Forged Steel Fluid End Blocks From the Federal Republic of Germany: Preliminary Affirmative Countervailing Duty Determination, and Alignment of Final Determination With Final Antidumping Duty Determination, 31454-31457 [2020-11206]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 85, Number 101 (Tuesday, May 26, 2020)]
[Notices]
[Pages 31454-31457]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-11206]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-428-848]


Forged Steel Fluid End Blocks From the Federal Republic of 
Germany: Preliminary Affirmative Countervailing Duty Determination, and 
Alignment of Final Determination With Final Antidumping Duty 
Determination

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

SUMMARY: The Department of Commerce (Commerce) preliminarily determines 
that countervailable subsidies are being provided to producers and 
exporters of forged steel fluid end blocks (fluid end blocks) from the 
Federal Republic of Germany (Germany) for the period of investigation 
(POI) January 1, 2018 through December 31, 2018. Interested parties are 
invited to comment on this preliminary determination.

DATES: Applicable May 26, 2020.

FOR FURTHER INFORMATION CONTACT: Bob Palmer or Joseph Dowling, AD/CVD 
Operations, Office VIII, Enforcement and Compliance, International 
Trade Administration, U.S. Department of Commerce, 1401 Constitution 
Avenue

[[Page 31455]]

NW, Washington, DC 20230; telephone: (202) 482-9068 or (202) 482-1646, 
respectively.

SUPPLEMENTARY INFORMATION:

Background

    This preliminary determination is made in accordance with section 
703(b) of the Tariff Act of 1930, as amended (the Act). Commerce 
published the notice of initiation of this investigation on January 15, 
2020.\1\ On February 27, 2020, Commerce postponed the preliminary 
determination of this investigation to May 18, 2020.\2\ For a complete 
description of the events that followed the initiation of this 
investigation, see the Preliminary Decision Memorandum.\3\ A list of 
topics discussed in the Preliminary Decision Memorandum is included as 
Appendix II 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. In addition, a complete version of the 
Preliminary Decision Memorandum can be accessed directly at https://enforcement.trade.gov/frn/. The signed and electronic versions of the 
Preliminary Decision Memorandum are identical in content.
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    \1\ See Forged Steel Fluid End Blocks from the Federal Republic 
of Germany, India, Italy and the People's Republic of China: 
Initiation of Countervailing Duty Investigations, 85 FR 2385 
(January 15, 2020) (Initiation Notice).
    \2\ See Forged Steel Fluid End Blocks from the Federal Republic 
of Germany, India, Italy, and the People's Republic of China: 
Postponement of Preliminary Determination in the Countervailing Duty 
Investigations: Postponement of Preliminary Determination in the 
Countervailing Duty Investigations, 85 FR 11336 (February 27, 2020).
    \3\ See Memorandum, ``Decision Memorandum for the Preliminary 
Determination of the Countervailing Duty Investigation of Forged 
Steel Fluid End Blocks from the Federal Republic of Germany,'' dated 
concurrently with, and hereby adopted by, this notice (Preliminary 
Decision Memorandum).
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Scope of the Investigation

    The product covered by this investigation is forged steel fluid end 
blocks from Germany. For a complete description of the scope of this 
investigation, see Appendix I.

Scope Comments

    In accordance with the preamble to Commerce's regulations,\4\ the 
Initiation Notice set aside a period of time for parties to raise 
issues regarding product coverage (i.e., scope).\5\ Certain interested 
parties commented on the scope of the investigation as it appeared in 
the Initiation Notice.
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    \4\ See Antidumping Duties; Countervailing Duties, Final Rule, 
62 FR 27296, 27323 (May 19, 1997).
    \5\ See Initiation Notice.
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    For a summary of the product coverage comments and rebuttal 
responses submitted to the record for this preliminary determination 
and accompanying discussion and analysis of all comments timely 
received, see the Preliminary Scope Decision Memorandum.\6\ Commerce is 
preliminarily modifying the scope language as it appeared in the 
Initiation Notice. See the revised scope in Appendix I.
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    \6\ See Memorandum, ``Forged Steel Fluid End Blocks from the 
Federal Republic of Germany, India, Italy, and the People's Republic 
of China: Scope Comments Decision Memorandum for the Preliminary 
Determinations,'' dated concurrently with this notice (Preliminary 
Scope Decision Memorandum).
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Methodology

