Notice2025-05423
Hard Empty Capsules From India: Preliminary Affirmative Countervailing Duty Determination and Alignment of Final Determination With Final Antidumping Duty Determination
Primary source
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Published
March 31, 2025
Issuing agencies
Commerce DepartmentInternational Trade Administration
Abstract
The U.S. Department of Commerce (Commerce) preliminarily determines that countervailable subsidies are being provided to producers and exporters of hard empty capsules (capsules) from India. The period of investigation is April 1, 2023, through March 31, 2024. Interested parties are invited to comment on this preliminary determination.
Full Text
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<title>Federal Register, Volume 90 Issue 60 (Monday, March 31, 2025)</title>
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[Federal Register Volume 90, Number 60 (Monday, March 31, 2025)]
[Notices]
[Pages 14237-14239]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-05423]
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DEPARTMENT OF COMMERCE
International Trade Administration
[C-533-935]
Hard Empty Capsules From India: Preliminary Affirmative
Countervailing Duty Determination and Alignment of Final Determination
With Final Antidumping Duty Determination
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: The U.S. Department of Commerce (Commerce) preliminarily
determines that countervailable subsidies are being provided to
producers and exporters of hard empty capsules (capsules) from India.
The period of investigation is April 1, 2023, through March 31, 2024.
Interested parties are invited to comment on this preliminary
determination.
DATES: Applicable March 31, 2025.
FOR FURTHER INFORMATION CONTACT: Katie Smith or Gorden Struck, AD/CVD
Operations, Office II, Enforcement and Compliance, International Trade
Administration, U.S. Department of Commerce, 1401 Constitution Avenue
NW, Washington, DC 20230; (202) 482-0557 or (202) 482-8151,
respectively.
SUPPLEMENTARY INFORMATION:
Background
On November 20, 2024, Commerce published the notice of initiation
of this countervailing duty (CVD) investigation on capsules from
India.\1\ On January 15, 2025, Commerce postponed the preliminary
determination of this investigation until March 24, 2025.\2\ This
preliminary determination is made in accordance with section 703(b) of
the Tariff Act of 1930, as amended (the Act).
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\1\ See Hard Empty Capsules from Brazil, the People's Republic
of China, India, and the Socialist Republic of Vietnam: Initiation
of Countervailing Duty Investigations, 89 FR 91680 (November 20,
2024) (Initiation Notice).
\2\ See Hard Empty Capsules from Brazil, the People's Republic
of China, India, and the Socialist Republic of Vietnam: Postponement
of Preliminary Determinations in the Countervailing Duty
Investigations, 90 FR 3788 (January 15, 2025).
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For a complete description of the events that followed the
initiation of this investigation, see the Preliminary Decision
Memorandum.\3\ A list of topics discussed in the Preliminary Decision
Memorandum is included as Appendix II in this notice. The Preliminary
Decision Memorandum is a public
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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 <a href="https://access.trade.gov">https://access.trade.gov</a>. In addition, a complete version of the Preliminary
Decision Memorandum can be accessed directly at <a href="https://access.trade.gov/public/FRNoticesListLayout.aspx">https://access.trade.gov/public/FRNoticesListLayout.aspx</a>.
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\3\ See Memorandum, ``Decision Memorandum for the Preliminary
Affirmative Determination of the Countervailing Duty Investigation
of Hard Empty Capsules from India,'' dated concurrently with, and
hereby adopted by, this notice (Preliminary Decision Memorandum).
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Scope of the Investigation
The products covered by this investigation are hard empty capsules
from India. For a complete description of the scope of this
investigation, see Appendix I.
Scope Comments
In accordance with the Preamble to Commerce's regulations,\4\ the
Initiation Notice set aside a period of time for parties to raise
issues regarding product coverage (i.e., scope).\5\ Certain interested
parties commented on the scope of the investigation as it appeared in
the Initiation Notice. For a summary of the scope comments and rebuttal
responses submitted for this preliminary determination, and Commerce's
accompanying preliminary analysis of all comments timely received, see
the Preliminary Scope Decision Memorandum.\6\ Commerce is not
preliminarily modifying the scope language as it appeared in the
Initiation Notice.
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\4\ See Antidumping Duties; Countervailing Duties, Final Rule,
62 FR 27296, 27323 (May 19, 1997) (Preamble).
\5\ See Initiation Notice.
\6\ See Memorandum, ``Less-Than-Fair-Value and Countervailing
Duty Investigations of Hard Empty Capsules from Brazil, the People's
Republic of China, India, and the Socialist Republic of Vietnam:
Scope Comments Decision Memorandum for the Preliminary
Determination,'' dated concurrently with, and hereby adopted by,
this notice (Preliminary Scope Decision Memorandum).
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Methodology
Commerce is conducting this investigation in accordance with
section 701 of the Act. For each of the subsidy programs found
countervailable, Commerce preliminarily determines that there is a
subsidy, i.e., a financial contribution by an ``authority'' that gives
rise to a benefit to the recipient, and that the subsidy is
specific.\7\ For a full description of the methodology underlying our
preliminary determination, see the Preliminary Decision Memorandum.
