Aluminum Extrusions From the People's Republic of China: Initiation of Anti-Circumvention Inquiries, 9267-9272 [2018-04390]
Download as PDF
<![CDATA[
Federal Register / Vol. 83, No. 43 / Monday, March 5, 2018 / Notices
764.2(b) charges PROVED. The
undersigned further recommends the
Under Secretary levy a fine in the
amount of 50,000.00 against Respondent
Trilogy; levy a fine in the Amount of
50,000.00 against Respondent Johnson;
and suspended both Trilogy and
Johnson’s exporting privileges for seven
years.
Done and dated this 24th day of January,
2018, Baltimore, MD.
Bruce Tucker Smith,
Administrative Law Judge, United States
Coast Guard.
CERTIFICATE OF SERVICE
I hereby certify that I have served the
foregoing Recommended Decision and
Order Granting Summary Decision on
Remand the following:
Zachary Klein, Esq., Attorney for Bureau
of Industry and Security, Office of
Chief Counsel for Industry and
Security, U.S. Department of
Commerce, Room H–3839, 14th Street
& Constitution Avenue NW,
Washington, D.C. 20230, Email:
zklein@doc.gov, (Electronically and
first class mail).
Trilogy International Associates, Inc.
Attn: William Michael Johnson,
President and General Manager, P.O.
Box 342, Altaville, CA 95221, Email:
mjohnson@trilogy-inc.com,
(Electronically and first class mail).
ALJ Docketing Center, Attention:
Hearing Docket, Clerk 40 South Gay
Street, Room 412, Baltimore, MD
21202–4022, (Hand delivered).
Done and dated this 24th day of January
2018, Baltimore, MD.
Lauren M. Meus,
Hearing Docket Clerk, United States Coast
Guard.
[FR Doc. 2018–04404 Filed 3–2–18; 8:45 am]
BILLING CODE P
DEPARTMENT OF COMMERCE
International Trade Administration
[A–570–967/C–570–968]
Aluminum Extrusions From the
People’s Republic of China: Initiation
of Anti-Circumvention Inquiries
Enforcement & Compliance,
International Trade Administration,
Department of Commerce.
SUMMARY: In response to a request from
the Aluminum Extrusions Fair Trade
Committee (the petitioner), the
Department of Commerce (Commerce) is
initiating anti-circumvention inquiries
to determine whether extruded
aluminum products that are exported
from the Socialist Republic of Vietnam
(Vietnam) by China Zhongwang
Holdings Ltd. and its affiliates
(collectively, Zhongwang) are
circumventing the antidumping duty
(AD) and countervailing duty (CVD)
orders on aluminum extrusions from the
People’s Republic of China (China).
DATES: Applicable March 5, 2018.
FOR FURTHER INFORMATION CONTACT:
Scott Hoefke or Erin Kearney, AD/CVD
Operations, Office VI, Enforcement &
Compliance, International Trade
Administration, U.S. Department of
Commerce, 1401 Constitution Avenue
NW, Washington, DC 20230; telephone:
(202) 482–4947 or (202) 482–0167,
respectively.
SUPPLEMENTARY INFORMATION:
Background
On January 9, 2018, pursuant to
sections 781(b) and (c) and 19 CFR
351.225(h) and (i) of the Tariff Act of
1930, as amended (the Act), the
petitioner requested that Commerce
initiate anti-circumvention inquiries on
imports of certain aluminum extrusions
from Vietnam by Zhongwang.1 In its
request, the petitioner contends that
Zhongwang’s Vietnamese aluminum
extrusions are circumventing the scope
of the Orders,2 because the aluminum
extrusions at issue are Chinese
extrusions being completed in Vietnam
and the processes involved (re-melting
and re-extruding) constitute a minor
alteration. Therefore, the petitioner
requests that Commerce address this
alleged circumvention by initiating both
a ‘‘merchandise completed or assembled
in other foreign countries’’ anticircumvention inquiry pursuant to
section 781(b) of the Act, as well as a
‘‘minor alterations’’ anti-circumvention
inquiry pursuant to section 781(c) of the
Act.3
Scope of the Orders
The merchandise covered by the
Orders is aluminum extrusions which
are shapes and forms, produced by an
extrusion process, made from aluminum
alloys having metallic elements
corresponding to the alloy series
designations published by The
Aluminum Association commencing
with the numbers 1, 3, and 6 (or
sradovich on DSK3GMQ082PROD with NOTICES
AGENCY:
VerDate Sep<11>2014
20:44 Mar 02, 2018
Jkt 244001
1 See Petitioner’s Circumvention Request
‘‘Aluminum Extrusions from the People’s Republic
of China: Request for Anti-Circumvention Inquiry,’’
dated January 9, 2018 (Anti-Circumvention
Request).
2 See Aluminum Extrusions from the People’s
Republic of China: Antidumping Duty Order, 76 FR
30650 (May 26, 2011), and Aluminum Extrusions
from the People’s Republic of China: Countervailing
Duty Order, 76 FR 30653 (May 26, 2011)
(collectively, the Orders).
3 See Anti-Circumvention Request, at 23–50.
PO 00000
Frm 00009
Fmt 4703
Sfmt 4703
9267
proprietary equivalents or other
certifying body equivalents).
Specifically, the subject merchandise
made from aluminum alloy with an
Aluminum Association series
designation commencing with the
number 1 contains not less than 99
percent aluminum by weight. The
subject merchandise made from
aluminum alloy with an Aluminum
Association series designation
commencing with the number 3
contains manganese as the major
alloying element, with manganese
accounting for not more than 3.0
percent of total materials by weight. The
subject merchandise is made from an
aluminum alloy with an Aluminum
Association series designation
commencing with the number 6
contains magnesium and silicon as the
major alloying elements, with
magnesium accounting for at least 0.1
percent but not more than 2.0 percent of
total materials by weight, and silicon
accounting for at least 0.1 percent but
not more than 3.0 percent of total
materials by weight. The subject
aluminum extrusions are properly
identified by a four-digit alloy series
without either a decimal point or
leading letter. Illustrative examples from
among the approximately 160 registered
alloys that may characterize the subject
merchandise are as follows: 1350, 3003,
and 6060.
Aluminum extrusions are produced
and imported in a wide variety of
shapes and forms, including, but not
limited to, hollow profiles, other solid
profiles, pipes, tubes, bars, and rods.
Aluminum extrusions that are drawn
subsequent to extrusion (drawn
aluminum) are also included in the
scope.
Aluminum extrusions are produced
and imported with a variety of finishes
(both coatings and surface treatments),
and types of fabrication. The types of
coatings and treatments applied to
subject aluminum extrusions include,
but are not limited to, extrusions that
are mill finished (i.e., without any
coating or further finishing), brushed,
buffed, polished, anodized (including
brightdip anodized), liquid painted, or
powder coated. Aluminum extrusions
may also be fabricated, i.e., prepared for
assembly. Such operations would
include, but are not limited to,
extrusions that are cut-to-length,
machined, drilled, punched, notched,
bent, stretched, knurled, swedged,
mitered, chamfered, threaded, and spun.
The subject merchandise includes
aluminum extrusions that are finished
(coated, painted, etc.), fabricated, or any
combination thereof.
E:\FR\FM\05MRN1.SGM
05MRN1
sradovich on DSK3GMQ082PROD with NOTICES
9268
Federal Register / Vol. 83, No. 43 / Monday, March 5, 2018 / Notices
Subject aluminum extrusions may be
described at the time of importation as
parts for final finished products that are
assembled after importation, including,
but not limited to, window frames, door
frames, solar panels, curtain walls, or
furniture. Such parts that otherwise
meet the definition of aluminum
extrusions are included in the scope.
The scope includes the aluminum
extrusion components that are attached
(e.g., by welding or fasteners) to form
subassemblies, i.e., partially assembled
merchandise unless imported as part of
the finished goods ‘kit’ defined further
below. The scope does not include the
non-aluminum extrusion components of
subassemblies or subject kits.
Subject extrusions may be identified
with reference to their end use, such as
fence posts, electrical conduits, door
thresholds, carpet trim, or heat sinks
(that do not meet the finished heat sink
exclusionary language below). Such
goods are subject merchandise if they
otherwise meet the scope definition,
regardless of whether they are ready for
use at the time of importation. The
following aluminum extrusion products
are excluded: aluminum extrusions
made from aluminum alloy with an
Aluminum Association series
designations commencing with the
number 2 and containing in excess of
1.5 percent copper by weight; aluminum
extrusions made from aluminum alloy
with an Aluminum Association series
designation commencing with the
number 5 and containing in excess of
1.0 percent magnesium by weight; and
aluminum extrusions made from
aluminum alloy with an Aluminum
Association series designation
commencing with the number 7 and
containing in excess of 2.0 percent zinc
by weight.
The scope also excludes finished
merchandise containing aluminum
extrusions as parts that are fully and
permanently assembled and completed
at the time of entry, such as finished
windows with glass, doors with glass or
vinyl, picture frames with glass pane
and backing material, and solar panels.
The scope also excludes finished goods
containing aluminum extrusions that
are entered unassembled in a ‘‘finished
goods kit.’’ A finished goods kit is
understood to mean a packaged
combination of parts that contains, at
the time of importation, all of the
necessary parts to fully assemble a final
finished good and requires no further
finishing or fabrication, such as cutting
or punching, and is assembled ‘‘as is’’
into a finished product. An imported
product will not be considered a
‘‘finished goods kit’’ and therefore
excluded from the scope of the Orders
VerDate Sep<11>2014
19:25 Mar 02, 2018
Jkt 244001
merely by including fasteners such as
screws, bolts, etc. in the packaging with
an aluminum extrusion product.
