Notice2023-23850
Hydrofluorocarbon Blends From the People's Republic of China: Initiation of Circumvention Inquiry on the Antidumping Duty Order
Primary source
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
October 30, 2023
Issuing agencies
Commerce DepartmentInternational Trade Administration
Abstract
In response to a request from the American HFC Coalition, a domestic interested party, the U.S. Department of Commerce (Commerce) is initiating a country-wide circumvention inquiry to determine whether U.S. imports from Mexico of R-410B, which are completed in Mexico using Chinese components and further processed in the United States, are circumventing the antidumping duty (AD) order on hydrofluorocarbon (HFC) blends from the People's Republic of China (China).
Full Text
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<title>Federal Register, Volume 88 Issue 208 (Monday, October 30, 2023)</title>
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[Federal Register Volume 88, Number 208 (Monday, October 30, 2023)]
[Notices]
[Pages 74150-74152]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-23850]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-028]
Hydrofluorocarbon Blends From the People's Republic of China:
Initiation of Circumvention Inquiry on the Antidumping Duty Order
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: In response to a request from the American HFC Coalition, a
domestic interested party, the U.S. Department of Commerce (Commerce)
is initiating a country-wide circumvention inquiry to determine whether
U.S. imports from Mexico of R-410B, which are completed in Mexico using
Chinese components and further processed in the United States, are
circumventing the antidumping duty (AD) order on hydrofluorocarbon
(HFC) blends from the People's Republic of China (China).
DATES: Applicable October 30, 2023.
FOR FURTHER INFORMATION CONTACT: Genevieve Coen or Jerry Xiao, AD/CVD
Operations, Office II, Enforcement and Compliance, International Trade
Administration, U.S. Department of Commerce, 1401 Constitution Avenue
NW, Washington, DC 20230; telephone: (202) 482-3251 or (202) 482-2273,
respectively.
SUPPLEMENTARY INFORMATION:
[[Page 74151]]
Background
On September 22, 2023, pursuant to sections 781(a) of the Tariff
Act of 1930, as amended (the Act) and 19 CFR 351.226(c), the American
HFC Coalition \1\ filed a circumvention inquiry request alleging that
HFC blends completed in Mexico from Chinese components and further
processed in the United States are circumventing the AD order on HFC
blends from Mexico \2\ and, accordingly, should be included within the
scope of the Order.\3\ On October 17, 2023, the American HFC Coalition
responded to our supplemental questionnaire.\4\
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\1\ The American HFC Coalition consists of individual members,
including Arkema, Inc., The Chemours Company FC LLC, Honeywell
International Inc., and Mexichem Fluor Inc. (collectively, domestic
interested parties).
\2\ See Hydrofluorocarbon Blends and Components Thereof from the
People's Republic of China: Antidumping Duty Order, 81 FR 55436
(August 19, 2016) (Order).
\3\ See American HFC Coalition's Letter, ``Request to Initiate
Anti-Circumvention Inquiry with Respect to Imports of R-410B from
Mexico Pursuant to Section 781(a) of the Act,'' dated September 22,
2023.
\4\ See American HFC Coalition's Letter, ``HFC Coalition's
Response to Circumvention Supplemental Questionnaire--R-410B from
Mexico,'' dated October 17, 2023.
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Scope of the Order
The products subject to the Order are HFC blends. HFC blends
covered by the scope of the Order are currently classified in the
Harmonized Tariff Schedule of the United States (HTSUS) at subheadings
3827.61.0000, 3827.63.0000, 3827.64.0000, 3827.65.0000, 3827.68.0000,
3827.69.0000. Although the HTSUS subheadings are provided for
convenience and customs purposes, the written description of the scope
is dispositive. For a full description of the scope the Order, see the
attachment to the Initiation Checklist.\5\
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\5\ See Initiation Checklist, ``Circumvention Initiation
Checklist: Hydrofluorocarbon Blends from the People's Republic of
China,'' dated concurrently with this notice (Initiation Checklist).
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Merchandise Subject to the Circumvention Inquiry
The circumvention inquiry covers R-410B from Mexico that is
completed in Mexico using Chinese R-32 and R-125 and then subsequently
exported to and further processed in the United States into an in-scope
blend (i.e., R-410A).
Initiation of Circumvention Inquiry
Section 351.226(d) of Commerce's regulations states that if
Commerce determines that a request for a circumvention inquiry
satisfies the requirements of 19 CFR 351.226(c), then Commerce ``will
accept the request and initiate a circumvention inquiry.'' Section
351.226(c)(1) of Commerce's regulations, in turn, requires that each
circumvention inquiry request allege ``that the elements necessary for
a circumvention determination under section 781 of the Act exist'' and
be ``accompanied by information reasonably available to the interested
party supporting these allegations.'' The American HFC Coalition
alleged circumvention pursuant to section 781(a) of the Act
(merchandise completed or assembled in the United States).
Section 781(a)(1) of the Act provides that Commerce may find
circumvention of an order when merchandise of the same class or kind
subject to the order is completed or assembled in the United States. In
conducting a circumvention inquiry, under section 781(a)(1) of the Act,
Commerce relies on the following criteria: (A) merchandise sold in the
United States is of the same class or kind as any merchandise that is
the subject of an AD or countervailing duty (CVD) order; (B) such
merchandise sold in the United States is completed or assembled in the
United States from parts or components produced in the foreign country
with respect to which such order or finding applies; (C) the process of
assembly or completion in the United States is minor or insignificant;
and (D) the value of the parts or components referred to in
subparagraph (B) is a significant portion of the total value of the
merchandise.
