation, Commerce calculated rates for Fasa Industrial and Hero
Stone in accordance with section 776 of the Act.\14\ Therefore, the
only rate that is not zero, de minimis, or based entirely on facts
otherwise available is the rate calculated for Foshan Yixin.
Consequently, the rate calculated for Foshan Yixin is also assigned as
the rate for ``all other'' producers and exporters.
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\14\ We also assigned rates to Foshan Yixin's unaffiliated
suppliers Foshan Nanhai and Qinguan Yuefeng in accordance with
section 776 of the Act.
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Commerce determines the total estimated net countervailable subsidy
rates to be the following:
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Subsidy
Company rate (%)
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Foshan Hero Stone Co., Ltd.\15\............................... 190.99
Fasa Industrial Corporation Limited........................... 190.99
Foshan Yixin Stone Co., Ltd................................... 45.32
Foshan Nanhai Julang Quartz Co................................ 190.99
Qinguan Yuefeng Decoration Material Co........................ 190.99
All Others.................................................... 45.32
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Disclosure
We intend to disclose the calculations performed to parties in this
proceeding within five days of the date of publication of this notice,
in accordance with 19 CFR 351.224(b).
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\15\ Commerce has found the following companies to be cross-
owned with Foshan Hero Stone Co., Ltd.: Mingwei Quartz New
Environmental Protection Materials Co., Ltd.; and Foshan Quartz
Stone Imp & Exp Co., Ltd.
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Continuation of Suspension of Liquidation
As a result of our Preliminary Determination of Critical
Circumstances and pursuant to sections 703(d)(1)(B) and (d)(2) of the
Act, Commerce instructed U.S. Customs and Border Protection (CBP) to
suspend liquidation of entries of subject merchandise for Fasa
Industrial and Hero Stone, as described in the scope of the
investigation section, entered, or withdrawn from warehouse, for
consumption on or after June 23, 2018, which is 90 days prior to the
date of publication of the Preliminary Determination in the Federal
Register. Additionally, as a result of our Preliminary Determination,
for Foshan Yixin and the companies covered by the all-others rate,
Commerce instructed 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 the Preliminary Determination in the Federal
Register. In accordance with section 703(d) of the Act, we issued
instructions to CBP to discontinue the suspension of liquidation for
countervailing duty (CVD) purposes for subject merchandise entered, or
withdrawn from warehouse, on or after January 19, 2019, but to continue
the suspension of liquidation of all entries from September 21, 2018
(or, in the case of Fasa Industrial and Hero Stone, June 23, 2018),
through January 18, 2019.
If the U.S. International Trade Commission (ITC) issues a final
affirmative injury determination, we will issue a CVD order, reinstate
the suspension of liquidation under section 706(a) of the Act, and
require a cash deposit of estimated countervailing duties for such
entries of subject merchandise in the amounts indicated above. If the
ITC also issues a final affirmative determination of critical
circumstances, on the basis of our final affirmative critical
circumstances determination, we will additionally instruct CBP to
suspend liquidation and require a cash deposit on all entries of quartz
surface products from China effective June 23, 2018. If the ITC issues
a final affirmative injury determination but a final negative
determination of critical circumstances, we will instruct CBP to
liquidate entries prior to the date of publication of the Preliminary
Determination without regard to duties, and all estimated duties
deposited or securities posted as a result of the suspension of
liquidation will be refunded or canceled. If the ITC determines that
material injury, or threat of material injury, does not exist, this
proceeding will be terminated and all estimated duties deposited or
securities posted as a result of the suspension of liquidation will be
refunded or canceled.
International Trade Commission Notification
In accordance with section 705(d) of the Act, we will notify the
ITC of our determination. Because Commerce's final determination is
affirmative, in accordance with section 705(b) of the Act, the ITC will
determine, within 45 days, whether the domestic industry in the United
States is materially injured, or threatened with material injury, by
reason of imports of quartz surface products from China, or sales (or
the likelihood of sales) for importation, of quartz surface products
from China. If the ITC determines that material injury or threat of
material injury does not exist, the proceeding will be terminated and
all cash deposits will be refunded. If the ITC determines that such
injury does exist, Commerce will issue a CVD order directing CBP to
assess, upon further instruction by Commerce, countervailing duties on
all imports of the subject merchandise that are entered, or withdrawn
from warehouse, for consumption on or after the effective date of the
suspension of liquidation, as discussed above in the ``Continuation of
Suspension of Liquidation'' section.
Notification Regarding Administrative Protective Orders
In the event that the ITC issues a final negative injury
determination, this notice will serve as the only reminder to parties
subject to the administrative protective order (APO) of their
responsibility concerning the destruction of proprietary information
disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely
written notification of the return/destruction of APO materials or
conversion to judicial protective order is hereby requested. Failure to
comply with the regulations and terms of an APO is a sanctionable
violation.
