[Federal Register Volume 89, Number 126 (Monday, July 1, 2024)]
[Notices]
[Pages 54421-54424]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-14458]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-570-173]


Vanillin From the People's Republic of China: Initiation of 
Countervailing Duty Investigation

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


DATES: Applicable June 25, 2024.

FOR FURTHER INFORMATION CONTACT: Jeff Pedersen, AD/CVD Operations, 
Office IV, Enforcement and Compliance, International Trade 
Administration, U.S. Department of Commerce, 1401 Constitution Avenue 
NW, Washington, DC 20230; telephone: (202) 482-2769.

SUPPLEMENTARY INFORMATION:

The Petition

    On June 5, 2024, the U.S. Department of Commerce (Commerce) 
received a countervailing duty (CVD) petition concerning imports of 
vanillin from the People's Republic of China (China) filed in proper 
form on behalf of Solvay USA LLC (the petitioner), a domestic producer 
of vanillin.\1\ The Petition was accompanied by an antidumping duty 
(AD) petition concerning imports of vanillin from China.\2\
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    \1\ See Petitioner's Letter, ``Petitions for the Imposition of 
Antidumping and Countervailing Duties'' dated June 5, 2024 
(Petition).
    \2\ Id.
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    On June 7, 14, and 18, 2024, Commerce requested supplemental 
information from the petitioner regarding the Petition, to which the 
petitioner responded on June 11, 18, and 21, 2024, respectively.\3\
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    \3\ See Commerce's Letters, ``Supplemental Questions,'' dated 
June 7, 2024 (First General Issues Questionnaire); ``Supplemental 
Questions,'' dated June 14, 2024, and ``Supplemental Questions,'' 
dated June 18, 2024; see also Memorandum, ``Phone Call with Counsel 
to the Petitioner,'' dated June 17, 2024 (June 17 Memorandum); see 
also Petitioner's Letters, ``Petitioner's Response to Supplemental 
Questions Regarding Common Issues and Injury Volume I of the 
Petitions,'' dated June 11, 2024 (First General Issues Supplement); 
``Petitioner's Response to Supplemental Questions Regarding Common 
Issues and Injury Volume I of the Petitions'' dated June 18, 2024 
(Second General Issues Supplement); and ``Petitioner's Response to 
Supplemental Questions Regarding Countervailing Duties Allegations 
Volume III of the Petitions,'' dated June 21, 2024.
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    In accordance with section 702(b)(1) of the Tariff Act of 1930, as 
amended (the Act), the petitioner alleges that the Government of China 
(GOC) is providing countervailable subsidies, within the meaning of 
sections 701 and 771(5) of the Act, to Chinese producers of vanillin, 
and that such imports are materially injuring, or threatening material 
injury to, the industry producing vanillin in the United States. 
Consistent with section 702(b)(1) of the Act and 19 CFR 351.202(b), the 
alleged programs for which we are initiating this CVD investigation are 
supported by information in the Petition that is reasonably available 
to the petitioner.
    Commerce finds that the petitioner filed the Petition on behalf of 
the domestic industry because the petitioner is an interested party as 
defined in section 771(9)(C) of the Act. Commerce also finds that the 
petitioner demonstrated sufficient industry support with respect to the 
initiation of the requested CVD investigation.\4\
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    \4\ See section on ``Determination of Industry Support for the 
Petition,'' infra.
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Period of Investigation

    Because the Petition was filed on June 5, 2024, the period of 
investigation (POI) is January 1, 2023, through December 31, 2023.\5\
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    \5\ See 19 CFR 351.204(b)(2).
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Scope of the Investigation

    The merchandise covered by this investigation is vanillin from 
China. For a full description of the scope of this investigation, see 
the appendix to this notice.

