Certain Vertical Shaft Engines Between 223cc and 999cc, and Parts Thereof From the People's Republic of China: Initiation of Countervailing Duty Investigation, 8835-8840 [2020-03104]

Download as PDF Federal Register / Vol. 85, No. 32 / Tuesday, February 18, 2020 / Notices responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a sanctionable violation. Notification to Interested Parties This determination is issued and published in accordance with sections 705(d) and 77(i)(1) of the Act, and 19 CFR 351.210(c). Dated: February 7, 2020. Jeffrey I. Kessler, Assistant Secretary for Enforcement and Compliance. lotter on DSKBCFDHB2PROD with NOTICES Appendix I Scope of the Investigation The merchandise covered by the scope of this investigation is carbon and alloy steel threaded rod. Steel threaded rod is certain threaded rod, bar, or studs, of carbon or alloy steel, having a solid, circular cross section of any diameter, in any straight length. Steel threaded rod is normally drawn, cold-rolled, threaded, and straightened, or it may be hotrolled. In addition, the steel threaded rod, bar, or studs subject to this investigation are non-headed and threaded along greater than 25 percent of their total actual length. A variety of finishes or coatings, such as plain oil finish as a temporary rust protectant, zinc coating (i.e., galvanized, whether by electroplating or hot-dipping), paint, and other similar finishes and coatings, may be applied to the merchandise. Steel threaded rod is normally produced to American Society for Testing and Materials (ASTM) specifications ASTM A36, ASTM A193 B7/B7m, ASTM A193 B16, ASTM A307, ASTM A320 L7/L7M, ASTM A320 L43, ASTM A354 BC and BD, ASTM A449, ASTM F1554–36, ASTM F1554–55, ASTM F1554 Grade 105, American Society of Mechanical Engineers (ASME) specification ASME B18.31.3, and American Petroleum Institute (API) specification API 20E. All steel threaded rod meeting the physical description set forth above is covered by the scope of this investigation, whether or not produced according to a particular standard. Subject merchandise includes material matching the above description that has been finished, assembled, or packaged in a third country, including by cutting, chamfering, coating, or painting the threaded rod, by attaching the threaded rod to, or packaging it with, another product, or any other finishing, assembly, or packaging operation that would not otherwise remove the merchandise from the scope of the investigation if performed in the country of manufacture of the threaded rod. Carbon and alloy steel threaded rod are also included in the scope of this investigation whether or not imported attached to, or in conjunction with, other parts and accessories such as nuts and VerDate Sep<11>2014 17:48 Feb 14, 2020 Jkt 250001 washers. If carbon and alloy steel threaded rod are imported attached to, or in conjunction with, such non-subject merchandise, only the threaded rod is included in the scope. Excluded from the scope of this investigation are: (1) Threaded rod, bar, or studs which are threaded only on one or both ends and the threading covers 25 percent or less of the total actual length; and (2) stainless steel threaded rod, defined as steel threaded rod containing, by weight, 1.2 percent or less of carbon and 10.5 percent or more of chromium, with our without other elements. Excluded from the scope of the antidumping investigation on steel threaded rod from the People’s Republic of China is any merchandise covered by the existing antidumping order on Certain Steel Threaded Rod from the People’s Republic of China. See Certain Steel Threaded Rod from the People’s Republic of China: Notice of Antidumping Duty Order, 74 FR 17154 (April 14, 2009). Specifically excluded from the scope of this investigation is threaded rod that is imported as part of a package of hardware in conjunction with a ready-to-assemble piece of furniture. Steel threaded rod is currently classifiable under subheadings 7318.15.5051, 7318.15.5056, and 7318.15.5090 of the Harmonized Tariff Schedule of the United States (HTSUS). Subject merchandise may also enter under subheading 7318.15.2095 and 7318.19.0000 of the HTSUS. The HTSUS subheadings are provided for convenience and U.S. Customs purposes only. The written description of the scope is dispositive. Appendix II List of Topics Discussed in the Final Decision Memorandum I. Summary II. Background III. Scope of the Investigation IV. Use of Facts Otherwise Available and Adverse Inferences V. Subsidies Valuation Information VI. Analysis of Programs VII. Analysis of Comments Comment 1: Whether the Provision of Steel Bar and Wire Rod at Less Than Adequate Remuneration (LTAR) Is Specific Comment 2: Whether the Chinese Market for Steel Bar and Wire Rod Is Distorted Comment 3: Whether Certain Chinese Producers of Steel Bar and Wire Rod Are Authorities Comment 4: Whether To Revise the Steel Bar and Wire Rod Benchmarks Comment 5: Whether To Revise the Ocean Freight Benchmark Comment 6: Whether To Countervail Export Buyer’s Credit Comment 7: Whether To Apply Adverse Facts Available (AFA) to Junyue Comment 8: Whether To Countervail Electricity Junyue Purchased from a Private Supplier Comment 9: Whether To Treat One of Zhongjiang Bolt’s Self-Reported Subsidies as an Export Subsidy. VIII. Recommendation [FR Doc. 2020–03047 Filed 2–14–20; 8:45 am] BILLING CODE 3510–DS–P PO 00000 Frm 00031 Fmt 4703 Sfmt 4703 8835 DEPARTMENT OF COMMERCE International Trade Administration [C–570–120] Certain Vertical Shaft Engines Between 223cc and 999cc, and Parts Thereof From the People’s Republic of China: Initiation of Countervailing Duty Investigation Enforcement and Compliance, International Trade Administration, Department of Commerce. DATES: Applicable February 4, 2020. FOR FURTHER INFORMATION CONTACT: Andrew Huston, AD/CVD Operations, Office VII, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482–4261. SUPPLEMENTARY INFORMATION: AGENCY: The Petition On January 15, 2020, the U.S. Department of Commerce (Commerce) received a countervailing duty (CVD) petition concerning imports of certain vertical shaft engines between 223cc and 999cc, and parts thereof (vertical shaft engines) from the People’s Republic of China (China) filed in proper form on behalf of the Coalition of American Vertical Engine Producers and its individual members (the petitioner or the Coalition).1 The Petition was accompanied by an antidumping duty (AD) petition concerning imports of vertical shaft engines from China. On January 17, 2020, Commerce requested supplemental information pertaining to certain aspects of the Petition,2 to which the petitioner filed its response on January 22, 2020.3 On January 27, 2020, Commerce had a phone conversation with the petitioner requesting that it address certain 1 See Petitioner’s Letter, ‘‘Petitions for the Imposition of Antidumping and Countervailing Duties on Certain Vertical Shaft Engines Between 225cc and 999cc, and Parts Thereof from the People’s Republic of China,’’ dated January 15, 2020 (the Petition). 2 See Commerce’s Letter, ‘‘Petitions for the Imposition of Antidumping and Countervailing Duties on Imports of Certain Vertical Shaft Engines Between 223cc and 999cc, and Parts Thereof from the People’s Republic of China: Supplemental Questions,’’ dated January 17, 2020. 3 See Petitioner’s Letter, ‘‘Response to Supplemental Questions Concerning Volume I of the Petitions for the Imposition of Antidumping and Countervailing Duties Pursuant to Sections 701 and 731 of the Tariff Act of 1930, As Amended on Certain Vertical Shaft Engines Between 223cc and 999cc, and Parts Thereof from the People’s Republic of China,’’ dated January 22, 2020 (General Issues Supplement). E:\FR\FM\18FEN1.SGM 18FEN1 8836 Federal Register / Vol. 85, No. 32 / Tuesday, February 18, 2020 / Notices issues.4 The petitioner filed responses to these requests on January 29, 2020.5 In accordance with section 702(b)(1) of the Tariff Act of 1930, as amended (the Act), the petitioner alleges that the Government of China (GOC) is providing countervailable subsidies, within the meaning of sections 701 and 771(5) of the Act, to producers of vertical shaft engines in China, and that such imports are materially injuring, or threatening material injury to, the domestic industry producing vertical shaft engines in the United States. Consistent with section 702(b)(1) of the Act and 19 CFR 351.202(b), for those alleged programs on which we are initiating a CVD investigation, the Petition is supported by information reasonably available to the petitioner supporting its allegations. Commerce finds that the petitioner filed the Petition on behalf of the domestic industry because the petitioner is an interested party as defined in sections 771(9)(C) and (E) of the Act. Commerce also finds that the petitioner demonstrated sufficient industry support with respect to the initiation of the requested CVD investigation.6 Period of Investigation Because the Petition was filed on January 15, 2020, the period of investigation (POI) is January 1, 2019 through December 31, 2019.7 Scope of the Investigation The merchandise covered by this investigation is vertical shaft engines from China. For a full description of the scope of this investigation, see the appendix to this notice. lotter on DSKBCFDHB2PROD with NOTICES Comments on Scope of the Investigation As discussed in the Preamble to Commerce’s regulations, we are setting aside a period for interested parties to raise issues regarding product coverage (i.e., scope).8 Commerce will consider all comments received from interested parties and, if necessary, will consult with interested parties prior to the issuance of the preliminary 4 See Memorandum, ‘‘Certain Vertical Shaft Engines Between 223cc and 999cc, and Parts Thereof from the People’s Republic of China: Call to Counsel,’’ dated January 27, 2020. 