[Federal Register Volume 90, Number 85 (Monday, May 5, 2025)]
[Notices]
[Pages 18957-18959]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-07678]
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DEPARTMENT OF COMMERCE
International Trade Administration
[C-122-858]
Certain Softwood Lumber Products From Canada: Notice of Amended
Final Results of Countervailing Duty Expedited Review; Notice of
Exclusion From Countervailing Duty Order
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: On January 21, 2025, the U.S. Court of International Trade
(CIT) issued an order in Committee Overseeing Action for Lumber
International Trade Investigations or Negotiations, et al., v. United
States, et al., Consol. Ct. No. 19-00122 (Slip Op. 25-8) (CIT 2025)
(COALITION V), partially sustaining the U.S. Department of Commerce's
(Commerce) final results of remand redetermination (remand
redetermination), concerning the countervailing duty (CVD) order on
certain softwood lumber products (softwood lumber) from Canada. In
particular, the CIT sustained Commerce's remand redetermination
calculating a 0.88 percent de minimis subsidy rate for Fontaine, Inc.
and its cross-owned affiliates Gestion Natanis Inc., Les Placements
Jean-Paul Fontaine Ltee, and Placements Nicolas Fontaine Inc.
(collectively, Fontaine) and determination to exclude subject
merchandise produced and exported by Fontaine from the CVD order on
softwood lumber from Canada. On March 13, 2025, the CIT issued an order
severing Fontaine, Inc., et al., v. United States, et al., Ct. No. 19-
00154, (Fontaine v. US) from COALITION. The CIT further issued its
judgment and ordered that Fontaine's enjoined entries be liquidated in
accordance with the final court decision. On April 18, 2025, pursuant
to CIT Rule 60(b)(6), the Court further ordered that Commerce: (1)
publish an amended final results of the CVD expedited review with
respect to Fontaine that reflects the calculated 0.00 percent cash
deposit rate for Fontaine, and (2) ensure that subject entries enjoined
in the action are liquidated in accordance with the final court
decision, including all appeals, consistent with the requirements of
section 516A(e) of the Tariff Act of 1930, as amended. Accordingly,
Commerce is issuing these amended final results of CVD expedited review
reflecting the zero percent cash deposit rate determined in Commerce's
remand redetermination. Moreover, we are confirming that Commerce will
also direct CBP to liquidate entries enjoined
[[Page 18958]]
in this action of softwood lumber produced and exported by Fontaine,
entered, or withdrawn from warehouse, for consumption, on or after
April 28, 2017, in accordance with the final court decision in this
case, including all appeals.
DATES: Applicable April 28, 2025.
FOR FURTHER INFORMATION CONTACT: Kristen Johnson, AD/CVD Operations,
Office III, Enforcement and Compliance, International Trade
Administration, U.S. Department of Commerce, 1401 Constitution Avenue
NW, Washington, DC 20230; telephone: (202) 482-4793.
SUPPLEMENTARY INFORMATION:
Background
On January 3, 2018, Commerce published the CVD Order on softwood
lumber from Canada.\1\ On July 5, 2019, Commerce published its Final
Results of Expedited Review for the Order.\2\ In the Final Results of
Expedited Review, Commerce calculated an individual subsidy rate of
1.26 percent (i.e., above de minimis) for Fontaine.\3\
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\1\ See Certain Softwood Lumber Products from Canada: Amended
Final Affirmative Countervailing Duty Determination and
Countervailing Duty Order, 83 FR 347 (January 3, 2018) (Order).
\2\ See Certain Softwood Lumber Products from Canada: Final
Results of Countervailing Duty Expedited Review, 84 FR 32121 (July
5, 2019) (Final Results of Expedited Review), and accompanying
Issues and Decision Memorandum.
\3\ Id., 84 FR at 32122.
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The Committee Overseeing Action for Lumber International Trade
Investigations or Negotiations appealed Commerce's Final Results of
Expedited Review. On November 19, 2020, the CIT remanded the Final
Results of Expedited Review to Commerce for reconsideration of the
statutory basis upon which Commerce promulgated its CVD expedited
review regulations at 19 CFR 351.214(k) \4\ to determine individual
subsidy rates for companies not individually examined in an
investigation.\5\
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\4\ The CVD expedited review regulation was initially
promulgated as 19 CFR 351.214(k). See Antidumping Duties;
Countervailing Duties, Final Rule, 62 FR 27296, 27321-22, 27396 (May
19, 1997). Section 351.214(k) of Commerce's regulations was later
renumbered to Sec. 351.214(l). Regulations to Improve
Administration and Enforcement of Antidumping and Countervailing
Duty Laws, 86 FR 52300, 52373 (Sept. 20, 2021).
