Wood Mouldings and Millwork Products From Brazil and the People's Republic of China: Initiation of Less-Than-Fair-Value Investigations, 6502-6508 [2020-02155]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 85, Number 24 (Wednesday, February 5, 2020)]
[Notices]
[Pages 6502-6508]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-02155]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-351-853, A-570-117]


Wood Mouldings and Millwork Products From Brazil and the People's 
Republic of China: Initiation of Less-Than-Fair-Value Investigations

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.

DATES: Applicable January 28, 2020.

FOR FURTHER INFORMATION CONTACT: George Ayache at (202) 482-2623 
(Brazil); Michael Bowen at (202) 482-0768 (the People's Republic of 
China (China)); AD/CVD Operations, Enforcement and Compliance, 
International Trade Administration, U.S. Department of Commerce, 1401 
Constitution Avenue NW, Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

The Petitions

    On January 8, 2020, the U.S. Department of Commerce (Commerce) 
received antidumping duty (AD) petitions concerning imports of wood 
mouldings and millwork products (millwork products) from Brazil and 
China.\1\ The AD Petitions were filed in proper form by the Coalition 
of American Millwork Producers (the petitioner or the Coalition).\2\ 
The AD Petitions were accompanied by the countervailing duty (CVD) 
petition concerning imports of millwork products from China.
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    \1\ See Petitioner's Letter, ``Wood Mouldings and Millwork 
Products from Brazil and the People's Republic of China: Petitions 
for the Imposition of Antidumping and Countervailing Duties,'' dated 
January 8, 2020 (the AD Petitions).
    \2\ The Coalition of American Millwork Producers is comprised of 
Bright Wood Corporation, Cascade Wood Products, Inc., Endura 
Products, Inc., Sierra Pacific Industries, Sunset Moulding, 
Woodgrain Millwork Inc., and Yuba River Moulding.
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    On January 10, 13, 17, and 21, 2020, Commerce requested 
supplemental

[[Page 6503]]

information pertaining to certain aspects of the AD Petitions in 
separate supplemental questionnaires and phone calls with the 
petitioner.\3\ Responses to the supplemental questionnaires were filed 
on January 15, 16, and 22, 2020.\4\
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    \3\ See Commerce's Letters, ``Petitions for the Imposition of 
Antidumping Duties on Imports of Wood Mouldings and Millwork 
Products from Brazil and the People's Republic of China and 
Countervailing Duties on Imports of Wood Mouldings and Millwork 
Products from the People's Republic of China: Supplemental 
Questions;'' dated January 10, 2020; ``Petition for the Imposition 
of Antidumping Duties on Imports of Wood Mouldings and Millwork 
Products from Brazil: Supplemental Questions;'' dated January 13, 
2020; ``Petition for the Imposition of Antidumping Duties on Imports 
of Wood Mouldings and Millwork Products from the People's Republic 
of China: Supplemental Questions,'' dated January 13, 2020. See also 
Memorandum, ``January 21, 2020 Phone Call with Counsel for Coalition 
of American Millwork Producers,'' dated January 21, 2020; and 
Memorandum, ``Phone Call with Counsel to the Petitioner,'' dated 
January 22, 2020 (Scope Phone Call Memo).
    \4\ See Petitioner's Letters, ``Wood Mouldings and Millwork 
Products from Brazil and the People's Republic of China: Responses 
to First Supplemental Questionnaire on General Issues Volume I of 
the Petition,'' dated January 15, 2020 (General Issues Supplement); 
``Wood Mouldings and Millwork Products from Brazil: Responses to 
First Supplemental Questionnaire on Brazil AD Volume II of the 
Petition,'' dated January 16, 2020; ``Wood Mouldings and Millwork 
Products from the People's Republic of China: Responses to First 
Supplemental Questions on China AD Volume III of the Petition,'' 
dated January 16, 2020; ``Wood Mouldings and Millwork Products from 
Brazil and the People's Republic of China: Responses to Second 
Supplemental Questionnaire on General Issues Volume I of the 
Petition,'' dated January 22, 2020 (Second General Issues 
Supplement); ``Wood Mouldings and Millwork Products from Brazil: 
Responses to First Supplemental Questions on Brazil AD Volume II of 
the Petition,'' dated January 22, 2020; and ``Wood Mouldings and 
Millwork Products from the People's Republic of China: Responses to 
First Supplemental Questions on China AD Volume III of the 
Petition,'' dated January 22, 2020.
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    In accordance with section 732(b) of the Tariff Act of 1930, as 
amended (the Act), the petitioner alleges that imports of millwork 
products from Brazil and China are being, or are likely to be, sold in 
the United States at less than fair value (LTFV) within the meaning of 
section 731 of the Act, and that such imports are materially injuring, 
or threatening material injury to, the domestic industry producing 
millwork products in the United States. Consistent with section 
732(b)(1) of the Act, the AD Petitions are accompanied by information 
reasonably available to the petitioner supporting its allegations.
    Commerce finds that the petitioner filed the AD Petitions on behalf 
of the domestic industry, because the Coalition is an interested party 
under section 771(9)(F) of the Act. Commerce also finds that the 
petitioner demonstrated sufficient industry support with respect to the 
initiation of the requested AD investigations.\5\
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    \5\ See infra, section on ``Determination of Industry Support 
for the AD Petitions.''
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Periods of Investigation

    Because the AD Petitions were filed on January 8, 2020, pursuant to 
19 CFR 351.204(b)(1), the period of investigation (POI) for the Brazil 
investigation is January 1, 2019 through December 31, 2019. Because 
China is a non-market economy (NME) country, pursuant to 19 CFR 
351.204(b)(1), the POI for the China investigation is July 1, 2019 
through December 31, 2019.