The scope also excludes aluminum
alloy sheet or plates produced by other
than the extrusion process, such as
aluminum products produced by a
method of casting. Cast aluminum
products are properly identified by four
digits with a decimal point between the
third and fourth digit. A letter may also
precede the four digits. The following
Aluminum Association designations are
representative of aluminum alloys for
casting: 208.0, 295.0, 308.0, 355.0,
C355.0, 356.0, A356.0, A357.0, 360.0,
366.0, 380.0, A380.0, 413.0, 443.0,
514.0, 518.1, and 712.0. The scope also
excludes pure, unwrought aluminum in
any form.
The scope also excludes collapsible
tubular containers composed of metallic
elements corresponding to alloy code
1080A as designated by the Aluminum
Association where the tubular container
(excluding the nozzle) meets each of the
following dimensional characteristics:
(1) Length of 37 millimeters (‘‘mm’’) or
62 mm, (2) outer diameter of 11.0 mm
or 12.7 mm, and (3) wall thickness not
exceeding 0.13 mm.
Also excluded from the scope of the
Orders are finished heat sinks. Finished
heat sinks are fabricated heat sinks
made from aluminum extrusions the
design and production of which are
organized around meeting certain
specified thermal performance
requirements and which have been
fully, albeit not necessarily
individually, tested to comply with
such requirements.
Imports of the subject merchandise
are provided for under the following
categories of the Harmonized Tariff
Schedule of the United States (HTSUS):
6603.90.8100, 7616.99.51, 8479.89.94,
8481.90.9060, 8481.90.9085,
9031.90.9195, 8424.90.9080,
9405.99.4020, 9031.90.90.95,
7616.10.90.90, 7609.00.00, 7610.10.00,
7610.90.00, 7615.10.30, 7615.10.71,
7615.10.91, 7615.19.10, 7615.19.30,
7615.19.50, 7615.19.70, 7615.19.90,
7615.20.00, 7616.99.10, 7616.99.50,
8479.89.98, 8479.90.94, 8513.90.20,
9403.10.00, 9403.20.00, 7604.21.00.00,
7604.29.10.00, 7604.29.30.10,
7604.29.30.50, 7604.29.50.30,
7604.29.50.60, 7608.20.00.30,
7608.20.00.90, 8302.10.30.00,
8302.10.60.30, 8302.10.60.60,
8302.10.60.90, 8302.20.00.00,
8302.30.30.10, 8302.30.30.60,
8302.41.30.00, 8302.41.60.15,
8302.41.60.45, 8302.41.60.50,
8302.41.60.80, 8302.42.30.10,
8302.42.30.15, 8302.42.30.65,
8302.49.60.35, 8302.49.60.45,
PO 00000
Frm 00010
Fmt 4703
Sfmt 4703
8302.49.60.55, 8302.49.60.85,
8302.50.00.00, 8302.60.90.00,
8305.10.00.50, 8306.30.00.00,
8414.59.60.90, 8415.90.80.45,
8418.99.80.05, 8418.99.80.50,
8418.99.80.60, 8419.90.10.00,
8422.90.06.40, 8473.30.20.00,
8473.30.51.00, 8479.90.85.00,
8486.90.00.00, 8487.90.00.80,
8503.00.95.20, 8508.70.00.00,
8515.90.20.00, 8516.90.50.00,
8516.90.80.50, 8517.70.00.00,
8529.90.73.00, 8529.90.97.60,
8536.90.80.85, 8538.10.00.00,
8543.90.88.80, 8708.29.50.60,
8708.80.65.90, 8803.30.00.60,
9013.90.50.00, 9013.90.90.00,
9401.90.50.81, 9403.90.10.40,
9403.90.10.50, 9403.90.10.85,
9403.90.25.40, 9403.90.25.80,
9403.90.40.05, 9403.90.40.10,
9403.90.40.60, 9403.90.50.05,
9403.90.50.10, 9403.90.50.80,
9403.90.60.05, 9403.90.60.10,
9403.90.60.80, 9403.90.70.05,
9403.90.70.10, 9403.90.70.80,
9403.90.80.10, 9403.90.80.15,
9403.90.80.20, 9403.90.80.41,
9403.90.80.51, 9403.90.80.61,
9506.11.40.80, 9506.51.40.00,
9506.51.60.00, 9506.59.40.40,
9506.70.20.90, 9506.91.00.10,
9506.91.00.20, 9506.91.00.30,
9506.99.05.10, 9506.99.05.20,
9506.99.05.30, 9506.99.15.00,
9506.99.20.00, 9506.99.25.80,
9506.99.28.00, 9506.99.55.00,
9506.99.60.80, 9507.30.20.00,
9507.30.40.00, 9507.30.60.00,
9507.90.60.00, and 9603.90.80.50.
The subject merchandise entered as
parts of other aluminum products may
be classifiable under the following
additional Chapter 76 subheadings:
7610.10, 7610.90, 7615.19, 7615.20, and
7616.99, as well as under other HTSUS
chapters. In addition, fin evaporator
coils may be classifiable under HTSUS
numbers: 8418.99.80.50 and
8418.99.80.60. While HTSUS
subheadings are provided for
convenience and customs purposes, the
written description of the scope of the
Orders is dispositive.
Merchandise Subject to the AntiCircumvention Inquiries
These anti-circumvention inquiries
cover extruded aluminum products that
meet the description of the Orders
exported from Vietnam by Zhongwang.4
4 The petitioner provided names of known, and
potential, entities involved in Zhongwang’s import
and export of Vietnamese aluminum extrusions.
The entities involved in the exportation Vietnamese
aluminum extrusions are Chinese, Mexican,
Singaporean, U.S., and Vietnamese affiliates of
Zhongwang. Through the course of inquiry, we
intend to examine in addition to Zhongwang the
E:\FR\FM\05MRN1.SGM
05MRN1
Federal Register / Vol. 83, No. 43 / Monday, March 5, 2018 / Notices
Commerce intends to consider whether
these inquiries should apply to all
exports of extruded aluminum products
from Vietnam that meet the description
of the Orders.
Allegations Supporting Initiation of
Anti-Circumvention Proceeding:
Merchandise Completed or Assembled
in Other Foreign Countries
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 an order is completed or
assembled in a foreign country other
than the country to which the order
applies. In conducting an anticircumvention inquiry under section
781(b)(1) of the Act, Commerce will
evaluate whether: (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 AD or CVD 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 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) action is appropriate to
prevent evasion of such order or
finding.
A. Merchandise of the Same Class or
Kind
sradovich on DSK3GMQ082PROD with NOTICES
The petitioner claims that the
aluminum extrusions exported to the
United States from Vietnam are the
same class or kind as that covered by
the Orders.5 The petitioner provided
evidence to show that the merchandise
from Vietnam enters the United States
following affiliated companies: Aluminicaste
Fundicion de Mexico (Aluminicaste); Dalian Liwan
Trade Co., Ltd.; Tianjin Boruxin Trading Co., Ltd.;
Dragon Luxe Limited; Perfectus Aluminum Inc,
Perfectus Aluminum Acquisitions LLC Pencheng
Aluminum Enterprise Inc. USA; Transport
Aluminum Inc.; Aluminum Source Inc.; Aluminum
Industrial Inc.; Global Aluminum (USA) Inc.;
Aluminum Shapes, LLC; Century American
Aluminum Inc.; and American Apex Aluminum
Inc.; Global Vietnam Aluminum Co., Ltd. (GVA);
Global Tower Worldwide Ltd. We also intend to
examine whether any Zhongwang’s affiliates are the
producers of the merchandise at issue.
5 See Anti-Circumvention Request, at 25; see also
sections 781(b)(1)(A)(i) and (iii) of the Act.
VerDate Sep<11>2014
19:25 Mar 02, 2018
Jkt 244001
under the same tariff classification as
subject merchandise.6
B. Completion of Merchandise in a
Foreign Country
The petitioner notes that section
781(b)(l)(B)(ii) of the Act requires that
‘‘{Commerce} must also assess whether,
prior to importation into the United
States, the merchandise in the third
country is completed from merchandise
produced in the country subject to the
antidumping or countervailing duty
order.’’ 7 In its request, the petitioner
submitted evidence of Zhongwang’s
long history of using its extensive
network of global affiliates to
circumvent and evade the Orders.
According to the petitioner, Zhongwang
began shipping subject merchandise
from its affiliates in the United States
and China to Vietnam for reprocessing
after Commerce made a scope ruling on
Zhongwang’s pallets.8 The petitioner
also provided information which
indicates that imports into Vietnam, and
imports into the United States, of
aluminum extrusions from Vietnam
significantly increased after the
imposition of the Orders.9
C. Minor or Insignificant Process
The petitioner maintains that the
process for completing Vietnamese
aluminum extrusions from Zhongwang’s
Chinese aluminum extrusions is minor
or insignificant.10 Under section
781(b)(2) of the Act, Commerce
considers the five factors set out below
to determine whether the process of
assembly or completion is minor or
insignificant. The petitioner argues that
processing done in Vietnam is minor
and must be viewed relative to: (1) The
value of the aluminum extrusions
produced in China, (2) the AD/CVD
duties avoided, and (3) the export tax
rebate received from exporting
aluminum extrusions from China to
Vietnam.11
(1) Level of Investment
The petitioner contends that the level
of investment by Zhongwang in
Vietnam is insignificant when compared
to the value of investment in China to
produce the billets and extrusions in the
first place.12 In support of its argument,
the petitioner points to Zhongwang’s
6 See Anti-Circumvention Request, at 25 and
Exhibits 20, and 23.
7 Id. at 25–26 and Exhibits 2, 6, 9, 10, 12 13, and
29.
8 Id. at 26–27 and Exhibits 9, 13, 16, 30, 31, and
32.
