[Federal Register Volume 88, Number 97 (Friday, May 19, 2023)]
[Notices]
[Pages 32184-32187]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-10779]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-570-146]


Certain Freight Rail Couplers and Parts Thereof From the People's 
Republic of China: Final Affirmative Countervailing Duty Determination 
and Final Affirmative Critical Circumstances Determination, In Part

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

SUMMARY: The U.S. Department of Commerce (Commerce) determines that 
countervailable subsidies are being provided to producers and exporters 
of certain freight rail couplers and parts thereof (freight rail 
couplers) from the People's Republic of China (China) during the period 
of investigation January 1, 2021, through December 31, 2021.

DATES: Applicable May 19, 2023.

FOR FURTHER INFORMATION CONTACT: Terre Keaton Stefanova or Paul Gill, 
AD/CVD Operations, Office IX, Enforcement and Compliance, International 
Trade Administration, U.S. Department of Commerce, 1401 Constitution 
Avenue NW, Washington, DC 20230; telephone: (202) 482-1280 or (202) 
482-5673, respectively.

SUPPLEMENTARY INFORMATION: 

Background

    On March 3, 2023, Commerce published the Preliminary Determination 
of this investigation in the Federal Register.\1\ We invited interested 
parties to comment on the Preliminary Determination. In March 2023, we 
received comments from Strato Inc. (Strato) and Wabtec Corporation 
(Wabtec), U.S. importers of freight rail couplers from China.\2\ On

[[Page 32185]]

April 6, 2023, we received rebuttal comments from the Coalition of 
Freight Coupler Producers (the petitioner).\3\ For a complete 
description of the events that followed the Preliminary Determination, 
see the Issues and Decision Memorandum.\4\ 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.
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    \1\ See Certain Freight Rail Couplers and Parts Thereof from the 
People's Republic of China: Preliminary Affirmative Countervailing 
Duty Determination and Preliminary Affirmative Critical 
Circumstances Determination, 88 FR 13425 (March 3, 2023) 
(Preliminary Determination), and accompanying Preliminary Decision 
Memorandum (PDM).
    \2\ See Strato's Letter, ``Strato Administrative Case Brief,'' 
date March 23, 2023; and Wabtec's Letter, ``Case Brief for Final 
Negative Countervailing Duty Determination and Final Negative 
Critical Circumstances Determination,'' dated March 23, 2023.
    \3\ See Petitioner's Letter, ``Petitioner's Rebuttal Brief,'' 
dated April 6, 2023.
    \4\ See Memorandum, ``Issues and Decision Memorandum for the 
Final Determination in the Countervailing Duty Investigation of 
Certain Freight Rail Couplers and Parts Thereof from the People's 
Republic of China,'' dated concurrently with, and hereby adopted by, 
this notice (Issues and Decision Memorandum).
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Period of Investigation

    The period of investigation is January 1, 2021, through December 
31, 2021.

Scope of the Investigation

    The products covered by this investigation are freight rail 
couplers from China. For a complete description of the scope of this 
investigation, see Appendix I.

Scope Comments

    During the course of this investigation and the concurrent less-
than-fair value investigations of freight rail couplers from China and 
Mexico, Commerce received scope comments from interested parties. 
Commerce issued a Preliminary Scope Memorandum to address these 
comments and set aside a period of time for parties to address scope 
issues in scope case and rebuttal briefs.\5\ We received comments from 
interested parties on the Preliminary Scope Memorandum, which we 
address in the Final Scope Memorandum.\6\ As a result of these 
comments, we made certain changes to the scope of these investigations 
from that published in the Preliminary Determination. See Appendix I.
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    \5\ See Memorandum, ``Preliminary Scope Decision Memorandum,'' 
dated March 28, 2023 (Preliminary Scope Memorandum).
    \6\ See Memorandum, ``Final Scope Decision Memorandum,'' dated 
concurrently with this notice (Final Scope Memorandum).
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Final Affirmative Determination of Critical Circumstances, In Part