Scope of the Investigations

    The products covered by these investigations are millwork products 
from Brazil and China. For a full description of the scope of these 
investigations, see the appendix to this notice.

Scope Comments

    During our review of the AD Petitions, we contacted the petitioner 
regarding the proposed scope to ensure that the scope language in the 
AD Petitions is an accurate reflection of the products for which the 
domestic industry is seeking relief.\6\ As a result, the scope of the 
AD Petitions was modified to clarify the description of the merchandise 
covered by the AD Petitions. The description of the merchandise covered 
by these investigations, as described in the appendix to this notice, 
reflects these clarifications.
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    \6\ See Scope Phone Call Memo; see also General Issues 
Supplement at 2-11; and Second General Issues Supplement at 1-6.
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    As discussed in the Preamble to Commerce's regulations, we are 
setting aside a period for interested parties to raise issues regarding 
product coverage (scope).\7\ Commerce will consider all comments 
received from interested parties and, if necessary, will consult with 
interested parties prior to the issuance of the preliminary 
determinations. If scope comments include factual information,\8\ all 
such factual information should be limited to public information. To 
facilitate preparation of its questionnaires, Commerce requests that 
all interested parties submit scope comments by 5:00 p.m. Eastern Time 
(ET) on February 18, 2020, which is the next business day after 20 
calendar days from the signature date of this notice.\9\ Any rebuttal 
comments, which may include factual information, must be filed by 5:00 
p.m. ET on February 28, 2020, which is 10 calendar days from the 
initial comment deadline.\10\
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    \7\ See Antidumping Duties; Countervailing Duties, Final Rule, 
62 FR 27296, 27323 (May 19, 1997) (Preamble).
    \8\ See 19 CFR 351.102(b)(21) (defining ``factual 
information'').
    \9\ The current deadline for scope comments falls on Monday, 
February 17, 2020, which is a federal holiday. Therefore, in 
accordance with our Next Business Day Rule, the deadline is moved to 
Tuesday, February 18, 2020. See Notice of Clarification: Application 
of ``Next Business Day'' Rule for Administrative Determination 
Deadlines Pursuant to the Tariff Act of 1930, As Amended, 70 FR 
24533 (May 10, 2005) (Next Business Day Rule).
    \10\ See 19 CFR 351.303(b).
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    Commerce requests that any factual information parties consider 
relevant to the scope of the investigations be submitted during this 
period. However, if a party subsequently finds that additional factual 
information pertaining to the scope of the investigations may be 
relevant, the party may contact Commerce and request permission to 
submit the additional information. All such submissions must be filed 
on the records of the concurrent AD and CVD investigations.

Filing Requirements

    All submissions to Commerce must be filed electronically via 
Enforcement and Compliance's Antidumping Duty and Countervailing Duty 
Centralized Electronic Service System (ACCESS).\11\ An electronically 
filed document must be received successfully in its entirety by the 
time and date it is due. Documents exempted from the electronic 
submission requirements must be filed manually (i.e., in paper form) 
with Enforcement and Compliance's APO/Dockets Unit, Room 18022, U.S. 
Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 
20230, and stamped with the date and time of receipt by the applicable 
deadlines.
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    \11\ See Antidumping and Countervailing Duty Proceedings: 
Electronic Filing Procedures; Administrative Protective Order 
Procedures, 76 FR 39263 (July 6, 2011); see also Enforcement and 
Compliance; Change of Electronic Filing System Name, 79 FR 69046 
(November 20, 2014), for details of Commerce's electronic filing 
requirements, effective August 5, 2011. Information on help using 
ACCESS can be found at https://access.trade.gov/help.aspx and a 
handbook can be found at https://access.trade.gov/help/Handbook%20on%20Electronic%20Filling%20Procedures.pdf.
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Comments on Product Characteristics

    Commerce is providing interested parties an opportunity to comment 
on the appropriate physical characteristics of millwork products to be 
reported in response to Commerce's AD questionnaires. This information 
will be used to identify the key physical characteristics of the 
subject merchandise in order to report the relevant factors of 
production (FOPs) accurately, as well as to develop

[[Page 6504]]

appropriate product comparison criteria.
    Interested parties may provide any information or comments that 
they feel are relevant to the development of an accurate list of 
physical characteristics. Specifically, they may provide comments as to 
which characteristics are appropriate to use as: (1) General product 
characteristics, and (2) product comparison criteria. We note that it 
is not always appropriate to use all product characteristics as product 
comparison criteria. We base product comparison criteria on meaningful 
commercial differences among products. In other words, although there 
may be some physical product characteristics utilized by manufacturers 
to describe millwork products, it may be that only a select few product 
characteristics take into account commercially meaningful physical 
characteristics. In addition, interested parties may comment on the 
order in which the physical characteristics should be used in matching 
products. Generally, Commerce attempts to list the most important 
physical characteristics first and the least important characteristics 
last.
    In order to consider the suggestions of interested parties in 
developing and issuing the AD questionnaires, all product 
characteristics comments must be filed by 5:00 p.m. ET on February 18, 
2020, which is the next business day after 20 calendar days from the 
signature date of this notice.\12\ Any rebuttal comments must be filed 
by 5:00 p.m. ET on February 28, 2020. All comments and submissions to 
Commerce must be filed electronically using ACCESS, as explained above, 
on the record of each of the AD investigations.
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    \12\ See 19 CFR 351.303(b). The current deadline for product 
characteristics comments falls on Monday, February 17, 2020, which 
is a federal holiday. Therefore, in accordance with our Next 
Business Day Rule, the deadline is moved to Tuesday, February 18, 
2020.
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Determination of Industry Support for the AD Petitions

