[Federal Register Volume 86, Number 41 (Thursday, March 4, 2021)]
[Notices]
[Pages 12619-12621]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-04477]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-570-120]


Certain Vertical Shaft Engines Between 225cc and 999cc, and Parts 
Thereof From the People's Republic of China: Countervailing Duty Order 
and Amended Final Affirmative Countervailing Duty Determination

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.

SUMMARY: Based on affirmative final determinations by the Department of 
Commerce (Commerce) and the International Trade Commission (ITC), 
Commerce is issuing a countervailing duty order on certain vertical 
shaft engines between 225cc and 999cc, and parts thereof (vertical 
shaft engines) from the People's Republic of China (China). In 
addition, Commerce is amending its final determination with respect to 
vertical shaft engines from China to correct ministerial errors.

DATES: Applicable March 4, 2021.

FOR FURTHER INFORMATION CONTACT: Andrew Huston, AD/CVD Operations, 
Office VII, Enforcement and Compliance, International Trade 
Administration, U.S. Department of Commerce, 1401 Constitution Avenue 
NW, Washington, DC 20230; telephone: (202) 482-4261.

SUPPLEMENTARY INFORMATION:

Background

    In accordance with sections 705(a), 705(d), and 777(i)(1) of the 
Tariff Act of 1930, as amended (the Act), and 19 CFR 351.210(c), on 
January 11, 2021, Commerce published its affirmative final 
determination that countervailable subsidies are being provided to 
producers and exporters of vertical shaft engines from China.\1\ In the 
investigation of vertical shaft engines from China, the petitioners and 
a mandatory respondent submitted timely allegations on the record that 
Commerce made certain ministerial errors in the final countervailing 
duty determination on vertical shaft engines from China. Section 705(e) 
of the Act and 19 CFR 351.224(f) define ministerial errors as errors in 
addition, subtraction, or other arithmetic function, clerical errors 
resulting from inaccurate copying, duplication, or the like, and any 
other type of unintentional error which Commerce considers ministerial. 
We reviewed the allegations and determined that we made certain 
ministerial errors in the final countervailing duty determination on 
vertical shaft engines from China. See ``Amendment to the Final 
Determination'' section below for further discussion.
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    \1\ See Certain Vertical Shaft Engines Between 225cc and 999cc, 
and Parts Thereof from the People's Republic of China: Final 
Affirmative Countervailing Duty Determination and Final Negative 
Critical Circumstances Determination, 86 FR 1933 (January 11, 2021) 
(Final Determination), and accompanying Issues and Decision 
Memorandum.
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    On February 24, 2021, the ITC notified Commerce of its affirmative 
final determination that pursuant to sections 705(b)(1)(A)(i) and 
705(d) of the Act, that an industry in the United States is materially 
injured by reason of subsidized imports of subject merchandise from 
China.\2\
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    \2\ See ITC Letter, ``Notification of ITC Final Determination,'' 
dated February 24, 2021 (ITC Notification Letter).
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Scope of the Order

    The products covered by this order are certain large vertical shaft 
engines from China. For a complete description of the scope of the 
order, see the appendix to this notice.

Amendment to the Final Determination of Vertical Shaft Engines From 
China

    On January 21, 2021, co-petitioner Kohler Co. (Kohler) and 
mandatory respondent Loncin Motor Co., Ltd. (Loncin) submitted timely 
ministerial error allegations regarding the Final Determination.\3\ On 
January 29, 2012, Kohler, mandatory respondent Chongqing Zongshen 
General Power Machine Co., Ltd. (Zongshen) and interested party MTD 
Products Inc. (MTD) submitted timely responses to the ministerial 
allegations.\4\
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    \3\ See Kohler's Letter, ``Certain Vertical Shaft Engines 
Between 225cc and 999cc, and Parts Thereof, from the People's 
Republic of China: Ministerial Error Allegations,'' dated January 
21, 2021 (Kohler Allegations); Loncin's Letter, ``Loncin Comments on 
Ministerial Errors in the Final Determination and the Disclosed 
Calculations for Loncin: Countervailing Duty Investigation of 
Certain Vertical Shaft Engines Between 225CC and 999CC, and Parts 
Thereof From the People's Republic of China (C-570-120),'' dated 
January 21, 2021 (Loncin Allegations).
    \4\ See Kohler's Letter, ``Certain Vertical Shaft Engines 
Between 225cc and 999cc, and Parts Thereof, from the People's 
Republic of China: Response to Ministerial Error Comments,'' dated 
January 29, 2021 (Kohler Response); Zongshen's Letter, ``Certain 
Vertical Shaft Engines Between 225cc and 999cc, and Parts Thereof, 
from China; CVD Investigation; Chongqing Zongshen Response to 
Petitioner Ministerial Error Comments,'' dated January 29, 2021 
(Zongshen Response); and MTD's Letter, ``Certain Vertical Shaft 
Engines Between 225cc and 999cc, and Parts Thereof (VSEs) from the 
People's Republic of China: MTD's Response to Kohler Ministerial 
Error Comments,'' dated January 29, 2021 (MTD Response).