    In the Preliminary Determination, Commerce preliminarily 
determined, pursuant to section 703(e)(c)(1) of the Tariff Act of 1930, 
as amended (the Act), that critical circumstances exist for Chongqing 
Tongyao Transportation Equipment Co. (Chongqing Tongyao), Qingdao 
Sanheshan Precision Casting Co., Ltd. (Qingdao Sanheshan), the non-
responsive companies,\7\ and all other producers and/or exporters.\8\ 
For this final determination, we continue to find that critical 
circumstances exist for Chongqing Tongyao, Qingdao Sanheshan, and the 
non-responsive companies, in accordance with section 705(a)(2) of the 
Act. However, for all other producers and/or exporters, we now find 
that we are unable to make a determination of whether there were 
massive imports of the subject merchandise over a relatively short 
period. Therefore, we do not find that critical circumstances exist 
with respect to all other producers and/or exporters. For the analysis 
of critical circumstances for the final determination, see Issues and 
Decision Memorandum at Comment 1.
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    \7\ The non-responsive companies are: (1) Chongqing Changzheng 
Heavy Industry Co., Ltd.; (2) CRRC Qiqihar Co., Ltd.; (3) NanJing 
Zhongsheng Rolling Stock Components Co. Ltd.; (4) Ningbo Minghui 
Metal Technology Co., Ltd.; (5) Qingdao Lianshan Casting Co., Ltd.; 
(6) Shaanxi Haiduo Railway Technology Development Co., Ltd.; and (7) 
Shanghai Voith Xiagujin Chuang Coupler Technology Co., Ltd.
    \8\ See Preliminary Determination, 88 FR at 13426.
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Analysis of Comments Received

    The issues raised in comments that were submitted by parties in 
this investigation are addressed in the Issues and Decision Memorandum. 
A list of the issues addressed in the Issues and Decision Memorandum is 
attached to this notice at Appendix II.

Changes Since the Preliminary Determination

    Based on our analysis of the comments received from interested 
parties, we made certain changes to our preliminary critical 
circumstances determination, as noted above. For a discussion of these 
changes, see the Issues and Decision Memorandum. However, as no 
interested party submitted comments on the subsidy rates selected in 
the Preliminary Determination, we made no changes to the subsidy rates 
assigned to Chongqing Tongyao, Qingdao Sanheshan, and the non-
responsive companies.

Analysis of Subsidy Programs--Adverse Facts Available (AFA)

    For the purposes of this final determination, Commerce relied 
solely on facts available pursuant to section 776 of the Act, because 
neither the Government of China nor the mandatory respondents, 
Chongqing Tongyao and Qingdao Sanheshan, participated in this 
investigation. Furthermore, as stated in our Preliminary Determination, 
the non-responsive companies also withheld necessary information that 
Commerce requested from them, failed to provide information within the 
deadlines established, and significantly impeded this proceeding by 
failing to respond to Commerce's quantity and value questionnaire.\9\ 
Therefore, because the mandatory respondents, the non-responsive 
companies, and the Government of China did not cooperate to the best of 
their abilities in responding to our requests for information in this 
investigation, we drew adverse inferences in selecting from among the 
facts otherwise available, in accordance with sections 776(a)-(b) of 
the Act. We received no comments from interested parties regarding our 
application of AFA to determine the countervailability of, and rates 
for, the subsidy programs at issue in this investigation. Consistent 
with the Preliminary Determination, we continue to apply AFA to 
determine the appropriate subsidy rates for this investigation. A 
detailed discussion of our application of AFA is provided in the 
Preliminary Determination.\10\
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    \9\ See Preliminary Determination PDM at 7.
    \10\ See Preliminary Determination PDM at 4-14.
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All-Others Rate

    As discussed in the Preliminary Determination, Commerce based the 
selection of the all-others rate on the countervailable subsidy rate 
established for the mandatory respondents, in accordance with 703(d) of 
the Act.\11\ Consistent with section 705(c)(5)(A)(ii) of the Act, we 
made no changes to the selection of the all-others rate for the final 
determination.
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    \11\ See Preliminary Determination, 88 FR at 13426.
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Final Determination

    Commerce determines that the following estimated countervailable 
subsidy rates exist:

[[Page 32186]]