    Section 732(b)(1) of the Act requires that a petition be filed on 
behalf of the domestic industry. Section 732(c)(4)(A) of the Act 
provides that a petition meets this requirement if the domestic 
producers or workers who support the petition account for: (i) At least 
25 percent of the total production of the domestic like product; and 
(ii) more than 50 percent of the production of the domestic like 
product produced by that portion of the industry expressing support 
for, or opposition to, the petition. Moreover, section 732(c)(4)(D) of 
the Act provides that, if the petition does not establish support of 
domestic producers or workers accounting for more than 50 percent of 
the total production of the domestic like product, Commerce shall: (i) 
Poll the industry or rely on other information in order to determine if 
there is support for the petition, as required by subparagraph (A); or 
(ii) determine industry support using a statistically valid sampling 
method to poll the ``industry.''
    Section 771(4)(A) of the Act defines the ``industry'' as the 
producers as a whole of a domestic like product. Thus, to determine 
whether a petition has the requisite industry support, the statute 
directs Commerce to look to producers and workers who produce the 
domestic like product. The International Trade Commission (ITC), which 
is responsible for determining whether ``the domestic industry'' has 
been injured, must also determine what constitutes a domestic like 
product in order to define the industry. While both Commerce and the 
ITC must apply the same statutory definition regarding the domestic 
like product,\13\ they do so for different purposes and pursuant to a 
separate and distinct authority. In addition, Commerce's determination 
is subject to limitations of time and information. Although this may 
result in different definitions of the like product, such differences 
do not render the decision of either agency contrary to law.\14\
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    \13\ See section 771(10) of the Act.
    \14\ See USEC, Inc. v. United States, 132 F. Supp. 2d 1, 8 (Ct. 
Int'l Trade 2001) (citing Algoma Steel Corp., Ltd. v. United States, 
688 F. Supp. 639, 644 (Ct. Int'l Trade 1988), aff'd 865 F.2d 240 
(Fed. Cir. 1989)).
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    Section 771(10) of the Act defines the domestic like product as ``a 
product which is like, or in the absence of like, most similar in 
characteristics and uses with, the article subject to an investigation 
under this title.'' Thus, the reference point from which the domestic 
like product analysis begins is ``the article subject to an 
investigation'' (i.e., the class or kind of merchandise to be 
investigated, which normally will be the scope as defined in the 
petition).
    With regard to the domestic like product, the petitioner does not 
offer a definition of the domestic like product distinct from the scope 
of the investigations.\15\ Based on our analysis of the information 
submitted on the record, we have determined that millwork products, as 
defined in the scope, constitute a single domestic like product, and we 
have analyzed industry support in terms of that domestic like 
product.\16\
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    \15\ See Volume I of the AD Petitions, at 13-15; see also 
General Issues Supplement, at 11-14.
    \16\ For a discussion of the domestic like product analysis as 
applied to these cases and information regarding industry support, 
see Antidumping Duty Investigation Initiation Checklist: Wood 
Mouldings and Millwork Products from Brazil (Brazil AD Initiation 
Checklist) at Attachment II, Analysis of Industry Support for the 
Antidumping and Countervailing Duty Petitions Covering Wood 
Mouldings and Millwork Products from Brazil and the People's 
Republic of China (Attachment II); see also Antidumping Duty 
Investigation Initiation Checklist: Wood Mouldings and Millwork 
Products from the People's Republic of China (China AD Initiation 
Checklist), at Attachment II. These checklists are dated 
concurrently with this notice and on file electronically via ACCESS. 
Access to documents filed via ACCESS is also available in the 
Central Records Unit, Room B8024 of the main Commerce building.
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    On January 23, 2020, we received comments on industry support from 
Composite Technology International, Inc. (CTI), an importer of the 
subject merchandise.\17\ The petitioner responded to CTI's industry 
support comments on January 27, 2020.\18\
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    \17\ See CTI's Letter, ``Wood Mouldings & Millwork Products from 
Brazil and the People's Republic of China: Pre-Initiation Comments 
on Industry Support,'' dated January 23, 2020.
    \18\ See Petitioner's Letter, ``Wood Mouldings and Millwork 
Products from Brazil and the People's Republic of China: Response to 
Pre-Initiation Comments on Industry Support,'' dated January 27, 
2020.
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    In determining whether the petitioner has standing under section 
732(c)(4)(A) of the Act, we considered the industry support data 
contained in the AD Petitions with reference to the domestic like 
product as defined in the ``Scope of the Investigations,'' in the 
appendix to this notice. To establish industry support, the petitioner 
provided the 2018 production of the domestic like product for the U.S. 
producers that support the AD Petitions.\19\ The petitioner estimated 
the production of the domestic like product for the remaining U.S. 
producers of millwork products based on production information from the 
Moulding and Millwork Producers Association and the Architectural 
Woodwork Institute, as well as estimated production information for 
U.S. producers that are not members of either of these two groups.\20\ 
The petitioner notes that 2019 production data are not yet available 
and contends that 2018 calendar year production data are a reasonable 
estimate of production in 2019.\21\ The petitioner compared the 
production of