Comments on Scope of the Investigation

    Between June 7 and June 17, 2024, Commerce requested information 
and clarification from the petitioner regarding the proposed scope to 
ensure that the scope language in the Petition is an accurate 
reflection of the products for which the domestic industry is seeking 
relief.\6\ Between June 11 and 18, 2024, the petitioner provided 
clarifications and revised the scope language.\7\ The description of 
merchandise covered by this investigation, as described in the appendix 
to this notice, reflects these clarifications.
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    \6\ See First General Issues Questionnaire; see also June 17 
Memorandum.
    \7\ See First General Issues Supplement at 2-4 and Exhibits I-
Supp-2 and I-Supp-3; see also Second General Issues Supplement at 2-
3.
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    As discussed in the Preamble to Commerce's regulations, we are 
setting aside a period for parties to raise issues

[[Page 54422]]

regarding product coverage (i.e., scope).\8\ Commerce will consider all 
scope comments received from interested parties and, if necessary, will 
consult with interested parties prior to the issuance of the 
preliminary determination. If scope comments include factual 
information, all such factual information should be limited to public 
information.\9\ To facilitate preparation of its questionnaires, 
Commerce requests that scope comments be submitted by 5:00 p.m. Eastern 
Time (ET) on July 15, 2024, which is 20 calendar days from the 
signature date of this notice. Any rebuttal scope comments, which may 
include factual information, must be filed by 5:00 p.m. ET on July 25, 
2024, which is 10 calendar days from the initial comment deadline.
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    \8\ See Antidumping Duties; Countervailing Duties, 62 FR 27296, 
27323 (May 19, 1997) (Preamble); see also 19 CFR 351.312.
    \9\ See 19 CFR 351.102(b)(21) (defining ``factual 
information'').
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    Commerce requests that any factual information that the parties 
consider relevant to the scope of the investigation be submitted during 
the time period identified above. However, if a party subsequently 
finds that additional factual information pertaining to the scope of 
the investigation may be relevant, the party may contact Commerce and 
request permission to submit the additional information. All scope 
comments must also be filed on the records of the concurrent AD and CVD 
investigations.

Filing Requirements

    All submissions to Commerce must be filed electronically via 
Enforcement and Compliance's Antidumping Duty and Countervailing Duty 
Centralized Electronic Service System (ACCESS), unless an exception 
applies.\10\ An electronically filed document must be received 
successfully in its entirety by the time and date it is due.
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    \10\ See Antidumping and Countervailing Duty Proceedings: 
Electronic Filing Procedures; Administrative Protective Order 
Procedures, 76 FR 39263 (July 6, 2011); see also Enforcement and 
Compliance; Change of Electronic Filing System Name, 79 FR 69046 
(November 20, 2014), for details of Commerce's electronic filing 
requirements, effective August 5, 2011. Information on using ACCESS 
can be found at: https://access.trade.gov/help.aspx and https://access.trade.gov/help/Handbook_on_Electronic_Filing_Procedures.pdf.
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Consultations

    Pursuant to sections 702(b)(4)(A)(i) and (ii) of the Act, Commerce 
notified the GOC of the receipt of the Petition and provided an 
opportunity for consultations with respect to the Petition.\11\ The GOC 
did not request consultations.
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    \11\ See Commerce's Letter ``Invitation for Consultations to 
Discuss the Countervailing Duty Petition on Vanillin from the 
People's Republic of China,'' dated June 12, 2024.
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Determination of Industry Support for the Petition