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\7\ See sections 771(5)(B) and (D) of the Act regarding
financial contribution; section 771(5)(E) of the Act regarding
benefit; and section 771(5A) of the Act regarding specificity.
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Alignment
As noted in the Preliminary Decision Memorandum, in accordance with
section 705(a)(1) of the Act and 19 CFR 351.210(b)(4), Commerce is
aligning the final CVD determination in this investigation with the
final determination in the concurrent less than fair value (LTFV)
investigation of capsules from India, based on a request made by the
petitioner.\8\ Consequently, the final CVD determination will be issued
on the same date as the final LTFV determination, which is currently
scheduled to be issued no later than August 5, 2025, unless postponed.
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\8\ See Petitioner's Letter, ``Lonza's Request to Align Final
Antidumping and Countervailing Duty Determinations,'' dated March
11, 2025.
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All-Others Rate
Sections 703(d) and 705(c)(5)(A) of the Act provide that in the
preliminary determination, Commerce shall determine an estimated all-
others rate for companies not individually examined. This rate shall be
an amount equal to the weighted average of the estimated subsidy rates
established for those companies individually examined, excluding any
zero and de minimis rates and any rates based entirely under section
776 of the Act.
Commerce preliminarily calculated an individual estimated
countervailable subsidy rate for ACG Associated Capsules Private
Limited (ACPL) and its affiliates ACG Pam Pharma Technologies Private
Limited (ACG PAM) and ACG Universal Capsules Private Limited (AUCPL)
(collectively ACG), the only individually examined exporter/producer in
this investigation, which is not zero, de minimis, or based entirely on
facts otherwise available. The countervailable subsidy rate calculated
for ACG is the rate assigned to all-other producers and exporters,
pursuant to section 705(c)(5)(A)(i) of the Act.
Preliminary Determination
Commerce preliminarily determines that the following estimated
countervailable subsidy rates exist: \9\
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\9\ As discussed in the Preliminary Decision Memorandum,
Commerce preliminarily finds ACPL to be cross-owned with the
following companies: (1) ACG PAM; and (2) AUCPL.
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Subsidy rate (percent
Company ad valorem)
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ACG Associated Capsules Private Limited; ACG 9.95
Pam Pharma Technologies Private Limited; ACG
Universal Capsules Private Limited............
All Others..................................... 9.95
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Disclosure
Commerce intends to disclose its calculations and analysis
performed to interested parties in this preliminary determination
within five days of its public announcement, or if there is no public
announcement, within five days of the date of this notice in accordance
with 19 CFR 351.224(b).
Consistent with 19 CFR 351.224(e), Commerce will analyze and, if
appropriate, correct any timely allegations of significant ministerial
errors by amending the preliminary determination. However, consistent
with 19 CFR 351.224(d), Commerce will not consider incomplete
allegations that do not address the significance standard under 19 CFR
351.224(g) following the preliminary determination. Instead, Commerce
will address such allegations in the final determination together with
issues raised in the case briefs or other written comments.
Suspension of Liquidation
In accordance with section 703(d)(1)(B) and (d)(2) of the Act,
Commerce will direct U.S. Customs and Border Protection (CBP) to
suspend liquidation of entries of subject merchandise as described in
the scope of the investigation entered, or withdrawn from warehouse,
for consumption on or after the date of publication of this notice in
the Federal Register. Further, pursuant to 19 CFR 351.205(d), Commerce
will instruct CBP to require a cash deposit equal to the rates
indicated above.
Verification
As provided in section 782(i)(1) of the Act, Commerce intends to
verify the information relied upon in making its final determination.
Public Comment
All interested parties will have the opportunity to submit scope
case and
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rebuttal briefs on the preliminary decision regarding the scope of the
LTFV and CVD investigations. The deadlines to submit scope case and
rebuttal briefs are April 14, 2025, and April 21, 2025, respectively.
For all scope case and rebuttal briefs, parties must file identical
documents simultaneously on the records of all the ongoing LTFV and CVD
capsules investigations. No new factual information or business
proprietary information may be included in either scope case or
rebuttal briefs.
Case briefs or other written comments, excluding scope comments,
may be submitted to the Assistant Secretary for Enforcement and
Compliance no later than seven days after the date on which the last
verification report is issued in this investigation. Rebuttal briefs,
limited to issues raised in the case briefs, may be filed not later
than five days after the date for filing case briefs.\10\ Interested
parties who submit case briefs or rebuttal briefs in this proceeding
must submit: (1) a table of contents listing each issue; and (2) a
table of authorities.\11\
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\10\ See 19 CFR 351.309(d); see also Administrative Protective
Order, Service, and Other Procedures in Antidumping and
Countervailing Duty Proceedings, 88 FR 67069, 67077 (September 29,
2023) (APO and Service Final Rule).
\11\ See 19 351.309(c)(2) and (d)(2).