[[Page 6505]]

the companies supporting the AD Petitions to the estimated total 
production of the domestic like product for the entire domestic 
industry.\22\ We relied on data provided by the petitioner for purposes 
of measuring industry support.\23\
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    \19\ See Volume I of the AD Petitions, at 2-3 and Exhibits I-3--
I-5; see also General Issues Supplement, at 16 and Exhibits I-Supp-
13 and I-Supp-14.
    \20\ See Volume I of the AD Petitions, at 2-4 and Exhibits I-3, 
I-6, I-7, I-8, and I-9; see also General Issues Supplement, at 16-18 
and Exhibits I-Supp-14--I-Supp-16.
    \21\ See Second General Issues Supplement, at 7-8.
    \22\ See Volume I of the AD Petitions, at 4 and Exhibit I-3; see 
also General Issues Supplement, at 16 and Exhibit I-Supp-14.
    \23\ See Volume I of the AD Petitions, at 2-4 and Exhibits I-3--
I-9; see also General Issues Supplement, at 14-18 and Exhibits I-
Supp-11--I-Supp-16. For further discussion, see Brazil AD Initiation 
Checklist, at Attachment II; see also China AD Initiation Checklist, 
at Attachment II.
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    Our review of the data provided in the AD Petitions, the General 
Issues Supplement, the Second General Issues Supplement, and other 
information readily available to Commerce indicates that the petitioner 
has established industry support for the AD Petitions.\24\ First, the 
AD Petitions established support from domestic producers (or workers) 
accounting for more than 50 percent of the total production of the 
domestic like product and, as such, Commerce is not required to take 
further action in order to evaluate industry support (e.g., 
polling).\25\ Second, the domestic producers (or workers) have met the 
statutory criteria for industry support under section 732(c)(4)(A)(i) 
of the Act because the domestic producers (or workers) who support the 
AD Petitions account for at least 25 percent of the total production of 
the domestic like product.\26\ Finally, the domestic producers (or 
workers) have met the statutory criteria for industry support under 
section 732(c)(4)(A)(ii) of the Act because the domestic producers (or 
workers) who support the AD Petitions account for more than 50 percent 
of the production of the domestic like product produced by that portion 
of the industry expressing support for, or opposition to, the AD 
Petitions.\27\ Accordingly, Commerce determines that the AD Petitions 
were filed on behalf of the domestic industry within the meaning of 
section 732(b)(1) of the Act.\28\
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    \24\ See Brazil AD Initiation Checklist, at Attachment II; see 
also China AD Initiation Checklist, at Attachment II.
    \25\ See section 732(c)(4)(D) of the Act; see also Brazil AD 
Initiation Checklist, at Attachment II; and China AD Initiation 
Checklist, at Attachment II.
    \26\ See Brazil AD Initiation Checklist, at Attachment II; see 
also China AD Initiation Checklist, at Attachment II.
    \27\ Id.
    \28\ Id.
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Allegations and Evidence of Material Injury and Causation

    The petitioner alleges that the U.S. industry producing the 
domestic like product is being materially injured, or is threatened 
with material injury, by reason of the imports of the subject 
merchandise sold at LTFV. In addition, the petitioner alleges that 
subject imports exceed the negligibility threshold provided for under 
section 771(24)(A) of the Act.\29\
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    \29\ See General Issues Supplement, at 18-19 and Exhibit I-Supp-
17.
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    The petitioner contends that the industry's injured condition is 
illustrated by a significant and increasing volume of subject imports; 
reduced market share; underselling and price depression or suppression; 
lost sales and revenues; declining financial performance; a decline in 
the domestic industry's capacity utilization and production and related 
workers; shuttered manufacturing facilities and bankruptcies; and 
actual and potential negative effects on cash flow.\30\ We have 
assessed the allegations and supporting evidence regarding material 
injury, threat of material injury, causation, as well as negligibility, 
and we have determined that these allegations are properly supported by 
adequate evidence, and meet the statutory requirements for 
initiation.\31\
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    \30\ See Volume I of the AD Petitions, at 12-13, 15-26, and 
Exhibits I-13 through I-23.
    \31\ See Brazil AD Initiation Checklist, at Attachment III, 
Analysis of Allegations and Evidence of Material Injury and 
Causation for the Antidumping Duty Petition Covering Wood Mouldings 
and Millwork Products from Brazil and the Republic of China 
(Attachment III); see also China AD Initiation Checklist, at 
Attachment III.
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Allegations of Sales at LTFV

    The following is a description of the allegation of sales at LTFV 
upon which Commerce based its decision to initiate AD investigations of 
imports of millwork products from Brazil and China. The sources of data 
for the deductions and adjustments relating to U.S. price and normal 
value (NV) are discussed in greater detail in the AD Initiation 
Checklist for each country.

