[Federal Register Volume 87, Number 241 (Friday, December 16, 2022)]
[Notices]
[Pages 77074-77076]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-27276]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-124; C-570-125]


Certain Vertical Shaft Engines Between 99cc and Up To 225cc, and 
Parts Thereof, From the People's Republic of China: Affirmative Final 
Determination of Circumvention of the Antidumping and Countervailing 
Duty Orders--60cc Up To 99cc Engines

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

SUMMARY: The U.S. Department of Commerce (Commerce) determines that 
vertical shaft engines with displacements between 60 cubic centimeters 
(cc) and up to 99cc produced in the People's Republic of China (China) 
and exported to the United States are circumventing the antidumping 
duty (AD) and countervailing duty (CVD) orders on certain vertical 
shaft engines between 99cc and up to 225cc, and parts thereof, (small 
vertical engines) from China by means of being merchandise ``altered in 
form or appearance in minor respects.''

DATES: Applicable December 16, 2022.

FOR FURTHER INFORMATION CONTACT: Benjamin A. Luberda, AD/CVD

[[Page 77075]]

Operations, Enforcement and Compliance, International Trade 
Administration, U.S. Department of Commerce, 1401 Constitution Avenue 
NW, Washington, DC 20230; telephone: (202) 482-2185.

SUPPLEMENTARY INFORMATION: 

Background

    On September 7, 2022, Commerce published the preliminary 
determination \1\ for the circumvention inquiry of the AD and CVD 
Orders on small vertical engines from China with respect to vertical 
shaft engines with displacements between 60cc and up to 99cc produced 
in China and exported to the United States.\2\ A summary of the events 
that occurred since Commerce published the Preliminary Determination 
may be found in the Issues and Decision Memorandum.\3\ Commerce 
conducted this inquiry in accordance with section 781(c) of the Tariff 
Act of 1930, as amended, (the Act) and 19 CFR 351.225(i). This inquiry 
was initiated on September 13, 2021,\4\ and it is being conducted under 
the prior version of 19 CFR 351.225, not the version promulgated in 
AB10.\5\
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    \1\ See Certain Vertical Shaft Engines Between 99cc and Up To 
225cc, and Parts Thereof, from the People's Republic of China: 
Affirmative Preliminary Determination of Circumvention of the 
Antidumping and Countervailing Duty Orders, 87 FR 54672 (September 
7, 2022) (Preliminary Determination), and accompanying Preliminary 
Decision Memorandum (PDM).
    \2\ See Certain Vertical Shaft Engines Between 99cc and Up to 
225cc, and Parts Thereof from the People's Republic of China: 
Antidumping and Countervailing Duty Orders, 86 FR 23675 (May 4, 
2021) (Orders).
    \3\ See Memorandum, ``Final Issues and Decision Memorandum for 
Circumvention Inquiry of the Antidumping and Countervailing Duty 
Orders on Certain Vertical Shaft Engines Between 99cc and Up To 
225cc, and Parts Thereof, from the People's Republic of China: 60cc 
Up To 99cc Engines,'' dated concurrently with, and hereby adopted 
by, this notice (Issues and Decision Memorandum).
    \4\ See Vertical Shaft Engines Between 99cc and Up to 225cc, and 
Parts Thereof, from the People's Republic of China: Initiation of 
Anti-Circumvention Inquiry of Antidumping and Countervailing Duty 
Orders--60cc Up to 99cc Engines, 86 FR 51866 (September 17, 2021), 
and accompanying Issues and Decision Memorandum.
    \5\ See Regulations to Improve Administration and Enforcement of 
Antidumping and Countervailing Duty Laws, 86 FR 52300 (September 20, 
2021) (AB10).
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Scope of the Orders

    The merchandise subject to the Orders is small vertical engines 
from China. For a complete description of the scope of the Orders, see 
the Issues and Decision Memorandum.

Merchandise Subject to the Circumvention Inquiry

    This circumvention inquiry covers vertical shaft engines with 
displacements between 60cc and up to 99cc produced in China and 
exported to the United States.

Analysis of Comments Received

    All the issues raised in case and rebuttal briefs that were 
submitted by parties in this inquiry are addressed in the Issues and 
Decision Memorandum. A list of the issues raised is attached in the 
Appendix to this notice. The Issues and 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 https://access.trade.gov. In addition, a complete version of the Issues and 
Decision Memorandum can be accessed directly at https://access.trade.gov/public/FRNoticesListLayout.aspx.

Final Determination

    In the Preliminary Determination, we determined that vertical shaft 
engines with displacements between 60cc and up to 99cc and engines with 
displacements of 99cc up to 225cc are not dissimilar in terms of 
overall physical characteristics of the merchandise, the expectations 
of the ultimate users, the use of the merchandise, channels of 
marketing, and the timing and circumstances under which the Zongshen 
Companies \6\ exported the engines with displacements between 60cc and 
up to 99cc. Thus, we preliminarily determined that the merchandise 
subject to this inquiry is not dissimilar to subject merchandise and 
that the engines at issue constitute merchandise ``altered in form or 
appearance in minor respects'' from in-scope merchandise, within the 
meaning of section 781(c) of the Act. We also preliminarily determined 
that the affirmative circumvention finding should be applied on a 
countrywide basis.\7\
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    \6\ In the less-than-fair-value investigation, Commerce found 
that Chongqing Zongshen General Power Machine Co., Ltd.; Chongqing 
Dajiang Power Equipment Co., Ltd.; and Chongqing Zongshen Power 
Machinery Co., Ltd. (collectively, the Zongshen Companies) should be 
treated as a single entity. See Certain Vertical Shaft Engines 
Between 99cc and Up to 225cc, and Parts Thereof, from the People's 
Republic of China: Preliminary Affirmative Determination of Sales at 
Less Than Fair Value, and Preliminary Affirmative Determination of 
Critical Circumstances, in Part, 85 FR 66932 (October 21, 2020), 
unchanged in Certain Vertical Shaft Engines Between 99cc and Up To 
225cc, and Parts Thereof, from the People's Republic of China: Final 
Affirmative Determination of Sales at Less Than Fair Value and Final 
Affirmative Determination of Critical Circumstances in Part, 86 FR 
14077 (March 12, 2021). Absent information to the contrary, we 
continue to treat the Zongshen Companies as a single entity for the 
purposes of this inquiry.
    \7\ See Preliminary Determination PDM.
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    Our final determination remains unchanged from the Preliminary 
Determination. Accordingly, we determine, pursuant to section 781(c) of 
the Act and 19 CFR 351.225(i), that imports of vertical shaft engines 
with displacements between 60cc and up to 99cc, produced in China and 
exported to the United States, are circumventing the Orders. We also 
continue to find that the affirmative circumvention finding should be 
applied on a countrywide basis.

