Notice2022-02488
Quartz Surface Products From the People's Republic of China: Initiation of Scope and Circumvention Inquiries of the Antidumping Duty and Countervailing Duty Orders
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Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
February 7, 2022
Issuing agencies
Commerce DepartmentInternational Trade Administration
Abstract
The Department of Commerce (Commerce) is self-initiating a scope inquiry, pursuant to U.S. trade remedy laws, to determine whether imports of quartz surface products (QSP), completed in Malaysia using inputs manufactured in the People's Republic of China (China), are covered by the antidumping duty (AD) and countervailing duty (CVD) orders on QSP from China (collectively, the Orders). In addition, in accordance with our regulations, Commerce is also self-initiating a country-wide circumvention inquiry to determine whether imports of QSP, if not covered by the scope of the Orders, are nonetheless circumventing the Orders, and is aligning both scope and circumvention inquiries in accordance with our regulations.
Full Text
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<title>Federal Register, Volume 87 Issue 25 (Monday, February 7, 2022)</title>
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[Federal Register Volume 87, Number 25 (Monday, February 7, 2022)]
[Notices]
[Pages 6844-6848]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-02488]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-084, C-570-085]
Quartz Surface Products From the People's Republic of China:
Initiation of Scope and Circumvention Inquiries of the Antidumping Duty
and Countervailing Duty Orders
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (Commerce) is self-initiating a
scope inquiry, pursuant to U.S. trade remedy laws, to determine whether
imports of quartz surface products (QSP), completed in Malaysia using
inputs manufactured in the People's Republic of China (China), are
covered by the antidumping duty (AD) and countervailing duty (CVD)
orders on QSP from China (collectively, the Orders). In addition, in
accordance with our regulations, Commerce is also self-initiating a
country-wide circumvention inquiry to determine whether imports of QSP,
if not covered by the scope of the Orders, are nonetheless
circumventing the Orders, and is aligning both scope and circumvention
inquiries in accordance with our regulations.
DATES: Applicable February 7, 2022.
FOR FURTHER INFORMATION CONTACT: Ajay Menon at (202) 482-0208, AD/CVD
Operations, Office II or Barb Rawdon at (202) 482-0474, Office of
Policy, Enforcement and Compliance, International Trade Administration,
U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington,
DC 20230.
SUPPLEMENTARY INFORMATION:
Background
On April 17, 2018, Cambria Company LLC filed petitions seeking the
imposition of AD and CVD duties on imports of QSP from China.\1\
Following Commerce's affirmative determinations of dumping and
countervailable
[[Page 6845]]
subsidies,\2\ and the U.S. International Trade Commission (ITC)'s
finding of material injury,\3\ Commerce issued the Orders.\4\
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\1\ See Certain Quartz Surface Products from the People's
Republic of China: Initiation of Less-Than-Fair-Value Investigation,
83 FR 22613 (May 16, 2018); Certain Quartz Surface Products from the
People's Republic of China: Initiation of Countervailing Duty
Investigation, 83 FR 22618 (May 16, 2018).
\2\ See Certain Quartz Surface Products from the People's
Republic of China: Final Affirmative Determination of Sales at Less
Than Fair Value, and Final Affirmative Determination of Critical
Circumstances, 84 FR 23767 (May 23, 2019); Certain Quartz Surface
Products from the People's Republic of China: Final Affirmative
Countervailing Duty Determination, and Final Affirmative
Determination of Critical Circumstances, 84 FR 23760 (May 23, 2019).
\3\ See Quartz Surface Products from China; Determinations, 84
FR 32216 (July 5, 2019); see also Quartz Surface Products from
China, Inv Nos. 701-TA-606 and 731-TA-1416, USITC Pub. 4913 (Final).
\4\ See Certain Quartz Surface Products from the People's
Republic of China: Antidumping and Countervailing Duty Orders, 84 FR
33053 (July 11, 2019) (Orders).