Export Price

    For both Brazil and China, the petitioner based export price (EP) 
on price quotes for millwork products produced in, and exported from, 
Brazil and China and offered for sale in the United States during the 
POI.\32\ Where appropriate, the petitioner made deductions from U.S. 
price for foreign brokerage and handling, foreign inland freight, ocean 
freight, marine insurance, U.S. inland freight, U.S. brokerage and 
handling, and U.S. customs duties and fees, consistent with the terms 
of sale, as applicable.\33\
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    \32\ See Brazil AD Initiation Checklist and China AD Initiation 
Checklist.
    \33\ Id.
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Normal Value

    For Brazil, the petitioner obtained home market prices through 
market research for millwork products produced in and sold, or offered 
for sale, in Brazil during the POI. The petitioner calculated net home 
market prices, adjusted as appropriate for Brazilian taxes.\34\ The 
petitioner provided information indicating that the prices were below 
the cost of production (COP) and, therefore, the petitioner calculated 
NV based on constructed value (CV).\35\ For further discussion of COP 
and NV based on CV, see the section ``Normal Value Based on Constructed 
Value'' below.\36\
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    \34\ See Brazil AD Initiation Checklist.
    \35\ Id.
    \36\ In accordance with section 773(b)(2) of the Act, for this 
investigation, Commerce will request information necessary to 
calculate the CV and COP to determine whether there are reasonable 
grounds to believe or suspect that sales of the foreign like product 
have been made at prices less than the COP of the product.
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    With respect to China, Commerce considers China to be an NME 
country.\37\ In accordance with section 771(18)(C)(i) of the Act, the 
presumption of NME status remains in effect until revoked by Commerce. 
Therefore, we continue to treat China as an NME for purposes of the 
initiation of this investigation. Accordingly, NV in China is 
appropriately based on FOPs valued in a surrogate market economy 
country, in accordance with section 773(c) of the Act.\38\
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    \37\ See Antidumping Duty Investigation of Certain Aluminum Foil 
from the People's Republic of China: Affirmative Preliminary 
Determination of Sales at Less-Than-Fair Value and Postponement of 
Final Determination, 82 FR 50858, 50861 (November 2, 2017), and 
accompanying Memorandum, ``China's Status as a Non-Market Economy,'' 
unchanged in Certain Aluminum Foil from the People's Republic of 
China: Final Determination of Sales at Less Than Fair Value, 83 FR 
9282 (March 5, 2018).
    \38\ See China AD Initiation Checklist.
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    The petitioner claims that Brazil is an appropriate surrogate 
country for China, because it is a market economy country that is at a 
level of economic development comparable to that of China and a 
significant producer of comparable merchandise.\39\ Further, public 
information from Brazil is available to value all material input 
factors.\40\ Based on the information provided by the petitioner, we 
determine that it is appropriate to use Brazil as a surrogate country 
for initiation purposes.
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    \39\ See Volume III of the AD Petitions at 10-12.
    \40\ Id. at Exhibit III-22.

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[[Page 6506]]

    Interested parties will have the opportunity to submit comments 
regarding surrogate country selection and, pursuant to 19 CFR 
351.301(c)(3)(i), will be provided an opportunity to submit publicly 
available information to value FOPs within 30 days before the scheduled 
date of the preliminary determination.

Factors of Production

    Because information regarding the volume of inputs consumed by the 
Chinese producers/exporters is not reasonably available, the petitioner 
relied on the production experience of a domestic producer as an 
estimate of Chinese manufacturers' FOPs.\41\ The petitioner valued the 
estimated FOPs using surrogate values from Brazil and used the average 
POI exchange rate to convert the data to U.S. dollars, where 
necessary.\42\
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    \41\ Id. at 12.
    \42\ Id. at 14; see also China AD Initiation Checklist.
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Normal Value Based on Constructed Value

    As noted above, for Brazil, the petitioner obtained home market 
prices but provided information indicating that these prices were below 
the COP during the POI; therefore, the petitioner based NV on CV 
pursuant to section 773(a)(4) of the Act. Pursuant to section 773(e) of 
the Act, CV consists of the cost of manufacturing (COM), selling, 
general, and administrative (SG&A) expenses, financial expenses, 
profit, and packing expenses.
    The petitioner calculated the COM based on a domestic producer's 
production inputs and usage rates for raw materials, labor, energy, and 
packing.\43\ The petitioner valued the production inputs using publicly 
available data on costs specific to Brazil during the POI. 
Specifically, the petitioner based the prices for raw material and 
packing inputs on publicly available import price data for Brazil.\44\ 
The petitioner valued labor and energy costs using publicly available 
sources for Brazil.\45\ The petitioner calculated factory overhead, 
SG&A, financial expenses, and profit for Brazil based on the experience 
of a Brazilian producer of comparable merchandise.\46\
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    \43\ See Brazil AD Initiation Checklist.
    \44\ Id.
    \45\ Id.
    \46\ Id.
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Fair Value Comparisons

    Based on the data provided in the AD Petitions, there is reason to 
believe that imports of millwork products from Brazil and China are 
being, or are likely to be, sold in the United States at LTFV. Based on 
comparisons of EP to NV in accordance with sections 772 and 773 of the 
Act, the estimated dumping margins for millwork products for each of 
the countries covered by this initiation are as follows: (1) Brazil--
86.73 percent; \47\ and (2) China--181.17 and 359.16 percent.\48\
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    \47\ See Brazil AD Initiation Checklist.
    \48\ See China AD Initiation Checklist.
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Initiation of LTFV Investigations

    Based upon the examination of the AD Petitions and supplemental 
responses, we find that the AD Petitions meet the requirements of 
section 732 of the Act. Therefore, we are initiating AD investigations 
to determine whether imports of millwork products from Brazil and China 
are being, or are likely to be, sold in the United States at LTFV. In 
accordance with section 733(b)(1)(A) of the Act and 19 CFR 
351.205(b)(1), unless postponed, we will make our preliminary 
determinations no later than 140 days after the date of this 
initiation.

