[Federal Register Volume 85, Number 101 (Tuesday, May 26, 2020)]
[Notices]
[Pages 31460-31462]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-11230]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-475-841]


Forged Steel Fluid End Blocks From Italy: 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 forged steel fluid end blocks (fluid end blocks) from 
Italy. The period of investigation is January 1, 2018 to December 31, 
2018. Interested parties are invited to comment on this preliminary 
determination.

DATES: Applicable May 26, 2020.

FOR FURTHER INFORMATION CONTACT: Nicholas Czajkowski or Ethan Talbott, 
AD/CVD Operations, Office I, Enforcement and Compliance, International 
Trade Administration, U.S. Department of Commerce, 1401 Constitution 
Avenue NW, Washington, DC 20230; telephone: (202) 482-1395 or (202) 
482-1030, 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 January 15, 
2020.\1\ On February 27, 2020, Commerce postponed the preliminary 
determination to May 18, 2020.\2\ For a complete description of the 
events that followed the initiation of this investigation, see the 
Preliminary Decision Memorandum.\3\ 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. 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 Forged Steel Fluid End Blocks from the Federal Republic 
of Germany, India, Italy and the People's Republic of China: 
Initiation of Countervailing Duty Investigations, 85 FR 2385 
(January 15, 2020) (Initiation Notice).
    \2\ See Forged Steel Fluid End Blocks from the Federal Republic 
of Germany, India, Italy and the People's Republic of China: 
Postponement of Preliminary Determination in the Countervailing Duty 
Investigations, 85 FR 11336 (February 27, 2020).
    \3\ See Memorandum, ``Decision Memorandum for the Preliminary 
Determination of the Countervailing Duty Investigation of Forged 
Steel Fluid End Blocks from Italy,'' 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 forged steel fluid 
end blocks from Italy. For a complete description of the scope of this 
investigation, see Appendix I.

Scope Comments

    In accordance with the preamble to Commerce's regulations,\4\ the 
Initiation Notice set aside a period of time for parties to raise 
issues regarding product coverage (i.e., scope).\5\ Certain interested 
parties commented on the scope of the investigation as it appeared in 
the Initiation Notice.
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    \4\ See Antidumping Duties; Countervailing Duties, Final Rule, 
62 FR 27296, 27323 (May 19, 1997).
    \5\ See Initiation Notice.
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    For a summary of the product coverage comments and rebuttal 
responses submitted to the record for this preliminary determination 
and accompanying discussion and analysis of all comments timely 
received, see the Preliminary Scope Decision Memorandum.\6\ Commerce is 
preliminarily modifying the scope language as it appeared in the 
Initiation Notice. See the revised scope in Appendix I.
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    \6\ See Memorandum, ``Forged Steel Fluid End Blocks from the 
Federal Republic of Germany, India, Italy, and the People's Republic 
of China: Scope Comments Decision Memorandum for the Preliminary 
Determinations,'' dated concurrently with this notice (Preliminary 
Scope Decision Memorandum).
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Methodology

    Commerce is conducting this investigation in accordance with 
section

[[Page 31461]]

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\
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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.
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    Commerce notes that, in making these findings, it relied, in part, 
on facts available and, because Commerce finds that one or more 
respondents did not act to the best of their ability to respond to 
Commerce's requests for information, Commerce drew an adverse 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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    \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 (CVD) determination in this 
investigation with the final determinations in the companion 
antidumping duty (AD) investigations of fluid end blocks from Germany, 
India, and Italy based on a request made by the petitioners.\9\ 
Consequently, the final CVD determination will be issued on the same 
date as the final AD determinations, which are currently scheduled to 
be issued no later than September 29, 2020, unless postponed.
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    \9\ See Petitioners' Letter, ``Forged Steel Fluid End Blocks 
from China, Germany, India, and Italy: Petitioner's Request for 
Alignment of the Countervailing Duty Investigations with the 
Concurrent Antidumping Duty Investigations,'' dated April 1, 2020.
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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 calculated individual estimated 
countervailable subsidy rates for Lucchini Mame Forge S.p.A (LMA) and 
Metalcam S.p.A (Metalcam) that are not zero, de minimis, or based 
entirely on facts otherwise available. Commerce calculated the all-
others rate using a weighted average of the individual estimated 
subsidy rates calculated for the examined respondents using each 
company's publicly-ranged data for the value of their exports to the 
United States of subject merchandise.\10\
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    \10\ 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 values 
of exports to the United States of subject merchandise. 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 were 
available, Commerce used the publicly ranged sales data of the 
mandatory respondents. For a complete analysis of the data, 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 ad
                          Company                              valorem
                                                              (percent)
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Lucchini Mame Forge S.p.A.\11\.............................         3.39
Metalcam S.p.A.\12\........................................         3.05
All Others.................................................         3.13
Companies Subject to AFA (non-respondent companies):
  Forge Mochieri S.p.A., Imer International S.p.A.,                43.75
   Galperti Group, Mimest S.p.A., P.Technologies S.r.L.....
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Suspension of Liquidation
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    \11\ As discussed in the Preliminary Decision Memorandum, 
Commerce has found the following companies to be cross-owned with 
LMA: Lucchini RS S.p.A., Lucchini Industries, Bicomet S.p.A. and 
Setrans SrL.
    \12\ As discussed in the Preliminary Decision Memorandum, 
Commerce has found the following companies to be cross-owned with 
Metalcam: Adamello Meccanica S.r.l. and B.S. S.r.l.
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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).