5 See Petitioner’s Letter, ‘‘Certain Vertical Shaft Engines Between 225cc and 999cc, and Parts Thereof from the People’s Republic of China: Responses to Second Supplemental Questions Concerning Volume I of the Petitions,’’ dated January 29, 2020 (Second General Issues Supplement). 6 See ‘‘Information Relating to the Degree of Industry Support for the Petition’’ section, infra. 7 See 19 CFR 351.204(b)(2). 8 See Antidumping Duties; Countervailing Duties, 62 FR 27296, 27323 (May 19, 1997) (Preamble). VerDate Sep<11>2014 17:48 Feb 14, 2020 Jkt 250001 determination. If scope comments include factual information,9 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 24, 2020, which is 20 calendar days from the signature date of this notice. Any rebuttal comments, which may include factual information, must be filed by 5:00 p.m. ET on March 5, 2020, which is 10 calendar days from the initial comment deadline.10 Commerce requests that any factual information the parties consider relevant to the scope of the investigation be submitted during this time period. However, if a party subsequently finds that additional factual information pertaining to the scope of the investigation may be relevant, the party may contact Commerce and request permission to submit the additional information. All such comments must also be filed on the record of the concurrent AD and CVD investigations. Filing Requirements All submissions to Commerce must be filed electronically using 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. Consultations Pursuant to sections 702(b)(4)(A)(i) and (ii) of the Act, Commerce notified the GOC of the receipt of the Petition and provided it the opportunity for consultations with respect to the CVD 9 See 19 CFR 351.102(b)(21) (defining ‘‘factual information’’). 10 See 19 CFR 351.303(b). 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 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%20 Electronic%20Filling%20Procedures.pdf. PO 00000 Frm 00032 Fmt 4703 Sfmt 4703 Petition.12 The GOC did not request consultations. Determination of Industry Support for the Petition Section 702(b)(1) of the Act requires that a petition be filed on behalf of the domestic industry. Section 702(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 702(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 Section 771(10) of the Act defines the domestic like product as ‘‘a product which is like, or in the absence of like, 12 See Commerce’s Letter, ‘‘Certain Vertical Shaft Engines Between 225cc and 999cc, and Parts Thereof from the People’s Republic of China: Invitation for Consultation to Discuss the Countervailing Duty Petition,’’ dated January 15, 2020. 13 See section 771(10) of the Act. 14 See USEC, Inc. v. United States, 132 F. Supp. 2d 1, 8 (CIT 2001) (citing Algoma Steel Corp., Ltd. v. United States, 688 F. Supp. 639, 644 (CIT 1988), aff’d 865 F. 2d 240 (Fed. Cir. 1989)). E:\FR\FM\18FEN1.SGM 18FEN1 Federal Register / Vol. 85, No. 32 / Tuesday, February 18, 2020 / Notices lotter on DSKBCFDHB2PROD with NOTICES 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 investigation.15 Based on our analysis of the information submitted on the record, we have determined that vertical shaft engines, 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 In determining whether the petitioner has standing under section 702(c)(4)(A) of the Act, we considered the industry support data contained in the Petition with reference to the domestic like product as defined in the ‘‘Scope of the Investigation,’’ in the appendix to this notice. To establish industry support, the petitioner provided 2019 shipments of the domestic like product for members of the Coalition.17 The petitioner estimated the production of the domestic like product for the entire domestic industry based on U.S. shipment data, export data, and its own knowledge of the industry, because shipments and production of vertical shaft engines correlate with one another and shipments are a reasonable proxy for production in the vertical shaft engines industry.18 The petitioner compared the 2019 shipments of the Coalition to the estimated total shipments of the domestic like product 15 See Volume I of the Petition, at 16–17; see also General Issues Supplement at 3–5. 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: Certain Vertical Shaft Engines Between 225cc and 999cc, and Parts Thereof from the People’s Republic of China (China AD Initiation Checklist) at Attachment II, ‘‘Analysis of Industry Support for the Antidumping and Countervailing Duty Petitions Covering Certain Vertical Shaft Engines Between 225cc and 999cc, and Parts Thereof from the People’s Republic of China’’ (Attachment II), 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. 17 See Volume I of the Petition, at 2–3 and Exhibits I–5 and I–6; see also General Issues Supplement at 6–9 and Exhibits Supp–I–2 and Supp–I–3; and Second General Issues Supplement, at Exhibit 2Supp–I–2. 18 See Volume I of the Petition, at Exhibit I–6; see also General Issues Supplement, at 6–9 and Exhibits Supp–I–2 and Supp–I–3; and Second General Issues Supplement, at Exhibit 2Supp–I–2. VerDate Sep<11>2014 17:48 Feb 14, 2020 Jkt 250001 for the entire domestic industry.19 We relied on data provided by the petitioner for purposes of measuring industry support.20 Our review of the data provided in the Petition, 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 Petition.21 First, the Petition 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).22 Second, the domestic producers (or workers) have met the statutory criteria for industry support under section 702(c)(4)(A)(i) of the Act because the domestic producers (or workers) who support the Petition account for at least 25 percent of the total production of the domestic like product.23 Finally, the domestic producers (or workers) have met the statutory criteria for industry support under section 702(c)(4)(A)(ii) of the Act because the domestic producers (or workers) who support the Petition 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 Petition.24 Accordingly, Commerce determines that the Petition was filed on behalf of the domestic industry within the meaning of section 702(b)(1) of the Act.25 Injury Test Because China is a ‘‘Subsidies Agreement Country’’ within the meaning of section 701(b) of the Act, section 701(a)(2) of the Act applies to these investigations. Accordingly, the ITC must determine whether imports of the subject merchandise from China materially injure, or threaten material injury to, a U.S. industry. 8837 Allegations and Evidence of Material Injury and Causation The petitioner alleges that imports of the subject merchandise are benefitting from countervailable subsidies and that such imports are causing, or threaten to cause, material injury to the U.S. industry producing the domestic like product. In addition, the petitioner alleges that subject imports exceed the negligibility threshold provided for under section 771(24)(A) of the Act.26 In CVD petitions, section 771(24)(B) of the Act provides that imports of subject merchandise from developing and least developed countries must exceed the negligibility threshold of four percent. 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; and a decline in the domestic industry’s financial performance and profitability.27 We have assessed the allegations and supporting evidence regarding material injury, threat of material injury, causation, as well as cumulation, and we have determined that these allegations are properly supported by adequate evidence, and meet the statutory requirements for initiation.28 Initiation of CVD Investigation Based upon the examination of the Petition on vertical shaft engines from China, we find that the Petition meets the requirements of section 702 of the Act. Therefore, we are initiating a CVD investigation to determine whether imports of vertical shaft engines from China benefit from countervailable subsidies conferred by the GOC. Based on our review of the Petition, we find that there is sufficient information to initiate a CVD investigation on each of the alleged programs. For a full discussion of the basis for our decision to initiate on each program, see China CVD Initiation Checklist.29 A public 26 See 19 See General Issues Supplement, at 6–9 and Exhibits Supp–I–2 and Supp–I–3. 20 See Volume I of the Petition, at 2–3 and Exhibits I–5 and I–6; see also General Issues Supplement at 6–9 and Exhibits Supp–I–2 and Supp–I–3; and Second General Issues Supplement, at Exhibit 2Supp–I–2. For further discussion, see China AD Initiation Checklist, at Attachment II. 21 See China AD Initiation Checklist, at Attachment II. 22 See section 702(c)(4)(D) of the Act; see also China AD Initiation Checklist, at Attachment II. 23 See China AD Initiation Checklist, at Attachment II. 24 Id. 25 Id. PO 00000 Frm 00033 Fmt 4703 Sfmt 4703 Volume I of the Petition, at 23–24. at 13–15, 22–35, and Exhibits I–5 and I–11 through I–24. 28 See China AD Initiation Checklist, at Attachment III, ‘‘Analysis of Allegations and Evidence of Material Injury and Causation for the Antidumping and Countervailing Duty Petitions Covering Vertical Shaft Engines Between 225cc and 999cc, and Parts thereof from the People’s Republic of China’’ (Attachment III). 