Respondent Selection

    The petitioner named 27 companies in Brazil as producers/exporters 
of millwork products.\49\ Following standard practice in AD 
investigations involving market economy countries, in the event 
Commerce determines that the number of companies is large and it cannot 
individually examine each company based upon Commerce's resources, 
where appropriate, Commerce intends to select respondents in Brazil 
based on U.S. Customs and Border Protection (CBP) data for U.S. imports 
under the appropriate Harmonized Tariff Schedule of the United States 
(HTSUS) numbers listed with the scope in the appendix, below.\50\
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    \49\ See Volume I of the AD Petitions, at Exhibit I-11.
    \50\ See, e.g., Polyester Textured Yarn from India and the 
People's Republic of China: Initiation of Less-Than-Fair-Value 
Investigations, 83 FR 58223, 58227 (November 19, 2018).
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    On January 24, 2020, Commerce released CBP data on imports of 
millwork products from Brazil under administrative protective order 
(APO) to all parties with access to information protected by APO and 
indicated that interested parties wishing to comment on the CBP data 
must do so within three business days of the publication date of the 
notice of initiation of these investigations. Commerce will not accept 
rebuttal comments regarding the CBP data or respondent selection. 
Interested parties must submit applications for disclosure under APO in 
accordance with 19 CFR 351.305(b). Instructions for filing such 
applications may be found on the Commerce's website at https://enforcement.trade.gov/apo.
    The petitioner named 92 producers/exporters of millwork products in 
China.\51\ In AD investigations involving NME countries, Commerce 
selects respondents based on quantity and value (Q&V) questionnaires in 
cases where it has determined that the number of companies is large and 
it cannot individually examine each company based upon its resources. 
After considering the large number of producers and exporters 
identified in the China AD Petition, and considering the resources that 
must be used by Commerce to mail Q&V questionnaires to all of these 
companies, Commerce has determined that it does not have sufficient 
administrative resources to mail Q&V questionnaires to all 92 
identified producers and exporters. Therefore, Commerce has determined 
to limit the number of Q&V questionnaires it will send out to exporters 
and producers based on CBP data for imports during the POI under the 
appropriate HTSUS numbers listed within the scope in the appendix, 
below. Accordingly, Commerce will send Q&V questionnaires to the 
largest producers and exporters that are identified in the CBP data for 
which there is address information on the record.
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    \51\ See Volume I of the AD Petitions, at Exhibit I-11.
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    In addition, Commerce will post the Q&V questionnaire along with 
filing instructions on the Enforcement and Compliance website at https://www.trade.gov/enforcement/news.asp. In accordance with our standard 
practice for respondent selection in AD cases involving NME countries, 
we intend to base respondent selection on the responses to the Q&V 
questionnaire that we receive.
    Producers/exporters of millwork products from China that do not 
receive Q&V questionnaires by mail may still submit a response to the 
Q&V questionnaire and can obtain a copy of the Q&V questionnaire from 
Enforcement and Compliance's website. The Q&V response must be 
submitted by the relevant Chinese exporters/producers no later than 
5:00 p.m. ET on February 11, 2020.

Separate Rates

    In order to obtain separate-rate status in an NME investigation, 
exporters and producers must submit a separate-rate application.\52\ 
The specific requirements

[[Page 6507]]

for submitting a separate-rate application in the China investigation 
are outlined in detail in the application itself, which is available on 
Commerce's website at https://enforcement.trade.gov/nme/nme-sep-rate.html. The separate-rate application will be due 30 days after 
publication of this initiation notice.\53\ Exporters and producers who 
submit a separate-rate application and are selected as mandatory 
respondents will be eligible for consideration for separate-rate status 
only if they respond to all parts of Commerce's AD questionnaire as 
mandatory respondents. Commerce requires that companies from China 
submit a response to both the Q&V questionnaire and the separate-rate 
application by the respective deadlines in order to receive 
consideration for separate-rate status. Companies not filing a timely 
Q&V response will not receive separate-rate consideration.
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    \52\ See Policy Bulletin 05.1: Separate-Rates Practice and 
Application of Combination Rates in Antidumping Investigation 
involving Non-Market Economy Countries (April 5, 2005), available at 
https://enforcement.trade.gov/policy/bull05-1.pdf (Policy Bulletin 
05.1).
    \53\ Although in past investigations this deadline was 60 days, 
consistent with 19 CFR 351.301(a), which states that ``the Secretary 
may request any person to submit factual information at any time 
during a proceeding,'' this deadline is now 30 days.
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Use of Combination Rates

    Commerce will calculate combination rates for certain respondents 
that are eligible for a separate rate in an NME investigation. The 
Separate Rates and Combination Rates Bulletin states:

{w{time} hile continuing the practice of assigning separate rates 
only to exporters, all separate rates that the Department will now 
assign in its NME Investigation will be specific to those producers 
that supplied the exporter during the period of investigation. Note, 
however, that one rate is calculated for the exporter and all of the 
producers which supplied subject merchandise to it during the period 
of investigation. This practice applies both to mandatory 
respondents receiving an individually calculated separate rate as 
well as the pool of non-investigated firms receiving the weighted-
average of the individually calculated rates. This practice is 
referred to as the application of ``combination rates'' because such 
rates apply to specific combinations of exporters and one or more 
producers. The cash-deposit rate assigned to an exporter will apply 
only to merchandise both exported by the firm in question and 
produced by a firm that supplied the exporter during the period of 
investigation.\54\
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    \54\ See Policy Bulletin 05.1 at 6 (emphasis added).
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Distribution of Copies of the AD Petitions

    In accordance with section 732(b)(3)(A) of the Act and 19 CFR 
351.202(f), copies of the public version of the AD Petitions have been 
provided to the governments of Brazil and China via ACCESS. To the 
extent practicable, we will attempt to provide a copy of the public 
version of the AD Petitions to each exporter named in the AD Petitions, 
as provided under 19 CFR 351.203(c)(2).