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Scope of the Orders
The products covered by the Orders are certain QSP from China,
whether finished or unfinished. Such products ``consist of slabs and
other surfaces created from a mixture of materials that includes
predominately silica (e.g., quartz, quartz powder, cristobalite) as
well as a resin binder (e.g., an unsaturated polyester). The
incorporation of other materials, including, but not limited to,
pigments, cement, or other additives does not remove the merchandise
from the scope of the Orders. However, the scope of the Orders only
includes products where the silica content is greater than any other
single material, by actual weight.'' For a full description of the
scope of the Orders, see the ``Scope of the Orders,'' in the appendix
to this notice.
Statutory and Regulatory Requirements To Initiate Scope and
Circumvention Inquiries
Pursuant to 19 CFR 351.225(b), if Commerce ``determines from
available information that an inquiry is warranted to determine whether
a product is covered by the scope of an order,'' then Commerce ``may
initiate a scope inquiry and publish a notice of initiation in the
Federal Register.''
Furthermore, section 351.226(b) of Commerce's regulations states
that if Commerce ``determines from available information that an
inquiry is warranted into the question of whether the elements
necessary for a circumvention determination under section 781 of the
Act exist,'' Commerce ``may initiate a circumvention inquiry and
publish a notice of initiation in the Federal Register.'' Section
781(b)(1) of the Act provides that Commerce may find circumvention of
an AD or CVD order when merchandise of the same class or kind subject
to the order is completed or assembled in a foreign country other than
the country to which the order applies. In conducting circumvention
inquiries, under section 781(b)(1) of the Act, Commerce relies on the
following criteria: (A) Merchandise imported into the United States is
of the same class or kind as any merchandise produced in a foreign
country that is the subject of an antidumping or countervailing duty
order or finding, (B) before importation into the United States, such
imported merchandise is completed or assembled in another foreign
country from merchandise which is subject to the order or merchandise
which is produced in the foreign country that is subject to the order,
(C) the process of assembly or completion in the foreign country
referred to in section (B) is minor or insignificant, (D) the value of
the merchandise produced in the foreign country to which the AD or CVD
order applies is a significant portion of the total value of the
merchandise exported to the United States, and (E) the administering
authority determines that action is appropriate to prevent evasion of
such order or finding.
In determining whether or not the process of assembly or completion
in a third country is minor or insignificant under section 781(b)(1)(C)
of the Act, section 781(b)(2) of the Act directs Commerce to consider:
(A) The level of investment in the foreign country, (B) the level of
research and development in the foreign country, (C) the nature of the
production process in the foreign country, (D) the extent of production
facilities in the foreign country, and (E) whether or not the value of
processing performed in the foreign country represents a small
proportion of the value of the merchandise imported into the United
States. However, no single factor, by itself, controls Commerce's
determination of whether the process of assembly or completion in a
third country is minor or insignificant.\5\ Accordingly, it is
Commerce's practice to evaluate each of these five factors as they
exist in the third country, depending on the totality of the
circumstances of the particular circumvention inquiry.\6\
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\5\ See Statement of Administrative Action accompanying the
Uruguay Round Agreements Act (SAA), H.R. Doc. No. 103-316 (1994) at
893.
\6\ See Uncovered Innerspring Units from the People's Republic
of China: Final Affirmative Determination of Circumvention of the
Antidumping Duty Order, 83 FR 65626 (December 21, 2018), and
accompanying Issues and Decision Memorandum at 4.
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In addition, section 781(b)(3) of the Act sets forth additional
factors to consider in determining whether to include merchandise
assembled or completed in a third country within the scope of an
antidumping and/or countervailing duty order. Specifically, Commerce
shall take into account such factors as: (A) The pattern of trade,
including sourcing patterns; (B) whether the manufacturer or exporter
of the merchandise is affiliated with the person who, in the third
country, uses the merchandise to complete or assemble the merchandise
which is subsequently imported into the United States; and (C) whether
imports of the merchandise into the third country have increased after
the initiation of the investigation that resulted in the issuance of
such order or finding.
As described below, Commerce is self-initiating concurrent scope
and circumvention inquiries.
