[Federal Register Volume 85, Number 95 (Friday, May 15, 2020)]
[Notices]
[Pages 29401-29403]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-10490]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-042, C-570-043]
Stainless Steel Sheet and Strip From the People's Republic of
China: Initiation of Anti-Circumvention and Scope Inquiries on the
Antidumping Duty and Countervailing Duty Orders
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: Based on available information, the Department of Commerce
(Commerce) is self-initiating a country-wide anti-circumvention inquiry
to determine whether imports of stainless steel sheet and strip
(stainless sheet and strip), completed in Vietnam using certain
stainless steel flat-rolled inputs manufactured in the People's
Republic of China (China), are circumventing the antidumping duty (AD)
and countervailing duty (CVD) orders on stainless sheet and strip from
China (collectively, the Orders). Commerce is also self-initiating a
scope inquiry to determine whether stainless sheet and strip that is
produced in China and undergoes further processing in Vietnam before
being exported to the United States is subject to the Orders.
DATES: Applicable May 15, 2020.
FOR FURTHER INFORMATION CONTACT: Blaine Wiltse at (202) 482-6345, AD/
CVD Operations, or Barb Rawdon at (202) 482-0474, Office of Policy,
Enforcement and Compliance, International Trade Administration, U.S.
Department of Commerce, 1401 Constitution Avenue NW, Washington, DC
20230.
SUPPLEMENTARY INFORMATION:
Background
On February 12, 2016, AK Steel Corporation, Allegheny Ludlum, LLC
D/B/A ATI Flat Rolled Products, North American Stainless, and Outokumpu
Stainless USA, LLC filed petitions seeking the imposition of
antidumping and countervailing duties on imports of stainless sheet and
strip from China.\1\ Following Commerce's affirmative determinations of
dumping and countervailable subsidies,\2\ and the U.S. International
Trade Commission's (USITC) finding of material injury,\3\ Commerce
issued AD and CVD orders on imports of stainless sheet and strip from
China.\4\
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\1\ See Stainless Steel Sheet and Strip from the People's
Republic of China: Initiation of Less-Than-Fair-Value Investigation,
81 FR 12711 (March 10, 2016); see also Stainless Steel Sheet and
Strip from the People's Republic of China: Initiation of
Countervailing Duty Investigation, 81 FR 13322 (March 14, 2016).
\2\ See Antidumping Duty Investigation of Stainless Steel Sheet
and Strip from the People's Republic of China: Final Determination
of Sales at Less Than Fair Value and Final Affirmative Determination
of Critical Circumstances, 82 FR 9716 (February 8, 2017); see also
Countervailing Duty Investigation of Stainless Steel Sheet and Strip
from the People's Republic of China: Final Affirmative
Determination, and Final Affirmative Critical Circumstances
Determination, in Part, 82 FR 9714 (February 8, 2017).
\3\ See Stainless Steel Sheet and Strip from China;
Determinations, 82 FR 15716 (March 30, 2017); see also Stainless
Steel Sheet and Strip from China, Inv. Nos. 791-TA-557 and 731-TA-
1312, USITC Pub. 4676 (March 2017) (Final).
\4\ See Stainless Steel Sheet and Strip from the People's
Republic of China: Antidumping Duty Order, 82 FR 16160 (April 3,
2017) (AD Order); see also Stainless Steel Sheet and Strip from the
People's Republic of China: Countervailing Duty Order, 82 FR 16166
(April 3, 2017) (CVD Order) (collectively, Orders).
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Scope of the Order
The products covered by the Orders are stainless sheet and strip,
whether in coils or straight lengths. For a full description of the
scope of the Orders, see the ``Scope of the Orders,'' in the Appendix
to this notice.
Merchandise Subject to the Anti-Circumvention Inquiry
The anti-circumvention inquiry covers stainless sheet and strip
completed in Vietnam using certain non-subject stainless steel flat-
rolled inputs of Chinese-origin that is subsequently exported from
Vietnam to the United States.