9 Id. at 28 and Exhibit 20.
10 Id. at 28.
11 Id. 28–39
12 Id. at 29–30.
PO 00000
Frm 00011
Fmt 4703
Sfmt 4703
9269
2016 financial report which indicates
that the level of investment by
Zhongwang in China consists of 90
aluminum extrusion production lines
and orders for an additional 99
extrusion presses.13 The petitioner also
submitted evidence that Zhongwang
built a ‘‘world-leading’’ aluminum tilt
smelting and casting facility at its
extrusion facility and possesses the
largest customized aluminum extrusions
product die design manufacturing
center in Asia.14 According to the
petitioner, the level of Zhongwang’s
investment in its Vietnamese affiliate
GVA is minimal when compared to
Zhongwang’s total aluminum extrusions
investments across its company and all
of its affiliates.15 Additionally, the
petitioner asserts that Zhongwang’s
level of investment is minimal when
compared to China’s semi-finished
aluminum goods export rebate that it
received on aluminum extrusions
exports from China and the avoidance of
400 percent AD/CVD duties on U.S.
imports.16
(2) Level of Research and Development
The petitioner states that, in
comparison with Zhongwang’s Chinese
operations, the level of research and
development (R&D) in Vietnam is
minimal.17 The petitioner points out
that Zhongwang’s financial reports
indicate that it invested heavily in R&D
in China.18 The petitioner also points to
Zhongwang’s financial reports, which
show an integrated production line and
its 1,288 R&D and quality control
personnel (which account for 7.7
percent of all Zhongwang employees).19
The petitioner also states that,
conversely, Zhongwang’s Vietnamese
operation (as well as those of and other
Vietnamese extruders) consists of
merely re-melting and re-extruding;
neither of which requires unique
technology or significant R&D.20
(3) Nature of Production Process
According to the petitioner, the
production process undertaken by
Vietnamese producers of aluminum
extrusions provides minimal value
added.21 The petitioner points out that
the that the process requires re-melting
the Chinese aluminum extrusions in a
furnace and then pushing the reheated
extrusion through a die for a desired
13 Id.
at 30 and Exhibit 33.
14 Id.
15 Id.
16 Id.
at 30–31 and Exhibit 33.
at 31.
18 Id. at 31 and Exhibit 33.
19 Id.
20 Id.
21 Id. at 32.
17 Id.
E:\FR\FM\05MRN1.SGM
05MRN1
9270
Federal Register / Vol. 83, No. 43 / Monday, March 5, 2018 / Notices
end shape; the costs incurred by
Vietnamese extruders for the process are
labor, energy, and overhead, which
account for allegedly only 8.8 percent of
total extrusion cost.22 In contrast, the
petitioner provides information
suggesting that 90 percent of the cost of
production of aluminum extrusions in
China is the metal material (i.e.,
aluminum ingot, aluminum scrap, and
additional elements) which is extruded
for export to Vietnam.23
(4) Extent of Production Facilities in
Vietnam
The petitioner provided information
indicating that production facilities in
Vietnam are more limited compared to
facilities in China.24 The petitioner
states that Zhongwang is using its
affiliate GVA to keep its Chinese
facilities running at full production and
to continue flooding the world with
extrusions, now from Vietnam.25
(5) Value of Processing in Vietnam
The petitioner asserts that producing
aluminum extrusions in China accounts
for a large percentage of the total value
of the aluminum extrusions reprocessed
in Vietnam.26 Using a cost of production
model with standard consumption rates
and surrogate costs for the production of
billets and extrusions, the petitioner
states that the value of reprocessing
performed in Vietnam is a small fraction
of the value of merchandise shipped to
the United States.27 The petitioner
argues that the vast majority of the value
of the merchandise consists of the
processing done in China and the value
of the aluminum itself. Additionally, the
petitioner argues that, from a qualitative
analysis standpoint, primary direct
material inputs (i.e., Chinese aluminum
extrusions) converted by producers in
Vietnam show no other significant costs
incurred by Vietnamese producers.28
Thus, petitioner concludes that the
value of the merchandise produced in
China comprises the vast majority of
total value of the inquiry merchandise
shipped to the United States.29
sradovich on DSK3GMQ082PROD with NOTICES
D. Additional Factors To Consider in
Determining Whether Action Is
Necessary
Section 781(b)(3) of the Act directs
Commerce to consider additional factors
in determining whether to include
merchandise assembled or completed in
at 32–33 and Exhibits 32 and 34.
at 33 and Exhibits 32 and 34.
24 Id. at 34–35.
25 Id. at 35, and Exhibit 16.
26 Id. at 35.
27 Id. at 35, and Exhibit 35.
28 Id. at 36.
29 Id. at 36–37.
a foreign country within the scope of an
order, such as: ‘‘{1} the pattern of trade,
including sourcing patterns, {2}
whether the manufacturer or exporter of
the merchandise . . . is affiliated with
the person who uses the merchandise
. . . to assemble or complete in the
foreign country the merchandise that is
subsequently imported into the United
States, and {3} whether imports into the
foreign country of the merchandise . . .
have increased after the initiation of the
investigation which resulted in the
issuance of such order or finding.’’
(1) Pattern of Trade
In its request, the petitioner provides
evidence that Vietnam’s imports of
aluminum extrusions from China, as
well as Vietnam’s exports of aluminum
extrusions to the United States, have
surged since the petitions were filed for
the original investigations of aluminum
extrusions from China.30 The petitioner
points to Zhongwang’s 2017 interim
financial report, which reveals that the
‘‘sales volume of {Zhongwang}’s deep
processing business’’ decreased by 80.7
percent compared to the same period in
2016 ‘‘due to the declined sales volume
of deep-processed product exporting to
the United States . . . caused by the
increasingly heating up trade friction in
aluminum industry between U.S. and
China.’’ 31 Thus, the petitioner
concludes that there is a pattern of trade
of Vietnam imports of Chinese
aluminum extrusions and export of
inquiry merchandise which indicates
circumvention of the Orders.
(2) Affiliation
The petitioner provided the following
to support its allegation that GVA is
affiliated with Zhongwang: (1)
Zhongwang’s employees have been
seconded to GVA; 32 (2) containers of
Zhongwang’s aluminum from China can
be traced to GVA in Vietnam; 33 (3) most
of GVA’s imports into Vietnam come
from Zhongwang; 34 (4) GVA is owned
in part by Jacky Cheung, who has been
involved with Zhongwang affiliated
companies PCA/Perfectus and
Alumincaste; 35 and (5) GVA is a
supplier to Zhongwang’s U.S. affiliate
PCA/Perfectus.36 The petitioner
concludes that the evidence supports its
allegation that GVA is affiliated with
Zhongwang in an effort to circumvent
the Orders.
22 Id.
23 Id.
VerDate Sep<11>2014
19:25 Mar 02, 2018
Jkt 244001
30 Id.
at 38.
at 38–39 and Exhibit 36.
32 Id. at 39.
33 Id.
34 Id. at 39–40 and Exhibits 2 and 3.
35 Id. at 40 and Exhibits 2, 3, 10, and 14.
36 Id. at 40 and Exhibits 3 and 16.
31 Id.
PO 00000
Frm 00012
Fmt 4703
Sfmt 4703
(3) Increase of Aluminum Extrusions
Shipments From China to Vietnam After
Initiations of the AD and CVD
Investigations of Aluminum Extrusions
From China
The petitioner presented evidence
indicating that imports of aluminum
extrusions from China to Vietnam have
increased since the initiation of the
investigations of aluminum extrusions
from China.37 No other factual
information on the record contradicts
this claim.
Allegations Supporting Initiation of
Anti-Circumvention Proceeding: Minor
Alterations
Section 781(c)(1) of the Act provides
that Commerce may find circumvention
of an AD or CVD order when products
which are of the class or kind of
merchandise subject to an AD or CVD
order have been ‘‘altered in form or
appearance in minor respects . . .
whether or not included in the same
tariff classification.’’ Section 781(c)(2) of
the Act provides an exception that
‘‘{p}aragraph 1 shall not apply with
respect to altered merchandise if the
administering authority determines that
it would be unnecessary to consider the
altered merchandise within the scope of
the {AD or CVD} order{.}’’
Although the statute is silent as to
what factors to consider in determining
whether alterations are properly
considered ‘‘minor,’’ the legislative
history of this provision indicates there
are certain factors which should be
considered before reaching an anticircumvention determination. In
conducting an anti-circumvention
inquiry under section 781(c) of the Act,
Commerce has generally relied upon
‘‘such criteria as the overall physical
characteristics of the merchandise, the
expectations of the ultimate users, the
use of the merchandise, the channels of
marketing and the cost of any
modification relative to the total value
of the imported product.’’ 38 Commerce
will examine these factors in evaluating
an allegation of minor alteration under
section 781(c) of the Act and 19 CFR
351.225(i). Still, because each case is
highly dependent on the facts on the
record, each must be analyzed in light
of the specific facts. Moreover, although
not specified in the statute, Commerce
has also considered additional factors as
part of its anti-circumvention analysis,
37 Id.
at 40 and Exhibits 17 and 18.
S. Rep. No. 71, 100th Cong., 1st Sess. 100
(1987) (‘‘In applying this provision, the Commerce
Department should apply practical measurements
regarding minor alterations, so that circumvention
can be dealt with effectively, even where such
alterations to an article technically transform it into
a differently designated article’’).