29 See Countervailing Duty Investigation Initiation Checklist: Certain Vertical Shaft Engines Between 225cc and 999cc, and Parts Thereof from the People’s Republic of China (China CVD Initiation Checklist), dated concurrently with this notice and on file electronically via ACCESS, at 7. Access to documents filed via ACCESS is also 27 Id. E:\FR\FM\18FEN1.SGM Continued 18FEN1 8838 Federal Register / Vol. 85, No. 32 / Tuesday, February 18, 2020 / Notices version of the initiation checklist for this investigation is available on ACCESS. In accordance with section 703(b)(1) of the Act and 19 CFR 351.205(b)(1), unless postponed, we will make our preliminary determination no later than 65 days after the date of this initiation. lotter on DSKBCFDHB2PROD with NOTICES Critical Circumstances The petitioner alleges, based on trade statistics, that there is a reasonable basis to believe or suspect that critical circumstances exist with regard to imports of vertical shaft engines from China.30 Section 703(e)(1) of the Act provides that if a petitioner alleges critical circumstances, Commerce will find that such circumstances exist, at any time after the date of initiation, when there is a reasonable basis to believe or suspect: (A) That ‘‘the alleged countervailable subsidy’’ is inconsistent with the Agreement on Subsidies and Countervailing Measures (SCM Agreement) of the World Trade Organization, and (B) that ‘‘there have been massive imports of the subject merchandise over a relatively short period.’’ Section 351.206(h)(2) of the Commerce’s regulations provides that, generally, imports must increase by at least 15 percent during the ‘‘relatively short period’’ to be considered ‘‘massive,’’ and section 351.206(i) defines a ‘‘relatively short period’’ as normally being the period beginning on the date the proceeding begins (i.e., the date the petition is filed) 31 and ending at least three months later.32 The regulations also provide, however, that, if Commerce ‘‘finds that importers, or exporters or producers, had reason to believe, at some time prior to the beginning of the proceeding, that a proceeding was likely,’’ Commerce ‘‘may consider a period of not less than three months from that earlier time.’’ 33 The petitioner alleges that Chinese vertical shaft engine producers benefit from numerous Chinese government subsidies, which include subsidies that are contingent upon export performance, subsidies for inputs provided for less than adequate remuneration (LTAR), tax benefits, and export incentives.34 Specifically, the GOC supported vertical shaft engines producers and exporters through the available in the Central Records Unit, Room B8024 of the main Commerce building. 30 See Volume IV of the Petition, at 3–6. 31 See 19 CFR 351.102(b)(40) (providing that a proceeding begins on the date of the filing of a petition). 32 See 19 CFR 351.206(i). 33 Id. 34 See Volume III of the Petition, at 11–59. VerDate Sep<11>2014 17:48 Feb 14, 2020 Jkt 250001 provision of aluminum and pig iron for LTAR, GOC subsidies for the development of famous export brands and China world top brands, export credits granted under the catalogue of Chinese high-tech products for export, and the provision of land at LTAR.35 The petitioner also asserts that there have been massive imports of vertical shaft engines over a relatively short period. Based on the petitioner’s calculation, the imports of engines in the classification that most closely approximates vertical shaft engines surged 35.7 percent between June 2019 through November 2019 against the same period in calendar year 2018.36 The petitioner chose these base and comparison periods in order to account for seasonality and the unusual circumstances caused by the imposition of 25 percent Section 301 duties, in accordance with 19 CFR 351.206(h)(1)(ii). The petitioner asserts that, because the surge in imports constituted more than a 15 percent change, import volumes of vertical shaft engines are massive, as defined in Commerce’s regulations. The petitioner requests that the Commerce make a preliminary finding of critical circumstances within 45 days of the filing of the Petition.37 Section 702(e) of the Act states that if ‘‘at any time after the initiation of an investigation under this subtitle, the administering authority finds a reasonable basis to suspect that the alleged countervailable subsidy is inconsistent with the {SCM} Agreement, the administering authority may request the Commissioner of Customs to compile information on an expedited basis regarding entries of the subject merchandise.’’ Taking into consideration the foregoing, we will analyze this matter further. We will monitor imports of vertical shaft engines from China and may request that U.S. Customs and Border Protection (CBP) compile information on an expedited basis regarding entries of subject merchandise.38 If, at any time, the criteria for a finding of critical circumstances are established, we will issue a critical circumstances determination at the earliest possible date.39 35 Id at 15, 22, 39 and 56–57. Volume IV of the Petition, at 6. 37 Id. at 11. 38 See section 702(e) of the Act. 39 See Change in Policy Regarding Timing of Issuance of Critical Circumstances Determinations, 63 FR 55364 (October 15, 1998). 36 See PO 00000 Frm 00034 Fmt 4703 Sfmt 4703 Respondent Selection The petitioner named 35 companies in China as producers/exporters of vertical shaft engines.40 Commerce intends to follow its standard practice in CVD investigations and calculate company-specific subsidy rates in this investigation. 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 mandatory respondents based on CBP data for U.S. imports of vertical shaft engines from China during the POI under the appropriate Harmonized Tariff Schedule of the United States numbers listed in the ‘‘Scope of the Investigation,’’ in the appendix. On February 3, 2020, Commerce released CBP data on imports of vertical shaft engines from China 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 this investigation.41 We further stated that we will not accept rebuttal comments. 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 website at http://enforcement.trade.gov/apo. Comments must be filed electronically using ACCESS. An electronically filed document must be received successfully, in its entirety, by ACCESS no later than 5:00 p.m. ET on the date noted above. Commerce intends to finalize its decisions regarding respondent selection within 20 days of publication of this notice. Distribution of Copies of the Petition In accordance with section 702(b)(3)(A) of the Act and 19 CFR 351.202(f), a copy of the public version of the Petition has been provided to the GOC via ACCESS. Furthermore, to the extent practicable, Commerce will attempt to provide a copy of the public version of the Petition to each exporter named in the Petition, as provided under 19 CFR 351.203(c)(2). 40 See Volume I of the Petition, at Exhibit I–10. Memorandum, ‘‘Certain Vertical Shaft Engines between 225cc and 999cc, and Parts Thereof from the People’s Republic of China Countervailing Duty Petition: Release of U.S. Customs and Border Protection Data,’’ dated February 3, 2020. 41 See E:\FR\FM\18FEN1.SGM 18FEN1 Federal Register / Vol. 85, No. 32 / Tuesday, February 18, 2020 / Notices ITC Notification Commerce will notify the ITC of its initiation, as required by section 702(d) of the Act. Preliminary Determinations by the ITC The ITC will preliminarily determine, within 45 days after the date on which the Petition was filed, whether there is a reasonable indication that imports of vertical shaft engines from China are materially injuring or threatening material injury to a U.S. industry.42 A negative ITC determination will result in the investigation being terminated.43 Otherwise, this investigation will proceed according to statutory and regulatory time limits. lotter on DSKBCFDHB2PROD with NOTICES 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). Any party, when submitting factual information, must specify under which subsection of 19 CFR 351.102(b)(21) the information is being submitted 44 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.45 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. Please review the regulations prior to submitting factual information in this investigation. 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 42 See section 733(a) of the Act. 43 Id. 44 See 45 See 19 CFR 351.301(b). 19 CFR 351.301(b)(2). VerDate Sep<11>2014 17:48 Feb 14, 2020 Jkt 250001 on the due date. Under certain circumstances, Commerce 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, Commerce 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, standalone submission; under limited circumstances Commerce will grant untimely filed requests for the extension of time limits. Parties should review Extension of Time Limits; Final Rule, 78 FR 57790 (September 20, 2013), available at http://www.gpo.gov/fdsys/ pkg/FR-2013-09-20/html/201322853.htm, prior to submitting extension requests or factual information in this investigation. Certification Requirements Any party submitting factual information in an AD or CVD proceeding must certify to the accuracy and completeness of that information.46 Parties must use the certification formats provided in 19 CFR 351.303(g).47 Commerce intends to reject factual submissions if the submitting party does not comply with the applicable certification requirements. Notification to Interested Parties Interested parties must submit applications for disclosure under APO in accordance with 19 CFR 351.305. Instructions for filing such applications may be found on the Commerce website at http://enforcement.trade.gov/apo. 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 this investigation 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 702 and 777(i) of the Act, and 19 CFR 351.203(c). 