Merchandise Subject to the Scope and Circumvention Inquiries
Commerce has placed information on the administrative record, as
attachments to its Initiation Memo, that indicates that certain QSP or
QSP inputs produced in China undergo further processing in Malaysia
before being exported to the United States.\7\ That QSP exported from
Malaysia to the United States is the merchandise at issue in both the
scope and circumvention inquiry initiations.
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\7\ See Memorandum, ``Certain Quartz Surface Products from the
People's Republic of China: Initiation of Scope and Circumvention
Inquiries of the Antidumping Duty and Countervailing Duty Orders
(Initiation Memo). This memo is a public document dated concurrently
with, and hereby adopted by, this notice and on file electronically
via ACCESS. Access to documents filed via ACCESS is also available
in the Central Records Unit, Room B8024 of the main Department of
Commerce building.
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(1) Available Information Supports Initiation of a Scope Inquiry
The scope covers merchandise which ``has been finished, packaged,
or otherwise fabricated in a third country, including by cutting,
polishing, curing, edging, thermoforming, attaching to, or packaging
with another product, or any other finishing, packaging, or fabrication
that would not otherwise remove the merchandise from the scope of the
orders if performed in the country of manufacture of the quartz surface
products.'' Accordingly, Commerce is self-initiating this scope inquiry
to determine if QSP or QSP inputs produced in China and further
processed in Malaysia before being exported to the United States meet
this description. We are seeking to determine whether in-scope QSP or
QSP inputs leave China and undergo minor processing in Malaysia before
being
[[Page 6846]]
exported to the United States. If the Chinese-origin, in-scope
merchandise that undergoes minor processing in Malaysia results in
merchandise that still corresponds to the description of in-scope
merchandise outlined in the Orders, Commerce will find that the
merchandise meeting the scope description is covered by the Orders. For
those products for which Commerce finds that the merchandise is covered
by the Orders, Commerce may rescind the circumvention inquiry, pursuant
to 19 CFR 351.226(f)(6).
(2) Available Information Also Supports Initiation of a Circumvention
Inquiry
Based on available information, we also determine the initiation of
a circumvention inquiry is warranted to determine whether certain
imports of QSP, completed in Malaysia using certain QSP inputs
manufactured in China, are circumventing the Orders.\8\ Commerce has
made this determination in accordance with its analysis of the factors
set forth in section 781(b) of the Act and 19 CFR 351.226(i).\9\
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\8\ See Initiation Memo. As explained in the Initiation Memo,
the available information supports initiating this circumvention
inquiry on a country-wide basis. Commerce has taken this approach in
prior circumvention inquiries, where the facts supported initiation
on a country-wide basis. See, e.g., Oil Country Tubular Goods from
the People's Republic of China: Initiation of Anti-Circumvention
Inquiries on the Antidumping and Countervailing Duty Orders, 85 FR
71877, 71878-79 (November 12, 2020); Stainless Steel Sheet and Strip
from the People's Republic of China: Initiation of Anti-
Circumvention and Scope Inquiries on the Antidumping and
Countervailing Duty Orders, 85 FR 29401, 29402 (May 15, 2020);
Corrosion-Resistant Steel Products from the People's Republic of
China: Initiation of Anti-Circumvention Inquiries on the Antidumping
Duty and Countervailing Duty Orders, 84 FR 43585 (August 21, 2019);
see also 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);
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).
\9\ See Initiation Memo.
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Commerce has determined that it is appropriate to first determine
whether the merchandise is covered by the scope of the Orders through a
scope inquiry, before considering whether the merchandise is
circumventing the Orders. Accordingly, Commerce will initially conduct
its scope inquiry of the merchandise at issue, and then once it has
made a determination as to the scope coverage status of the
merchandise, it will determine whether to continue with the
circumvention inquiry. If Commerce determines QSP or QSP inputs leaving
China that are not covered by the scope of the Orders undergo further
processing in Malaysia and this further processing consequently results
in the production of in-scope merchandise, this merchandise would be
subject to the scope of the Orders. Under that scenario, Commerce may
apply its scope determination, in accordance with 19 CFR 351.225(m)(1),
on a producer-specific, exporter-specific, or importer-specific basis,
or on country-wide basis, regardless of the producer, exporter or
importer of the products being exported from Malaysia to the United
States.
