[Federal Register Volume 85, Number 177 (Friday, September 11, 2020)]
[Notices]
[Pages 56216-56219]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-20073]
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DEPARTMENT OF COMMERCE
International Trade Administration
[C-570-128]
Mattresses 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 mattresses from the People's Republic of China. The period
of investigation is January 1, 2019 through December 31, 2019.
Interested parties are invited to comment on this preliminary
determination.
DATES: Applicable September 11, 2020.
FOR FURTHER INFORMATION CONTACT: Theodore Pearson or Mary Kolberg, 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) 482-2631 or (202)
482-1785, 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 April 24,
2020.\1\ On June 10, 2020, Commerce postponed the preliminary
determination of this investigation to August 28, 2020. For a complete
description of the events that followed the initiation of this
investigation, see the Preliminary Decision Memorandum.\2\ 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. The signed and electronic versions of the
Preliminary Decision Memorandum are identical in content.
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\1\ See Mattresses from the People's Republic of China:
Initiation of Countervailing Duty Investigation, 85 FR 22998 (April
24, 2020) (Initiation Notice).
\2\ See Memorandum, ``Decision Memorandum for the Preliminary
Determination of the Countervailing Duty Investigation of Mattresses
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 mattresses from the
People's Republic of China. For a complete description of the scope of
this investigation, see Appendix I.
[[Page 56217]]
Scope Comments
In accordance with the preamble to Commerce's regulations,\3\ the
Initiation Notice set aside a period of time for parties to raise
issues regarding product coverage (i.e., scope).\4\ Certain interested
parties commented on the scope of the investigation as it appeared in
the Initiation Notice.\5\ Commerce intends to issue its preliminary
decision regarding comments concerning the scope of the antidumping
duty (AD) and CVD investigations in the preliminary determinations of
the concurrent AD investigations.
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\3\ See Antidumping Duties; Countervailing Duties, Final Rule,
62 FR 27296, 27323 (May 19, 1997).
\4\ See Initiation Notice.
\5\ See Cozy Comfort LLC's Letter, ``Mattresses from Cambodia,
Indonesia, Malaysia, the People's Republic of China, Serbia,
Thailand, the Republic of Turkey, and the Socialist Republic of
Vietnam; Comments on the Scope of the Less-Than-Fair-Value and
Countervailing Duty Investigations,'' dated May 26, 2020; see also
Night & Day Furniture LLC's Letter, ``Mattresses from Cambodia,
China, Indonesia, Malaysia, Serbia, Thailand, Turkey, and Vietnam,''
dated May 26, 2020; Target General Merchandise, Inc.'s Letter,
``Mattresses from Cambodia, Indonesia, Malaysia, Serbia, Thailand,
the Republic of Turkey, the Socialist Republic of Vietnam and the
People's Republic of China: Scope Comments,'' dated May 26, 2020;
Brooklyn Bedding's, Corsicana Mattress Company's Elite Comfort
Solutions', FXI, Inc.'s, Innocor, Inc.'s, Kolcraft Enterprises,
Inc.'s, Leggett & Platt, Incorporated's, the International
Brotherhood of Teamsters', and United Steel, Paper, and Forestry,
Rubber, Manufacturing, Energy, Allied Industrial and Service Workers
International Union's, AFL-CIO's (USW) (collectively, the
petitioners) Letter, ``Mattresses from Cambodia, China, Indonesia,
Malaysia, Serbia, Thailand, Turkey, and Vietnam: Mattress
Petitioner's Scope Rebuttal Comments,'' dated June 5, 2020; and Cozy
Comfort LLC's Letter, ``Mattresses from Cambodia, Indonesia,
Malaysia, the People's Republic of China, Serbia, Thailand, the
Republic of Turkey, and the Socialist Republic of Vietnam: Rebuttal
Comments on the Scope of the Less-Than-Fair Value and Countervailing
Duty Investigation,'' dated June 5, 2020.
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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.\6\
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\6\ 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 on facts
available and, because it finds that necessary information was missing
from the record and because respondents did not act to the best of
their ability to respond to Commerce's request for information, it drew
adverse inferences in selecting from among the facts otherwise
available. For further information, see ``Use of Facts Otherwise
Available and Adverse Inferences'' in the Preliminary Decision
Memorandum.