    Section 702(b)(1) of the Act requires that a petition be filed on 
behalf of the domestic industry. Section 702(c)(4)(A) of the Act 
provides that a petition meets this requirement if the domestic 
producers or workers who support the petition account for: (i) at least 
25 percent of the total production of the domestic like product; and 
(ii) more than 50 percent of the production of the domestic like 
product produced by that portion of the industry expressing support 
for, or opposition to, the petition. Moreover, section 702(c)(4)(D) of 
the Act provides that, if the petition does not establish support of 
domestic producers or workers accounting for more than 50 percent of 
the total production of the domestic like product, Commerce shall: (i) 
poll the industry or rely on other information in order to determine if 
there is support for the petition, as required by subparagraph (A); or 
(ii) determine industry support using a statistically valid sampling 
method to poll the ``industry.''
    Section 771(4)(A) of the Act defines the ``industry'' as the 
producers as a whole of a domestic like product. Thus, to determine 
whether a petition has the requisite industry support, the statute 
directs Commerce to look to producers and workers who produce the 
domestic like product. The U.S. International Trade Commission (ITC), 
which is responsible for determining whether ``the domestic industry'' 
has been injured, must also determine what constitutes a domestic like 
product in order to define the industry. While both Commerce and the 
ITC must apply the same statutory definition regarding the domestic 
like product,\12\ they do so for different purposes and pursuant to a 
separate and distinct authority. In addition, Commerce's determination 
is subject to limitations of time and information. Although this may 
result in different definitions of the like product, such differences 
do not render the decision of either agency contrary to law.\13\
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    \12\ See section 771(10) of the Act.
    \13\ See USEC, Inc. v. United States, 132 F. Supp. 2d 1, 8 (CIT 
2001) (citing Algoma Steel Corp., Ltd. v. United States, 688 F. 
Supp. 639, 644 (CIT 1988), aff'd 865 F. 2d 240 (Fed. Cir. 1989)).
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    Section 771(10) of the Act defines the domestic like product as ``a 
product which is like, or in the absence of like, most similar in 
characteristics and uses with, the article subject to an investigation 
under this title.'' Thus, the reference point from which the domestic 
like product analysis begins is ``the article subject to an 
investigation'' (i.e., the class or kind of merchandise to be 
investigated, which normally will be the scope as defined in the 
petition).
    With regard to the domestic like product, the petitioner does not 
offer a definition of the domestic like product distinct from the scope 
of the investigation.\14\ Based on our analysis of the information 
submitted on the record, we have determined that vanillin, as defined 
in the scope, constitutes a single domestic like product, and we have 
analyzed industry support in terms of that domestic like product.\15\
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    \14\ See Petition at Volume I (pages 7-9 and Exhibit I-8); see 
also First General Issues Supplement at 7-8 and Exhibits I-Supp-3.
    \15\ For a discussion of the domestic like product analysis as 
applied to this case and information regarding industry support, see 
Checklist, ``Vanillin from the People's Republic of China,'' dated 
concurrently with, and hereby adopted by, this notice (China CVD 
Initiation Checklist), at Attachment II, Analysis of Industry 
Support for the Antidumping and Countervailing Duty Petitions 
Covering Vanillin from the People's Republic of China. This 
checklist is on file electronically via ACCESS.
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    In determining whether the petitioner has standing under section 
702(c)(4)(A) of the Act, we considered the industry support data 
contained in the Petition with reference to the domestic like product 
as defined in the ``Scope of the Investigation,'' in the appendix to 
this notice. To establish industry support, the petitioner provided its 
2023 production of the domestic like product.\16\ The petitioner 
estimated the production of the domestic like product for the remaining 
U.S. producers of vanillin based on its knowledge of the industry.\17\ 
We relied on data provided by the petitioner for purposes of measuring 
industry support.\18\
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    \16\ See Petition at Volume I (Exhibits I-2 and I-11); see also 
First General Issues Supplement at 5, 8, and Exhibits I-Supp-4 and 
I-Supp-7.
    \17\ See Petition at Volume I (page 2 and Exhibit I-2); see also 
First General Issues Supplement at 5-7 and Exhibits I-Supp-4, I-
Supp-5, I-Supp-8 and I-Supp-9; and Second General Issues Supplement 
at 1-2.
    \18\ See Petition at Volume I (page 2 and Exhibits I-2 and I-
11); see also First General Issues Supplement at 5-8 and Exhibits I-
Supp-4 and I-Supp-7; and Second General Issues Supplement at 1-2.
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    Our review of the data provided in the Petition, the First General 
Issues Supplement, the Second General Issues Supplement, and other 
information readily available to Commerce indicates that the petitioner 
has established