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

    All interested parties will have the opportunity to submit case and 
rebuttal briefs on the preliminary scope determination. The deadline to 
submit these comments will be no later than 30 days after the 
publication of the preliminary determinations of the CVD investigations 
of fluid end blocks from Germany, India, Italy, and China in the 
Federal Register. Scope rebuttal briefs (which are limited to issues 
raised in the scope briefs) may be submitted no later than seven days 
after the deadline for the scope briefs. These deadlines apply to the 
AD and CVD fluid end blocks investigations, regardless of the deadlines 
of the preliminary determinations in the AD investigations. For all 
scope briefs and rebuttals thereto, parties must file identical 
documents simultaneously on the records of all the ongoing AD and CVD 
fluid end blocks investigations. No new factual information or business 
proprietary information may be included in either scope briefs or 
rebuttal scope briefs.
    Case briefs or other written comments regarding non-scope matters 
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 
seven 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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[[Page 31462]]

    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. Note that Commerce has temporarily modified certain of its 
requirements for serving documents containing business proprietary 
information, until July 17, 2020, unless extended.\14\
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    \14\ See Temporary Rule Modifying AD/CVD Service Requirements 
Due to COVID-19; Extension of Effective Period, 85 FR 29615 (May 18, 
2020).
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International Trade Commission Notification

    In accordance with section 703(f) of the Act, Commerce will notify 
the International Trade Commission (ITC) of its determination. Pursuant 
to section 705(b)(2) of the Act, if the final determination is 
affirmative, the ITC will make its final injury determination before 
the later of 120 days after the date of this preliminary determination 
or 45 days after Commerce's 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: May 18, 2020.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.

Appendix I

Scope of the Investigation

    The products covered by this investigation are forged steel 
fluid end blocks (fluid end blocks), whether in finished or 
unfinished form, and which are typically used in the manufacture or 
service of hydraulic pumps.
    The term ``forged'' is an industry term used to describe the 
grain texture of steel resulting from the application of localized 
compressive force. Illustrative forging standards include, but are 
not limited to, American Society for Testing and Materials (ASTM) 
specifications A668 and A788.
    For purposes of this investigation, the term ``steel'' denotes 
metal containing the following chemical elements, by weight: (i) 
Iron greater than or equal to 60 percent; (ii) nickel less than or 
equal to 8.5 percent; (iii) copper less than or equal to 6 percent; 
(iv) chromium greater than or equal to 0.4 percent, but less than or 
equal to 20 percent; and (v) molybdenum greater than or equal to 
0.15 percent, but less than or equal to 3 percent. Illustrative 
steel standards include, but are not limited to, American Iron and 
Steel Institute (AISI) or Society of Automotive Engineers (SAE) 
grades 4130, 4135, 4140, 4320, 4330, 4340, 8630, 15-5, 17-4, F6NM, 
F22, F60, and XM25, as well as modified varieties of these grades.
    The products covered by this investigation are: (1) Cut-to-
length fluid end blocks with an actual height (measured from its 
highest point) of 8 inches (203.2 mm) to 40 inches (1,016.0 mm), an 
actual width (measured from its widest point) of 8 inches (203.2 mm) 
to 40 inches (1,016.0 mm), and an actual length (measured from its 
longest point) of 11 inches (279.4 mm) to 75 inches (1,905.0 mm); 
and (2) strings of fluid end blocks with an actual height (measured 
from its highest point) of 8 inches (203.2 mm) to 40 inches (1,016.0 
mm), an actual width (measured from its widest point) of 8 inches 
(203.2 mm) to 40 inches (1,016.0 mm), and an actual length (measured 
from its longest point) up to 360 inches (9,144.0 mm).
    The products included in the scope of this investigation have a 
tensile strength of at least 70 KSI (measured in accordance with 
ASTM A370) and a hardness of at least 140 HBW (measured in 
accordance with ASTM E10).
    A fluid end block may be imported in finished condition (i.e., 
ready for incorporation into a pump fluid end assembly without 
further finishing operations) or unfinished condition (i.e., forged 
but still requiring one or more finishing operations before it is 
ready for incorporation into a pump fluid end assembly). Such 
finishing operations may include: (1) Heat treating; (2) milling one 
or more flat surfaces; (3) contour machining to custom shapes or 
dimensions; (4) drilling or boring holes; (5) threading holes; and/
or (6) painting, varnishing, or coating.
    Excluded from the scope of this investigation are fluid end 
block assemblies which (1) include (a) plungers and related 
housings, adapters, gaskets, seals, and packing nuts, (b) valves and 
related seats, springs, seals, and cover nuts, and (c) a discharge 
flange and related seals, and (2) are otherwise ready to be mated 
with the ``power end'' of a hydraulic pump without the need for 
installation of any plunger, valve, or discharge flange components, 
or any other further manufacturing operations.
    The products included in the scope of this investigation may 
enter under Harmonized Tariff Schedule of the United States (HTSUS) 
subheadings 7218.91.0030, 7218.99.0030, 7224.90.0015, 7224.90.0045, 
7326.19.0010, 7326.90.8688, or 8413.91.9055. While these HTSUS 
subheadings are provided for convenience and customs purposes, the 
written description of the scope of the investigation 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. Use of Facts Otherwise Available and Adverse Inferences
VI. Subsidies Valuation
VII. Analysis of Programs
VIII. Conclusion

[FR Doc. 2020-11230 Filed 5-22-20; 8:45 am]
BILLING CODE 3510-DS-P