\5\ See Committee Overseeing Action for Lumber International
Trade Investigations or Negotiations, et al. v. United States, et
al., 483 F. Supp. 3d 1253 (CIT 2020) (COALITION I).
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In its Final Remand, issued in February 2021, Commerce determined
that section 103(a) of the Uruguay Round of Agreements Act, as well as
the other legal authorities presented to the CIT, cannot be the basis
for the promulgation of the CVD expedited review regulations under 19
CFR 351.214(k) and, thus, Commerce lacked the statutory authority to
conduct CVD expedited reviews.\6\ The CIT sustained Commerce's Final
Remand in COALITION II.7 Consequently, effective August 28,
2021, Commerce removed Fontaine's individual subsidy rate of 1.26
percent ad valorem and instead imposed a 14.19 percent ad valorem cash
deposit requirement based on the all-others rate from the
investigation.\8\ The Canadian parties appealed the CIT's decision.\9\
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\6\ See Final Results of Redetermination Pursuant to Court
Remand, Committee Overseeing Action for Lumber International Trade
Investigations or Negotiations, et al. v. United States, et al.,
Court No. 19-00122, Slip Op. 20-167 (CIT 2020), dated February 17,
2021 (Final Remand), available at https://access.trade.gov/resources/remands/20-167.pdf.
\7\ See Committee Overseeing Action for Lumber International
Trade Investigations or Negotiations, et al. v. United States, et
al., 535 F. Supp. 3d 1336 (CIT 2021) (COALITION II).
\8\ See Certain Softwood Lumber Products from Canada: Notice of
Court Decision Not in Harmony with the Results of Countervailing
Duty Expedited Review; Notice of Amended Final Results, 86 FR 48396
(August 30, 2021) (Amended Final Results of Expedited Review).
\9\ The Canadian parties are Les Produits Forestiers D&G
Lt[eacute]e, Marcel Lauzon Inc., North American Forest Products
Ltd., Scierie Alexandre Lemay & Fils Inc., Fontaine, Mobilier
Rustique (Beauce) Inc., Government of Canada, Government of New
Brunswick, and Government of Qu[eacute]bec.
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On April 25, 2023, the U.S. Court of Appeals for the Federal
Circuit (Federal Circuit) reversed the CIT's August 18, 2021 decision
and held that Commerce has the statutory authority to adopt the CVD
expedited review process, and remanded for further proceedings
necessitated by its holding that such statutory authority exists.\10\
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\10\ See Committee Overseeing Action for Lumber International
Trade Investigations or Negotiations v. United States, 66 F.4th 968
(Fed. Cir. 2023).
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On April 22, 2024, the CIT sustained, in part, and remanded, in
part, certain claims concerning Commerce's Final Results of Expedited
Review not addressed in COALITION I.\11\ Relevant here, the CIT
addressed Commerce's decision to rely on Fontaine's tax returns that
preceded the period of review (POR) to calculate the benefit received
for certain subsidy programs received during the POR.\12\ The CIT
remanded the issue to Commerce for reconsideration or further
explanation.\13\
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\11\ See Committee Overseeing Action for Lumber International
Trade Investigations or Negotiations, et al., v. United States, et
al., 701 F. Supp. 3d 1334 (CIT 2024) (COALITION IV).
\12\ Id. at 1360.
\13\ Id. at 1362-63.
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On September 10, 2024, Commerce issued its final results of
redetermination pursuant to court remand in COALITION IV.\14\ Pursuant
to the Court's order, Commerce reconsidered the information on its
record with respect to Fontaine's tax returns.\15\ On remand, Commerce
reconsidered its determination in the Final Results of Expedited Review
and instead relied on Fontaine's tax returns filed during the POR.\16\
Thus, in its remand redetermination, Commerce recalculated Fontaine's
benefit for the subsidy programs at issue and overall subsidy rate.\17\
As a result of the re-calculations on remand, Commerce determined that
Fontaine's overall subsidy rate was de minimis and, thus, Fontaine
should be excluded from the Order should the CIT sustain the remand
redetermination in a final and conclusive decision.\18\ In the event of
a final and conclusive determination, Commerce stated that it would
instruct CBP to discontinue the suspension of liquidation and the
collection of cash deposits of estimated countervailing duties on all
shipments of softwood lumber produced and exported by Fontaine,
entered, or withdrawn from warehouse, for consumption on or after April
28, 2017. Commerce further stated that upon a final and conclusive CIT
decision it would instruct CBP to liquidate, without regard to
countervailing duties, all suspended entries of shipments of softwood
lumber produced and exported by Fontaine, and to refund all cash
deposits of estimated countervailing duties collected on all such
shipments.