[[Page 54423]]

industry support for the Petition.\19\ First, the Petition established 
support from domestic producers (or workers) accounting for more than 
50 percent of the total production of the domestic like product and, as 
such, Commerce is not required to take further action in order to 
evaluate industry support (e.g., polling).\20\ Second, the domestic 
producers (or workers) have met the statutory criteria for industry 
support under section 702(c)(4)(A)(i) of the Act because the domestic 
producers (or workers) who support the Petition account for at least 25 
percent of the total production of the domestic like product.\21\ 
Finally, the domestic producers (or workers) have met the statutory 
criteria for industry support under section 702(c)(4)(A)(ii) of the Act 
because the domestic producers (or workers) who support the Petition 
account for more than 50 percent of the production of the domestic like 
product produced by that portion of the industry expressing support 
for, or opposition to, the Petition.\22\ Accordingly, Commerce 
determines that the Petition was filed on behalf of the domestic 
industry within the meaning of section 702(b)(1) of the Act.\23\
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    \19\ See Attachment II of the China CVD Initiation Checklist.
    \20\ Id.; see also section 702(c)(4)(D) of the Act.
    \21\ See Attachment II of the China CVD Initiation Checklist.
    \22\ Id.
    \23\ Id.
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Injury Test

    Because China is a ``Subsidies Agreement Country'' within the 
meaning of section 701(b) of the Act, section 701(a)(2) of the Act 
applies to this investigation. Accordingly, the ITC must determine 
whether imports of the subject merchandise from China materially 
injure, or threaten material injury to, a U.S. industry.

Allegations and Evidence of Material Injury and Causation

    The petitioner alleges that imports of the subject merchandise are 
benefitting from countervailable subsidies and that such imports are 
causing, or threaten to cause, material injury to the U.S. industry 
producing the domestic like product. In addition, the petitioner 
alleges that subject imports exceed the negligibility threshold 
provided for under section 771(24)(A) of the Act.\24\
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    \24\ See Petition at Volume I (pages 11-12 and Exhibit I-10).
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    The petitioner contends that the industry's injured condition is 
illustrated by a significant volume of subject imports; significant 
market share of subject imports; underselling and price depression and/
or suppression; decline in financial performance and operating income; 
declines in production, shipments, capacity utilization, and employment 
variables; and lost sales and revenues.\25\ We assessed the allegations 
and supporting evidence regarding material injury, threat of material 
injury, causation, as well as negligibility, and we have determined 
that these allegations are properly supported by adequate evidence, and 
meet the statutory requirements for initiation.\26\
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    \25\ Id. at 10-21 and Exhibits I-5 and I-9 through I-15.
    \26\ See China CVD Initiation Checklist at Attachment III, 
Analysis of Allegations and Evidence of Material Injury and 
Causation for the Antidumping and Countervailing Duty Petitions 
Covering Vanillin from the People's Republic of China.
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Initiation of CVD Investigation

    Based upon our examination of the Petition and supplemental 
responses, we find that they meet the requirements of section 702 of 
the Act. Therefore, we are initiating a CVD investigation to determine 
whether imports of vanillin from China benefit from countervailable 
subsidies conferred by the GOC. In accordance with section 703(b)(1) of 
the Act and 19 CFR 351.205(b)(1), unless postponed, we will make our 
preliminary determination no later than 65 days after the date of this 
initiation.
    Based on our review of the Petition, we find that there is 
sufficient information to initiate a CVD investigation on all 56 
programs alleged by the petitioner. For a full discussion of the basis 
for our decision to initiate an investigation of each program, see the 
CVD Initiation Checklist. A public version of the initiation checklist 
for this investigation is available in ACCESS.