------------------------------------------------------------------------
                                                           Subsidy Rate
                         Company                           (percent  ad
                                                             valorem)
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Chongqing Changzheng Heavy Industry Co., Ltd............          265.99
Chongqing Tongyao Transportation Equipment Co...........          265.99
CRRC Qiqihar Co., Ltd...................................          265.99
NanJing Zhongsheng Rolling Stock Components Co. Ltd.....          265.99
Ningbo Minghui Metal Technology Co., Ltd................          265.99
Qingdao Lianshan Casting Co., Ltd.......................          265.99
Qingdao Sanheshan Precision Casting Co., Ltd............          265.99
Shaanxi Haiduo Railway Technology Development Co., Ltd..          265.99
Shanghai Voith Xiagujin Chuang Coupler Technology Co.,            265.99
 Ltd....................................................
All Others..............................................          265.99
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Continuation of Suspension of Liquidation

    In accordance with section 705(c)(4)(A) of the Act, Commerce 
intends to instruct U.S. Customs and Border Protection (CBP) to 
continue to suspend liquidation of entries of subject merchandise, as 
described in Appendix I of this notice, for Chongqing Tongyao, Qingdao 
Sanheshan, and the non-responsive companies, entered, or withdrawn from 
warehouse, for consumption on or after December 3, 2022, which is 90 
days prior to the date of publication of the Preliminary Determination 
in the Federal Register. However, for all other producers and/or 
exporters, Commerce intends to instruct CBP to continue to suspend 
liquidation of entries of subject merchandise, as described in Appendix 
I of this notice, entered, or withdrawn from warehouse, for consumption 
on or after March 3, 2023, which is the date of publication of the 
Preliminary Determination in the Federal Register, at the all-others 
rate indicated above. These suspension of liquidation instructions will 
remain in effect until further notice.
    Because we now find that critical circumstances do not exist for 
all other producers and/or exporters, we will direct CBP to terminate 
the retroactive suspension of liquidation ordered at the Preliminary 
Determination and release any cash deposits that were required prior to 
March 3, 2022, the date of publication of the Preliminary Determination 
in the Federal Register, consistent with section 705(c)(3) of the Act.
    If the U.S. International Trade Commission (ITC) issues a final 
affirmative injury determination, we intend to issue a countervailing 
duty order and continue to require a case deposit of estimated 
countervailing duties for such entries of subject merchandise in the 
amounts indicated above, in accordance with 706(a) of the Act. If the 
ITC issues a final affirmative injury determination but a final 
negative determination of critical circumstances, we will instruct CBP 
to liquidate entries prior to the date of publication of the 
Preliminary Determination without regard to duties, and all estimated 
duties deposited or securities posted as a result of the suspension of 
liquidation will be refunded or canceled. If the ITC determines that 
material injury, or threat of material injury, does not exist, this 
proceeding will be terminated, and all estimated duties deposited as a 
result of the suspension of liquidation will be refunded or canceled.

ITC Notification

    In accordance with section 705(d) of the Act, we intend to notify 
the ITC of our final affirmative determination that countervailable 
subsidies are being provided to producers and exporters of freight rail 
couplers from China. Because the final determination in this proceeding 
is affirmative, in accordance with section 705(b) of the Act, the ITC 
will make its final determination as to whether the domestic industry 
in the United States is materially injured, or threatened with material 
injury, by reason of imports of freight rail couplers from China no 
later than 45 days after our final determination.
    If the ITC determines that material injury or threat of material 
injury does not exist, this proceeding will be terminated and all cash 
deposits will be refunded or canceled, as Commerce determines to be 
appropriate. If the ITC determines that such injury does exist, 
Commerce intends to issue a countervailing duty order directing CBP to 
assess, upon further instruction by Commerce, countervailing duties on 
all imports of the subject merchandise that are entered, or withdrawn 
from warehouse, for consumption on or after the effective date of the 
suspension of liquidation, as discussed above in the ``Continuation of 
Suspension of Liquidation'' section.

Notification Regarding Administrative Protective Order (APO)

    In the event that the ITC issues a final negative injury 
determination, this notice will serve as the only reminder to parties 
subject to an 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 the return/destruction of 
APO materials or conversion to judicial protective order is hereby 
requested. Failure to comply with the regulations and terms of an APO 
is a violation which is subject to sanction.