46 See section 782(b) of the Act. Certification of Factual Information to Import Administration During Antidumping and Countervailing Duty Proceedings, 78 FR 42678 (July 17, 2013) (Final Rule); see also frequently asked questions regarding the Final Rule, available at http://enforcement.trade.gov/tlei/notices/factual_ info_final_rule_FAQ_07172013.pdf. 47 See PO 00000 Frm 00035 Fmt 4703 Sfmt 4703 8839 Dated: February 4, 2020. Jeffrey I. Kessler, Assistant Secretary for Enforcement and Compliance. Appendix Scope of the Investigation The merchandise covered by this investigation consists of spark-ignited, nonroad, vertical shaft engines, whether finished or unfinished, whether assembled or unassembled, primarily for riding lawn mowers and zero-tum radius lawn mowers. Engines meeting this physical description may also be for other non-hand-held outdoor power equipment such as, including but not limited to, tow-behind brush mowers, grinders, and vertical shaft generators. The subject engines are spark ignition, single or multiple cylinder, air cooled, internal combustion engines with vertical power take off shafts with a minimum displacement of 225 cubic centimeters (cc) and a maximum displacement of 999cc. Typically, engines with displacements of this size generate gross power of between 6.7 kilowatts (kw) to 42 kw. Engines covered by this scope normally must comply with and be certified under Environmental Protection Agency (EPA) air pollution controls title 40, chapter I, subchapter U, part 1054 of the Code of Federal Regulations standards for small nonroad spark-ignition engines and equipment. Engines that otherwise meet the physical description of the scope but are not certified under 40 CFR part 1054 and are not certified under other parts of subchapter U of the EPA air pollution controls are not excluded from the scope of this proceeding. Engines that may be certified under both 40 CFR part 1054 as well as other parts of subchapter U remain subject to the scope of this proceeding. For purposes of this investigation, an unfinished engine covers at a minimum a sub-assembly comprised of, but not limited to, the following components: Crankcase, crankshaft, camshaft, piston(s), and connecting rod(s). Importation of these components together, whether assembled or unassembled, and whether or not accompanied by additional components such as an oil pan, manifold, cylinder head(s), valve train, or valve cover(s), constitutes an unfinished engine for purposes of this investigation. The inclusion of other products such as spark plugs fitted into the cylinder head or electrical devices (e.g., ignition modules, ignition coils) for synchronizing with the motor to supply tension current does not remove the product from the scope. The inclusion of any other components not identified as comprising the unfinished engine subassembly in a thirdcountry does not remove the engine from the scope. The engines subject to this investigation are typically classified in the Harmonized Tariff Schedule of the United States (HTSUS) at subheadings: 8407.90.1020, 8407.90.1060, and 8407.90.1080. The engine subassemblies that are subject to this investigation enter under HTSUS 8409.91.9990. Engines subject to this investigation may also enter under HTSUS 8407.90.9060 and 8407.90.9080. The E:\FR\FM\18FEN1.SGM 18FEN1 8840 Federal Register / Vol. 85, No. 32 / Tuesday, February 18, 2020 / Notices HTSUS subheadings are provided for convenience and customs purposes only, and the written description of the merchandise under investigation is dispositive. [FR Doc. 2020–03104 Filed 2–14–20; 8:45 am] BILLING CODE 3510–DS–P DEPARTMENT OF COMMERCE International Trade Administration [A–570–026; C–570–027] Certain Corrosion-Resistant Steel Products From the People’s Republic of China: Negative Preliminary Determination of Circumvention Involving Guatemala Enforcement and Compliance, International Trade Administration, Department of Commerce. SUMMARY: The Department of Commerce (Commerce) preliminarily determines that imports of certain corrosionresistant steel products (CORE) completed in Guatemala are not circumventing the antidumping duty (AD) and countervailing duty (CVD) orders on CORE from the People’s Republic of China (China) at this time. DATES: Applicable February 18, 2020. FOR FURTHER INFORMATION CONTACT: Drew Jackson, AD/CVD Operations, Office IV, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482–4406. SUPPLEMENTARY INFORMATION: AGENCY: Background lotter on DSKBCFDHB2PROD with NOTICES On August 12, 2019, Commerce selfinitiated country-wide anticircumvention inquiries of the China CORE Orders 1 covering Chinese-origin hot-rolled steel (HRS) and/or cold-rolled steel (CRS) exported to various countries, including Guatemala, for completion into CORE and subsequently exported to the United States.2 In the 1 See Certain Corrosion-Resistant Steel Flat Products from India, Italy, the People’s Republic of China, the Republic of Korea, and Taiwan: Amended Final Affirmative Antidumping Duty Determination for India and Taiwan, and Antidumping Duty Orders, 81 FR 48390 (July 25, 2016); see also Certain Corrosion-Resistant Steel Products from India, Italy, Republic of Korea, and the People’s Republic of China: Countervailing Duty Order, 81 FR 48387 (July 25, 2016) (collectively, China CORE Orders). 2 The notice of initiation subsequently published in the Federal Register on August 21, 2019. See Corrosion-Resistant Steel Products from the People’s Republic of China: Initiation of AntiCircumvention Inquiries on the Antidumping Duty and Countervailing Duty Orders, 84 FR 43585 (August 21, 2019) (Initiation Notice) and accompanying Memorandum, ‘‘Certain CorrosionResistant Steel Products from the People’s Republic VerDate Sep<11>2014 17:48 Feb 14, 2020 Jkt 250001 Initiation Notice, Commerce initiated the instant anti-circumvention inquiries based on available information and an analysis pursuant to section 781(b) of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.225(h), to determine whether the importation of the Chinese-origin HRS or CRS substrate for completion into CORE in Guatemala and subsequent exportation of that CORE to the United States constitutes circumvention of the China CORE Orders. For a complete description of the record developed since the initiation of these inquiries, see the Preliminary Decision Memorandum.3 A list of topics included in the Preliminary Decision Memorandum is included as Appendix I to this notice. The Preliminary Decision Memorandum is a public document and is on file electronically via Enforcement and Compliance’s Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS). ACCESS is available to registered users at https:// access.trade.gov, and to all parties in the Central Records Unit, Room B8024 of the main Commerce building. In addition, a complete version of the Preliminary Decision Memorandum can be accessed directly at http:// enforcement.trade.gov/frn/. The signed and the electronic versions of the Preliminary Decision Memorandum are identical in content. subsequently exported from Guatemala to the United States. Scope of the Orders The products covered by these orders are certain flat-rolled steel products, either clad, plated, or coated with corrosion-resistant metals such as zinc, aluminum, or zinc-, aluminum-, nickelor iron-based alloys, whether or not corrugated or painted, varnished, laminated, or coated with plastics or other non-metallic substances in addition to the metallic coating. For a complete description of the scope of the orders, see the Preliminary Decision Memorandum. Public Comment Scope of the Anti-Circumvention Inquiries These anti-circumvention inquiries cover CORE completed in Guatemala from HRS or CRS substrate input manufactured in China and of China: Initiation of Anti-Circumvention Inquiries on the Antidumping Duty and Countervailing Duty Orders,’’ dated August 12, 2019. 3 See Memorandum, ‘‘Preliminary Decision Memorandum for the Anti-Circumvention Inquiries Involving Guatemala of the Antidumping and Countervailing Duty Orders on Certain CorrosionResistant Steel Products from the People’s Republic of China,’’ dated concurrently with, and hereby adopted by, this notice (Preliminary Decision Memorandum). PO 00000 Frm 00036 Fmt 4703 Sfmt 4703 Methodology Commerce is conducting these anticircumvention inquiries in accordance with section 781(b) of the Act and 19 CFR 351.225(h). For a full description of the methodology underlying Commerce’s preliminary determination, see the Preliminary Decision Memorandum. Preliminary Finding As detailed in the Preliminary Decision Memorandum, we preliminarily determine that Ternium Internacional Guatemala S.A. is neither producing CORE from Chinese substrate in Guatemala nor exporting CORE incorporating Chinese substrate to the United States at present, or at any point recent enough to support the concerns which served as the basis for the initiation of these inquiries, and thus action is not appropriate to address circumvention of the China CORE Orders, at this time. Accordingly, Commerce is making a preliminary negative finding of circumvention of the China CORE Orders. Verification As provided in 19 CFR 351.307, Commerce intends to verify information relied upon in making its final determination. Case briefs or other written comments may be submitted to the Assistant Secretary for Enforcement and Compliance no later than seven days after the date on which the final verification report is issued in these anti-circumvention inquiries, unless the Secretary alters the time limit. Rebuttal briefs, limited to issues raised in case briefs, may be submitted no later than five days after the deadline date for case briefs.4 Pursuant to 19 CFR 351.309(c)(2) and (d)(2), parties who submit case briefs or rebuttal briefs in these anti-circumvention inquiries are encouraged to submit with each argument: (1) A statement of the issue; (2) a brief summary of the argument; and (3) a table of authorities. Pursuant to 19 CFR 351.310(c), interested parties who wish to request a hearing, limited to issues raised in the case and rebuttal briefs, must submit a written request to the Assistant Secretary for Enforcement and Compliance, U.S. Department of Commerce, within 30 days after the date 4 See 19 CFR 351.309; see also 19 CFR 351.303 (for general filing requirements). E:\FR\FM\18FEN1.SGM 18FEN1