Respondent Selection

    The petitioner identified 42 companies in China as producers and/or 
exporters of vanillin.\27\ Commerce intends to follow its standard 
practice in CVD investigations and calculate company-specific subsidy 
rates in this investigation. In the event that Commerce determines that 
the number of companies identified is large, and it cannot individually 
examine each company based upon Commerce's resources, Commerce intends 
to select mandatory respondents based on U.S. Customs and Border 
Protection (CBP) data for U.S. imports of vanillin from China during 
the POI under the appropriate Harmonized Tariff Schedule of the United 
States subheading(s) listed in the ``Scope of the Investigation'' in 
the appendix.
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    \27\ See Petition at Exhibit I-7.
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    On June 20, 2024, Commerce released CBP data on imports of vanillin 
from China under administrative protective order (APO) to all parties 
with access to information protected by APO and indicated that 
interested parties wishing to comment on CBP data and/or respondent 
selection must do so within three business days of the date of 
publication of this notice in the Federal Register.\28\ Comments must 
be filed electronically using ACCESS. An electronically filed document 
must be received successfully in its entirety via ACCESS by 5:00 p.m. 
ET on the specified deadline. Commerce will not accept rebuttal 
comments regarding the CBP data or respondent selection.
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    \28\ See Memorandum, ``Release of U.S. Customs and Border 
Protection Entry Data,'' dated June 20, 2024.
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    Interested parties must submit applications for disclosure under 
APO in accordance with 19 CFR 351.305(b). Instructions for filing such 
applications may be found on Commerce's website at https://www.trade.gov/administrative-protective-orders.

Distribution of Copies of the Petition

    In accordance with section 702(b)(4)(A)(i) of the Act and 19 CFR 
351.202(f), a copy of the public version of the Petition has been 
provided to the GOC via ACCESS. Furthermore, to the extent practicable, 
Commerce will attempt to provide a copy of the public version of the 
Petition to each exporter named in the Petition, as provided under 19 
CFR 351.203(c)(2).

ITC Notification

    Commerce will notify the ITC of its initiation, as required by 
section 702(d) of the Act.

Preliminary Determination by the ITC

    The ITC will preliminarily determine, within 45 days after the date 
on which the Petition was filed, whether there is a reasonable 
indication that subject imports are materially injuring, or threatening 
material injury to, a U.S. industry.\29\ A negative ITC determination 
will result in the investigation being terminated.\30\ Otherwise, this 
CVD investigation will proceed according to statutory and regulatory 
time limits.
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    \29\ See section 703(a)(1) of the Act.
    \30\ Id.
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Submission of Factual Information

    Factual information is defined in 19 CFR 351.102(b)(21) as: (i) 
evidence submitted in response to questionnaires; (ii) evidence 
submitted in support of

[[Page 54424]]

allegations; (iii) publicly available information to value factors of 
production under 19 CFR 351.408(c) or to measure the adequacy of 
remuneration under 19 CFR 351.511(a)(2); (iv) evidence placed on the 
record by Commerce; and (v) evidence other than factual information 
described in (i)-(iv). Section 351.301(b) of Commerce's regulations 
requires any party, when submitting factual information, to specify 
under which subsection of 19 CFR 351.102(b)(21) the information is 
being submitted \31\ and, if the information is submitted to rebut, 
clarify, or correct factual information already on the record, to 
provide an explanation identifying the information already on the 
record that the factual information seeks to rebut, clarify, or 
correct.\32\ Time limits for the submission of factual information are 
addressed in 19 CFR 351.301, which provides specific time limits based 
on the type of factual information being submitted. Interested parties 
should review the regulations prior to submitting factual information 
in this investigation.
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    \31\ See 19 CFR 351.301(b).
    \32\ See 19 CFR 351.301(b)(2).
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Extensions of Time Limits