Initiation of Anti-Circumvention Inquiry
Section 781(b)(1) of the Tariff Act of 1930, as amended (the Act),
provides that Commerce may find circumvention of an AD or CVD order
when merchandise of the same class or kind subject to the order is
completed or assembled in a foreign country other than the country to
which the order applies. In conducting anti-circumvention inquiries,
under section 781(b)(1) of the Act, Commerce relies on the following
criteria: (A) Merchandise imported into the United States is of the
same class or kind as any merchandise produced in a foreign country
that is the subject of an antidumping or countervailing duty order or
finding, (B) before importation into the United States, such imported
merchandise is completed or assembled in another foreign country from
merchandise which is subject to the order or merchandise which is
produced in the foreign country that is subject to the order, (C) the
process of assembly or completion in the foreign country referred to in
section (B) is minor or insignificant, (D) the value of the merchandise
produced in the foreign country to which the AD or CVD order applies is
a significant portion of the total value of the merchandise exported to
the United States, and (E) the administering authority determines that
action is appropriate to prevent evasion of such order or finding.
In determining whether or not the process of assembly or completion
in a third country is minor or insignificant under section 781(b)(1)(C)
of the Act, section 781(b)(2) of the Act directs Commerce to consider:
(A) The level of investment in the foreign country, (B) the level of
research and development in the foreign country, (C) the nature of the
production process in the foreign country, (D) the extent of production
facilities in the foreign country, and (E) whether or not the value of
processing performed in the foreign country represents a small
proportion of the value of the merchandise imported into the United
States. However, no single factor, by itself, controls Commerce's
determination of whether the process of assembly or completion in a
third country is minor or insignificant.\5\ Accordingly, it is
Commerce's practice to evaluate each of these five factors as they
exist in the third country, depending on the totality of the
circumstances of the particular anti-circumvention inquiry.\6\
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\5\ See Statement of Administrative Action accompanying the
Uruguay Round Agreements Act (SAA), H.R. Doc. No. 103-316 (1994) at
893.
\6\ See Uncovered Innerspring Units from the People's Republic
of China: Final Affirmative Determination of Circumvention of the
Antidumping Duty Order, 83 FR 65626 (December 21, 2018), and
accompanying Issues and Decision Memorandum at 4.
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Furthermore, section 781(b)(3) of the Act sets forth additional
factors to consider in determining whether to include merchandise
assembled or completed in a third country within the scope of an
antidumping and/or countervailing duty order. Specifically, Commerce
shall take into account such
[[Page 29402]]
factors as: (A) The pattern of trade, including sourcing patterns; (B)
whether the manufacturer or exporter of the merchandise is affiliated
with the person who, in the third country, uses the merchandise to
complete or assemble the merchandise which is subsequently imported
into the United States; and (C) whether imports of the merchandise into
the third country have increased after the initiation of the
investigation that resulted in the issuance of such order or finding.
We have analyzed the criteria above, and from available information
we determine pursuant to section 781(b) of the Act and 19 CFR
351.225(b) and (h), that initiation of an anti-circumvention inquiry is
warranted to determine whether certain imports of stainless sheet and
strip, completed in Vietnam using certain stainless steel flat-rolled
inputs manufactured in China, are circumventing the Orders. For a full
discussion of the basis for our decision to initiate this anti-
circumvention inquiry, see the Initiation Memo.\7\ As explained in the
Initiation Memo, the available information supports initiating this
anti-circumvention inquiry on a country-wide basis. Commerce has taken
this approach in prior anti-circumvention inquiries, where the facts
supported initiation on a country-wide basis.\8\
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\7\ See Memorandum, ``Stainless Steel Sheet and Strip from the
People's Republic of China: Initiation of Anti-Circumvention and
Scope Inquiries on the Antidumping and Countervailing Duty Orders''
(Initiation Memo). This memo is a public document dated concurrently
with, and hereby adopted by, this notice and on file electronically
via ACCESS. Access to documents filed via ACCESS is also available
in the Central Records Unit, Room B8024 of the main Department of
Commerce building.