Notification to Interested Parties

    This determination is issued and published pursuant to sections 
705(d) and 777(i) of the Act, and 19 CFR 351.205(c).

    Dated: May 15, 2023.
Lisa W. Wang,
Assistant Secretary for Enforcement and Compliance.

Appendix I

Scope of the Investigation

    The scope of this investigation covers certain freight railcar 
couplers (also known as ``fits'' or ``assemblies'') and parts 
thereof. Freight railcar couplers are composed of two main parts, 
namely knuckles and coupler bodies but may also include other items 
(e.g., coupler locks, lock lift assemblies, knuckle pins, knuckle 
throwers, and rotors). The parts of couplers that are covered by the 
investigation include: (1) E coupler bodies, (2) E/F coupler bodies, 
(3) F coupler bodies, (4) E knuckles, and (5) F knuckles, as set 
forth by the Association of American Railroads (AAR). The freight 
rail coupler parts (i.e., knuckles and coupler bodies) are included 
within the scope of the investigation when imported separately. 
Coupler locks, lock lift assemblies, knuckle pins, knuckle throwers, 
and rotors are covered merchandise when imported in an assembly but 
are not covered by the scope when imported separately.
    Subject freight railcar couplers and parts are included within 
the scope whether finished or unfinished, whether imported 
individually or with other subject or nonsubject parts, whether 
assembled or unassembled, whether mounted or unmounted, or if joined 
with nonsubject merchandise, such as other nonsubject parts

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or a completed railcar. Finishing includes, but is not limited to, 
arc washing, welding, grinding, shot blasting, heat treatment, 
machining, and assembly of various parts. When a subject coupler or 
subject parts are mounted on or to other nonsubject merchandise, 
such as a railcar, only the coupler or subject parts are covered by 
the scope.
    The finished products covered by the scope of this investigation 
meet or exceed the AAR specifications of M-211, ``Foundry and 
Product Approval Requirements for the Manufacture of Couplers, 
Coupler Yokes, Knuckles, Follower Blocks, and Coupler Parts'' and/or 
AAR M-215 ``Coupling Systems,'' or other equivalent domestic or 
international standards (including any revisions to the 
standard(s)).
    The country of origin for subject couplers and parts thereof, 
whether fully assembled, unfinished or finished, or attached to a 
railcar, is the country where the subject coupler parts were cast or 
forged. Subject merchandise includes coupler parts as defined above 
that have been further processed or further assembled, including 
those coupler parts attached to a railcar in third countries. 
Further processing includes, but is not limited to, arc washing, 
welding, grinding, shot blasting, heat treatment, painting, coating, 
priming, machining, and assembly of various parts. The inclusion, 
attachment, joining, or assembly of nonsubject parts with subject 
parts or couplers either in the country of manufacture of the in-
scope product or in a third country does not remove the subject 
parts or couplers from the scope.
    The couplers that are the subject of this investigation are 
currently classifiable in the Harmonized Tariff Schedule of the 
United States (HTSUS) statistical reporting number 8607.30.1000. 
Unfinished subject merchandise may also enter under HTSUS 
statistical reporting number 7326.90.8688. Subject merchandise 
attached to finished railcars may also enter under HTSUS statistical 
reporting numbers 8606.10.0000, 8606.30.0000, 8606.91.0000, 
8606.92.0000, 8606.99.0130, 8606.99.0160, or under subheading 
9803.00.50. Subject merchandise may also be imported under HTSUS 
statistical reporting number 7325.99.5000. These HTSUS subheadings 
are provided for convenience and customs purposes only; the written 
description of the scope of this investigation is dispositive.

Appendix II

List of Topics Discussed in the Issues and Decision Memorandum

I. Summary
II. Background
III. Final Critical Circumstances Determination
IV. Analysis of Comments
    Comment 1: Whether Commerce Should Reverse its Preliminary 
Affirmative Critical Circumstances Determinations
    Comment 2: Whether Commerce Should Terminate the Investigation
V. Recommendation

[FR Doc. 2023-10779 Filed 5-18-23; 8:45 am]
BILLING CODE 3510-DS-P