Liquidation of Entries

    In the Preliminary Determination, Commerce stated that it would 
instruct United States Customs and Border Protection (CBP) to suspend 
liquidation of, and collect cash deposits on, vertical shaft engines 
between 60cc and up to 99cc produced in China and exported to the 
United States that were entered, or withdrawn from warehouse, for 
consumption on or after September 17, 2021 (i.e., the date of the 
initiation of this inquiry).\8\ On October 26, 2022, Commerce rescinded 
the administrative review of the AD order for the period July 23, 2020, 
through April 30, 2022, and the administrative review of the CVD order 
for the period May 26, 2020, through December 31, 2021.\9\ Accordingly, 
the administrative reviews covering certain entries of inquiry 
merchandise for which liquidation is suspended have been rescinded.
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    \8\ See Preliminary Determination, 87 FR at 54673.
    \9\ See Rescission of Antidumping and Countervailing Duty 
Administrative Reviews, 87 FR 64764 (October 26, 2022).
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    For any unliquidated entries and entries for which liquidation has 
not become final of vertical shaft engines with displacements between 
60cc and up to 99cc produced in China and exported to the United States 
that entered as non-AD/CVD type entries (e.g., type 01) that were 
shipped and/or entered, or withdrawn from warehouse, for consumption in 
the United States after September 17, 2021, importers should file a 
Post Summary Correction with CBP, in accordance with CBP's regulations, 
regarding conversion of such entries from non-AD/CVD case numbers to 
AD/CVD type entries (e.g., type 01 to type 03). For such shipments, the 
Post Summary Corrections should be completed as soon as practicable, 
but not later than 45 days after publication of this notice in the 
Federal Register. Importers should report those AD/CVD type entries of 
merchandise under the AD/CVD case numbers of the Orders on

[[Page 77076]]

small vertical engines from China (i.e., A-570-124; C-570-125) or 
appropriate third-country case numbers (i.e., A-201-996; C-201-997). 
The importer must pay cash deposits on those entries consistent with 
the regulations governing post summary corrections that require payment 
of additional duties.
    Commerce intends to instruct CBP to assess AD and/or CVD duties on 
all appropriate entries of vertical shaft engines with displacements 
between 60cc and up to 90cc during the periods of review noted above at 
rates equal to the applicable cash deposit of estimated AD or CVD 
duties in effect at time of entry, or withdrawal of merchandise from 
warehouse, for consumption, in accordance with 19 CFR 351.212(c)(1)(i). 
Commerce intends to issue assessment instructions no earlier than 35 
days after the publication of this notice in the Federal Register. If a 
timely summons is filed at the U.S. Court of International Trade, the 
assessment instructions will direct CBP not to liquidate relevant 
entries until the time for parties to file a request for a statutory 
injunction has expired (i.e., within 90 days of publication).

Continuation of Suspension of Liquidation

    As a result of this determination, and consistent with 19 CFR 
351.225(l)(3), we will instruct CBP to continue to suspend the 
liquidation of all entries of merchandise subject to the inquiry 
entered, or withdrawn from warehouse, for consumption, under the AD 
order after April 30, 2022, and all entries entered, or withdrawn from 
warehouse, for consumption, under the CVD order after December 31, 
2021, and to require cash deposits of estimated AD and/or CVD duties at 
the applicable subject merchandise rates. The suspension of liquidation 
and cash deposit instructions will remain in effect until further 
notice.

Notification Regarding Administrative Protective Order

    This notice serves as the only reminder to all parties subject to 
the administrative protective order (APO) of their responsibility 
concerning the destruction of proprietary information disclosed under 
APO in accordance with 19 CFR 351.305(a)(3). Timely written 
notification of return/destruction of APO materials or conversion to 
judicial protective order is hereby requested. Failure to comply with 
the regulations and terms of the APO is a sanctionable violation.

Notification to Interested Parties

    This affirmative final determination of circumvention is issued and 
published in accordance with section 781(c) of the Act.

    Dated: December 9, 2022.
Lisa W. Wang,
Assistant Secretary for Enforcement and Compliance.

Appendix--List of Topics Discussed in the Issues and Decision 
Memorandum

I. Summary
II. Background
III. Merchandise Subject to the Circumvention Inquiry
IV. Scope of the Orders
V. Use of Facts Available With an Adverse Inference
VI. Discussion of the Issues
    Comment 1. Whether Commerce's Preliminary Determination 
Improperly Applied the Minor Alterations Provision of the Statute
    Comment 2. Physical Characteristics of the Inquiry Merchandise
    Comment 3. Modification Cost of the Inquiry Merchandise
VII. Recommendation

[FR Doc. 2022-27276 Filed 12-15-22; 8:45 am]
BILLING CODE 3510-DS-P