    Commerce is conducting this investigation in accordance with 
section 701 of the Act. For each of the subsidy programs found 
countervailable, Commerce preliminarily determines that there is a 
subsidy, i.e., a financial contribution by an ``authority'' that 
confers a benefit to the recipient, and that the subsidy is 
specific.\7\
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    \7\ See sections 771(5)(B) and (D) of the Act regarding 
financial contribution; section 771(5)(E) of the Act regarding 
benefit; and section 771(5A) of the Act regarding specificity.
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    Commerce notes that, in making these findings, it relied, in part, 
on facts available and, because Commerce finds that one of the 
respondents did not act to the best of its ability to respond to 
Commerce's requests for information, Commerce drew an adverse inference 
where appropriate in selecting from among the facts otherwise 
available.\8\ For further information, see ``Use of Facts Otherwise 
Available and Adverse Inferences'' in the Preliminary Decision 
Memorandum.
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    \8\ See sections 776(a) and (b) of the Act.
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Alignment

    As noted in the Preliminary Decision Memorandum, in accordance with 
section 705(a)(1) of the Act and 19 CFR 351.210(b)(4), Commerce is 
aligning the final countervailing duty (CVD) determination in this 
investigation with the final determinations in the concurrent 
antidumping duty (AD) investigations of forged steel fluid end blocks 
from Germany, India, and Italy, based on a request made by the 
petitioners.\9\ Consequently, the final CVD determination will be 
issued on the same date as the final AD determinations, which are 
currently scheduled to be issued no later than September 29, 2020, 
unless postponed.
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    \9\ See Petitioners' Letter, ``Forged Steel Fluid End Blocks 
from China, Germany, India, and Italy: Petitioner's Request for 
Alignment of the Countervailing Duty Investigations with the 
Concurrent Antidumping Duty Investigations,'' dated April 1, 2020.
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All-Others Rate

    Sections 703(d) and 705(c)(5)(A) of the Act provide that in the 
preliminary determination, Commerce shall determine an estimated all-
others rate for companies not individually examined. This rate shall be 
an amount equal to the weighted average of the estimated subsidy rates 
established for those companies individually examined, excluding any 
zero and de minimis rates and any rates based entirely under section 
776 of the Act.
    In this investigation, Commerce calculated individual estimated 
countervailable subsidy rates for BGH Edelstahl Siegen GmbH and 
Schmiedewerke Gr[ouml]ditz GmbH that are not zero, de minimis, or based 
entirely on facts otherwise available. Commerce calculated the all-
others rate using a weighted average of the individual estimated 
subsidy rates calculated for the examined respondents using each 
company's publicly-ranged sales data.\10\
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    \10\ With two respondents under examination, Commerce normally 
calculates (A) a weighted-average of the estimated subsidy rates 
calculated for the examined respondents; (B) a simple average of the 
estimated subsidy rates calculated for the examined respondents; and 
(C) a weighted-average of the estimated subsidy rates calculated for 
the examined respondents using each company's publicly-ranged sales 
values. Commerce then compares (B) and (C) to (A) and selects the 
rate closest to (A) as the most appropriate rate for all other 
producers and exporters. See, e.g., Ball Bearings and Parts Thereof 
from France, Germany, Italy, Japan, and the United Kingdom: Final 
Results of Antidumping Duty Administrative Reviews, Final Results of 
Changed-Circumstances Review, and Revocation of an Order in Part, 75 
FR 53661, 53663 (September 1, 2010). As complete publicly ranged 
sales data were available, Commerce used the publicly ranged sales 
data of the mandatory respondents. For a complete analysis of the 
data, see the All-Others' Rate Calculation Memorandum, dated 
concurrently with this notice.
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Preliminary Determination

    Commerce preliminarily determines that the following estimated 
countervailable subsidy rates exist:

------------------------------------------------------------------------
                                                           Subsidy rate
                         Company                            ad valorem
                                                             (percent)
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BGH Edelstahl Siegen GmbH \11\..........................            5.25
Schmiedewerke Gr[ouml]ditz GmbH \12\....................            6.06
voestalpine Bohler Group................................           10.04
All Others..............................................            5.61
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Suspension of Liquidation
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    \11\ As discussed in the Preliminary Decision Memorandum, 
Commerce has found the following companies to be cross-owned with 
BGH Edelstahl Siegen GmbH: Boschgotthardsh[uuml]tte O. Breyer GmbH, 
BGH Edelstahlwerke GmbH, Rohstoff-, Press- und Schneidbetrieb Siegen 
GmbH, and SRG Schrott und Recycling GmbH.
    \12\ As discussed in the Preliminary Decision Memorandum, 
Commerce has found the following companies to be cross-owned with 
Schmiedewerke Gr[ouml]ditz GmbH: GMH Schmiedetechnik GmbH, 
Georgsmarienh[uuml]tte Holding GmbH, and GHM Recycling GmbH.
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    In accordance with section 703(d)(1)(B) and (d)(2) of the Act,