    Parties may request an extension of time limits before the 
expiration of a time limit established under 19 CFR 351.301(c), or as 
otherwise specified by Commerce. In general, an extension request will 
be considered untimely if it is filed after the expiration of the time 
limit established under 19 CFR 351.301.\33\ For submissions that are 
due from multiple parties simultaneously, an extension request will be 
considered untimely if it is filed after 10:00 a.m. ET on the due date. 
Under certain circumstances, Commerce may elect to specify a different 
time limit by which extension requests will be considered untimely for 
submissions which are due from multiple parties simultaneously. In such 
a case, Commerce will inform parties in a letter or memorandum of the 
deadline (including a specified time) by which extension requests must 
be filed to be considered timely. An extension request must be made in 
a separate, standalone submission; Commerce will grant untimely filed 
requests for the extension of time limits only in limited cases where 
we determine, based on 19 CFR 351.302(c), that extraordinary 
circumstances exist. Parties should review Commerce's regulations 
concerning time limits for submission of factual information prior to 
submitting factual information in this investigation.\34\
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    \33\ See 19 CFR 351.302.
    \34\ See 19 CFR 351.301; see also Extension of Time Limits; 
Final Rule, 78 FR 57790 (September 20, 2013), and Regulations 
Improving and Strengthening the Enforcement of Trade Remedies 
Through the Administration of the Antidumping and Countervailing 
Duty Laws, 89 FR 20766 (March 25, 2024).
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Certification Requirements

    Any party submitting factual information in an AD or CVD proceeding 
must certify to the accuracy and completeness of that information.\35\ 
Parties must use the certification formats provided in 19 CFR 
351.303(g).\36\ Commerce intends to reject factual submissions if the 
submitting party does not comply with the applicable certification 
requirements.
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    \35\ See section 782(b) of the Act.
    \36\ See Certification of Factual Information to Import 
Administration During Antidumping and Countervailing Duty 
Proceedings, 78 FR 42678 (July 17, 2013) (Final Rule); see also 
frequently asked questions regarding the Final Rule, available at: 
https://enforcement.trade.gov/tlei/notices/factual_info_final_rule_FAQ_07172013.pdf.
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Notification to Interested Parties

    Interested parties must submit applications for disclosure under 
administrative protective order in accordance with 19 CFR 351.305. 
Parties wishing to participate in this investigation should ensure that 
they meet the requirements of 19 CFR 351.103(d) (e.g., by filing the 
required letters of appearance). Note that Commerce has amended certain 
of its requirements pertaining to the service of documents in 19 CFR 
351.303(f).\37\
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    \37\ See Administrative Protective Order, Service, and Other 
Procedures in Antidumping and Countervailing Duty Proceedings, 88 FR 
67069 (September 29, 2023).
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    This notice is issued and published pursuant to sections 702 and 
777(i) of the Act, and 19 CFR 351.203(c).

    Dated: June 25, 2024.
Ryan Majerus,
Deputy Assistant Secretary for Policy and Negotiations, performing the 
non-exclusive functions and duties of the Assistant Secretary for 
Enforcement and Compliance.

Appendix--Scope of the Investigation

    The merchandise covered by the investigation is vanillin, with 
the molecular formula C8H8O3 or 
C9H10O3. For purposes of this 
investigation, vanillin consists of natural vanillin, synthetic 
vanillin, bio-sourced synthetic vanillin (biovanillin) (each also 
known as 4-Hydroxy-3-methoxybenzaldehyde), and ethylvanillin (also 
known as 3-Ethoxy-4-hydroxybenzaldehyde). Vanillin covered by this 
investigation is a chemical compound with the Chemical Abstracts 
Service (CAS) number 121-33-5 or 121-32-4. Vanillin is covered by 
the investigation regardless of whether it is in a crystalline 
powder or crystal form. Vanillin is covered by the scope of the 
investigation, irrespective of purity, particle size, or physical 
form.
    Merchandise subject to the investigation is specified within the 
Harmonized Tariff Schedule of the United States (HTSUS) under 
subheading 2912.41.0000 and 2912.42.0000. The HTSUS subheadings and 
CAS registry numbers are provided for convenience and customs 
purposes only. The written description of the merchandise covered by 
the investigation is dispositive.

[FR Doc. 2024-14458 Filed 6-28-24; 8:45 am]
BILLING CODE 3510-DS-P