ITC Notification

    We will notify the ITC of our initiation, as required by section 
732(d) of the Act.

Preliminary Determination by the ITC

    The ITC will preliminarily determine, within 45 days after the date 
on which the AD Petitions were filed, whether there is a reasonable 
indication that imports of millwork products from Brazil and/or China 
are materially injuring, or threatening material injury to, a U.S. 
industry.\55\ A negative ITC determination for any country will result 
in the investigation being terminated with respect to that country.\56\ 
Otherwise, the investigations will proceed according to statutory and 
regulatory time limits.
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    \55\ See section 733(a) of the Act.
    \56\ Id.
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Submission of Factual Information

    Factual information is defined in 19 CFR 351.102(b)(21) as: (i) 
Evidence submitted in response to questionnaires; (ii) evidence 
submitted in support of allegations; (iii) publicly available 
information to value factors under 19 CFR 351.408(c) or to measure the 
adequacy of remuneration under 19 CFR 351.511(a)(2); (iv) evidence 
placed on the record by Commerce; and (v) evidence other than factual 
information described in (i)-(iv). Section 351.301(b) of Commerce's 
regulations requires any party, when submitting factual information, to 
specify under which subsection of 19 CFR 351.102(b)(21) the information 
is being submitted \57\ and, if the information is submitted to rebut, 
clarify, or correct factual information already on the record, to 
provide an explanation identifying the information already on the 
record that the factual information seeks to rebut, clarify, or 
correct.\58\ Time limits for the submission of factual information are 
addressed in 19 CFR 351.301, which provides specific time limits based 
on the type of factual information being submitted. Interested parties 
should review the regulations prior to submitting factual information 
in these investigations.
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    \57\ See 19 CFR 351.301(b).
    \58\ See 19 CFR 351.301(b)(2).
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Particular Market Situation Allegation

    Section 504 of the Trade Preferences Extension Act of 2015 amended 
the Act by adding the concept of particular market situation (PMS) for 
purposes of CV under section 773(e) of the Act.\59\ Section 773(e) of 
the Act states that ``if a particular market situation exists such that 
the cost of materials and fabrication or other processing of any kind 
does not accurately reflect the cost of production in the ordinary 
course of trade, the administering authority may use another 
calculation methodology under this subtitle or any other calculation 
methodology.'' When an interested party submits a PMS allegation 
pursuant to section 773(e) of the Act, Commerce will respond to such a 
submission consistent with 19 CFR 351.301(c)(2)(v). If Commerce finds 
that a PMS exists under section 773(e) of the Act, then it will modify 
its dumping calculations appropriately.
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    \59\ See Trade Preferences Extension Act of 2015, Public Law 
114-27, 129 Stat. 362 (2015).
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    Neither section 773(e) of the Act nor 19 CFR 351.301(c)(2)(v) set a 
deadline for the submission of PMS allegations and supporting factual 
information. However, in order to administer section 773(e) of the Act, 
Commerce must receive PMS allegations and supporting factual 
information with enough time to consider the submission. Thus, should 
an interested party wish to submit a PMS allegation and supporting new 
factual information pursuant to section 773(e) of the Act, it must do 
so no later than 20 days after submission of a respondent's initial 
section D questionnaire response.

Extensions of Time Limits

    Parties may request an extension of time limits before the 
expiration of a time limit established under 19 CFR 351.301, or as 
otherwise specified by Commerce. In general, an extension request will 
be considered untimely if it is filed after the expiration of the time 
limit established under 19 CFR 351.301. For submissions that are due 
from multiple parties simultaneously, an extension request will be 
considered untimely if it is filed after 10:00 a.m. ET on the due date. 
Under certain circumstances, we may elect to specify a different time 
limit by which extension requests will be considered untimely for 
submissions which are due from multiple parties simultaneously. In such 
a case, we will inform parties in a letter or memorandum of the 
deadline (including a specified time) by which extension requests must 
be filed to be considered timely. An extension request must be made in 
a separate, stand-alone submission; under limited circumstances we will 
grant untimely-filed requests for the extension of time

[[Page 6508]]

limits. Parties should review Extension of Time Limits; Final Rule, 78 
FR 57790 (September 20, 2013), available at https://www.gpo.gov/fdsys/pkg/FR-2013-09-20/html/2013-22853.htm, prior to submitting factual 
information in these investigations.

Certification Requirements

    Any party submitting factual information in an AD or CVD proceeding 
must certify to the accuracy and completeness of that information.\60\ 
Parties must use the certification formats provided in 19 CFR 
351.303(g).\61\ Commerce intends to reject factual submissions if the 
submitting party does not comply with the applicable certification 
requirements.
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    \60\ See section 782(b) of the Act.
    \61\ See also Certification of Factual Information to Import 
Administration During Antidumping and Countervailing Duty 
Proceedings, 78 FR 42678 (July 17, 2013) (Final Rule). Answers to 
frequently asked questions regarding the Final Rule are available at 
https://enforcement.trade.gov/tlei/notices/factual_info_final_rule_FAQ_07172013.pdf.
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Notification to Interested Parties

    Interested parties must submit applications for disclosure under 
APO in accordance with 19 CFR 351.305. On January 22, 2008, Commerce 
published Antidumping and Countervailing Duty Proceedings: Documents 
Submission Procedures; APO Procedures, 73 FR 3634 (January 22, 2008). 
Parties wishing to participate in these investigations should ensure 
that they meet the requirements of these procedures (e.g., the filing 
of letters of appearance as discussed at 19 CFR 351.103(d)).
    This notice is issued and published pursuant to sections 732(c)(2) 
and 777(i) of the Act, and 19 CFR 351.203(c).

