[Federal Register Volume 81, Number 123 (Monday, June 27, 2016)]
[Notices]
[Pages 41519-41521]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-15132]
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DEPARTMENT OF COMMERCE
International Trade Administration
[C-570-043]
Countervailing Duty Investigation of Stainless Steel Sheet and
Strip From the People's Republic of China: Preliminary Determination of
Critical Circumstances
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: On February 12, 2016, the Department of Commerce (the
Department) received a countervailing
[[Page 41520]]
duty (CVD) petition concerning imports of stainless steel sheet and
strip (stainless sheet and strip) from the People's Republic of China
(PRC).\1\ On May 6, 2016, the Department received timely allegations
that critical circumstances exist with respect to imports of the
merchandise under investigation.\2\ Based on information provided by
Petitioners, data placed on the record of this investigation by the
mandatory respondent, and data collected by the Department, the
Department preliminarily determines that critical circumstances exist
for imports of stainless sheet and strip from the PRC.
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\1\ See Stainless Steel Sheet and Strip From the People's
Republic of China--Petitions for the Imposition of Antidumping and
Countervailing Duties,'' February 12, 2016 (Petition). The
petitioners for these investigations are AK Steel Corporation,
Allegheny Ludlum, LLC d/b/a ATI Flat Rolled Products, North American
Stainless, and Outokumpu Stainless USA, LLC (collectively,
Petitioners).
\2\ See Letter from Petitioners, ``Antidumping and
Countervailing Duty Investigations of Stainless Steel Sheet and
Strip from the People's Republic of China--Petitioners Allegation of
Critical Circumstances,'' May 6, 2016 (Critical Circumstances
Allegation).
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DATES: Effective on June 27, 2016.
FOR FURTHER INFORMATION CONTACT: Emily Halle, AD/CVD Operations,
Enforcement and Compliance, International Trade Administration, U.S.
Department of Commerce, 14th Street and Constitution Avenue NW.,
Washington, DC 20230; telephone: (202) 482-0176.
SUPPLEMENTARY INFORMATION:
Background
Section 703(e)(1) of the Tariff Act of 1930, as amended (the Act),
provides that the Department will preliminarily determine that critical
circumstances exist in CVD investigations if there is a reasonable
basis to believe or suspect: (A) That ``the alleged countervailable
subsidy'' is inconsistent with the Subsidies and Countervailing
Measures (SCM) Agreement of the World Trade Organization, and (B) that
there have been massive imports of the subject merchandise over a
relatively short period. Section 19 CFR 351.206 provides that imports
must increase by at least 15 percent during the ``relatively short
period'' to be considered ``massive'' and defines a ``relatively short
period'' as normally being the period beginning on the date the
proceeding begins (i.e., the date the petition is filed) and ending at
least three months later.\3\ The regulations also provide, however,
that, if the Department finds that importers, or exporters or
producers, had reason to believe, at some time prior to the beginning
of the proceeding, that a proceeding was likely, the Department may
consider a period of not less than three months from that earlier
time.\4\
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\3\ See 19 CFR 351.206(i).
\4\ Id.
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On March 25, 2016, the Department selected Ningbo Baoxin Stainless
Steel Co., Ltd. (Ningbo Baoxin) and Shanxi Taigang Stainless Steel Co.
Ltd. (Taigang) as mandatory respondents.\5\ Since Ningbo Baoxin has not
participated in this proceeding, we selected Daming International
Import Export Co Ltd (Daming) as an additional mandatory respondent on
May 5, 2016.\6\ Daming has not participated in this proceeding.
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\5\ See Memorandum, ``Countervailing Duty Investigation of
Stainless Steel Sheet and Strip from the People's Republic of China:
Respondent Selection,'' March 25, 2016.
\6\ See Memorandum, ``Countervailing Duty Investigation of
Stainless Steel Sheet and Strip From the People's Republic of China:
Second Analysis Regarding Respondent Selection,'' May 5, 2016.
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Alleged Countervailable Subsidies Are Inconsistent With the SCM
Agreement
To determine whether an alleged countervailable subsidy is
inconsistent with the SCM Agreement, in accordance with section
703(e)(1)(A) of the Act, the Department considered the evidence
currently on the record of this investigation. Specifically, as
determined in our initiation checklist, the following subsidy programs,
alleged in the Petition and supported by information reasonably
available to Petitioners, appear to be either export contingent or
contingent upon the use of domestic goods over imported goods, which
would render them inconsistent with the SCM Agreement: Preferential
Lending to Stainless Sheet and Strip Producers and Exporters Classified
As ``Honorable Enterprises,'' \7\ Export Loans,\8\ Export Credit
Guarantees,\9\ Income Tax Credits for Domestically-Owned Companies
Purchasing Domestically Produced Equipment,\10\ Subsidies for
Development of Famous Brands and China World Top Brands,\11\ and Export
Assistance Grants.\12\ Therefore, the Department preliminarily
determines that there are alleged subsidies in this CVD investigation
that are inconsistent with the SCM Agreement.
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\7\ See PRC CVD Initiation Checklist, March 3, 2016, at 9.
\8\ Id., at 10.
\9\ Id., at 12.
\10\ Id., at 21.
\11\ Id., at 32.
\12\ Id., at 36.
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Massive Imports
In determining whether there are ``massive imports'' over a
``relatively short period,'' pursuant to sections 703(e)(1)(B) and
733(e)(1)(B) of the Act, the Department normally compares the import
volumes of the subject merchandise for at least three months
immediately preceding the filing of the petition (i.e., the ``base
period'') to a comparable period of at least three months following the
filing of the petition (i.e., the ``comparison period''). Imports
normally will be considered massive when imports during the comparison
period have increased by 15 percent or more compared to imports during
the base period.
