[Federal Register Volume 87, Number 21 (Tuesday, February 1, 2022)]
[Notices]
[Pages 5468-5470]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-01992]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-580-829]


Stainless Steel Wire Rod From the Republic of Korea: Initiation 
of Circumvention Inquiry of Antidumping Duty Order

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

SUMMARY: In response to an allegation of circumvention from North 
American Stainless (NAS), the Department of Commerce (Commerce) is 
initiating a country-wide circumvention inquiry to determine whether 
imports of stainless steel round wire (SS round wire) from the 
Socialist Republic of Vietnam (Vietnam) are circumventing the 
antidumping duty (AD) order on stainless steel wire rod (SSWR) from the 
Republic of Korea (Korea).

DATES: Applicable February 1, 2022.

FOR FURTHER INFORMATION CONTACT: Hermes Pinilla, AD/CVD Operations, 
Office I, Enforcement and Compliance, International Trade 
Administration,

[[Page 5469]]

U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, 
DC 20230; telephone: (202) 482-3477.

SUPPLEMENTARY INFORMATION:

Background

    On May 18, 2021, NAS, a domestic producer of SSWR requested that 
Commerce initiate a circumvention inquiry proceeding, pursuant to 
section 781(c) of the Tariff Act of 1930, as amended (the Act) and 19 
CFR 351.225(i), to determine whether SS round wire from Vietnam 
involves a minor alteration to subject merchandise, such that it should 
be subject to the order \1\ on SSWR from Korea.\2\ On July 12, 2021, we 
issued a supplemental questionnaire.\3\ On July 26, 2021, NAS responded 
to our supplemental questionnaire.\4\ On July 2, 2021, August 12, 2021, 
and again on September 22, 2021, we extended the deadline by 45 days 
respectively, to determine whether to initiate the circumvention 
allegation.\5\ Because we granted NAS an extension of time to respond 
to Commerce's second supplemental questionnaire response, on November 
10, 2021, we determined that additional time was required to review and 
assess NAS's request for Commerce to determine whether to initiate a 
circumvention inquiry and, therefore, extended the deadline by 60 days, 
until January 14, 2022. On November 19, 2021, NAS responded to our 
second supplemental questionnaire.\6\ On January 4, 2022, we extended 
the deadline by 14 days, until January 28, 2022.\7\
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    \1\ See Notice of Amendment of Final Determination of Sales at 
Less Than Fair Value and Antidumping Duty Order: Stainless Steel 
Wire Rod from Korea, 63 FR 49331 (September 15, 1998) (Order).
    \2\ See NAS's Letter, ``Stainless Steel Wire Rod from the 
Republic of Korea--Request for Circumvention Ruling Pursuant to 
Section 781(c),'' dated May 18, 2021 (Circumvention Allegation).
    \3\ See Commerce's Letter, ``Request for Initiation of Anti-
Circumvention Inquiry of Antidumping Duty Order on Stainless Steel 
Wire Rod from the Republic of Korea: Supplemental Questionnaire,'' 
dated July 12, 2021.
    \4\ See NAS's Letter, ``Stainless Steel Wire Rod from Korea--
NAS's Response to the Department's Supplemental Questionnaire,'' 
dated July 26, 2021.
    \5\ See Memoranda, ``Stainless Steel Wire Rod from the Republic 
of Korea: Extension of Time to Determine Whether to Initiate Anti-
Circumvention Inquiry,'' dated July 2, 2021, August 12, 2021, and 
September 22, 2021.
    \6\ See NAS' Letter, ``Stainless Steel Wire Rod from Korea--NAS' 
Response to the Department's 2nd Supplemental Questionnaire,'' dated 
November 19, 2021.
    \7\ See Memorandum, ``Stainless Steel Wire Rod from the Republic 
of Korea: Extension of Time to Determine Whether to Initiate Anti-
Circumvention Inquiry,'' dated January 4, 2022.
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Scope of the Order

    For a complete description of the scope of the Order, see Appendix 
I.