Agencies

[Federal Register Volume 85, Number 32 (Tuesday, February 18, 2020)]
[Notices]
[Pages 8835-8840]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-03104]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-570-120]


Certain Vertical Shaft Engines Between 223cc and 999cc, and Parts 
Thereof From the People's Republic of China: Initiation of 
Countervailing Duty Investigation

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

DATES: Applicable February 4, 2020.

FOR FURTHER INFORMATION CONTACT: Andrew Huston, AD/CVD Operations, 
Office VII, Enforcement and Compliance, International Trade 
Administration, U.S. Department of Commerce, 1401 Constitution Avenue 
NW, Washington, DC 20230; telephone: (202) 482-4261.

SUPPLEMENTARY INFORMATION:

The Petition

    On January 15, 2020, the U.S. Department of Commerce (Commerce) 
received a countervailing duty (CVD) petition concerning imports of 
certain vertical shaft engines between 223cc and 999cc, and parts 
thereof (vertical shaft engines) from the People's Republic of China 
(China) filed in proper form on behalf of the Coalition of American 
Vertical Engine Producers and its individual members (the petitioner or 
the Coalition).\1\ The Petition was accompanied by an antidumping duty 
(AD) petition concerning imports of vertical shaft engines from China.
---------------------------------------------------------------------------

    \1\ See Petitioner's Letter, ``Petitions for the Imposition of 
Antidumping and Countervailing Duties on Certain Vertical Shaft 
Engines Between 225cc and 999cc, and Parts Thereof from the People's 
Republic of China,'' dated January 15, 2020 (the Petition).
---------------------------------------------------------------------------

    On January 17, 2020, Commerce requested supplemental information 
pertaining to certain aspects of the Petition,\2\ to which the 
petitioner filed its response on January 22, 2020.\3\ On January 27, 
2020, Commerce had a phone conversation with the petitioner requesting 
that it address certain

[[Page 8836]]

issues.\4\ The petitioner filed responses to these requests on January 
29, 2020.\5\
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    \2\ See Commerce's Letter, ``Petitions for the Imposition of 
Antidumping and Countervailing Duties on Imports of Certain Vertical 
Shaft Engines Between 223cc and 999cc, and Parts Thereof from the 
People's Republic of China: Supplemental Questions,'' dated January 
17, 2020.
    \3\ See Petitioner's Letter, ``Response to Supplemental 
Questions Concerning Volume I of the Petitions for the Imposition of 
Antidumping and Countervailing Duties Pursuant to Sections 701 and 
731 of the Tariff Act of 1930, As Amended on Certain Vertical Shaft 
Engines Between 223cc and 999cc, and Parts Thereof from the People's 
Republic of China,'' dated January 22, 2020 (General Issues 
Supplement).
    \4\ See Memorandum, ``Certain Vertical Shaft Engines Between 
223cc and 999cc, and Parts Thereof from the People's Republic of 
China: Call to Counsel,'' dated January 27, 2020.
    \5\ See Petitioner's Letter, ``Certain Vertical Shaft Engines 
Between 225cc and 999cc, and Parts Thereof from the People's 
Republic of China: Responses to Second Supplemental Questions 
Concerning Volume I of the Petitions,'' dated January 29, 2020 
(Second General Issues Supplement).
---------------------------------------------------------------------------