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\14\ See Final Results of Redetermination Pursuant to Court
Remand, Committee Overseeing Action for Lumber International Trade
Investigations or Negotiations, et al. v. United States, et al.,
Court No. 19-00122, Slip Op. 24-50 (CIT 2024), dated September 10,
2024 (Remand Redetermination).
\15\ Id. at 19-21.
\16\ Id.
\17\ Id. at 21.
\18\ Id. at 22.
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On January 21, 2025, in COALITION V, the CIT sustained Commerce's
remand redetermination with respect to Commerce's recalculation of
Fontaine's overall subsidy rate to 0.88 percent ad valorem, or de
minimis.\19\
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\19\ See COALITION V at 18-21.
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On March 10, 2025, Fontaine filed a motion requesting that the CIT
sever the consolidated case in Court No. 19-122 and enter judgment on
behalf Fontaine in severed Court No. 19-00154.\20\
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\20\ On November 12, 2019, the CIT consolidated Court No. 19-
00154 with Court No. 19-00122.
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On March 13, 2025, the CIT granted the motion, ordering that
subject entries enjoined under Court No. 19-00154 must be liquidated in
accordance with the final court decision, including all appeals,
consistent with the
[[Page 18959]]
requirements in section 516A(e) of the Tariff Act of 1930.
On April 8, 2025, Fontaine filed a motion seeking that Commerce
give effect to the CIT's order issued on March 13, 2025, ahead of the
conclusion of the appeals period. Specifically, Fontaine requested that
the CIT direct Commerce to publish a notice of amended final results,
set Fontaine's cash deposit rate to 0.00 percent, exclude Fontaine from
the CVD Order, and direct CBP to refund Fontaine's cash deposits
without regard to CVD duties.
On April 18, 2025, the CIT granted Fontaine's request for relief,
in part. The CIT ordered Commerce to publish amended final results of
CVD expedited review with respect to Fontaine that reflect the 0.00
percent cash deposit rate determined for Fontaine in Commerce's remand
redetermination. The CIT also held that subject entries enjoined in
this litigation should be liquidated in accordance with the CIT's final
court decision, including all appeals, consistent with the requirements
in section 516A(e) of the Tariff Act of 1930, as amended.
Amended Final Results and Exclusion From the Order
On March 13, 2025, the CIT entered final judgment sustaining
Commerce's remand redetermination calculating a 0.88 percent, de
minimis, subsidy rate for Fontaine and determining to exclude Fontaine
from the CVD Order, effective April 28, 2017. Commerce's practice with
respect to the exclusion of companies from a CVD order is to exclude
the subject merchandise both produced and exported by those
companies.\21\ As a result, Commerce is excluding subject merchandise
produced and exported by Fontaine \22\ from the CVD Order, effective
April 28, 2017, and will instruct to CBP to apply the zero percent cash
deposit rate determined on remand.
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\21\ See, e.g., Certain Corrosion-Resistant Steel Products from
India, Italy, Republic of Korea and the People's Republic of China:
Countervailing Duty Order, 81 FR 48387 (July 25, 2016).
\22\ See Remand Redetermination at 23; see also CVD Order.
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Liquidation of Suspended Entries
In accordance with the CIT's April 18, 2025 order, in the event
that the CIT's final judgment is not appealed or is upheld on appeal,
Commerce will instruct CBP to liquidate entries enjoined in this action
of softwood lumber produced and exported by Fontaine, entered, or
withdrawn from warehouse, for consumption, on or after April 28, 2017,
without respect to countervailing duties.
At this time, Commerce remains enjoined by the CIT from liquidating
certain entries. These entries will remain enjoined pursuant to the
terms of the injunction during any appeals process. Lastly, subject
merchandise that Fontaine exports but does not produce, as well as
merchandise Fontaine produces but is exported by another company,
remain subject to the Order.
Dated: April 28, 2025.
Abdelali Elouaradia,
Deputy Assistant Secretary for Enforcement and Compliance.
[FR Doc. 2025-07678 Filed 5-2-25; 8:45 am]
BILLING CODE 3510-DS-P