Merchandise Subject to the Circumvention Inquiry

    This circumvention inquiry covers SSWR from Korea that has been 
cold-drawn and further processed into SS round wire in Vietnam and 
exported into the United States.

Legal Framework

    Section 781(c) of the Act provides that Commerce may find 
circumvention of an AD or countervailing duty (CVD) order when products 
which are of the class or kind as merchandise subject to an AD or CVD 
order have been ``altered in form or appearance in minor respects . . . 
whether or not included in the same tariff classification.'' Section 
781(c)(2) of the Act provides an exception that ``{p{time} aragraph 1 
shall not apply with respect to altered merchandise if the 
administering determines that it would be unnecessary to consider the 
altered merchandise within the scope of the {order{time} .''
    While the Act is silent as to what factors to consider in 
determining whether alterations are properly considered ``minor,'' the 
legislative history of this provision indicates that there are certain 
factors that should be considered before reaching a circumvention 
determination. In conducting a circumvention inquiry under section 
781(c) of the Act, Commerce has generally relied upon ``such criteria 
as the overall physical characteristics of the merchandise, the 
expectations of the ultimate users, the use of the merchandise, the 
channels of marketing and the cost of any modification relative to the 
total value of the imported products.'' \8\ Concerning the allegation 
of minor alteration under section 781(c) of the Act and 19 CFR 
351.225(i), Commerce examines such factors as: (1) Overall physical 
characteristics; (2) expectations of ultimate users; (3) use of 
merchandise; (4) channels of marketing; and (5) cost of any 
modification relative to the value of the imported products.\9\
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    \8\ See Certain Vertical Shaft Engines Between 99c and Up To 
225c, and Parts Thereof, from the People's Republic of China: 
Initiation of Anti-Circumvention Inquiry of Antidumping and 
Countervailing Duty Orders--600cc Up To 99cc Engines, 86 FR 51866 
(September 17, 2021).
    \9\ Id.; see also Deacero S.A. de C.V. v. United States, 817 
F.3d 1332 (Fed. Cir. 2016).
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Analysis

    After analyzing the record evidence and the petitioner's 
allegation, we determine that there is sufficient information to at 
minimum warrant the initiation of a minor alterations circumvention 
inquiry, pursuant to section 781(c) of the Act and 19 CFR 
351.225(i).\10\ For a full discussion of the basis for our decision to 
initiate a minor alterations circumvention inquiry, see the Initiation 
Decision Memorandum.\11\ The Initiation Decision Memorandum is a public 
document, on file electronically via Enforcement and Compliance's 
Antidumping and Countervailing Duty Centralized Electronic Service 
System (ACCESS). ACCESS is available to registered users at https://access.trade.gov. In addition, a complete version of the Initiation 
Decision Memorandum is available at https://access.trade.gov/public/FRNoticesListLayout.aspx. As explained in the Initiation Decision 
Memorandum, the information provided by NAS warrants initiating this 
circumvention inquiry on a country-wide basis. Commerce has taken this 
approach in prior circumvention inquiries, where the facts warranted 
initiation on a country-wide basis.\12\
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    \10\ See Memorandum, ``Decision Memorandum for Initiation of -
Circumvention Inquiry,'' dated concurrently with, and hereby adopted 
by, this notice (Initiation Decision Memorandum). The record 
evidence necessary for initiating a circumvention inquiry differ 
from a determination of circumvention. See also, e.g., 
Hydrofluorocarbon Blends from the People's Republic of China; 
Initiation of the Anticircumvention Inquiry of Antidumping Duty 
Order; Components, 84 FR 28273 (June 18, 2019).
    \11\ Id.
    \12\ See, e.g., Certain Corrosion-Resistant Steel Products from 
the Republic of Korea and Taiwan: Initiation of Anti-Circumvention 
Inquiries on the Antidumping Duty and Countervailing Duty Orders, 83 
FR 37785 (August 2, 2018); Carbon 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); and 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 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 SS round wire to the United 
States made from SSWR produced in Korea. 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

[[Page 5470]]

inferences, pursuant to section 776(b) of the Act.