In determining whether the process of assembly or completion in the
United States is minor or insignificant under section 781(a)(1)(C) of
the Act, section 781(a)(2) of the Act directs Commerce to consider: (A)
the level of investment in the United States; (B) the level of research
and development in the United States; (C) the nature of the production
process in the United States; (D) the extent of production facilities
in the United States; and (E) whether the value of the processing
performed in the United States represents a small proportion of the
value of the merchandise sold in the United States. However, no single
factor, by itself, controls Commerce's determination of whether the
process of assembly or completion in the United States is minor or
insignificant.\6\ Accordingly, it is Commerce's practice to evaluate
each of these five factors as they exist in the United States, and to
reach an affirmative or negative circumvention determination based on
the totality of the circumstances of the particular circumvention
inquiry.\7\
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\6\ See Statement of Administrative Action Accompanying the
Uruguay Round Agreements Act, H.R. Doc. No. 103-316, Vol. 1 (1994),
at 893.
\7\ See Hydrofluorocarbon Blends from the People's Republic of
China: Final Negative Scope Ruling on Gujarat Fluorochemicals Ltd.'s
R-410A Blend; Affirmative Final Determination of Circumvention of
the Antidumping Duty Order by Indian Blends Containing CCC
Components, 85 FR 61930 (October 1, 2020), and accompanying Issues
and Decision Memorandum at 20 (specifying the same in the context of
a section 781(b) inquiry).
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In addition, section 781(a)(3) of the Act sets forth additional
factors to consider in determining whether to include merchandise
assembled or completed in the United States within the scope of an AD
or CVD 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 parts or components is
affiliated with the person who assembles or completes the merchandise
sold in the United States from the parts or components produced in the
foreign country with respect to which the order applies; and (C)
whether imports into the United States of the parts or components
products in such foreign country have increased after the initiation of
the investigation which resulted in the issuance of such order.
Analysis
Based on our analysis of the American HFC Coalition's circumvention
request, Commerce determines that the American HFC Coalition has
satisfied the criteria under 19 CFR 351.226(c) to warrant the
initiation of a circumvention inquiry of the Order. For a full
discussion of the basis for our decision to initiate this circumvention
inquiry, see the Initiation Checklist. As explained in the Initiation
Checklist, the information provided by domestic interested parties
warrants initiating this circumvention inquiry on a country-wide basis.
Commerce has taken this approach in prior circumvention inquiries,
where the facts warranted initiation on a country-wide basis.\8\
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\8\ See, e.g., Hydrofluorocarbon Blends from the People's
Republic of China: Initiation of Circumvention Inquiries on the
Antidumping Duty Order, 88 FR 43275 (July 7, 2023); see also Certain
Corrosion-Resistant Steel Products from the Republic of Korea and
Taiwan: Initiation of Anti-Circumvention Inquiries on the
Antidumping Duty and Countervailing Duty Orders, 83 FR 37785 (August
2, 2018); Carbon 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); and 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).
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[[Page 74152]]
Consistent with the approach in the prior circumvention inquiries
that were initiated on a country-wide basis, Commerce intends to issue
questionnaires to solicit information from producers and exporters in
Mexico, concerning their shipments to the United States and the origin
of any imported HFC blends being further processed into HFC blends
subject to the Order.
Respondent Selection
Commerce intends to base respondent selection on U.S. Customs and
Border and Protection (CBP) data. Commerce intends to place CBP data on
the record within five days of the publication of the initiation
notice. Comments regarding the CBP data and respondent selection should
be submitted within seven days after placement of the CBP data on the
record of this inquiry.
Commerce intends to establish a schedule for questionnaire
responses after respondent selection. A company's failure to completely
respond to Commerce's requests for information may result in the
application of partial or total facts available, pursuant to section
776(a) of the Act, which may include adverse inferences, pursuant to
section 776(b) of the Act.
Suspension of Liquidation
Pursuant to 19 CFR 351.226(l)(1), Commerce will notify CBP of the
initiation of this circumvention inquiry 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 under the Order and to apply the cash deposit rate that
would be applicable if the product was determined to be covered by the
scope of the Order. Should Commerce issue a preliminary or final
circumvention determination, Commerce will follow the suspension of
liquidation rules under 19 CFR 351.226(l)(2)-(4).
Notification to Interested Parties
In accordance with 19 CFR 351.226(d) and section 781(a) of the Act,
Commerce determines that the American HFC Coalition's request for this
circumvention inquiry satisfies the requirements of 19 CFR 351.226(c).
Accordingly, Commerce is notifying all interested parties of the
initiation of this circumvention inquiry to determine whether U.S.
imports from Mexico of R-410B that are completed in Mexico using
Chinese components and then blended into in-scope R-410A in the United
States are circumventing the Order. In addition, we included a
description of the product that is the subject of this inquiry and an
explanation of the reasons for Commerce's decision to initiate this
inquiry as provided above and in the accompanying Initiation Checklist.
In accordance with 19 CFR 351.226(e)(1), Commerce intends to issue its
preliminary determination no later than 150 days from the date of
publication of the notice of initiation of this circumvention inquiry
in the Federal Register.
This notice is published in accordance with section 781(a) of the
Act and 19 CFR 351.226(d)(1)(ii).
Dated: October 23, 2023.
Lisa W. Wang,
Assistant Secretary for Enforcement and Compliance.
[FR Doc. 2023-23850 Filed 10-27-23; 8:45 am]
BILLING CODE 3510-DS-P
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</html>Indexed from Federal Register on October 30, 2023.
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