38 See
E:\FR\FM\05MRN1.SGM
05MRN1
Federal Register / Vol. 83, No. 43 / Monday, March 5, 2018 / Notices
including the circumstances under
which the products at issue entered the
United States, and the timing and
quantity of said entries during the
circumvention review period.39
A. Overall Physical Characteristics
The petitioner contends that the
aluminum extrusions being imported
into the United States from Vietnam are
indistinguishable in any meaningful
sense from subject extrusions produced
in China.40 Indeed, the petitioner
provided evidence that the aluminum
‘‘pallets’’ exported from China to GVA
in Vietnam are the same as subject
merchandise as determined by
Commerce in two separate scope
rulings.41 Additionally, the petitioner
provided evidence showing that
aluminum extrusions from Vietnam are
entering the United States under the
same HTS subheadings as subject
Chinese extrusions.42 As such, the
petitioner argues that the only
difference between Chinese aluminum
extrusions and extrusions from Vietnam
is that the extrusions from Vietnam are
being re-extruded from Chinese subject
merchandise.
sradovich on DSK3GMQ082PROD with NOTICES
B. Expectations of the Ultimate Users
The petitioner alleges that the
expectations of the purchasers, and
ultimate use of aluminum extrusions
from Vietnam, are the same as those of
products produced in China.43 The
petitioner cites to Commerce’s scope
ruling on pallets that aluminum
‘‘pallets’’ could not be differentiated
from aluminum extrusions based on
their end use because the ‘‘pallets’’ at
issue were not functional as ordinary
pallets.44 The petitioner avers that the
‘‘pallets’’ (or other extruded aluminum
products that have been re-melted and
re-extruded) would serve the same
39 See, e.g., Brass Sheet and Strip from West
Germany; Negative Preliminary Determination of
Circumvention of Antidumping Duty Order, 55 FR
32655 (August 10, 1990) (Brass Sheet and Strip
from West Germany Prelim), unchanged in Brass
Sheet and Strip from Germany; Negative Final
Determination of Circumvention of Antidumping
Duty Order, 56 FR 65884 (December 19, 1991); see
also Small Diameter Graphite Electrodes from the
People’s Republic of China: Initiation of
Anticircumvention Inquiry, 77 FR 37873, 37876
(June 25, 2012).
40 See Anti-Circumvention Request, at 42.
41 Id. at 42 and Exhibits 2, 3, and 20.
42 Id. at 42 and Exhibit 20.
43 Id. at 43.
44 Id. (citing Memorandum, ‘‘Antidumping and
Countervailing Duty Orders on Aluminum
Extrusions from the People’s Republic of China:
Final Scope Ruling on Certain Aluminum Pallets,’’
dated December 7, 2016; and Memorandum,
‘‘Antidumping and Countervailing Duty Orders on
Aluminum Extrusions from the People’s Republic
of China: Final Scope Ruling on Certain Aluminum
Pallets,’’ dated June 13, 2017).
VerDate Sep<11>2014
19:25 Mar 02, 2018
Jkt 244001
expected end use, because the
underlying aluminum in these
extrusions is exactly the same.45 The
petitioner provided evidence that
aluminum extrusion producers in
Vietnam do not distinguish between
aluminum billet feedstock produced in
one location from another when
marketing their extrusions to the
public.46 Therefore, the petitioner
argues that the end-users of these
products do not distinguish between
those produced entirely in China and
those re-extruded in Vietnam.
C. Channels of Marketing
The petitioner maintains that there is
no difference between the channels of
marketing for aluminum extrusions
from China and for aluminum extrusion
from Vietnam.47 For example, the
petitioner provided evidence that the
marketing pages of companies’ websites
do not differentiate between the
aluminum extrusions produced in
Vietnam and those produced in China
and melted and re-extruded in
Vietnam.48 The petitioner alleges that if
there were a difference between those
extrusions, then one would expect
companies to highlight the difference.49
D. Cost of Modification
The petitioner claims that the cost of
the minor alterations to make aluminum
extrusions in Vietnam is small when
compared to the total cost of production
and the total value of the aluminum
extrusions.50 As discussed above, the
petitioner contends that, since the
Vietnamese producers are only melting
and re-extruding the aluminum, the
production which takes place in
Vietnam amounts to minimal additional
processing.51 The petitioner alleges that
this processing (i.e., re-melting and reextruding) takes place in two steps: (1)
GVA melts the Chinese extrusion into a
billet, and (2) GVA extrudes the billet.52
It claims that GVA avoids the metal
costs of billet production in Vietnam by
simply melting aluminum extrusions
that are already at the desired aluminum
alloy.53 According to the petitioner, this
allows GVA to save over 90 percent of
the cost of producing a billet, which
comprises 80 percent of the cost of
producing an extrusion.54 For that
reason, the petitioner avers that the
45 Id.
at 43.
at 43 and Exhibits 22, 37, and 38.
47 Id. at 44.
48 Id. at 44 and Exhibits 22, 37, and 38.
49 Id. at 44 and Exhibit 22.
50 Id. at 44.
51 Id.
52 Id. at 44–45 and Exhibits 32 and 34.
53 Id. at 44–46 and Exhibits 32 and 34.
54 Id.
9271
remaining processing which takes place
in Vietnam is 10 percent of total
aluminum extrusions; these costs are
broken down between labor, energy, and
additional overhead, and are
insignificant in comparison to the AD/
CVD duties avoided.55
E. Additional Factors To Consider in
Determining Whether Action Is
Necessary
In addition to the factors described
above, Commerce has considered
additional factors in determining
whether a producer or exporter has used
a minor alteration to circumvent an
order.56
i. Circumstance Under Which the
Subject Products Entered the United
States
The petitioner states that, at the
completion of the original
investigations, the China-wide AD/CVD
rate was nearly 400 percent.57
According to the petitioner, these
considerable margins give Zhongwang a
tremendous financial incentive to
circumvent the Orders, thereby not
incurring the costs associated with the
duties levied on the entries of subject
merchandise.58 The petitioner alleges
that Zhongwang has a long history of
evading the Orders.59
ii. Timing of Entries
The petitioner asserts that the timing
of the entries of Vietnamese aluminum
extrusions shows that Zhongwang has
attempted to circumvent the Orders.60
To support its contention, the petitioner
provided import data showing that
aluminum extrusions shipments to
Vietnam from China, and aluminum
extrusion shipments to the United
States from Vietnam, both increased
after the imposition of the Orders in
2011.61
Analysis of the Allegations
Based on our analysis of the
information provided by the petitioner,
Commerce finds that there exists a
sufficient basis to initiate anticircumvention inquiries, pursuant to
sections 781(b) and (c) of the Act.
Commerce will determine whether the
merchandise subject to the inquiries
(identified in the ‘‘Merchandise Subject
to the Anti-Circumvention Inquiries’’
section, above) involves merchandise
46 Id.
PO 00000
Frm 00013
Fmt 4703
Sfmt 4703
55 Id.
at 46–47 and Exhibit 34.
e.g., Brass Sheet and Strip from West
Germany Prelim, 55 FR at 32655, 32658.
57 See Anti-Circumvention Request, at 47–48.
58 Id. at 48.
59 Id.
60 Id.
61 Id. at 48–50 and Exhibits 9, 17, and 20.
56 See,
E:\FR\FM\05MRN1.SGM
05MRN1
9272
Federal Register / Vol. 83, No. 43 / Monday, March 5, 2018 / Notices
either completed or assembled in other
foreign countries which can be
considered subject to the Orders, and/or
represents a minor alteration to subject
merchandise in such minor respects that
it should be subject to the Orders.
Commerce will not order the
suspension of liquidation of entries of
any additional merchandise at this time.
However, in accordance with 19 CFR
351.225(l)(2), if Commerce issues a
preliminary affirmative determination,
we will then instruct U.S. Customs and
Border Protection to suspend
liquidation and require a cash deposit of
estimated duties, at the applicable rate,
for each unliquidated entry of the
merchandise at issue, entered or
withdrawn from warehouse for
consumption, on or after the date of
initiation of the inquiries.
In the event we issue a preliminary
affirmative determination of
circumvention pursuant to section
781(b) of the act (Merchandise
Completed or Assembled in Other
Foreign Countries), we intend to notify
the International Trade Commission, in
accordance with section 781(b)(1) of the
Act and 19 CFR 351.225(f)(7)(i)(B), if
applicable.
Commerce will, following
consultation with interested parties,
establish a schedule for questionnaires
and comments on the issues. Commerce
intends to issue its final determination
within 300 days of this initiation, in
accordance with section 781(f) of the
Act.
This notice is published in
accordance with sections 781(b) and (c)
of the Act and 19 CFR 351.225(h) and
(i).
Dated: February 26, 2018.
Prentiss Lee Smith,
Deputy Assistant Secretary for Policy and
Negotiations.
[FR Doc. 2018–04390 Filed 3–2–18; 8:45 am]
BILLING CODE 3510–DS–P
DEPARTMENT OF COMMERCE
International Trade Administration
[A–570–890]
sradovich on DSK3GMQ082PROD with NOTICES
Wooden Bedroom Furniture From the
People’s Republic of China: Notice of
Covered Merchandise Referral
Enforcement and Compliance,
International Trade Administration,
Department of Commerce.
SUMMARY: Pursuant to the Enforce and
Protect Act of 2015 (EAPA), the
Department of Commerce (Commerce)
received a covered merchandise referral
from U.S. Customs and Border
AGENCY:
VerDate Sep<11>2014
19:25 Mar 02, 2018
Jkt 244001
Protection (CBP) in connection with a
CBP Enforce and Protect Act (EAPA)
investigation concerning the
antidumping duty (AD) order on
wooden bedroom furniture (WBF) from
the People’s Republic of China (China).
In accordance with EAPA, Commerce
intends to determine whether the
merchandise subject to the referral is
covered by the scope of the order and
promptly transmit its determination to
CBP. Commerce is providing notice of
the referral and inviting participation
from interested parties.
DATES: Applicable March 5, 2018.
FOR FURTHER INFORMATION CONTACT:
Ariela Garvett at (202) 482–3609 or
Howard Smith at (202) 482–5193, AD/
CVD Operations Office IV, Enforcement
& Compliance, International Trade
Administration, U.S. Department of
Commerce, 1401 Constitution Avenue
NW, Washington, DC 20230.