If Commerce determines that QSP or QSP inputs completed in Malaysia
and exported to the United States are not covered by the scope of the
Orders, in whole or in part, Commerce may then determine to immediately
continue with the circumvention inquiry of that merchandise. If as a
result of a circumvention inquiry Commerce determines that the products
subject to the inquiry are circumventing the Orders, then in accordance
with 19 CFR 351.226(m)(1), Commerce may apply its determination on a
producer-specific, exporter-specific, or importer specific basis, or on
a country-wide basis, regardless of the producer, exporter or importer
of the products being exported from Malaysia to the United States.
Pursuant to 19 CFR 351.226(f)(7), Commerce may ``alter or extend''
time limits under the circumvention inquiry as necessary to make
certain all parties to each or both segments of the proceeding are able
to file comments and factual information, as necessary.
Suspension of Liquidation
(1) Scope Inquiry
Pursuant to 19 CFR 351.225(l)(1), when Commerce self-initiates a
scope inquiry under 19 CFR 351.225(b), Commerce will notify CBP of the
initiation and direct CBP to continue the suspension of liquidation of
entries of products subject to the scope inquiry that were already
subject to the suspension of liquidation, and to apply the cash deposit
rate that would be applicable if the product were determined to be
covered by the scope of the order. Accordingly, Commerce will notify
CBP of the initiation of the scope inquiry and direct CBP to continue
to suspend (unliquidated) entries of the products subject to the scope
inquiry that were already subject to the suspension of liquidation. In
addition, Commerce will direct CBP to apply the cash deposit rate that
would be applicable if the products were determined to be covered by
the scope of the Orders.
Should Commerce issue preliminary or final scope rulings, Commerce
will follow the suspension of liquidation rules under 19 CFR
351.225(l)(2)-(4). In the event that Commerce issues preliminary or
final scope rulings that the products are covered by the scope of the
Orders, Commerce will instruct CBP to continue the suspension of
liquidation of previously suspended entries and to apply the applicable
cash deposit rate. Commerce will also instruct CBP to begin the
suspension of liquidation and application of cash deposits for any
unliquidated entries not yet suspended, entered, or withdrawn from
warehouse, for consumption, on or after the date of initiation of the
scope inquiry pursuant to paragraphs (l)(2)(ii) and (l)(3)(ii). In
addition, pursuant to paragraphs (l)(2)(iii)(A) and (l)(3)(iii)(A),
Commerce normally will instruct CBP to begin the suspension of
liquidation and application of cash deposits for any unliquidated
entries not yet suspended, entered, or withdrawn from warehouse, for
consumption, prior to the date of initiation of the scope inquiry, but
not for such entries prior to November 4, 2021, the effective date of
these provisions in the Final Rule.\10\ These rules will not affect
CBP's authority to take any additional action with respect to the
suspension of liquidation or related measures for these entries, as
stated in 19 CFR 351.225(l)(5).
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\10\ See Regulations to Improve Administration and Enforcement
of Antidumping and Countervailing Duty Laws, 86 FR 52300, 52327
(September 20, 2021) (Final Rule).
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(2) Circumvention Inquiry
Pursuant to 19 CFR 351.226(l)(1), when Commerce self-initiates a
circumvention inquiry under 19 CFR 351.226(b), Commerce will notify CBP
of the initiation and direct CBP to continue the suspension of
liquidation of entries of products subject to the circumvention inquiry
that were already subject to the suspension of liquidation, and to
apply the cash deposit rate that would be applicable if the product
were determined to be circumventing the order. Accordingly, Commerce
will notify CBP of the initiation of the circumvention inquiry and
direct CBP to continue to suspend (unliquidated) entries of the
products subject to the circumvention inquiry that were already subject
to the suspension of liquidation. In addition, Commerce will direct CBP
to apply the cash deposit rate that would be applicable if the products
[[Page 6847]]
were determined to be circumventing the Orders.