Alignment
In accordance with section 705(a)(1) of the Act and 19 CFR
351.210(b)(4), and based on the petitioner's request, we are aligning
the final CVD determination in this investigation with the final
determinations in the concurrent AD investigations of mattresses from
Cambodia, Indonesia, Malaysia, Serbia, Thailand, the Republic of
Turkey, and the Socialist Republic of Vietnam.\7\ 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 January 11, 2021, unless postponed.
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\7\ These AD investigations were initiated at the same time as
this CVD investigation. In addition, the AD investigations and this
CVD investigation cover the same class or kind of merchandises. See
Initiation Notice; see also Mattresses from Cambodia, Indonesia,
Malaysia, Serbia, Thailand, the Republic of Turkey, and the
Socialist Republic of Vietnam: Initiation of Less-Than-Fair-Value
Investigations, 85 FR 23002 (April 24, 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.
Pursuant to section 705(c)(5)(A)(ii) of the Act, if the individual
estimated countervailable subsidy rates established for all exporters
and producers individually examined are zero, de minimis, or determined
based entirely on facts otherwise available, Commerce may use any
reasonable method to establish the estimated subsidy rate for all other
producers or exporters. In this investigation, all rates are based
entirely on facts available, pursuant to section 776 of the Act.
Accordingly, we find under ``any reasonable method'' to rely on a
simple average of the total AFA rates computed for the non-responsive
companies as the all-others rate in this preliminary determination. For
a full description of the methodology underlying Commerce's analysis,
see the Preliminary Decision Memorandum.
Preliminary Determination
Commerce preliminarily determines that the following estimated
countervailable subsidy rates exist:
------------------------------------------------------------------------
Estimated
countervailable
Company subsidy rate
(percent)
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Kewei Furniture Co Ltd............................... 97.78
Zinus Xiamen......................................... 97.78
Ningbo Megafeat Bedding Co., Ltd./Megafeat Bedding Co 97.78
Ltd.................................................
Healthcare Co. Ltd................................... 97.78
All Others........................................... 97.78
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Suspension of Liquidation
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
Normally, Commerce discloses its calculations performed in
connection with the preliminary determination to interested parties
within five days of its public announcement, or if there is no public
announcement, within five days of the date of publication of this
notice
[[Page 56218]]
in accordance with 19 CFR 351.224(b). However, because Commerce
preliminarily applied total AFA rates in the calculation of the benefit
for the non-responsive companies, and the applied AFA rates are based
on rates calculated in prior proceedings, there are no calculations to
disclose.
Verification
Because the examined respondents in this investigation did not
provide information requested by Commerce and Commerce preliminarily
determines each of the examined respondents to have been uncooperative,
it will not conduct verification.
Public Comment
Case briefs or other written comments may be submitted to the
Assistant Secretary for Enforcement and Compliance no later than 50
days after the date of publication of the preliminary determination.
Rebuttal briefs, limited to issues raised in case briefs, may be
submitted no later than five days after the deadline date for case
briefs.\8\ 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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\8\ 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 a time and date to be
determined. Parties should confirm by telephone the date, and time 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 make its determination
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: August 28, 2020.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.
Appendix I--Scope of the Investigation
The products covered by this investigation are all types of
youth and adult mattresses. The term ``mattress'' denotes an
assembly of materials that at a minimum includes a ``core,'' which
provides the main support system of the mattress, and may consist of
innersprings, foam, other resilient filling, or a combination of
these materials. Mattresses may also contain (1) ``upholstery,'' the
material between the core and the top panel of the ticking on a
single-sided mattress, or between the core and the top and bottom
panel of the ticking on a double-sided mattress; and/or (2)
``ticking,'' the outermost layer of fabric or other material (e.g.,
vinyl) that encloses the core and any upholstery, also known as a
cover.
The scope of this investigation is restricted to only ``adult
mattresses'' and ``youth mattresses.'' ``Adult mattresses'' are
frequently described as ``twin,'' ``extra-long twin,'' ``full,''
``queen,'' ``king,'' or ``California king'' mattresses. ``Youth
mattresses'' are typically described as ``crib,'' ``toddler,'' or
``youth'' mattresses. All adult and youth mattresses are included
regardless of size or size description.
