[Federal Register Volume 85, Number 67 (Tuesday, April 7, 2020)]
[Notices]
[Pages 19440-19443]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-07189]


-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

International Trade Administration

[C-570-109]


Ceramic Tile From the People's Republic of China: Final 
Affirmative Countervailing Duty Determination, and Final Negative 
Critical Circumstances Determination

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 ceramic tile from the People's Republic of China (China).

DATES: Applicable April 7, 2020.

FOR FURTHER INFORMATION CONTACT: Yasmin Bordas, Moses Song, or John 
McGowan, AD/CVD Operations, Office VI, Enforcement and Compliance, 
International Trade Administration, U.S. Department of Commerce, 1401 
Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-
3813, (202) 482-7885, or (202) 482-3019, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On September 12, 2019, Commerce published the Preliminary 
Determination of this investigation.\1\

[[Page 19441]]

The petitioner is The Coalition for Fair Trade in Ceramic Tile. The 
mandatory respondents in this investigation are Temgoo International 
Trading Limited (Temgoo) and Foshan Sanfi Import & Export Co., Ltd. 
(Foshan Sanfi). In the Preliminary Determination, Commerce aligned the 
final determination in this countervailing duty (CVD) investigation 
with the final determination in the companion less-than-fair-value 
(LTFV) investigation, in accordance with section 705(a)(1) of the 
Tariff Act of 1930, as amended (the Act), and 19 CFR 351.210(b)(4).
---------------------------------------------------------------------------

    \1\ See Ceramic Tile from the People's Republic of China: 
Preliminary Affirmative Countervailing Duty Investigation, 
Preliminary Negative Critical Circumstances Determination, and 
Alignment of Final Determination with Final Antidumping Duty 
Determination, 84 FR 48125 (September 12, 2019) (Preliminary 
Determination) and accompanying Preliminary Decision Memorandum.
---------------------------------------------------------------------------

    A summary of the events that occurred since Commerce published the 
Preliminary Determination, as well as a full discussion of the issues 
raised by parties for this final determination, are discussed in the 
Issues and Decision Memorandum.\2\ 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 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 and 
electronic versions of the Issues and Decision Memorandum are identical 
in content.
---------------------------------------------------------------------------

    \2\ See Memorandum, ``Issues and Decision for the Final 
Determination in the Countervailing Duty Investigation of Ceramic 
Tile from the People's Republic of China,'' dated concurrently, and 
hereby adopted by, this notice (Issues and Decision Memorandum).
---------------------------------------------------------------------------

Period of Investigation

    The period of investigation (POI) is from January 1, 2018 through 
December 31, 2018.

Scope of the Investigation

    The product covered by this investigation covers ceramic tile from 
China. For a complete description of the scope of this investigation, 
see Appendix I.

Scope Comments

    During the course of this investigation and the concurrent LTFV 
investigation of ceramic tile from China, Commerce received scope 
comments from interested parties. On September 6, 2019, Commerce issued 
a Preliminary Scope Decision Memorandum.\3\ Several interested parties 
submitted case and rebuttal briefs concerning the scope of this 
investigation. For a summary of the product coverage comments and 
rebuttal comments submitted to the record for this final determination, 
and accompanying discussion and analysis of all comments timely 
received, see the Final Scope Decision Memorandum.\4\ Based on the 
comments received, Commerce is not modifying the scope language as it 
appeared in the Preliminary Determination. The scope in Appendix I 
remains unchanged from that which appeared in the Preliminary 
Determination.
---------------------------------------------------------------------------

    \3\ See Memorandum, ``Ceramic Tile from the People's Republic of 
China Decision Memorandum for the Preliminary Determinations,'' 
dated September 6, 2019 (Preliminary Scope Decision Memorandum).
    \4\ See Memorandum, ``Ceramic Tile from the People's Republic of 
China: Scope Decision Memorandum for the Final Determinations, dated 
concurrently with this notice (Final Scope Decision Memorandum).
---------------------------------------------------------------------------

Analysis of Subsidy Programs and Comments Received

    All issues raised in the case and rebuttal briefs by parties in 
this investigation, other than those issues related to scope, are 
discussed in the Issues and Decision Memorandum. A list of the issues 
raised by parties and responded to by Commerce in the Issues and 
Decision Memorandum, is attached at Appendix II.