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[[Page 12620]]

    Commerce reviewed the record and agreed that certain errors 
referenced in Kohler and Loncin's allegations constituted ministerial 
errors within the meaning of section 705(e) of the Act and 19 CFR 
351.224(f).\5\ Pursuant to 19 CFR 351.224(e), Commerce is amending the 
Final Determination to reflect the corrections of the ministerial 
errors described in the Ministerial Error Memorandum. Based on these 
corrections, the subsidy rate for Loncin changed from 17.75 to 18.96 
percent, and the subsidy rate for Zongshen changed from 19.29 percent 
to 20.38 percent. Because we based the all-others rate on Loncin's and 
Zongshen's ad valorem subsidy rates, the all-others rate has also 
changed from 18.72 percent to 19.85 percent.
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    \5\ See Memorandum, ``Countervailing Duty Investigation of 
Certain Vertical Shaft Engines Between 225cc and 999cc, and Parts 
Thereof from the People's Republic of China: Ministerial Error 
Allegations in the Final Determination,'' dated concurrently with, 
and hereby adopted by, this notice (Ministerial Error Memorandum), 
at 2-6.
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Countervailing Duty (CVD) Order

    On February 24, 2021, in accordance with sections 705(b)(1)(A)(i) 
and 705(d) of the Act, the ITC notified Commerce of its final 
determination in this investigation, in which it found that an industry 
in the United States is materially injured by reason of subsidized 
imports of vertical shaft engines from China.\6\ Therefore, in 
accordance with section 705(c)(2) of the Act, Commerce is issuing this 
countervailing duty order. Because the ITC determined that imports of 
vertical shaft engines from China are materially injuring a U.S. 
industry, unliquidated entries of such merchandise from China, entered 
or withdrawn from warehouse for consumption, are subject to the 
assessment of countervailing duties.
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    \6\ See ITC Notification Letter.
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    Therefore, in accordance with section 706(a) of the Act, Commerce 
will direct U.S. Customs and Border Protection (CBP) to assess, upon 
further instruction by Commerce, countervailing duties for all relevant 
entries of vertical shaft engines from China which are entered, or 
withdrawn from warehouse, for consumption on or after June 19, 2020, 
the date of publication of the Preliminary Determination,\7\ but will 
not include entries occurring after the expiration of the provisional 
measures period and before the publication of the ITC's final injury 
determinations under section 705(b) of the Act, as further described 
below.
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    \7\ See Certain Vertical Shaft Engines Between 225cc and 999cc, 
and Parts Thereof from the People's Republic of China: Preliminary 
Affirmative Countervailing Duty Determination, Preliminary Negative 
Critical Circumstances Determination, and Alignment of Final 
Determination With Final Antidumping Duty Determination, 85 FR 37061 
(June 19, 2020) (Preliminary Determination), and accompanying 
Preliminary Decision Memorandum.
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Suspension of Liquidation and Cash Deposits

    In accordance with section 706 of the Act, Commerce will instruct 
CBP to reinstitute the suspension of liquidation of vertical shaft 
engines from China, as described in the appendix to this notice, 
effective on the date of publication of the ITC's notice of final 
determinations in the Federal Register, and to assess, upon further 
instruction by Commerce, pursuant to section 706(a)(1) of the Act, 
countervailing duties for each entry of the subject merchandise in an 
amount based on the net countervailable subsidy rates below. On or 
after the date of publication of the ITC's final injury determinations 
in the Federal Register, CBP must require, at the same time as 
importers would deposit estimated normal customs duties on this 
merchandise, a cash deposit equal to the rates noted below. The all-
others rate applies to all producers or exporters not specifically 
listed below.