Should Commerce issue preliminary or final circumvention
determinations, Commerce will follow the suspension of liquidation
rules under 19 CFR 351.226(l)(2)-(4). In the event that Commerce issues
affirmative preliminary or final circumvention determinations that the
products are circumventing the Orders, Commerce will instruct CBP to
continue the suspension of liquidation of previously suspended entries
and to apply the applicable cash deposit rate. Commerce will also
instruct CBP to begin the suspension of liquidation and application of
cash deposits for any unliquidated entries not yet suspended, entered,
or withdrawn from warehouse, for consumption, on or after the date of
publication of the notice of initiation of the circumvention inquiry
pursuant to paragraphs (l)(2)(ii) and (l)(3)(ii). In addition, pursuant
to paragraphs (l)(2)(iii)(A) and (l)(3)(iii)(A), Commerce may instruct
CBP to begin the suspension of liquidation and application of cash
deposits for any unliquidated entries not yet suspended, entered, or
withdrawn from warehouse, for consumption, prior to the date of
initiation of the circumvention inquiry, but not for such entries prior
to November 4, 2021, the effective date of these provisions in the
Final Rule.\11\ These rules will not affect CBP's authority to take any
additional action with respect to the suspension of liquidation or
related measures for these entries, as stated in 19 CFR 351.226(l)(5).
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\11\ Id., 86 FR at 52345.
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Notification to Interested Parties
In accordance with sections 19 CFR 351.225(b) and 351.226(b), and
781(b) of the Act, Commerce determines that available information
supports initiating both scope and circumvention inquiries to determine
whether certain imports of QSP, completed in and exported from Malaysia
using certain QSP inputs manufactured in China, are subject to or
circumventing the Orders. Accordingly, Commerce is notifying all
interested parties of the initiation of scope and circumvention
inquiries. In addition, we have included a description of the products
that are the subject of these inquiries, and an explanation of the
reasons for Commerce's decision to initiate these inquiries as provided
above and in the accompanying Initiation Memo. Pursuant to 19 CFR
351.225(e)(3) and 351.226(e)(3), due to the interrelated nature of the
scope and circumvention inquiries, Commerce is aligning the deadlines
for the scope inquiry with the circumvention inquiry and will conduct
the scope inquiry first for the reasons explained above.
Pursuant to 19 CFR 351.225(f)(1), interested parties have until
March 2, 2022, to submit one set of comments and factual information
addressing the self-initiation of the scope inquiry. Under 19 CFR
351.225(l)(2)(iii)(B) and (l)(3)(iii)(B), interested parties may timely
request that Commerce adopt an alternative date to begin the suspension
of liquidation and application of cash deposits under paragraphs
(l)(2)(ii)(A) and (l)(3)(iii)(A). A request for Commerce to adopt an
alternative date must be based on a specific argument supported by
evidence establishing the appropriateness of that alternative date.\12\
If parties wish to make such a request, that request must be included
with the set of comments and factual information submitted to Commerce
pursuant to 19 CFR 351.225(f)(1).
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\12\ See Final Rule, 86 FR 52326-29, for further information.
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Interested parties will then have until March 16, 2022 to submit
comments and factual information to rebut, clarify, or correct factual
information submitted by the other interested parties (including
rebuttal in response to any requests made under 19 CFR
351.225(l)(2)(iii)(B) and (l)(3)(iii)(B)). At this time, we are not
soliciting or accepting comments on the self-initiation of the
circumvention inquiry. Should Commerce determine to proceed with the
circumvention inquiry after finalizing its scope determination,
Commerce will notify interested parties on the segment-specific service
list of an opportunity to comment.