SUPPLEMENTARY INFORMATION:
Background
On February 24, 2016, the Trade
Facilitation and Trade Enforcement Act
of 2015 was signed into law, which
contains Title IV-Prevention of Evasion
of Antidumping and Countervailing
Duty Orders (short title ‘‘Enforce and
Protect Act of 2015’’ or ‘‘EAPA’’) (Pub.
L. 114–125, 130 Stat. 122, 155, Feb. 24,
2016). Effective August 22, 2016, section
421 of the EAPA added section 517 to
the Tariff Act of 1930, as amended (the
Act), which establishes a formal process
for CBP to investigate allegations of the
evasion of antidumping and
countervailing duty (AD/CVD) orders.
Section 517(b)(4)(A) of the Act provides
a procedure whereby if, during the
course of an EAPA investigation, CBP is
unable to determine whether the
merchandise at issue is covered
merchandise within the meaning of
section 517(a)(3) of the Act, it shall refer
the matter to Commerce to make such a
determination. Section 517(a)(3) of the
Act defines covered merchandise as
merchandise that is subject to an
antidumping duty order issued under
section 736 of the Act or a
countervailing duty order issued under
section 706 of the Act. Section
517(b)(4)(B) of the Act states that
Commerce, after receiving a covered
merchandise referral from CBP, shall
determine whether the merchandise is
covered merchandise and promptly
transmit its determination to CBP. The
Act does not establish a deadline within
which Commerce must issue its
determination.
On December 22, 2017, Commerce
received a covered merchandise referral
from CBP regarding CBP EAPA
PO 00000
Frm 00014
Fmt 4703
Sfmt 4703
Investigation No. 7189 1 which concerns
the AD order on WBF from China.2
Specifically, based on an allegation by
the American Furniture Manufacturers
Committee for Legal Trade, CBP has
requested that Commerce issue a
determination as to whether certain
merchandise imported by Aspects
Furniture International, Inc. is subject to
the AD order on WBF from China:
(1) Desk/Console table with drawers;
(2) Credenza/Trunk Storage/Cabinet
with minibar;
(3) Consoles/Custom Dresser/Console;
and
(4) Bed Bench Base.
Notification to Interested Parties
Commerce is hereby notifying
interested parties that it has received the
covered merchandise referral referenced
above, will begin a new segment of the
proceeding, and intends to issue a
determination regarding whether the
merchandise subject to the referral is
covered merchandise within the
meaning of section 517(a)(3) of the Act.
Additionally, Commerce intends to
provide interested parties with the
opportunity to participate in this
segment of the proceeding, including
through the submission of comments,
and, if appropriate, new factual
information and verification.
Specifically, Commerce will notify
parties on the segment-specific service
list for this segment of the proceeding of
a schedule for comments. In addition,
Commerce may request factual
information from any person to assist in
making its determination and may
verify submissions of factual
information, if Commerce determines
that such verification is appropriate.
Commerce intends to issue a final
determination within 120 days of the
publication of this notice (this deadline
may be extended if it is not practicable
to complete the final determination
within 120 days), and will promptly
transmit its final determination to CBP
in accordance with section 517(b)(4)(B)
of the Act.
1 See Letter from CBP, ‘‘EAPA Case Number:
7189; Scope Referral Request for merchandise
under EAPA Investigation 7189, imported by
Aspects Furniture International, Inc. and
concerning evasion of the antidumping duty order
on Wooden Bedroom Furniture from the People’s
Republic of China,’’ dated December 22, 2017. This
document and any supporting documents will be
available electronically on Enforcement and
Compliance’s Antidumping Duty and
Countervailing Duty Centralized Electronic Service
System (ACCESS) within five days of publication of
this notice.
2 See Notice of Amended Final Determination of
Sales at Less Than Fair Value and Antidumping
Duty Order: Wooden Bedroom Furniture from the
People’s Republic of China, 70 FR 329 (January 4,
2005).
E:\FR\FM\05MRN1.SGM
05MRN1
]]>Agencies
[Federal Register Volume 83, Number 43 (Monday, March 5, 2018)]
[Notices]
[Pages 9267-9272]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-04390]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-967/C-570-968]
Aluminum Extrusions From the People's Republic of China:
Initiation of Anti-Circumvention Inquiries
AGENCY: Enforcement & Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: In response to a request from the Aluminum Extrusions Fair
Trade Committee (the petitioner), the Department of Commerce (Commerce)
is initiating anti-circumvention inquiries to determine whether
extruded aluminum products that are exported from the Socialist
Republic of Vietnam (Vietnam) by China Zhongwang Holdings Ltd. and its
affiliates (collectively, Zhongwang) are circumventing the antidumping
duty (AD) and countervailing duty (CVD) orders on aluminum extrusions
from the People's Republic of China (China).
DATES: Applicable March 5, 2018.
FOR FURTHER INFORMATION CONTACT: Scott Hoefke or Erin Kearney, AD/CVD
Operations, Office VI, Enforcement & Compliance, International Trade
Administration, U.S. Department of Commerce, 1401 Constitution Avenue
NW, Washington, DC 20230; telephone: (202) 482-4947 or (202) 482-0167,
respectively.
SUPPLEMENTARY INFORMATION:
Background
On January 9, 2018, pursuant to sections 781(b) and (c) and 19 CFR
351.225(h) and (i) of the Tariff Act of 1930, as amended (the Act), the
petitioner requested that Commerce initiate anti-circumvention
inquiries on imports of certain aluminum extrusions from Vietnam by
Zhongwang.\1\ In its request, the petitioner contends that Zhongwang's
Vietnamese aluminum extrusions are circumventing the scope of the
Orders,\2\ because the aluminum extrusions at issue are Chinese
extrusions being completed in Vietnam and the processes involved (re-
melting and re-extruding) constitute a minor alteration. Therefore, the
petitioner requests that Commerce address this alleged circumvention by
initiating both a ``merchandise completed or assembled in other foreign
countries'' anti-circumvention inquiry pursuant to section 781(b) of
the Act, as well as a ``minor alterations'' anti-circumvention inquiry
pursuant to section 781(c) of the Act.\3\
---------------------------------------------------------------------------
\1\ See Petitioner's Circumvention Request ``Aluminum Extrusions
from the People's Republic of China: Request for Anti-Circumvention
Inquiry,'' dated January 9, 2018 (Anti-Circumvention Request).
\2\ See Aluminum Extrusions from the People's Republic of China:
Antidumping Duty Order, 76 FR 30650 (May 26, 2011), and Aluminum
Extrusions from the People's Republic of China: Countervailing Duty
Order, 76 FR 30653 (May 26, 2011) (collectively, the Orders).
\3\ See Anti-Circumvention Request, at 23-50.
---------------------------------------------------------------------------
Scope of the Orders
The merchandise covered by the Orders is aluminum extrusions which
are shapes and forms, produced by an extrusion process, made from
aluminum alloys having metallic elements corresponding to the alloy
series designations published by The Aluminum Association commencing
with the numbers 1, 3, and 6 (or proprietary equivalents or other
certifying body equivalents). Specifically, the subject merchandise
made from aluminum alloy with an Aluminum Association series
designation commencing with the number 1 contains not less than 99
percent aluminum by weight. The subject merchandise made from aluminum
alloy with an Aluminum Association series designation commencing with
the number 3 contains manganese as the major alloying element, with
manganese accounting for not more than 3.0 percent of total materials
by weight. The subject merchandise is made from an aluminum alloy with
an Aluminum Association series designation commencing with the number 6
contains magnesium and silicon as the major alloying elements, with
magnesium accounting for at least 0.1 percent but not more than 2.0
percent of total materials by weight, and silicon accounting for at
least 0.1 percent but not more than 3.0 percent of total materials by
weight. The subject aluminum extrusions are properly identified by a
four-digit alloy series without either a decimal point or leading
letter. Illustrative examples from among the approximately 160
registered alloys that may characterize the subject merchandise are as
follows: 1350, 3003, and 6060.
Aluminum extrusions are produced and imported in a wide variety of
shapes and forms, including, but not limited to, hollow profiles, other
solid profiles, pipes, tubes, bars, and rods. Aluminum extrusions that
are drawn subsequent to extrusion (drawn aluminum) are also included in
the scope.
Aluminum extrusions are produced and imported with a variety of
finishes (both coatings and surface treatments), and types of
fabrication. The types of coatings and treatments applied to subject
aluminum extrusions include, but are not limited to, extrusions that
are mill finished (i.e., without any coating or further finishing),
brushed, buffed, polished, anodized (including brightdip anodized),
liquid painted, or powder coated. Aluminum extrusions may also be
fabricated, i.e., prepared for assembly. Such operations would include,
but are not limited to, extrusions that are cut-to-length, machined,
drilled, punched, notched, bent, stretched, knurled, swedged, mitered,
chamfered, threaded, and spun. The subject merchandise includes
aluminum extrusions that are finished (coated, painted, etc.),
fabricated, or any combination thereof.
[[Page 9268]]
Subject aluminum extrusions may be described at the time of
importation as parts for final finished products that are assembled
after importation, including, but not limited to, window frames, door
frames, solar panels, curtain walls, or furniture. Such parts that
otherwise meet the definition of aluminum extrusions are included in
the scope. The scope includes the aluminum extrusion components that
are attached (e.g., by welding or fasteners) to form subassemblies,
i.e., partially assembled merchandise unless imported as part of the
finished goods `kit' defined further below. The scope does not include
the non-aluminum extrusion components of subassemblies or subject kits.