Petitioners did not provide any argument or evidence pursuant to
CFR 351.206(i), that importers, exporters or producers had a reason to
believe, at some time prior to the filing of the petition, that a
proceeding was likely. Thus, in order to determine whether there has
been a massive surge in imports for the cooperating mandatory
respondent, we have used a comparison period starting with the month
the petition was filed in (i.e., February 2016), up to the most recent
month we have shipping data for on the record (i.e., April 2016). We
then selected a base period with the same number of months, starting in
the month prior to the filing of the petition (i.e., November 2015
through January 2016). Based on this analysis, we preliminarily
determine that Taigang had massive imports.\13\
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\13\ See Memorandum, ``Monthly Shipment Quantity and Value
Analysis for Critical Circumstances Preliminary Determination,''
June 20, 2016.
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For ``all other'' exporters or producers, the Department compared
Global Trade Atlas (GTA) data for the period February through April
(the last month for which GTA data is currently available) with the
proceeding three-month period of November 2015 through January
2016.\14\ We then
[[Page 41521]]
subtracted shipments reported by the cooperating mandatory respondent
from the GTA data. Based on this analysis, we preliminarily determine
that ``all other'' exporters or producers had massive imports.\15\
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\14\ The Department gathered GTA data under the following
harmonized tariff schedule numbers: 7219.13.0031, 7219.13.0051,
7219.13.0071, 7219.13.0081, 7219.14.0030, 7219.14.0065,
7219.14.0090, 7219.23.0030, 7219.23.0060, 7219.24.0030,
7219.24.0060, 7219.32.0005, 7219.32.0020, 7219.32.0025,
7219.32.0035, 7219.32.0036, 7219.32.0038, 7219.32.0042,
7219.32.0044, 7219.32.0045, 7219.32.0060, 7219.33.0005,
7219.33.0020, 7219.33.0025, 7219.33.0035, 7219.33.0036,
7219.33.0038, 7219.33.0042, 7219.33.0044, 7219.33.0045,
7219.33.0070, 7219.33.0080, 7219.34.0005, 7219.34.0020,
7219.34.0025, 7219.34.0030, 7219.34.0035, 7219.34.0050,
7219.35.0005, 7219.35.0015, 7219.35.0030, 7219.35.0035,
7219.35.0050, 7219.90.0010, 7219.90.0020, 7219.90.0025,
7219.90.0060, 7219.90.0080, 7220.12.1000, 7220.12.5000,
7220.20.1010, 7220.20.1015, 7220.20.1060, 7220.20.1080,
7220.20.6005, 7220.20.6010, 7220.20.6015, 7220.20.6060,
7220.20.6080, 7220.20.7005, 7220.20.7010, 7220.20.7015,
7220.20.7060, 7220.20.7080, 7220.90.0010, 7220.90.0015,
7220.90.0060, and 7220.90.0080.
\15\ Id.
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Because we do not have verifiable shipment data from the non-
cooperating mandatory respondents (i.e., those mandatory respondents
that did not respond to the initial questionnaire or who otherwise
indicated their unwillingness to participate in the investigation), we
determined, on the basis of adverse facts available,\16\ that there has
been a massive surge in imports. Accordingly, we preliminarily
determine that the following producers/exporters had massive surges in
imports: Ningbo Baoxin, and Daming.\17\
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\16\ See Section 776 of the Act.
\17\ See Memorandum, ``Monthly Shipment Quantity and Value
Analysis for Critical Circumstances Preliminary Determination,''
dated concurrently with this Federal Register notice.
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Conclusion
Based on the criteria and findings discussed above, we
preliminarily determine that critical circumstances exist with respect
to imports of stainless sheet and strip shipped by Taigang, Ningbo
Baoxin, Daming, and ``all other'' exporters or producers.
Final Critical Circumstances Determination
We will issue a final determination concerning critical
circumstances when we issue our final subsidy determination. All
interested parties will have the opportunity to address this
determination in case briefs to be submitted after completion of the
preliminary CVD determination.
ITC Notification
In accordance with sections 703(f) and 733(f) of the Act, we will
notify the ITC of our determination.
Suspension of Liquidation
In accordance with sections 703(e)(2), because we have
preliminarily found that critical circumstances exist with regard to
imports exported by certain producers and exporters, if we make an
affirmative preliminary determination that countervailable subsidies
have been provided to these same producers/exporters at above de
minimis rates,\18\ we will instruct U.S. Customs and Border Protection
(CBP) to suspend liquidation of all entries of subject merchandise from
these producers/exporters that are entered, or withdrawn from
warehouse, for consumption on or after the date that is 90 days prior
to the effective date of ``provisional measures'' (e.g., the date of
publication in the Federal Register of the notice of an affirmative
preliminary determination that countervailable subsidies have been
provided at above de minimis rates). At such time, we will also
instruct CBP to require a cash deposit equal to the estimated
preliminary subsidy rates reflected in the preliminary determination
published in the Federal Register. This suspension of liquidation will
remain in effect until further notice.
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\18\ The preliminary determinations concerning the provision of
countervailable subsidies is currently scheduled for July 11, 2016.
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This notice is issued and published pursuant to section 777(i) of
the Act and 19 CFR 351.206(c)(2).
Dated: June 20, 2016.
Ronald K. Lorentzen,
Acting Assistant Secretary for Enforcement and Compliance.
[FR Doc. 2016-15132 Filed 6-24-16; 8:45 am]
BILLING CODE 3510-DS-P