In accordance with section 19 CFR 351.225(e), unless the scope
inquiry is rescinded, in whole or in part, Commerce intends to issue
its final scope ruling within 120 days after the date on which the
scope inquiry was initiated. Furthermore, in accordance with section
781(f) of the Act and 19 CFR 351.226(e)(2), unless the circumvention
inquiry is rescinded, in whole or in part, Commerce intends to issue
its final circumvention determination within 300 days from the date of
publication of the notice of initiation of a circumvention inquiry in
the Federal Register.
This notice is published in accordance with 19 CFR 351.225(b) and
351.226(b) and section 781(b) of the Act.
Dated: January 31, 2022.
Lisa W. Wang,
Assistant Secretary for Enforcement and Compliance.
Appendix--Scope of the Orders
The scope of the orders covers certain quartz surface products.
Quartz surface products consist of slabs and other surfaces created
from a mixture of materials that includes predominately silica
(e.g., quartz, quartz powder, cristobalite) as well as a resin
binder (e.g., an unsaturated polyester). The incorporation of other
materials, including, but not limited to, pigments, cement, or other
additives does not remove the merchandise from the scope of the
orders. However, the scope of the orders only includes products
where the silica content is greater than any other single material,
by actual weight.
Quartz surface products are typically sold as rectangular slabs
with a total surface area of approximately 45 to 60 square feet and
a nominal thickness of one, two, or three centimeters. However, the
scope of the orders includes surface products of all other sizes,
thicknesses, and shapes. In addition to slabs, the scope of the
orders includes, but is not limited to, other surfaces such as
countertops, backsplashes, vanity tops, bar tops, work tops,
tabletops, flooring, wall facing, shower surrounds, fire place
surrounds, mantels, and tiles. Certain quartz surface products are
covered by the orders whether polished or unpolished, cut or uncut,
fabricated or not fabricated, cured or uncured, edged or not edged,
finished or unfinished, thermoformed or not thermoformed, packaged
or unpackaged, and regardless of the type of surface finish.
In addition, quartz surface products are covered by the orders
whether or not they are imported attached to, or in conjunction
with, non-subject merchandise such as sinks, sink bowls, vanities,
cabinets, and furniture. If quartz surface products are imported
attached to, or in conjunction with, such non-subject merchandise,
only the quartz surface product is covered by the scope. Subject
merchandise includes material matching the above description that
has been finished, packaged, or otherwise fabricated in a third
country, including by cutting, polishing, curing, edging,
thermoforming, attaching to, or packaging with another product, or
any other finishing, packaging, or fabrication that would not
otherwise remove the merchandise from the scope of the orders if
performed in the country of manufacture of the quartz surface
products.
The scope of the orders does not cover quarried stone surface
products, such as granite, marble, soapstone, or quartzite.
Specifically excluded from the scope of the orders are crushed glass
surface products. Crushed glass surface products must meet each of
the following criteria to qualify for this exclusion: (1) The
crushed glass content is greater than any other single material, by
actual weight; (2) there are pieces of crushed glass visible across
the surface of the product; (3) at least some of the individual
pieces of crushed glass that are visible across the surface are
larger than one centimeter wide as measured at their widest cross-
section (glass pieces); and (4) the distance between
[[Page 6848]]
any single glass piece and the closest separate glass piece does not
exceed three inches.
The products subject to the scope are currently classified in
the Harmonized Tariff Schedule of the United States (HTSUS) under
the following subheading: 6810.99.0010. Subject merchandise may also
enter under subheadings 6810.11.0010, 6810.11.0070, 6810.19.1200,
6810.19.1400, 6810.19.5000, 6810.91.0000, 6810.99.0080,
6815.99.4070, 2506.10.0010, 2506.10.0050, 2506.20.0010,
2506.20.0080, and 7016.90.10. The HTSUS subheadings set forth above
are provided for convenience and U.S. Customs purposes only. The
written description of the scope of the orders is dispositive.
If we determine that all relevant QSP is subject to the China
Orders, then further analysis under section 781(b) of the Act may be
unnecessary and the circumvention inquiry may be rescinded.
[FR Doc. 2022-02488 Filed 2-4-22; 8:45 am]
BILLING CODE 3510-DS-P
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This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.