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.\5\ Commerce notes that, in making these findings, it relied, 
in part, on facts available and, because it finds that one or more 
respondents did not act to the best of their ability to respond to 
Commerce's requests for information, it drew an adverse inference where 
appropriate in selecting from among the facts otherwise available.\6\ 
For description of the methodology underlying our final determination, 
see the Issues and Decision Memorandum.
---------------------------------------------------------------------------

    \5\ 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.
    \6\ See Memorandum, ``Ceramic Tile from the People's Republic of 
China Decision Memorandum for the Final Determination, dated 
concurrently with this notice (Final Scope Decision Memorandum).
---------------------------------------------------------------------------

Adverse Facts Available (AFA)

    Commerce relied on ``facts otherwise available,'' including adverse 
facts available (AFA), for several findings in the Preliminary 
Determination. For this final determination, we are basing the CVD 
rates for Temgoo and Foshan Sanfi on facts otherwise available, with an 
adverse inference, pursuant to sections 776(a) and (b) of the Act. For 
a full discussion of our application of AFA, see the Issues and 
Decision Memorandum.

Final Negative Determination of Critical Circumstances

    In the Preliminary Determination, Commerce determined, pursuant to 
section 703(e)(1) of the Act, that information provided in the critical 
circumstances allegation does not demonstrate the existence of critical 
circumstances with respect to imports of ceramic tile from China. For 
this final determination, we continue to find that critical 
circumstances do not exist with respect to imports of ceramic tile from 
China. For a full description of the methodology and results of 
Commerce's analysis, see the Issues and Decision Memorandum.

Changes Since the Preliminary Determination

    Based on our analysis of the comments received from parties, we 
made certain changes to the respondents' subsidy rate calculations set 
forth in the Preliminary Determination. For a discussion of these 
changes, see the Issues and Decision Memorandum.

All-Others Rate

    In accordance with section 705(c)(5)(A) of the Act, Commerce shall 
determine an estimated all-others rate for companies not individually 
examined. Generally, under section 705(c)(5)(A)(i) of the Act, 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 on 
AFA under section 776 of the Act. However, section 705(c)(5)(A)(ii) of 
the Act provides that, where all countervailable subsidy rates 
established for the mandatory respondents are zero, de minimis, or 
based entirely on facts available, Commerce may use ``any reasonable 
method'' for assigning an all-others rate, including ``averaging the 
estimated average countervailable subsidy rates

[[Page 19442]]

determined for the exporters and producers individually investigated.'' 
In this investigation, all rates for the individually investigated 
respondents are based entirely on facts available, pursuant to section 
776 of the Act. We are relying on a simple average of the total AFA 
rates assigned to Temgoo and Foshan Sanfi as the all-others rate in 
this final determination, consistent with the statutory provision to 
rely on ``any reasonable method.''

Final Determination

    In accordance with section 705(c)(1)(B)(i)(I) of the Act, we 
established individual estimated countervailable subsidy rates, as 
follows:
---------------------------------------------------------------------------

    \7\ Commerce assigned Sanfi's rate to each of the entities for 
which Sanfi provided an initial questionnaire response: Guangdong 
Sanfi Ceramics Group Co., Ltd.

------------------------------------------------------------------------
                                                           Subsidy rate
                         Company                             (percent)
------------------------------------------------------------------------
Temgoo International Trading Limited....................          358.81
Sanfi Imp & Exp Co., Ltd \7\............................          358.81
All Others..............................................          358.81
------------------------------------------------------------------------

Continuation of Suspension of Liquidation

    As a result of our Preliminary Determination, and pursuant to 
sections 703(d)(1)(B) and (d)(2) of the Act, we instructed U.S. Customs 
and Border Protection (CBP) to suspend liquidation of all entries of 
merchandise under consideration from China that were entered or 
withdrawn from warehouse, for consumption, on or after September 17, 
2019, the date of publication of the Preliminary Determination in the 
Federal Register. In accordance with section 703(d) of the Act, we 
instructed CBP to discontinue the suspension of liquidation for CVD 
purposes for subject merchandise entered, or withdrawn from warehouse, 
on or after January 10, 2020, but continue the suspension of 
liquidation of all entries from September 17 through January 9, 2020.
    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 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.

Disclosure

    We intend to disclose the calculations performed to parties in this 
proceeding 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).

ITC Notification

    In accordance with section 705(d) of the Act, we will notify the 
ITC of our final affirmative determination that countervailable 
subsidies are being provided to producers and exporters of ceramic tile 
from China. As 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 ceramic tile from China, or sales (or the likelihood of 
sales) for importation of ceramic tile from China. In addition, we are 
making available to the ITC all non-privileged and nonproprietary 
information related to this investigation. We will allow the ITC access 
to all privileged and business proprietary information in our files, 
provided the ITC confirms that it will not disclose such information, 
either publicly or under an administrative protective order (APO), 
without the written consent of the Assistant Secretary for Enforcement 
and Compliance.