\8\ See, e.g., Corrosion-Resistant Steel Products from the
People's Republic of China: Initiation of Anti-Circumvention
Inquiries on the Antidumping Duty and Countervailing Duty Orders, 84
FR 43585 (August 21, 2019); see also Steel Butt-Weld Pipe Fittings
from the People's Republic of China: Initiation of Anti-
Circumvention Inquiry on the Antidumping Duty Order, 82 FR 40556,
40560 (August 25, 2017) (stating at initiation that Commerce would
evaluate the extent to which a country-wide finding applicable to
all exports might be warranted); Certain Corrosion-Resistant Steel
Products from the People's Republic of China: Initiation of Anti-
Circumvention Inquiries on the Antidumping Duty and Countervailing
Duty Orders, 81 FR 79454, 79458 (November 14, 2016) (stating at
initiation that Commerce would evaluate the extent to which a
country-wide finding applicable to all exports might be warranted).
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Consistent with the approach in the prior anti-circumvention
inquiries that were initiated on a country-wide basis, Commerce intends
to issue questionnaires to solicit information from producers and
exporters in Vietnam concerning their shipments of stainless sheet and
strip to the United States and the origin of any imported stainless
steel flat-rolled inputs being processed into stainless sheet and
strip. A company's failure to respond completely to Commerce's requests
for information may result in the application of partial or total facts
available, pursuant to section 776(a) of the Act, which may include
adverse inferences, pursuant to section 776(b) of the Act.
Merchandise Subject to the Scope Inquiry
The scope inquiry covers stainless sheet and strip of Chinese-
origin that has undergone further processing in Vietnam (including but
not limited to cold-rolling, annealing, tempering, polishing,
aluminizing, coating, painting, varnishing, trimming, cutting,
punching, and/or slitting, or any other processing that would not
otherwise remove the merchandise from the scope of the Orders) that is
subsequently exported to the United States.
There is evidence of (a) possible circumvention of the Orders
pursuant to section 781(b) of the Act through the completion of
stainless sheet and strip in Vietnam using inputs from China, and (b)
third-country processing in Vietnam of stainless sheet and strip from
China that is subsequently exported to the United States. Furthermore,
the scope language states that stainless sheet and strip is subject to
the Orders even if it has undergone processing that would not otherwise
remove the merchandise from the scope of the Orders if performed in the
country of manufacture of the stainless sheet and strip. Accordingly,
the initiation of a scope inquiry is warranted to determine whether
stainless sheet and strip produced in China that undergoes processing
in Vietnam is subject to the Orders. For a discussion of the basis for
our decision to initiate this scope inquiry, see the Initiation Memo.
Notification to Interested Parties
In accordance with section 781(b) of the Act and 19 CFR 351.225(b)
and (h), Commerce determines that available information supports
initiating anti-circumvention and scope inquiries to determine whether
certain imports of stainless sheet and strip are circumventing or
subject to the Orders. Accordingly, Commerce hereby notifies all
parties on Commerce's scope service list of the initiation of anti-
circumvention and scope inquiries. In addition, in accordance with 19
CFR 351.225(f)(1)(i) and (ii), in this notice of initiation issued
under 19 CFR 351.225(b), we have included a description of the products
that are the subject of these inquiries, and an explanation of the
reasons for Commerce's decision to initiate these inquiries as provided
above and in the accompanying Initiation Memo. Commerce will establish
a schedule for questionnaires and comments on the issues in these
inquiries.
In accordance with 19 CFR 351.225(l)(2), if Commerce issues
preliminary affirmative determinations, we will then instruct U.S.
Customs and Border Protection to suspend liquidation and require a cash
deposit of the estimated antidumping and countervailing duties, at the
applicable rate, for each unliquidated entry of the merchandise at
issue, entered or withdrawn from warehouse for consumption on or after
the date of initiation of these inquiries. Moreover, in the event we
issue preliminary affirmative determinations of circumvention, pursuant
to section 781(b) of the act (Merchandise Completed or Assembled in
Other Foreign Countries), we intend to notify the ITC, in accordance
with section 781(b)(1) of the Act and 19 CFR 351.225(f)(7)(i)(B), if
applicable.
Commerce will, following consultation with interested parties,
establish a schedule for questionnaires and comments on the issues. In
accordance with section 781(f) of the Act and 19 CFR 351.225(f)(5),
Commerce intends to issue its final scope and circumvention
determinations within 120 days and 300 days, respectively, of the date
of publication of this initiation.
This notice is published in accordance with section 781(b) of the
Act and 19 CFR 351.225(f).
Dated: May 11, 2020.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.