Subject extrusions may be identified with reference to their end
use, such as fence posts, electrical conduits, door thresholds, carpet
trim, or heat sinks (that do not meet the finished heat sink
exclusionary language below). Such goods are subject merchandise if
they otherwise meet the scope definition, regardless of whether they
are ready for use at the time of importation. The following aluminum
extrusion products are excluded: aluminum extrusions made from aluminum
alloy with an Aluminum Association series designations commencing with
the number 2 and containing in excess of 1.5 percent copper by weight;
aluminum extrusions made from aluminum alloy with an Aluminum
Association series designation commencing with the number 5 and
containing in excess of 1.0 percent magnesium by weight; and aluminum
extrusions made from aluminum alloy with an Aluminum Association series
designation commencing with the number 7 and containing in excess of
2.0 percent zinc by weight.
The scope also excludes finished merchandise containing aluminum
extrusions as parts that are fully and permanently assembled and
completed at the time of entry, such as finished windows with glass,
doors with glass or vinyl, picture frames with glass pane and backing
material, and solar panels. The scope also excludes finished goods
containing aluminum extrusions that are entered unassembled in a
``finished goods kit.'' A finished goods kit is understood to mean a
packaged combination of parts that contains, at the time of
importation, all of the necessary parts to fully assemble a final
finished good and requires no further finishing or fabrication, such as
cutting or punching, and is assembled ``as is'' into a finished
product. An imported product will not be considered a ``finished goods
kit'' and therefore excluded from the scope of the Orders merely by
including fasteners such as screws, bolts, etc. in the packaging with
an aluminum extrusion product.
The scope also excludes aluminum alloy sheet or plates produced by
other than the extrusion process, such as aluminum products produced by
a method of casting. Cast aluminum products are properly identified by
four digits with a decimal point between the third and fourth digit. A
letter may also precede the four digits. The following Aluminum
Association designations are representative of aluminum alloys for
casting: 208.0, 295.0, 308.0, 355.0, C355.0, 356.0, A356.0, A357.0,
360.0, 366.0, 380.0, A380.0, 413.0, 443.0, 514.0, 518.1, and 712.0. The
scope also excludes pure, unwrought aluminum in any form.
The scope also excludes collapsible tubular containers composed of
metallic elements corresponding to alloy code 1080A as designated by
the Aluminum Association where the tubular container (excluding the
nozzle) meets each of the following dimensional characteristics: (1)
Length of 37 millimeters (``mm'') or 62 mm, (2) outer diameter of 11.0
mm or 12.7 mm, and (3) wall thickness not exceeding 0.13 mm.
Also excluded from the scope of the Orders are finished heat sinks.
Finished heat sinks are fabricated heat sinks made from aluminum
extrusions the design and production of which are organized around
meeting certain specified thermal performance requirements and which
have been fully, albeit not necessarily individually, tested to comply
with such requirements.
Imports of the subject merchandise are provided for under the
following categories of the Harmonized Tariff Schedule of the United
States (HTSUS): 6603.90.8100, 7616.99.51, 8479.89.94, 8481.90.9060,
8481.90.9085, 9031.90.9195, 8424.90.9080, 9405.99.4020, 9031.90.90.95,
7616.10.90.90, 7609.00.00, 7610.10.00, 7610.90.00, 7615.10.30,
7615.10.71, 7615.10.91, 7615.19.10, 7615.19.30, 7615.19.50, 7615.19.70,
7615.19.90, 7615.20.00, 7616.99.10, 7616.99.50, 8479.89.98, 8479.90.94,
8513.90.20, 9403.10.00, 9403.20.00, 7604.21.00.00, 7604.29.10.00,
7604.29.30.10, 7604.29.30.50, 7604.29.50.30, 7604.29.50.60,
7608.20.00.30, 7608.20.00.90, 8302.10.30.00, 8302.10.60.30,
8302.10.60.60, 8302.10.60.90, 8302.20.00.00, 8302.30.30.10,
8302.30.30.60, 8302.41.30.00, 8302.41.60.15, 8302.41.60.45,
8302.41.60.50, 8302.41.60.80, 8302.42.30.10, 8302.42.30.15,
8302.42.30.65, 8302.49.60.35, 8302.49.60.45, 8302.49.60.55,
8302.49.60.85, 8302.50.00.00, 8302.60.90.00, 8305.10.00.50,
8306.30.00.00, 8414.59.60.90, 8415.90.80.45, 8418.99.80.05,
8418.99.80.50, 8418.99.80.60, 8419.90.10.00, 8422.90.06.40,
8473.30.20.00, 8473.30.51.00, 8479.90.85.00, 8486.90.00.00,
8487.90.00.80, 8503.00.95.20, 8508.70.00.00, 8515.90.20.00,
8516.90.50.00, 8516.90.80.50, 8517.70.00.00, 8529.90.73.00,
8529.90.97.60, 8536.90.80.85, 8538.10.00.00, 8543.90.88.80,
8708.29.50.60, 8708.80.65.90, 8803.30.00.60, 9013.90.50.00,
9013.90.90.00, 9401.90.50.81, 9403.90.10.40, 9403.90.10.50,
9403.90.10.85, 9403.90.25.40, 9403.90.25.80, 9403.90.40.05,
9403.90.40.10, 9403.90.40.60, 9403.90.50.05, 9403.90.50.10,
9403.90.50.80, 9403.90.60.05, 9403.90.60.10, 9403.90.60.80,
9403.90.70.05, 9403.90.70.10, 9403.90.70.80, 9403.90.80.10,
9403.90.80.15, 9403.90.80.20, 9403.90.80.41, 9403.90.80.51,
9403.90.80.61, 9506.11.40.80, 9506.51.40.00, 9506.51.60.00,
9506.59.40.40, 9506.70.20.90, 9506.91.00.10, 9506.91.00.20,
9506.91.00.30, 9506.99.05.10, 9506.99.05.20, 9506.99.05.30,
9506.99.15.00, 9506.99.20.00, 9506.99.25.80, 9506.99.28.00,
9506.99.55.00, 9506.99.60.80, 9507.30.20.00, 9507.30.40.00,
9507.30.60.00, 9507.90.60.00, and 9603.90.80.50.
The subject merchandise entered as parts of other aluminum products
may be classifiable under the following additional Chapter 76
subheadings: 7610.10, 7610.90, 7615.19, 7615.20, and 7616.99, as well
as under other HTSUS chapters. In addition, fin evaporator coils may be
classifiable under HTSUS numbers: 8418.99.80.50 and 8418.99.80.60.
While HTSUS subheadings are provided for convenience and customs
purposes, the written description of the scope of the Orders is
dispositive.
Merchandise Subject to the Anti-Circumvention Inquiries
These anti-circumvention inquiries cover extruded aluminum products
that meet the description of the Orders exported from Vietnam by
Zhongwang.\4\
[[Page 9269]]
Commerce intends to consider whether these inquiries should apply to
all exports of extruded aluminum products from Vietnam that meet the
description of the Orders.
---------------------------------------------------------------------------
\4\ The petitioner provided names of known, and potential,
entities involved in Zhongwang's import and export of Vietnamese
aluminum extrusions. The entities involved in the exportation
Vietnamese aluminum extrusions are Chinese, Mexican, Singaporean,
U.S., and Vietnamese affiliates of Zhongwang. Through the course of
inquiry, we intend to examine in addition to Zhongwang the following
affiliated companies: Aluminicaste Fundicion de Mexico
(Aluminicaste); Dalian Liwan Trade Co., Ltd.; Tianjin Boruxin
Trading Co., Ltd.; Dragon Luxe Limited; Perfectus Aluminum Inc,
Perfectus Aluminum Acquisitions LLC Pencheng Aluminum Enterprise
Inc. USA; Transport Aluminum Inc.; Aluminum Source Inc.; Aluminum
Industrial Inc.; Global Aluminum (USA) Inc.; Aluminum Shapes, LLC;
Century American Aluminum Inc.; and American Apex Aluminum Inc.;
Global Vietnam Aluminum Co., Ltd. (GVA); Global Tower Worldwide Ltd.
We also intend to examine whether any Zhongwang's affiliates are the
producers of the merchandise at issue.
---------------------------------------------------------------------------
Allegations Supporting Initiation of Anti-Circumvention Proceeding:
Merchandise Completed or Assembled in Other Foreign Countries
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 an order is completed or assembled in a foreign
country other than the country to which the order applies. In
conducting an anti-circumvention inquiry under section 781(b)(1) of the
Act, Commerce will evaluate whether: (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 AD or CVD 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 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) action is appropriate to prevent evasion of such order or
finding.
A. Merchandise of the Same Class or Kind
The petitioner claims that the aluminum extrusions exported to the
United States from Vietnam are the same class or kind as that covered
by the Orders.\5\ The petitioner provided evidence to show that the
merchandise from Vietnam enters the United States under the same tariff
classification as subject merchandise.\6\
---------------------------------------------------------------------------
\5\ See Anti-Circumvention Request, at 25; see also sections
781(b)(1)(A)(i) and (iii) of the Act.
\6\ See Anti-Circumvention Request, at 25 and Exhibits 20, and
23.
---------------------------------------------------------------------------
B. Completion of Merchandise in a Foreign Country
The petitioner notes that section 781(b)(l)(B)(ii) of the Act
requires that ``{Commerce{time} must also assess whether, prior to
importation into the United States, the merchandise in the third
country is completed from merchandise produced in the country subject
to the antidumping or countervailing duty order.'' \7\ In its request,
the petitioner submitted evidence of Zhongwang's long history of using
its extensive network of global affiliates to circumvent and evade the
Orders. According to the petitioner, Zhongwang began shipping subject
merchandise from its affiliates in the United States and China to
Vietnam for reprocessing after Commerce made a scope ruling on
Zhongwang's pallets.\8\ The petitioner also provided information which
indicates that imports into Vietnam, and imports into the United
States, of aluminum extrusions from Vietnam significantly increased
after the imposition of the Orders.\9\
---------------------------------------------------------------------------
\7\ Id. at 25-26 and Exhibits 2, 6, 9, 10, 12 13, and 29.