Notification Regarding APO

    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 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 violation which is subject to sanction.

Notification to Interested Parties

    This determination is issued and published in accordance with 
sections 705(d) and 777(i) of the Act and 19 CFR 351.210(c). Note that 
Commerce has temporarily modified certain of its requirements for 
serving documents containing business proprietary information, until 
May 19, 2020, unless extended.\8\
---------------------------------------------------------------------------

    \8\ See Temporary Rule Modifying AD/CVD Service Requirements Due 
to COVID-19, 85 FR 17006 (March 26, 2020).

    Dated: March 30, 2020.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.

Appendix I

Scope of the Investigation

    The merchandise covered by this investigation is ceramic 
flooring tile, wall tile, paving tile, hearth tile, porcelain tile, 
mosaic tile, flags, finishing tile, and the like (hereinafter 
ceramic tile). Ceramic tiles are articles containing a mixture of 
minerals including clay (generally hydrous silicates of alumina or 
magnesium) that are fired so the raw materials are fused to produce 
a finished good that is less than 3.2 cm in actual thickness. All 
ceramic tile is subject to the scope regardless of end use, surface 
area, and weight, regardless of whether the tile is glazed or 
unglazed, regardless of the water absorption coefficient by weight, 
regardless of the extent of vitrification, and regardless of whether 
or not the tile is on a backing. Subject merchandise includes 
ceramic tile with decorative features that may in spots exceed 3.2 
cm in thickness and includes ceramic tile ``slabs'' or ``panels'' 
(tiles that are larger than 1 meter\2\ (11 ft.\2\)).
    Subject merchandise includes ceramic tile that undergoes minor 
processing in a third country prior to importation into the United 
States. Similarly, subject merchandise includes ceramic tile 
produced that undergoes minor processing after importation into the 
United States. Such minor processing includes, but is not limited 
to, one or more of the following: Beveling, cutting, trimming, 
staining, painting, polishing, finishing, additional firing, or any 
other processing that would otherwise not remove the merchandise 
from the scope of the investigation if performed in the country of 
manufacture of the in-scope product.
    Subject merchandise is currently classified in the Harmonized 
Tariff Schedule of the United States (HTSUS) under the following 
subheadings of heading 6907: 6907.21.1005, 6907.21.1011, 
6907.21.1051, 6907.21.2000, 6907.21.3000, 6907.21.4000, 
6907.21.9011, 6907.21.9051, 6907.22.1005, 6907.22.1011, 
6907.22.1051, 6907.22.2000, 6907.22.3000, 6907.22.4000, 
6907.22.9011, 6907.22.9051, 6907.23.1005, 6907.23.1011, 
6907.23.1051, 6907.23.2000, 6907.23.3000, 6907.23.4000, 
6907.23.9011, 6907.23.9051, 6907.30.1005, 6907.30.1011, 
6907.30.1051, 6907.30.2000, 6907.30.3000, 6907.30.4000, 
6907.30.9011, 6907.30.9051, 6907.40.1005, 6907.40.1011, 
6907.40.1051, 6907.40.2000, 6907.40.3000, 6907.40.4000, 
6907.40.9011, and 6907.40.9051. Subject merchandise may also enter 
under subheadings of headings 6914 and 6905: 6914.10.8000, 
6914.90.8000, 6905.10.0000, and 6905.90.0050. The HTSUS subheadings 
are provided for convenience and customs purposes only. The written 
description of the scope of this investigation is dispositive.

[[Page 19443]]

Appendix II

List of Topics Discussed in the Issues and Decision Memorandum

I. Summary
II. Background
III. Scope Comments
IV. Scope of the Investigation
V. Critical Circumstances
VI. Subsidies Valuation
VII. Benchmarks and Interest Rates
VIII. Use of Facts Otherwise Available and Adverse Inferences
IX. Discussion of Issues
    Comment 1: Application of AFA to Sanfi and Temgoo and 
Calculation of the All-Others Rate
    Comment 2: Whether Commerce's Calculation of the AFA Rate in 
Unreasonable
    Comment 3: Selection of AFA Rates for Subsidy Programs
    Comment 4: Preliminary Scope Determination
X. Recommendation

[FR Doc. 2020-07189 Filed 4-6-20; 8:45 am]
BILLING CODE 3510-DS-P