Conclusion

    Commerce will determine whether the merchandise subject to the 
inquiry (as described in the ``Merchandise Subject to the Circumvention 
Inquiry'' section above) is circumventing the Order such that it should 
be included within the scope of the Order, pursuant to section 781(c) 
of the Act and 19 CFR 351.225(i).
    In accordance with 19 CFR 351.225(1)(2), if Commerce issues a 
preliminary affirmative determination, we will then instruct U.S. 
Customs and Border Protection to suspend liquidation and require a cash 
deposit of estimated 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 
the inquiry.
    Commerce will establish a schedule for questionnaires and comments 
on the issues related to the inquiry. In accordance with section 781(f) 
of the Act, to the maximum extent practicable, Commerce intends to 
issue its final determination within 300 days of the date of 
publication of this initiation.

Notification to Interested Parties

    This notice is published in accordance with sections 781(c) of the 
Act and 19 CFR 351.225(i).

    Dated: January 26, 2022.
Lisa W. Wang,
Assistant Secretary for Enforcement and Compliance.

Appendix I--Scope of the Order

    Stainless Steel Wire Rod, which comprises products that are hot-
rolled or hot-rolled annealed and/or pickled and/or descaled rounds, 
squares, octagons, hexagons or other shapes, in coils, that may also 
be coated with a lubricant containing copper, lime or oxalate. SSWR 
is made of alloy steels containing, by weight, 1.2 percent or less 
of carbon and 10.5 percent or more of chromium, with or without 
other elements. These products are manufactured only by hot-rolling 
or hot-rolling, annealing, and/or pickling and/or descaling, are 
normally sold in coiled form, and are of solid cross-section. The 
majority of SSWR sold in the United States is round in cross-
sectional shape, annealed and pickled, and later cold-finished into 
stainless steel wire or small-diameter bar.
    The most common size for such products is 5.5 millimeters or 
0.217 inches in diameter, which represents the smallest size that 
normally is produced on a rolling mill and is the size that most 
wire-drawing machines are set up to draw. The range of SSWR sizes 
normally sold in the United States is between 0.20 inches and 1.312 
inches diameter. Two stainless steel grades, SF20T and K-M35FL, are 
excluded from the scope of the investigation. The chemical makeup 
for the excluded grades is as follows:

SF20T

Carbon--0.05 max
Manganese--2.00 max
Phosphorous--0.05 max
Sulfur--0.15 max
Silicon--1.00 max
Chromium--19.00/21.00
Molybdenum--1.50/2.50
Lead--added (0.10/0.30)
Tellurium--added (0.03 min)

K-M35FL

Carbon--0.015 max
Silicon--0.70/1.00
Manganese--0.40 max
Phosphorous--0.04 max
Sulfur--0.03 max
Nickel--0.30 max
Chromium--12.50/14.00
Lead--0.10/0.30
Aluminum--0.20/0.35

    The products subject to this order are currently classifiable 
under subheadings 7221.00.0005, 7221.00.0015, 7221.00.0030, 
7221.00.0045, and 7221.00.0075 of the Harmonized Tariff Schedule of 
the United States (HTSUS). Although the HTSUS subheadings are 
provided for convenience and customs purposes, the written 
description of the merchandise is dispositive.

Appendix II

I. Summary
II. Background
III. Scope of the Order
IV. Merchandise Subject to the Circumvention Inquiry
V. Legal Framework
VI. Analysis
VII. Country-Wide Circumvention Inquiries
VIII. Recommendation

[FR Doc. 2022-01992 Filed 1-31-22; 8:45 am]
BILLING CODE 3510-DS-P