\8\ Id. at 26-27 and Exhibits 9, 13, 16, 30, 31, and 32.
\9\ Id. at 28 and Exhibit 20.
---------------------------------------------------------------------------
C. Minor or Insignificant Process
The petitioner maintains that the process for completing Vietnamese
aluminum extrusions from Zhongwang's Chinese aluminum extrusions is
minor or insignificant.\10\ Under section 781(b)(2) of the Act,
Commerce considers the five factors set out below to determine whether
the process of assembly or completion is minor or insignificant. The
petitioner argues that processing done in Vietnam is minor and must be
viewed relative to: (1) The value of the aluminum extrusions produced
in China, (2) the AD/CVD duties avoided, and (3) the export tax rebate
received from exporting aluminum extrusions from China to Vietnam.\11\
---------------------------------------------------------------------------
\10\ Id. at 28.
\11\ Id. 28-39
---------------------------------------------------------------------------
(1) Level of Investment
The petitioner contends that the level of investment by Zhongwang
in Vietnam is insignificant when compared to the value of investment in
China to produce the billets and extrusions in the first place.\12\ In
support of its argument, the petitioner points to Zhongwang's 2016
financial report which indicates that the level of investment by
Zhongwang in China consists of 90 aluminum extrusion production lines
and orders for an additional 99 extrusion presses.\13\ The petitioner
also submitted evidence that Zhongwang built a ``world-leading''
aluminum tilt smelting and casting facility at its extrusion facility
and possesses the largest customized aluminum extrusions product die
design manufacturing center in Asia.\14\ According to the petitioner,
the level of Zhongwang's investment in its Vietnamese affiliate GVA is
minimal when compared to Zhongwang's total aluminum extrusions
investments across its company and all of its affiliates.\15\
Additionally, the petitioner asserts that Zhongwang's level of
investment is minimal when compared to China's semi-finished aluminum
goods export rebate that it received on aluminum extrusions exports
from China and the avoidance of 400 percent AD/CVD duties on U.S.
imports.\16\
---------------------------------------------------------------------------
\12\ Id. at 29-30.
\13\ Id. at 30 and Exhibit 33.
\14\ Id.
\15\ Id.
\16\ Id. at 30-31 and Exhibit 33.
---------------------------------------------------------------------------
(2) Level of Research and Development
The petitioner states that, in comparison with Zhongwang's Chinese
operations, the level of research and development (R&D) in Vietnam is
minimal.\17\ The petitioner points out that Zhongwang's financial
reports indicate that it invested heavily in R&D in China.\18\ The
petitioner also points to Zhongwang's financial reports, which show an
integrated production line and its 1,288 R&D and quality control
personnel (which account for 7.7 percent of all Zhongwang
employees).\19\ The petitioner also states that, conversely,
Zhongwang's Vietnamese operation (as well as those of and other
Vietnamese extruders) consists of merely re-melting and re-extruding;
neither of which requires unique technology or significant R&D.\20\
---------------------------------------------------------------------------
\17\ Id. at 31.
\18\ Id. at 31 and Exhibit 33.
\19\ Id.
\20\ Id.
---------------------------------------------------------------------------
(3) Nature of Production Process
According to the petitioner, the production process undertaken by
Vietnamese producers of aluminum extrusions provides minimal value
added.\21\ The petitioner points out that the that the process requires
re-melting the Chinese aluminum extrusions in a furnace and then
pushing the reheated extrusion through a die for a desired
[[Page 9270]]
end shape; the costs incurred by Vietnamese extruders for the process
are labor, energy, and overhead, which account for allegedly only 8.8
percent of total extrusion cost.\22\ In contrast, the petitioner
provides information suggesting that 90 percent of the cost of
production of aluminum extrusions in China is the metal material (i.e.,
aluminum ingot, aluminum scrap, and additional elements) which is
extruded for export to Vietnam.\23\
---------------------------------------------------------------------------
\21\ Id. at 32.
\22\ Id. at 32-33 and Exhibits 32 and 34.
\23\ Id. at 33 and Exhibits 32 and 34.
---------------------------------------------------------------------------
(4) Extent of Production Facilities in Vietnam
The petitioner provided information indicating that production
facilities in Vietnam are more limited compared to facilities in
China.\24\ The petitioner states that Zhongwang is using its affiliate
GVA to keep its Chinese facilities running at full production and to
continue flooding the world with extrusions, now from Vietnam.\25\
---------------------------------------------------------------------------
\24\ Id. at 34-35.
\25\ Id. at 35, and Exhibit 16.
---------------------------------------------------------------------------
(5) Value of Processing in Vietnam
The petitioner asserts that producing aluminum extrusions in China
accounts for a large percentage of the total value of the aluminum
extrusions reprocessed in Vietnam.\26\ Using a cost of production model
with standard consumption rates and surrogate costs for the production
of billets and extrusions, the petitioner states that the value of
reprocessing performed in Vietnam is a small fraction of the value of
merchandise shipped to the United States.\27\ The petitioner argues
that the vast majority of the value of the merchandise consists of the
processing done in China and the value of the aluminum itself.
Additionally, the petitioner argues that, from a qualitative analysis
standpoint, primary direct material inputs (i.e., Chinese aluminum
extrusions) converted by producers in Vietnam show no other significant
costs incurred by Vietnamese producers.\28\ Thus, petitioner concludes
that the value of the merchandise produced in China comprises the vast
majority of total value of the inquiry merchandise shipped to the
United States.\29\
---------------------------------------------------------------------------
\26\ Id. at 35.
\27\ Id. at 35, and Exhibit 35.
\28\ Id. at 36.
\29\ Id. at 36-37.
---------------------------------------------------------------------------
D. Additional Factors To Consider in Determining Whether Action Is
Necessary
Section 781(b)(3) of the Act directs Commerce to consider
additional factors in determining whether to include merchandise
assembled or completed in a foreign country within the scope of an
order, such as: ``{1{time} the pattern of trade, including sourcing
patterns, {2{time} whether the manufacturer or exporter of the
merchandise . . . is affiliated with the person who uses the
merchandise . . . to assemble or complete in the foreign country the
merchandise that is subsequently imported into the United States, and
{3{time} whether imports into the foreign country of the merchandise .
. . have increased after the initiation of the investigation which
resulted in the issuance of such order or finding.''
(1) Pattern of Trade
In its request, the petitioner provides evidence that Vietnam's
imports of aluminum extrusions from China, as well as Vietnam's exports
of aluminum extrusions to the United States, have surged since the
petitions were filed for the original investigations of aluminum
extrusions from China.\30\ The petitioner points to Zhongwang's 2017
interim financial report, which reveals that the ``sales volume of
{Zhongwang{time} 's deep processing business'' decreased by 80.7
percent compared to the same period in 2016 ``due to the declined sales
volume of deep-processed product exporting to the United States . . .
caused by the increasingly heating up trade friction in aluminum
industry between U.S. and China.'' \31\ Thus, the petitioner concludes
that there is a pattern of trade of Vietnam imports of Chinese aluminum
extrusions and export of inquiry merchandise which indicates
circumvention of the Orders.
---------------------------------------------------------------------------
\30\ Id. at 38.
\31\ Id. at 38-39 and Exhibit 36.
---------------------------------------------------------------------------
(2) Affiliation
The petitioner provided the following to support its allegation
that GVA is affiliated with Zhongwang: (1) Zhongwang's employees have
been seconded to GVA; \32\ (2) containers of Zhongwang's aluminum from
China can be traced to GVA in Vietnam; \33\ (3) most of GVA's imports
into Vietnam come from Zhongwang; \34\ (4) GVA is owned in part by
Jacky Cheung, who has been involved with Zhongwang affiliated companies
PCA/Perfectus and Alumincaste; \35\ and (5) GVA is a supplier to
Zhongwang's U.S. affiliate PCA/Perfectus.\36\ The petitioner concludes
that the evidence supports its allegation that GVA is affiliated with
Zhongwang in an effort to circumvent the Orders.
---------------------------------------------------------------------------
\32\ Id. at 39.
\33\ Id.
\34\ Id. at 39-40 and Exhibits 2 and 3.
\35\ Id. at 40 and Exhibits 2, 3, 10, and 14.
\36\ Id. at 40 and Exhibits 3 and 16.
---------------------------------------------------------------------------
(3) Increase of Aluminum Extrusions Shipments From China to Vietnam
After Initiations of the AD and CVD Investigations of Aluminum
Extrusions From China
The petitioner presented evidence indicating that imports of
aluminum extrusions from China to Vietnam have increased since the
initiation of the investigations of aluminum extrusions from China.\37\
No other factual information on the record contradicts this claim.
---------------------------------------------------------------------------
\37\ Id. at 40 and Exhibits 17 and 18.
---------------------------------------------------------------------------
Allegations Supporting Initiation of Anti-Circumvention Proceeding:
Minor Alterations
Section 781(c)(1) of the Act provides that Commerce may find
circumvention of an AD or CVD order when products which are of the
class or kind of merchandise subject to an AD or CVD order have been
``altered in form or appearance in minor respects . . . whether or not
included in the same tariff classification.'' Section 781(c)(2) of the
Act provides an exception that ``{p{time} aragraph 1 shall not apply
with respect to altered merchandise if the administering authority
determines that it would be unnecessary to consider the altered
merchandise within the scope of the {AD or CVD{time} order{.{time} ''
Although the statute is silent as to what factors to consider in
determining whether alterations are properly considered ``minor,'' the
legislative history of this provision indicates there are certain
factors which should be considered before reaching an anti-
circumvention determination. In conducting an anti-circumvention
inquiry under section 781(c) of the Act, Commerce has generally relied
upon ``such criteria as the overall physical characteristics of the
merchandise, the expectations of the ultimate users, the use of the
merchandise, the channels of marketing and the cost of any modification
relative to the total value of the imported product.'' \38\ Commerce
will examine these factors in evaluating an allegation of minor
alteration under section 781(c) of the Act and 19 CFR 351.225(i).