    Dated: January 28, 2020.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.

Appendix

Scope of the Investigations

    The merchandise subject to these investigations consists of wood 
mouldings and millwork products that are made of wood (regardless of 
wood species), bamboo, laminated veneer lumber (LVL), or of wood and 
composite materials (where the composite materials make up less than 
50 percent of the total merchandise), and which are continuously 
shaped wood that undergoes additional manufacturing or finger-
jointed or edge-glued moulding or millwork blanks (whether or not 
resawn).
    The percentage of composite materials contained in a wood 
moulding or millwork product is measured by length, except when the 
composite material is a coating or cladding. Wood mouldings and 
millwork products that are coated or clad, even along their entire 
length, with a composite material, but that are otherwise comprised 
of wood, LVL, or wood and composite materials (where the non-coating 
composite materials make up 50 percent or less of the total 
merchandise) are covered by the scope.
    The merchandise subject to these investigations consists of 
wood, LVL, bamboo, or a combination of wood and composite materials 
that is continuously shaped throughout its length (with the 
exception of any endwork/dados), profiled wood having a repetitive 
design in relief, similar milled wood architectural accessories, 
such as rosettes and plinth blocks, and finger-jointed or edge-glued 
moulding or millwork blanks (whether or not resawn). The scope 
includes continuously shaped wood in the forms of dowels, building 
components such as interior paneling and jamb parts, and door 
components such as rails and stiles.
    The covered products may be solid wood, laminated, finger-
jointed, edge-glued, face-glued, or otherwise joined in the 
production or remanufacturing process and are covered by the scope 
whether imported raw, coated (e.g., gesso, polymer, or plastic), 
primed, painted, stained, wrapped (paper or vinyl overlay), any 
combination of the aforementioned surface coatings, treated, or 
which incorporate rot-resistant elements (whether wood or 
composite). The covered products are covered by the scope whether or 
not any surface coating(s) or covers obscures the grain, textures, 
or markings of the wood, whether or not they are ready for use or 
require final machining (e.g., endwork/dado, hinge/strike machining, 
weatherstrip or application thereof, mitre) or packaging.
    All wood mouldings and millwork products are included within the 
scope even if they are trimmed; cut-to-size; notched; punched; 
drilled; or have undergone other forms of minor processing.
    Subject merchandise also includes wood mouldings and millwork 
products that have been further processed in a third country, 
including but not limited to trimming, cutting, notching, punching, 
drilling, coating, or any other processing that would not otherwise 
remove the merchandise from the scope of the investigations if 
performed in the country of manufacture of the in-scope product.
    Excluded from the scope of these investigations are exterior 
fencing, exterior decking and exterior siding products (including 
solid wood siding, non-wood siding (e.g., composite or cement), and 
shingles) that are not LVL or finger jointed; finished and 
unfinished doors; flooring; parts of stair steps (including newel 
posts, balusters, easing, gooseneck, risers, treads and rail 
fittings); and picture frame components three feet and under in 
individual lengths.
    Excluded from the scope of these investigations are all products 
covered by the scope of the antidumping and countervailing duty 
orders on Hardwood Plywood from the People's Republic of China. See 
Certain Hardwood Plywood Products from the People's Republic of 
China: Amended Final Determination of Sales at Less Than Fair Value, 
and Antidumping Duty Order, 83 FR 504 (January 4, 2018); Certain 
Hardwood Plywood Products from the People's Republic of China: 
Countervailing Duty Order, 83 FR 513 (January 4, 2018).
    Excluded from the scope of these investigations are all products 
covered by the scope of the antidumping and countervailing duty 
orders on Multilayered Wood Flooring from the People's Republic of 
China. See Multilayered Wood Flooring from the People's Republic of 
China: Amended Final Determination of Sales at Less Than Fair Value 
and Antidumping Duty Order, 76 FR 76690 (December 8, 2011); 
Multilayered Wood Flooring from the People's Republic of China: 
Countervailing Duty Order, 76 FR 76693 (December 8, 2011).
    Imports of wood mouldings and millwork products are primarily 
entered under the following Harmonized Tariff Schedule of the United 
States (HTSUS) numbers: 4409.10.4010, 4409.10.4090, 4409.10.4500, 
4409.10.5000, 4409.22.4000, 4409.22.5000, 4409.29.4100, and 
4409.29.5100. Imports of wood mouldings and millwork products may 
also enter under HTSUS numbers: 4409.10.6000, 4409.10.6500, 
4409.22.6000, 4409.22.6500, 4409.29.6100, 4409.29.6600, 4418.99.9095 
and 4421.99.9780. While the HTSUS subheadings are provided for 
convenience and customs purposes, the written description of the 
scope of these investigations is dispositive.

[FR Doc. 2020-02155 Filed 2-4-20; 8:45 am]
BILLING CODE 3510-DS-P