------------------------------------------------------------------------
                                                                Subsidy
                     Producers/exporters                         rate
                                                               (percent)
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Loncin Motor Co.............................................       18.96
Chongqing Zongshen General Power Machine Co.................       20.38
All Others..................................................       19.85
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Provisional Measures

    Section 703(d) of the Act states that instructions issued pursuant 
to an affirmative preliminary determination may not remain in effect 
for more than four months. In the underlying investigations, Commerce 
published the Preliminary Determinations on June 19, 2020. As such, the 
four-month period beginning on the date of the publication of the 
Preliminary Determination ended on October 16, 2020. Furthermore, 
section 707(b) of the Act states that definitive duties are to begin on 
the date of publication of the ITC's final injury determination. 
Therefore, in accordance with section 703(d) of the Act, we instructed 
CBP to terminate the suspension of liquidation and to liquidate, 
without regard to countervailing duties, unliquidated entries of 
vertical shaft engines from China, entered, or withdrawn from 
warehouse, for consumption, on or after October 17, 2020, the date on 
which the provisional measures expired, until and through the day 
preceding the date of publication of the ITC's final injury 
determinations in the Federal Register. Suspension of liquidation will 
resume on the date of publication of the ITC's final determinations in 
the Federal Register.

Notification to Interested Parties

    This notice constitutes the CVD orders with respect to vertical 
shaft engines from China pursuant to section 706(a) of the Act. 
Interested parties can find a list of CVD orders currently in effect at 
http://enforcement.trade.gov/stats/iastats1.html. This order is issued 
and published in accordance with section 706(a) of the Act and 19 CFR 
351.211(b).

    Dated: February 26, 2021.
Christian Marsh,
Acting Assistant Secretary for Enforcement and Compliance.

Appendix

Scope of the Order

    The merchandise covered by this order consists of spark-ignited, 
non-road, vertical shaft engines, whether finished or unfinished, 
whether assembled or unassembled, primarily for riding lawn mowers 
and zero-turn radius lawn mowers. Engines meeting this physical 
description may also be for other non-hand-held outdoor power 
equipment such as, including but not limited to, tow-behind brush 
mowers, grinders, and vertical shaft generators. The subject engines 
are spark ignition, single or multiple cylinder, air cooled, 
internal combustion engines with vertical power take off shafts with 
a minimum displacement of 225 cubic centimeters (cc) and a maximum 
displacement of 999cc. Typically, engines with displacements of this 
size generate gross power of between 6.7 kilowatts (kw) to 42 kw.
    Engines covered by this scope normally must comply with and be 
certified under Environmental Protection Agency (EPA) air pollution 
controls title 40, chapter I, subchapter U, part 1054 of the Code of 
Federal Regulations standards for small non-road spark-ignition 
engines and equipment. Engines that otherwise meet the physical 
description of the scope but are not certified under 40 CFR part 
1054 and are not certified under other parts of subchapter U of the 
EPA air pollution controls are not excluded from the scope of this 
proceeding. Engines that may be certified under both 40 CFR part 
1054 as well as other parts of subchapter U remain subject to the 
scope of this proceeding.
    For purposes of this order, an unfinished engine covers at a 
minimum a sub-assembly

[[Page 12621]]

comprised of, but not limited to, the following components: 
Crankcase, crankshaft, camshaft, piston(s), and connecting rod(s). 
Importation of these components together, whether assembled or 
unassembled, and whether or not accompanied by additional components 
such as an oil pan, manifold, cylinder head(s), valve train, or 
valve cover(s), constitutes an unfinished engine for purposes of 
this order. The inclusion of other products such as spark plugs 
fitted into the cylinder head or electrical devices (e.g., ignition 
modules, ignition coils) for synchronizing with the motor to supply 
tension current does not remove the product from the scope. The 
inclusion of any other components not identified as comprising the 
unfinished engine subassembly in a third country does not remove the 
engine from the scope.
    The engines subject to this order are typically classified in 
the Harmonized Tariff Schedule of the United States (HTSUS) at 
subheadings: 8407.90.1020, 8407.90.1060, and 8407.90.1080. The 
engine subassemblies that are subject to this investigation enter 
under HTSUS 8409.91.9990. Engines subject to this order may also 
enter under HTSUS 8407.90.9060 and 8407.90.9080. The HTSUS 
subheadings are provided for convenience and customs purposes only, 
and the written description of the merchandise subject to this order 
is dispositive.

[FR Doc. 2021-04477 Filed 3-3-21; 8:45 am]
BILLING CODE 3510-DS-P