    In accordance with section 702(b)(1) of the Tariff Act of 1930, as 
amended (the Act), the petitioner alleges that the Government of China 
(GOC) is providing countervailable subsidies, within the meaning of 
sections 701 and 771(5) of the Act, to producers of vertical shaft 
engines in China, and that such imports are materially injuring, or 
threatening material injury to, the domestic industry producing 
vertical shaft engines in the United States. Consistent with section 
702(b)(1) of the Act and 19 CFR 351.202(b), for those alleged programs 
on which we are initiating a CVD investigation, the Petition is 
supported by information reasonably available to the petitioner 
supporting its allegations.
    Commerce finds that the petitioner filed the Petition on behalf of 
the domestic industry because the petitioner is an interested party as 
defined in sections 771(9)(C) and (E) of the Act. Commerce also finds 
that the petitioner demonstrated sufficient industry support with 
respect to the initiation of the requested CVD investigation.\6\
---------------------------------------------------------------------------

    \6\ See ``Information Relating to the Degree of Industry Support 
for the Petition'' section, infra.
---------------------------------------------------------------------------

Period of Investigation

    Because the Petition was filed on January 15, 2020, the period of 
investigation (POI) is January 1, 2019 through December 31, 2019.\7\
---------------------------------------------------------------------------

    \7\ See 19 CFR 351.204(b)(2).
---------------------------------------------------------------------------

Scope of the Investigation

    The merchandise covered by this investigation is vertical shaft 
engines from China. For a full description of the scope of this 
investigation, see the appendix to this notice.

Comments on Scope of the Investigation

    As discussed in the Preamble to Commerce's regulations, we are 
setting aside a period for interested parties to raise issues regarding 
product coverage (i.e., scope).\8\ Commerce will consider all comments 
received from interested parties and, if necessary, will consult with 
interested parties prior to the issuance of the preliminary 
determination. If scope comments include factual information,\9\ 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 24, 2020, which is 20 calendar days from the signature 
date of this notice. Any rebuttal comments, which may include factual 
information, must be filed by 5:00 p.m. ET on March 5, 2020, which is 
10 calendar days from the initial comment deadline.\10\
---------------------------------------------------------------------------

    \8\ See Antidumping Duties; Countervailing Duties, 62 FR 27296, 
27323 (May 19, 1997) (Preamble).
    \9\ See 19 CFR 351.102(b)(21) (defining ``factual 
information'').
    \10\ See 19 CFR 351.303(b).
---------------------------------------------------------------------------

    Commerce requests that any factual information the parties consider 
relevant to the scope of the investigation be submitted during this 
time period. However, if a party subsequently finds that additional 
factual information pertaining to the scope of the investigation may be 
relevant, the party may contact Commerce and request permission to 
submit the additional information. All such comments must also be filed 
on the record of the concurrent AD and CVD investigations.

Filing Requirements

    All submissions to Commerce must be filed electronically using 
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.
---------------------------------------------------------------------------

    \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 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.
---------------------------------------------------------------------------

Consultations

    Pursuant to sections 702(b)(4)(A)(i) and (ii) of the Act, Commerce 
notified the GOC of the receipt of the Petition and provided it the 
opportunity for consultations with respect to the CVD Petition.\12\ The 
GOC did not request consultations.
---------------------------------------------------------------------------

    \12\ See Commerce's Letter, ``Certain Vertical Shaft Engines 
Between 225cc and 999cc, and Parts Thereof from the People's 
Republic of China: Invitation for Consultation to Discuss the 
Countervailing Duty Petition,'' dated January 15, 2020.
---------------------------------------------------------------------------

Determination of Industry Support for the Petition

    Section 702(b)(1) of the Act requires that a petition be filed on 
behalf of the domestic industry. Section 702(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 702(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\
---------------------------------------------------------------------------

    \13\ See section 771(10) of the Act.
    \14\ See USEC, Inc. v. United States, 132 F. Supp. 2d 1, 8 (CIT 
2001) (citing Algoma Steel Corp., Ltd. v. United States, 688 F. 
Supp. 639, 644 (CIT 1988), aff'd 865 F. 2d 240 (Fed. Cir. 1989)).
---------------------------------------------------------------------------

    Section 771(10) of the Act defines the domestic like product as ``a 
product which is like, or in the absence of like,

[[Page 8837]]

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 investigation.\15\ Based on our analysis of the information 
submitted on the record, we have determined that vertical shaft 
engines, 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\
---------------------------------------------------------------------------

    \15\ See Volume I of the Petition, at 16-17; see also General 
Issues Supplement at 3-5.
    \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: Certain 
Vertical Shaft Engines Between 225cc and 999cc, and Parts Thereof 
from the People's Republic of China (China AD Initiation Checklist) 
at Attachment II, ``Analysis of Industry Support for the Antidumping 
and Countervailing Duty Petitions Covering Certain Vertical Shaft 
Engines Between 225cc and 999cc, and Parts Thereof from the People's 
Republic of China'' (Attachment II), 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.
---------------------------------------------------------------------------

    In determining whether the petitioner has standing under section 
702(c)(4)(A) of the Act, we considered the industry support data 
contained in the Petition with reference to the domestic like product 
as defined in the ``Scope of the Investigation,'' in the appendix to 
this notice. To establish industry support, the petitioner provided 
2019 shipments of the domestic like product for members of the 
Coalition.\17\ The petitioner estimated the production of the domestic 
like product for the entire domestic industry based on U.S. shipment 
data, export data, and its own knowledge of the industry, because 
shipments and production of vertical shaft engines correlate with one 
another and shipments are a reasonable proxy for production in the 
vertical shaft engines industry.\18\ The petitioner compared the 2019 
shipments of the Coalition to the estimated total shipments of the 
domestic like product for the entire domestic industry.\19\ We relied 
on data provided by the petitioner for purposes of measuring industry 
support.\20\
---------------------------------------------------------------------------

    \17\ See Volume I of the Petition, at 2-3 and Exhibits I-5 and 
I-6; see also General Issues Supplement at 6-9 and Exhibits Supp-I-2 
and Supp-I-3; and Second General Issues Supplement, at Exhibit 
2Supp-I-2.
    \18\ See Volume I of the Petition, at Exhibit I-6; see also 
General Issues Supplement, at 6-9 and Exhibits Supp-I-2 and Supp-I-
3; and Second General Issues Supplement, at Exhibit 2Supp-I-2.
    \19\ See General Issues Supplement, at 6-9 and Exhibits Supp-I-2 
and Supp-I-3.
    \20\ See Volume I of the Petition, at 2-3 and Exhibits I-5 and 
I-6; see also General Issues Supplement at 6-9 and Exhibits Supp-I-2 
and Supp-I-3; and Second General Issues Supplement, at Exhibit 
2Supp-I-2. For further discussion, see China AD Initiation 
Checklist, at Attachment II.
---------------------------------------------------------------------------