The scope encompasses all types of ``innerspring mattresses,''
``non-innerspring mattresses,'' and ``hybrid mattresses.''
``Innerspring mattresses'' contain innersprings, a series of metal
springs joined together in sizes that correspond to the dimensions
of mattresses. Mattresses that contain innersprings are referred to
as ``innerspring mattresses'' or ``hybrid mattresses.'' ``Hybrid
mattresses'' contain two or more support systems as the core, such
as layers of both memory foam and innerspring units.
``Non-innerspring mattresses'' are those that do not contain any
innerspring units. They are generally produced from foams (e.g.,
polyurethane, memory (viscoelastic), latex foam, gel-infused
viscoelastic (gel foam), thermobonded polyester, polyethylene) or
other resilient filling.
Mattresses covered by the scope of this investigation may be
imported independently, as part of furniture or furniture mechanisms
(e.g., convertible sofa bed mattresses, sofa bed mattresses imported
with sofa bed mechanisms, corner group mattresses, day-bed
mattresses, roll-away bed mattresses, high risers, trundle bed
mattresses, crib mattresses), or as part of a set in combination
with a ``mattress foundation.'' ``Mattress foundations'' are any
base or support for a mattress. Mattress foundations are commonly
referred to as ``foundations,'' ``boxsprings,'' ``platforms,'' and/
or ``bases.'' Bases can be static, foldable, or adjustable. Only the
mattress is covered by the scope if imported as part of furniture,
with furniture mechanisms, or as part of a set, in combination with
a mattress foundation.
Excluded from the scope of this investigation are ``futon''
mattresses. A ``futon'' is a bi-fold frame made of wood, metal, or
plastic material, or any combination thereof, that functions as both
seating furniture (such as a couch, love seat, or sofa) and a bed. A
``futon mattress'' is a tufted mattress, where the top covering is
secured to the bottom with thread that goes completely through the
mattress from the top through to the bottom, and it does not contain
innersprings or foam. A futon mattress is both the bed and seating
surface for the futon.
Also excluded from the scope are airbeds (including inflatable
mattresses) and waterbeds, which consist of air--or liquid-filled
bladders as the core or main support system of the mattress.
Also excluded is certain multifunctional furniture that is
convertible from seating to sleeping, regardless of filler material
or components, where that filler material or components are
upholstered, integrated into the design and construction of, and
inseparable from, the furniture framing, and the outermost layer of
the multifunctional furniture converts into the sleeping surface.
Such furniture may, and without limitation, be commonly referred to
as ``convertible sofas,'' ``sofa beds,'' ``sofa chaise sleepers,''
``futons,'' ``ottoman sleepers'' or a like description.
Also excluded from the scope of this investigation are any
products covered by the existing antidumping duty orders on
uncovered innerspring units from China or Vietnam. See Uncovered
Innerspring Units from the People's Republic of China: Notice of
Antidumping Duty Order, 74 FR 7661 (Feb. 19, 2009); Uncovered
Innerspring Units From the Socialist Republic of Vietnam, 73 FR
75391 (Dec. 11, 2008).
Also excluded from the scope of this investigation are bassinet
pads with a nominal length of less than 39 inches, a nominal width
less than 25 inches, and a nominal depth of less than 2 inches.
Additionally, also excluded from the scope of this investigation
are ``mattress toppers.'' A ``mattress topper'' is a removable
bedding accessory that supplements a mattress by providing an
additional layer that is placed on top of a mattress. Excluded
mattress toppers have a nominal height of four inches or less.
The products subject to this investigation are currently
properly classifiable under Harmonized Tariff Schedule of the United
States (HTSUS) subheadings: 9404.21.0010, 9404.21.0013,
9404.29.1005, 9404.29.1013, 9404.29.9085, and 9404.29.9087. Products
subject to this investigation may also enter under HTSUS
subheadings: 9404.21.0095, 9404.29.1095, 9404.29.9095, 9401.40.0000,
and 9401.90.5081. Although the HTSUS subheadings are provided for
convenience and customs purposes, the written description of the
merchandise subject to this investigation is dispositive.
[[Page 56219]]
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 Available and Adverse Inferences
VI. Analysis of Programs
VII. Calculation of the All-Others Rate
VIII. Recommendation
[FR Doc. 2020-20073 Filed 9-10-20; 8:45 am]
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