Notification to Interested Parties
This determination is issued and published pursuant to sections
705(d) and 777(i) of the Act.
[[Page 23763]]
Dated: May 14, 2019.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.
Appendix I
Scope of the Investigation
The merchandise covered by the investigation is certain quartz
surface products.\16\ Quartz surface products consist of slabs and
other surfaces created from a mixture of materials that includes
predominately silica (e.g., quartz, quartz powder, cristobalite) as
well as a resin binder (e.g., an unsaturated polyester). The
incorporation of other materials, including, but not limited to,
pigments, cement, or other additives does not remove the merchandise
from the scope of the investigation. However, the scope of the
investigation only includes products where the silica content is
greater than any other single material, by actual weight. Quartz
surface products are typically sold as rectangular slabs with a
total surface area of approximately 45 to 60 square feet and a
nominal thickness of one, two, or three centimeters. However, the
scope of this investigation includes surface products of all other
sizes, thicknesses, and shapes. In addition to slabs, the scope of
this investigation includes, but is not limited to, other surfaces
such as countertops, backsplashes, vanity tops, bar tops, work tops,
tabletops, flooring, wall facing, shower surrounds, fire place
surrounds, mantels, and tiles. Certain quartz surface products are
covered by the investigation whether polished or unpolished, cut or
uncut, fabricated or not fabricated, cured or uncured, edged or not
edged, finished or unfinished, thermoformed or not thermoformed,
packaged or unpackaged, and regardless of the type of surface
finish.
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\16\ Quartz surface products may also generally be referred to
as engineered stone or quartz, artificial stone or quartz,
agglomerated stone or quartz, synthetic stone or quartz, processed
stone or quartz, manufactured stone or quartz, and
Bretonstone[supreg].
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In addition, quartz surface products are covered by the
investigation whether or not they are imported attached to, or in
conjunction with, non-subject merchandise such as sinks, sink bowls,
vanities, cabinets, and furniture. If quartz surface products are
imported attached to, or in conjunction with, such non-subject
merchandise, only the quartz surface product is covered by the
scope.
Subject merchandise includes material matching the above
description that has been finished, packaged, or otherwise
fabricated in a third country, including by cutting, polishing,
curing, edging, thermoforming, attaching to, or packaging with
another product, or any other finishing, packaging, or fabrication
that would not otherwise remove the merchandise from the scope of
the investigation if performed in the country of manufacture of the
quartz surface products.
The scope of the investigation does not cover quarried stone
surface products, such as granite, marble, soapstone, or quartzite.
Specifically excluded from the scope of the investigation are
crushed glass surface products. Crushed glass surface products must
meet each of the following criteria to qualify for this exclusion:
(1) The crushed glass content is greater than any other single
material, by actual weight; (2) there are pieces of crushed glass
visible across the surface of the product; (3) at least some of the
individual pieces of crushed glass that are visible across the
surface are larger than one centimeter wide as measured at their
widest cross-section (glass pieces); and (4) the distance between
any single glass piece and the closest separate glass piece does not
exceed three inches.
The products subject to the scope are currently classified in
the Harmonized Tariff Schedule of the United States (HTSUS) under
the following subheading: 6810.99.0010. Subject merchandise may also
enter under subheadings 6810.11.0010, 6810.11.0070, 6810.19.1200,
6810.19.1400, 6810.19.5000, 6810.91.0000, 6810.99.0080,
6815.99.4070, 2506.10.0010, 2506.10.0050, 2506.20.0010,
2506.20.0080, and 7016.90.10. The HTSUS subheadings set forth above
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 Issues and Decision Memorandum
I. Summary
II. Background
III. Final Determination of Critical Circumstances
IV. Scope Comments
V. Use of Adverse Facts Available
VI. Subsidies Valuation Information
VII. Analysis of Programs
VIII. Analysis of Comments
Comment 1: Whether This Investigation Was Improperly Initiated
Comment 2: The Application of AFA to Hero Stone
Comment 3: The Application of AFA to Foshan Yixin's and Hero
Stone's Unaffiliated Suppliers of Subject Merchandise
Comment 4: The Application of AFA to Input Market Distortion
Comment 5: The Application of AFA Regarding Whether Inputs Are
Specific
Comment 6: Whether Commerce's Use of a Tier Two Benchmark Takes
Into Account Prevailing Market Conditions in China
Comment 7: The Benchmark Used in the Calculation of the
Provision of Polyester Resin for Less Than Adequate Remuneration
(LTAR) Program
Comment 8: The Benchmark Used in the Calculation of the
Provision of Quartz for LTAR Program
Comment 9: Whether Commerce Should Continue To Treat Quartz
``Powder'' as Crushed Quartz Sand
Comment 10: Whether Commerce's Preliminary Critical
Circumstances Determination Was Lawful
IX. Recommendation
[FR Doc. 2019-10799 Filed 5-22-19; 8:45 am]
BILLING CODE 3510-DS-P