    Our review of the data provided in the Petition, 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 Petition.\21\ First, the Petition 
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).\22\ Second, the 
domestic producers (or workers) have met the statutory criteria for 
industry support under section 702(c)(4)(A)(i) of the Act because the 
domestic producers (or workers) who support the Petition account for at 
least 25 percent of the total production of the domestic like 
product.\23\ Finally, the domestic producers (or workers) have met the 
statutory criteria for industry support under section 702(c)(4)(A)(ii) 
of the Act because the domestic producers (or workers) who support the 
Petition 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 Petition.\24\ 
Accordingly, Commerce determines that the Petition was filed on behalf 
of the domestic industry within the meaning of section 702(b)(1) of the 
Act.\25\
---------------------------------------------------------------------------

    \21\ See China AD Initiation Checklist, at Attachment II.
    \22\ See section 702(c)(4)(D) of the Act; see also China AD 
Initiation Checklist, at Attachment II.
    \23\ See China AD Initiation Checklist, at Attachment II.
    \24\ Id.
    \25\ Id.
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Injury Test

    Because China is a ``Subsidies Agreement Country'' within the 
meaning of section 701(b) of the Act, section 701(a)(2) of the Act 
applies to these investigations. Accordingly, the ITC must determine 
whether imports of the subject merchandise from China materially 
injure, or threaten material injury to, a U.S. industry.

Allegations and Evidence of Material Injury and Causation

    The petitioner alleges that imports of the subject merchandise are 
benefitting from countervailable subsidies and that such imports are 
causing, or threaten to cause, material injury to the U.S. industry 
producing the domestic like product. In addition, the petitioner 
alleges that subject imports exceed the negligibility threshold 
provided for under section 771(24)(A) of the Act.\26\ In CVD petitions, 
section 771(24)(B) of the Act provides that imports of subject 
merchandise from developing and least developed countries must exceed 
the negligibility threshold of four percent.
---------------------------------------------------------------------------

    \26\ See Volume I of the Petition, at 23-24.
---------------------------------------------------------------------------

    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; and a decline in the domestic industry's 
financial performance and profitability.\27\ We have assessed the 
allegations and supporting evidence regarding material injury, threat 
of material injury, causation, as well as cumulation, and we have 
determined that these allegations are properly supported by adequate 
evidence, and meet the statutory requirements for initiation.\28\
---------------------------------------------------------------------------

    \27\ Id. at 13-15, 22-35, and Exhibits I-5 and I-11 through I-
24.
    \28\ See China AD Initiation Checklist, at Attachment III, 
``Analysis of Allegations and Evidence of Material Injury and 
Causation for the Antidumping and Countervailing Duty Petitions 
Covering Vertical Shaft Engines Between 225cc and 999cc, and Parts 
thereof from the People's Republic of China'' (Attachment III).
---------------------------------------------------------------------------

Initiation of CVD Investigation

    Based upon the examination of the Petition on vertical shaft 
engines from China, we find that the Petition meets the requirements of 
section 702 of the Act. Therefore, we are initiating a CVD 
investigation to determine whether imports of vertical shaft engines 
from China benefit from countervailable subsidies conferred by the GOC. 
Based on our review of the Petition, we find that there is sufficient 
information to initiate a CVD investigation on each of the alleged 
programs. For a full discussion of the basis for our decision to 
initiate on each program, see China CVD Initiation Checklist.\29\ A 
public

[[Page 8838]]

version of the initiation checklist for this investigation is available 
on ACCESS. In accordance with section 703(b)(1) of the Act and 19 CFR 
351.205(b)(1), unless postponed, we will make our preliminary 
determination no later than 65 days after the date of this initiation.
---------------------------------------------------------------------------

    \29\ See Countervailing Duty Investigation Initiation Checklist: 
Certain Vertical Shaft Engines Between 225cc and 999cc, and Parts 
Thereof from the People's Republic of China (China CVD Initiation 
Checklist), dated concurrently with this notice and on file 
electronically via ACCESS, at 7. Access to documents filed via 
ACCESS is also available in the Central Records Unit, Room B8024 of 
the main Commerce building.
---------------------------------------------------------------------------

Critical Circumstances

    The petitioner alleges, based on trade statistics, that there is a 
reasonable basis to believe or suspect that critical circumstances 
exist with regard to imports of vertical shaft engines from China.\30\
---------------------------------------------------------------------------

    \30\ See Volume IV of the Petition, at 3-6.
---------------------------------------------------------------------------

    Section 703(e)(1) of the Act provides that if a petitioner alleges 
critical circumstances, Commerce will find that such circumstances 
exist, at any time after the date of initiation, when there is a 
reasonable basis to believe or suspect: (A) That ``the alleged 
countervailable subsidy'' is inconsistent with the Agreement on 
Subsidies and Countervailing Measures (SCM Agreement) of the World 
Trade Organization, and (B) that ``there have been massive imports of 
the subject merchandise over a relatively short period.'' Section 
351.206(h)(2) of the Commerce's regulations provides that, generally, 
imports must increase by at least 15 percent during the ``relatively 
short period'' to be considered ``massive,'' and section 351.206(i) 
defines a ``relatively short period'' as normally being the period 
beginning on the date the proceeding begins (i.e., the date the 
petition is filed) \31\ and ending at least three months later.\32\ The 
regulations also provide, however, that, if Commerce ``finds that 
importers, or exporters or producers, had reason to believe, at some 
time prior to the beginning of the proceeding, that a proceeding was 
likely,'' Commerce ``may consider a period of not less than three 
months from that earlier time.'' \33\
---------------------------------------------------------------------------

    \31\ See 19 CFR 351.102(b)(40) (providing that a proceeding 
begins on the date of the filing of a petition).
    \32\ See 19 CFR 351.206(i).
    \33\ Id.
---------------------------------------------------------------------------

    The petitioner alleges that Chinese vertical shaft engine producers 
benefit from numerous Chinese government subsidies, which include 
subsidies that are contingent upon export performance, subsidies for 
inputs provided for less than adequate remuneration (LTAR), tax 
benefits, and export incentives.\34\ Specifically, the GOC supported 
vertical shaft engines producers and exporters through the provision of 
aluminum and pig iron for LTAR, GOC subsidies for the development of 
famous export brands and China world top brands, export credits granted 
under the catalogue of Chinese high-tech products for export, and the 
provision of land at LTAR.\35\
---------------------------------------------------------------------------

    \34\ See Volume III of the Petition, at 11-59.
    \35\ Id at 15, 22, 39 and 56-57.
---------------------------------------------------------------------------

    The petitioner also asserts that there have been massive imports of 
vertical shaft engines over a relatively short period. Based on the 
petitioner's calculation, the imports of engines in the classification 
that most closely approximates vertical shaft engines surged 35.7 
percent between June 2019 through November 2019 against the same period 
in calendar year 2018.\36\ The petitioner chose these base and 
comparison periods in order to account for seasonality and the unusual 
circumstances caused by the imposition of 25 percent Section 301 
duties, in accordance with 19 CFR 351.206(h)(1)(ii). The petitioner 
asserts that, because the surge in imports constituted more than a 15 
percent change, import volumes of vertical shaft engines are massive, 
as defined in Commerce's regulations.
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    \36\ See Volume IV of the Petition, at 6.
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    The petitioner requests that the Commerce make a preliminary 
finding of critical circumstances within 45 days of the filing of the 
Petition.\37\ Section 702(e) of the Act states that if ``at any time 
after the initiation of an investigation under this subtitle, the 
administering authority finds a reasonable basis to suspect that the 
alleged countervailable subsidy is inconsistent with the {SCM{time}  
Agreement, the administering authority may request the Commissioner of 
Customs to compile information on an expedited basis regarding entries 
of the subject merchandise.''
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    \37\ Id. at 11.
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    Taking into consideration the foregoing, we will analyze this 
matter further. We will monitor imports of vertical shaft engines from 
China and may request that U.S. Customs and Border Protection (CBP) 
compile information on an expedited basis regarding entries of subject 
merchandise.\38\ If, at any time, the criteria for a finding of 
critical circumstances are established, we will issue a critical 
circumstances determination at the earliest possible date.\39\
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    \38\ See section 702(e) of the Act.
    \39\ See Change in Policy Regarding Timing of Issuance of 
Critical Circumstances Determinations, 63 FR 55364 (October 15, 
1998).
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Respondent Selection