Appendix
Scope of the Orders
The merchandise covered by the Orders is stainless sheet and
strip, whether in coils or straight lengths. Stainless steel is an
alloy steel containing, by weight, 1.2 percent or less of carbon and
10.5 percent or more of chromium, with or without other elements.
The subject sheet and strip is a flat-rolled product with a width
that is greater than 9.5 mm and with a thickness of 0.3048 mm and
greater but less than 4.75 mm, and that is annealed or otherwise
heat treated, and pickled or otherwise descaled. The subject sheet
and strip may also be further processed (e.g., cold-rolled,
annealed, tempered, polished, aluminized, coated, painted,
varnished, trimmed, cut, punched, or slit, etc.) provided that it
maintains the specific dimensions of sheet and strip set forth above
following such processing. The products
[[Page 29403]]
described include products regardless of shape, and include products
of either rectangular or non-rectangular cross-section where such
cross-section is achieved subsequent to the rolling process, i.e.,
products which have been ``worked after rolling'' (e.g., products
which have been beveled or rounded at the edges).
For purposes of the width and thickness requirements referenced
above: (1) Where the nominal and actual measurements vary, a product
is within the scope if application of either the nominal or actual
measurement would place it within the scope based on the definitions
set forth above; and (2) where the width and thickness vary for a
specific product (e.g., the thickness of certain products with non-
rectangular cross-section, the width of certain products with non-
rectangular shape, etc.), the measurement at its greatest width or
thickness applies.
All products that meet the written physical description, and in
which the chemistry quantities do not exceed any one of the noted
element levels listed above, are within the scope of the Orders
unless specifically excluded.
Subject merchandise includes stainless sheet and strip that has
been further processed in a third country, including but not limited
to cold-rolling, annealing, tempering, polishing, aluminizing,
coating, painting, varnishing, trimming, cutting, punching, and/or
slitting, or any other processing that would not otherwise remove
the merchandise from the scope of the Orders if performed in the
country of manufacture of the stainless sheet and strip.
Excluded from the scope of the Orders are the following: (1)
Sheet and strip that is not annealed or otherwise heat treated and
not pickled or otherwise descaled; (2) plate (i.e., flat-rolled
stainless steel products of a thickness of 4.75 mm or more); and (3)
flat wire (i.e., cold-rolled sections, with a mill edge, rectangular
in shape, of a width of not more than 9.5 mm).
The products under the Orders are currently classifiable under
Harmonized Tariff Schedule of the United States (HTSUS) subheadings
7219.13.0031, 7219.13.0051, 7219.13.0071, 7219.13.0081,
7219.14.0030, 7219.14.0065, 7219.14.0090, 7219.23.0030,
7219.23.0060, 7219.24.0030, 7219.24.0060, 7219.32.0005,
7219.32.0020, 7219.32.0025, 7219.32.0035, 7219.32.0036,
7219.32.0038, 7219.32.0042, 7219.32.0044, 7219.32.0045,
7219.32.0060, 7219.33.0005, 7219.33.0020, 7219.33.0025,
7219.33.0035, 7219.33.0036, 7219.33.0038, 7219.33.0042,
7219.33.0044, 7219.33.0045, 7219.33.0070, 7219.33.0080,
7219.34.0005, 7219.34.0020, 7219.34.0025, 7219.34.0030,
7219.34.0035, 7219.34.0050, 7219.35.0005, 7219.35.0015,
7219.35.0030, 7219.35.0035, 7219.35.0050, 7219.90.0010,
7219.90.0020, 7219.90.0025, 7219.90.0060, 7219.90.0080,
7220.12.1000, 7220.12.5000, 7220.20.1010, 7220.20.1015,
7220.20.1060, 7220.20.1080, 7220.20.6005, 7220.20.6010,
7220.20.6015, 7220.20.6060, 7220.20.6080, 7220.20.7005,
7220.20.7010, 7220.20.7015, 7220.20.7060, 7220.20.7080,
7220.90.0010, 7220.90.0015, 7220.90.0060, and 7220.90.0080. Although
the HTSUS subheadings are provided for convenience and customs
purposes, the written description of the scope of this proceeding is
dispositive.
[FR Doc. 2020-10490 Filed 5-14-20; 8:45 am]
BILLING CODE 3510-DS-P