Still, because each case is highly dependent on the facts on the
record, each must be analyzed in light of the specific facts. Moreover,
although not specified in the statute, Commerce has also considered
additional factors as part of its anti-circumvention analysis,
[[Page 9271]]
including the circumstances under which the products at issue entered
the United States, and the timing and quantity of said entries during
the circumvention review period.\39\
---------------------------------------------------------------------------
\38\ See S. Rep. No. 71, 100th Cong., 1st Sess. 100 (1987) (``In
applying this provision, the Commerce Department should apply
practical measurements regarding minor alterations, so that
circumvention can be dealt with effectively, even where such
alterations to an article technically transform it into a
differently designated article'').
\39\ See, e.g., Brass Sheet and Strip from West Germany;
Negative Preliminary Determination of Circumvention of Antidumping
Duty Order, 55 FR 32655 (August 10, 1990) (Brass Sheet and Strip
from West Germany Prelim), unchanged in Brass Sheet and Strip from
Germany; Negative Final Determination of Circumvention of
Antidumping Duty Order, 56 FR 65884 (December 19, 1991); see also
Small Diameter Graphite Electrodes from the People's Republic of
China: Initiation of Anticircumvention Inquiry, 77 FR 37873, 37876
(June 25, 2012).
---------------------------------------------------------------------------
A. Overall Physical Characteristics
The petitioner contends that the aluminum extrusions being imported
into the United States from Vietnam are indistinguishable in any
meaningful sense from subject extrusions produced in China.\40\ Indeed,
the petitioner provided evidence that the aluminum ``pallets'' exported
from China to GVA in Vietnam are the same as subject merchandise as
determined by Commerce in two separate scope rulings.\41\ Additionally,
the petitioner provided evidence showing that aluminum extrusions from
Vietnam are entering the United States under the same HTS subheadings
as subject Chinese extrusions.\42\ As such, the petitioner argues that
the only difference between Chinese aluminum extrusions and extrusions
from Vietnam is that the extrusions from Vietnam are being re-extruded
from Chinese subject merchandise.
---------------------------------------------------------------------------
\40\ See Anti-Circumvention Request, at 42.
\41\ Id. at 42 and Exhibits 2, 3, and 20.
\42\ Id. at 42 and Exhibit 20.
---------------------------------------------------------------------------
B. Expectations of the Ultimate Users
The petitioner alleges that the expectations of the purchasers, and
ultimate use of aluminum extrusions from Vietnam, are the same as those
of products produced in China.\43\ The petitioner cites to Commerce's
scope ruling on pallets that aluminum ``pallets'' could not be
differentiated from aluminum extrusions based on their end use because
the ``pallets'' at issue were not functional as ordinary pallets.\44\
The petitioner avers that the ``pallets'' (or other extruded aluminum
products that have been re-melted and re-extruded) would serve the same
expected end use, because the underlying aluminum in these extrusions
is exactly the same.\45\ The petitioner provided evidence that aluminum
extrusion producers in Vietnam do not distinguish between aluminum
billet feedstock produced in one location from another when marketing
their extrusions to the public.\46\ Therefore, the petitioner argues
that the end-users of these products do not distinguish between those
produced entirely in China and those re-extruded in Vietnam.
---------------------------------------------------------------------------
\43\ Id. at 43.
\44\ Id. (citing Memorandum, ``Antidumping and Countervailing
Duty Orders on Aluminum Extrusions from the People's Republic of
China: Final Scope Ruling on Certain Aluminum Pallets,'' dated
December 7, 2016; and Memorandum, ``Antidumping and Countervailing
Duty Orders on Aluminum Extrusions from the People's Republic of
China: Final Scope Ruling on Certain Aluminum Pallets,'' dated June
13, 2017).
\45\ Id. at 43.
\46\ Id. at 43 and Exhibits 22, 37, and 38.
---------------------------------------------------------------------------
C. Channels of Marketing
The petitioner maintains that there is no difference between the
channels of marketing for aluminum extrusions from China and for
aluminum extrusion from Vietnam.\47\ For example, the petitioner
provided evidence that the marketing pages of companies' websites do
not differentiate between the aluminum extrusions produced in Vietnam
and those produced in China and melted and re-extruded in Vietnam.\48\
The petitioner alleges that if there were a difference between those
extrusions, then one would expect companies to highlight the
difference.\49\
---------------------------------------------------------------------------
\47\ Id. at 44.
\48\ Id. at 44 and Exhibits 22, 37, and 38.
\49\ Id. at 44 and Exhibit 22.
---------------------------------------------------------------------------
D. Cost of Modification
The petitioner claims that the cost of the minor alterations to
make aluminum extrusions in Vietnam is small when compared to the total
cost of production and the total value of the aluminum extrusions.\50\
As discussed above, the petitioner contends that, since the Vietnamese
producers are only melting and re-extruding the aluminum, the
production which takes place in Vietnam amounts to minimal additional
processing.\51\ The petitioner alleges that this processing (i.e., re-
melting and re-extruding) takes place in two steps: (1) GVA melts the
Chinese extrusion into a billet, and (2) GVA extrudes the billet.\52\
It claims that GVA avoids the metal costs of billet production in
Vietnam by simply melting aluminum extrusions that are already at the
desired aluminum alloy.\53\ According to the petitioner, this allows
GVA to save over 90 percent of the cost of producing a billet, which
comprises 80 percent of the cost of producing an extrusion.\54\ For
that reason, the petitioner avers that the remaining processing which
takes place in Vietnam is 10 percent of total aluminum extrusions;
these costs are broken down between labor, energy, and additional
overhead, and are insignificant in comparison to the AD/CVD duties
avoided.\55\
---------------------------------------------------------------------------
\50\ Id. at 44.
\51\ Id.
\52\ Id. at 44-45 and Exhibits 32 and 34.
\53\ Id. at 44-46 and Exhibits 32 and 34.
\54\ Id.
\55\ Id. at 46-47 and Exhibit 34.
---------------------------------------------------------------------------
E. Additional Factors To Consider in Determining Whether Action Is
Necessary
In addition to the factors described above, Commerce has considered
additional factors in determining whether a producer or exporter has
used a minor alteration to circumvent an order.\56\
---------------------------------------------------------------------------
\56\ See, e.g., Brass Sheet and Strip from West Germany Prelim,
55 FR at 32655, 32658.
---------------------------------------------------------------------------
i. Circumstance Under Which the Subject Products Entered the United
States
The petitioner states that, at the completion of the original
investigations, the China-wide AD/CVD rate was nearly 400 percent.\57\
According to the petitioner, these considerable margins give Zhongwang
a tremendous financial incentive to circumvent the Orders, thereby not
incurring the costs associated with the duties levied on the entries of
subject merchandise.\58\ The petitioner alleges that Zhongwang has a
long history of evading the Orders.\59\
---------------------------------------------------------------------------
\57\ See Anti-Circumvention Request, at 47-48.
\58\ Id. at 48.
\59\ Id.
---------------------------------------------------------------------------
ii. Timing of Entries
The petitioner asserts that the timing of the entries of Vietnamese
aluminum extrusions shows that Zhongwang has attempted to circumvent
the Orders.\60\ To support its contention, the petitioner provided
import data showing that aluminum extrusions shipments to Vietnam from
China, and aluminum extrusion shipments to the United States from
Vietnam, both increased after the imposition of the Orders in 2011.\61\
---------------------------------------------------------------------------
\60\ Id.
\61\ Id. at 48-50 and Exhibits 9, 17, and 20.
---------------------------------------------------------------------------
Analysis of the Allegations
Based on our analysis of the information provided by the
petitioner, Commerce finds that there exists a sufficient basis to
initiate anti-circumvention inquiries, pursuant to sections 781(b) and
(c) of the Act. Commerce will determine whether the merchandise subject
to the inquiries (identified in the ``Merchandise Subject to the Anti-
Circumvention Inquiries'' section, above) involves merchandise
[[Page 9272]]
either completed or assembled in other foreign countries which can be
considered subject to the Orders, and/or represents a minor alteration
to subject merchandise in such minor respects that it should be subject
to the Orders.
Commerce will not order the suspension of liquidation of entries of
any additional merchandise at this time. However, in accordance with 19
CFR 351.225(l)(2), if Commerce issues a preliminary affirmative
determination, we will then instruct U.S. Customs and Border Protection
to suspend liquidation and require a cash deposit of estimated duties,
at the applicable rate, for each unliquidated entry of the merchandise
at issue, entered or withdrawn from warehouse for consumption, on or
after the date of initiation of the inquiries.
In the event we issue a preliminary affirmative determination of
circumvention pursuant to section 781(b) of the act (Merchandise
Completed or Assembled in Other Foreign Countries), we intend to notify
the International Trade Commission, in accordance with section
781(b)(1) of the Act and 19 CFR 351.225(f)(7)(i)(B), if applicable.
Commerce will, following consultation with interested parties,
establish a schedule for questionnaires and comments on the issues.
Commerce intends to issue its final determination within 300 days of
this initiation, in accordance with section 781(f) of the Act.
This notice is published in accordance with sections 781(b) and (c)
of the Act and 19 CFR 351.225(h) and (i).
Dated: February 26, 2018.
Prentiss Lee Smith,
Deputy Assistant Secretary for Policy and Negotiations.
[FR Doc. 2018-04390 Filed 3-2-18; 8:45 am]
BILLING CODE 3510-DS-P