    The petitioner named 35 companies in China as producers/exporters 
of vertical shaft engines.\40\ Commerce intends to follow its standard 
practice in CVD investigations and calculate company-specific subsidy 
rates in this investigation. 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 mandatory respondents based on CBP data for U.S. 
imports of vertical shaft engines from China during the POI under the 
appropriate Harmonized Tariff Schedule of the United States numbers 
listed in the ``Scope of the Investigation,'' in the appendix.
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    \40\ See Volume I of the Petition, at Exhibit I-10.
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    On February 3, 2020, Commerce released CBP data on imports of 
vertical shaft engines from China 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 this investigation.\41\ We further stated that 
we will not accept rebuttal comments.
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    \41\ See Memorandum, ``Certain Vertical Shaft Engines between 
225cc and 999cc, and Parts Thereof from the People's Republic of 
China Countervailing Duty Petition: Release of U.S. Customs and 
Border Protection Data,'' dated February 3, 2020.
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    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 website at http://enforcement.trade.gov/apo.
    Comments must be filed electronically using ACCESS. An 
electronically filed document must be received successfully, in its 
entirety, by ACCESS no later than 5:00 p.m. ET on the date noted above. 
Commerce intends to finalize its decisions regarding respondent 
selection within 20 days of publication of this notice.

Distribution of Copies of the Petition

    In accordance with section 702(b)(3)(A) of the Act and 19 CFR 
351.202(f), a copy of the public version of the Petition has been 
provided to the GOC via ACCESS.
    Furthermore, to the extent practicable, Commerce will attempt to 
provide a copy of the public version of the Petition to each exporter 
named in the Petition, as provided under 19 CFR 351.203(c)(2).

[[Page 8839]]

ITC Notification

    Commerce will notify the ITC of its initiation, as required by 
section 702(d) of the Act.

Preliminary Determinations by the ITC

    The ITC will preliminarily determine, within 45 days after the date 
on which the Petition was filed, whether there is a reasonable 
indication that imports of vertical shaft engines from China are 
materially injuring or threatening material injury to a U.S. 
industry.\42\ A negative ITC determination will result in the 
investigation being terminated.\43\ Otherwise, this investigation will 
proceed according to statutory and regulatory time limits.
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    \42\ See section 733(a) of the Act.
    \43\ 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). Any party, when submitting factual 
information, must specify under which subsection of 19 CFR 
351.102(b)(21) the information is being submitted \44\ 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.\45\ 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. Please review the regulations prior to 
submitting factual information in this investigation.
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    \44\ See 19 CFR 351.301(b).
    \45\ See 19 CFR 351.301(b)(2).
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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, Commerce 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, Commerce 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, standalone submission; under limited circumstances Commerce 
will grant untimely filed requests for the extension of time limits. 
Parties should review Extension of Time Limits; Final Rule, 78 FR 57790 
(September 20, 2013), available at http://www.gpo.gov/fdsys/pkg/FR-2013-09-20/html/2013-22853.htm, prior to submitting extension requests 
or factual information in this investigation.

Certification Requirements

    Any party submitting factual information in an AD or CVD proceeding 
must certify to the accuracy and completeness of that information.\46\ 
Parties must use the certification formats provided in 19 CFR 
351.303(g).\47\ Commerce intends to reject factual submissions if the 
submitting party does not comply with the applicable certification 
requirements.
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    \46\ See section 782(b) of the Act.
    \47\ See Certification of Factual Information to Import 
Administration During Antidumping and Countervailing Duty 
Proceedings, 78 FR 42678 (July 17, 2013) (Final Rule); see also 
frequently asked questions regarding the Final Rule, available at 
http://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. Instructions for filing such 
applications may be found on the Commerce website at http://enforcement.trade.gov/apo.
    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 this investigation 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 702 and 
777(i) of the Act, and 19 CFR 351.203(c).

    Dated: February 4, 2020.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.

Appendix

Scope of the Investigation

    The merchandise covered by this investigation consists of spark-
ignited, non-road, vertical shaft engines, whether finished or 
unfinished, whether assembled or unassembled, primarily for riding 
lawn mowers and zero-tum radius lawn mowers. Engines meeting this 
physical description may also be for other non-hand-held outdoor 
power equipment such as, including but not limited to, tow-behind 
brush mowers, grinders, and vertical shaft generators. The subject 
engines are spark ignition, single or multiple cylinder, air cooled, 
internal combustion engines with vertical power take off shafts with 
a minimum displacement of 225 cubic centimeters (cc) and a maximum 
displacement of 999cc. Typically, engines with displacements of this 
size generate gross power of between 6.7 kilowatts (kw) to 42 kw.
    Engines covered by this scope normally must comply with and be 
certified under Environmental Protection Agency (EPA) air pollution 
controls title 40, chapter I, subchapter U, part 1054 of the Code of 
Federal Regulations standards for small non-road spark-ignition 
engines and equipment. Engines that otherwise meet the physical 
description of the scope but are not certified under 40 CFR part 
1054 and are not certified under other parts of subchapter U of the 
EPA air pollution controls are not excluded from the scope of this 
proceeding. Engines that may be certified under both 40 CFR part 
1054 as well as other parts of subchapter U remain subject to the 
scope of this proceeding.
    For purposes of this investigation, an unfinished engine covers 
at a minimum a sub-assembly comprised of, but not limited to, the 
following components: Crankcase, crankshaft, camshaft, piston(s), 
and connecting rod(s). Importation of these components together, 
whether assembled or unassembled, and whether or not accompanied by 
additional components such as an oil pan, manifold, cylinder 
head(s), valve train, or valve cover(s), constitutes an unfinished 
engine for purposes of this investigation. The inclusion of other 
products such as spark plugs fitted into the cylinder head or 
electrical devices (e.g., ignition modules, ignition coils) for 
synchronizing with the motor to supply tension current does not 
remove the product from the scope. The inclusion of any other 
components not identified as comprising the unfinished engine 
subassembly in a third-country does not remove the engine from the 
scope.
    The engines subject to this investigation are typically 
classified in the Harmonized Tariff Schedule of the United States 
(HTSUS) at subheadings: 8407.90.1020, 8407.90.1060, and 
8407.90.1080. The engine subassemblies that are subject to this 
investigation enter under HTSUS 8409.91.9990. Engines subject to 
this investigation may also enter under HTSUS 8407.90.9060 and 
8407.90.9080. The

[[Page 8840]]

HTSUS subheadings are provided for convenience and customs purposes 
only, and the written description of the merchandise under 
investigation is dispositive.

[FR Doc. 2020-03104 Filed 2-14-20; 8:45 am]
BILLING CODE 3510-DS-P