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As provided under 19 CFR 351.309(c)(2) and (d)(2), in prior
proceedings we have encouraged interested parties to provide an
executive summary of their brief that should be limited to five pages
total, including footnotes. In this investigation, we instead request
that interested parties provide at the beginning of their briefs a
public, executive summary for each issue raised in their briefs.\12\
Further, we request that interested parties limit their public
executive summary of each issue to no more than 450 words, not
including citations. We intend to use the executive summaries as the
basis of the comment summaries included in the issues and decision
memorandum that will accompany the final determination in this
investigation. We request that interested parties include footnotes for
relevant citations in the public executive summary of each issue. Note
that Commerce has amended certain of its requirements pertaining to the
service of documents in 19 CFR 351.303(f).\13\
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\12\ We use the term ``issue'' here to describe an argument that
Commerce would normally address in a comment of the Issues and
Decision Memorandum.
\13\ See APO and Service Final Rule.
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Pursuant to 19 CFR 351.310(c), interested parties who wish to
request a hearing, limited to issues raised in the case and rebuttal
briefs, must submit a written request to the Assistant Secretary for
Enforcement and Compliance, U.S. Department of Commerce within 30 days
after the date of publication of this notice. Requests should contain
the party's name, address, and telephone number, the number of
participants, whether any participant is a foreign national, and a list
of the issues to be discussed. If a request for a hearing is made,
Commerce intends to hold the hearing at a time and date to be
determined. Parties should confirm by telephone the date, time, and
location of the hearing two days before the scheduled date. All
submissions, including case and rebuttal briefs, as well as hearing
requests, should be filed using ACCESS. An electronically-filed
document must be received successfully in its entirety by ACCESS by
5:00 p.m. Eastern Time on the established deadline.
U.S. International Trade Commission Notification
In accordance with section 703(f) of the Act, Commerce will notify
the U.S. International Trade Commission (ITC) of its determination. If
the final determination is affirmative, the ITC will determine before
the later of 120 days after the date of this preliminary determination
or 45 days after the final determination, whether imports of capsules
from India are materially injuring, or threaten material injury to, the
U.S. industry.
Notification to Interested Parties
This determination is issued and published pursuant to sections
703(f) and 777(i) of the Act and 19 CFR 351.205(c).
Dated: March 24, 2025.
Christopher Abbott,
Deputy Assistant Secretary for Policy and Negotiations, performing the
non-exclusive functions and duties of the Assistant Secretary for
Enforcement and Compliance.
Appendix I--Scope of the Investigation
The merchandise subject to the scope of this investigation is
hard empty capsules, which are comprised of two prefabricated,
hollowed cylindrical sections (cap and body). The cap and body
pieces each have one closed and rounded end and one open end, and
are constructed with different or equal diameters at their open
ends.
Hard empty capsules are unfilled cylindrical shells composed of
at least 80 percent by weight of a water soluble polymer that is
considered non-toxic and appropriate for human or animal consumption
by the United States Pharmacopeia--National Formulary (USP-NF), Food
Chemical Codex (FCC), or equivalent standards. The most common
polymer materials in hard empty capsules are gelatin derived from
animal collagen (including, but not limited to, pig, cow, or fish
collagen), hydroxypropyl methylcellulose (HPMC), and pullulan.
Hard empty capsules may also contain water and additives, such
as opacifiers, colorants, processing aids, controlled release
agents, plasticizers, and preservatives. Hard empty capsules may
also be imprinted or otherwise decorated with markings. Hard empty
capsules are covered by the scope of this investigation regardless
of polymer material, additives, transparency, opacity, color,
imprinting, or other markings.
Hard empty capsules are also covered by the scope of this
investigation regardless of their size, weight, length, diameter,
thickness, and filling capacity.
Cap and body pieces of hard empty capsules are covered by the
scope of this investigation regardless of whether they are imported
together or separately, and regardless of whether they are imported
in attached or detached form.
Hard empty capsules covered by the scope of this investigation
are those that disintegrate in water within 2 hours under tests
specified in Chapter 701 of the USP-NF, or equivalent disintegration
tests.
Hard empty capsules are classifiable under subheadings
9602.00.1040 or 9602.00.5010 of the Harmonized Tariff Schedule of
the United States (HTSUS). In addition, hard empty capsules may be
imported under HTSUS subheading 1905.90.9090; gelatin hard empty
capsules may be imported under HTSUS subheading 3503.00.5510; HPMC
hard empty capsules may be imported under HTSUS subheading
3923.90.0080; and pullulan hard empty capsules may be imported under
HTSUS subheading 2106.90.9998. Although the HTSUS subheadings are
provided for convenience and customs purposes, the written
description of the merchandise covered by this investigation is
dispositive.
Appendix II--List of Topics Discussed in the Preliminary Decision
Memorandum
I. Summary
II. Background
III. Injury Test
IV. Subsidies Valuation
V. Loan Benchmarks and Interest Rates
VI. Analysis of Programs
VII. Recommendation
[FR Doc. 2025-05423 Filed 3-28-25; 8:45 am]
BILLING CODE 3510-DS-P
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