[[Page 31456]]

Commerce will direct U.S. Customs and Border Protection (CBP) to 
suspend liquidation of entries of subject merchandise as described in 
the scope of the investigation section entered, or withdrawn from 
warehouse, for consumption on or after the date of publication of this 
notice in the Federal Register. Further, pursuant to 19 CFR 351.205(d), 
Commerce will instruct CBP to require a cash deposit equal to the rates 
indicated above.

Disclosure

    Commerce intends to disclose its calculations and analysis 
performed to interested parties in this preliminary determination 
within five days of its public announcement, or if there is no public 
announcement, within five days of the date of this notice in accordance 
with 19 CFR 351.224(b).

Verification

    As provided in section 782(i)(1) of the Act, Commerce intends to 
verify the information relied upon in making its final determination.

Public Comment

    All interested parties will have the opportunity to submit case and 
rebuttal briefs on the preliminary scope determination. The deadline to 
submit these comments will be no later than 30 days after the 
publication of the preliminary determinations of the CVD investigations 
of fluid end blocks from Germany, India, Italy, and China in the 
Federal Register. Scope rebuttal briefs (which are limited to issues 
raised in the scope briefs) may be submitted no later than seven days 
after the deadline for the scope briefs. These deadlines apply to the 
AD and CVD fluid end blocks investigations, regardless of the deadlines 
of the preliminary determinations in the AD investigations. For all 
scope briefs and rebuttals thereto, parties must file identical 
documents simultaneously on the records of all the ongoing AD and CVD 
fluid end blocks investigations. No new factual information or business 
proprietary information may be included in either scope briefs or 
rebuttal scope briefs.
    Case briefs or other written comments regarding non-scope matters 
may be submitted to the Assistant Secretary for Enforcement and 
Compliance no later than seven days after the date on which the last 
verification report is issued in this investigation. Rebuttal briefs, 
limited to issues raised in case briefs, may be submitted no later than 
seven days after the deadline date for case briefs.\13\ Pursuant to 19 
CFR 351.309(c)(2) and (d)(2), parties who submit case briefs or 
rebuttal briefs in this investigation 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.
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    \13\ See 19 CFR 351.309; see also 19 CFR 351.303 (for general 
filing requirements).
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    Pursuant to 19 CFR 351.310(c), interested parties who wish to 
request a hearing, limited to issues raised in the case and rebuttal 
briefs, must submit a written request to the Assistant Secretary for 
Enforcement and Compliance, U.S. Department of Commerce within 30 days 
after the date of publication of this notice. Requests should contain 
the party's name, address, and telephone number, the number of 
participants, whether any participant is a foreign national, and a list 
of the issues to be discussed. If a request for a hearing is made, 
Commerce intends to hold the hearing at the U.S. Department of 
Commerce, 1401 Constitution Avenue NW, Washington, DC 20230, at a time 
and date to be determined. Parties should confirm by telephone the 
date, time, and location of the hearing two days before the scheduled 
date. Note that Commerce has modified certain of its requirements for 
serving documents containing business proprietary information, until 
July 17, 2020, unless extended.\14\
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    \14\ See Temporary Rule Modifying AD/CVD Service Requirements 
Due to COVID-19; Extension of Effective Period, 85 FR 29615 (May 18, 
2020).
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International Trade Commission Notification

    In accordance with section 703(f) of the Act, Commerce will notify 
the International Trade Commission (ITC) of its determination. Pursuant 
to section 705(b)(2) of the Act, if the final determination is 
affirmative, the ITC will make its final injury determination before 
the later of 120 days after the date of this preliminary determination 
or 45 days after Commerce's final determination.

Notification to Interested Parties

    This determination is issued and published pursuant to sections 
703(f) and 777(i) of the Act and 19 CFR 351.205(c).

    Dated: May 18, 2020.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.

Appendix I

Scope of the Investigation

    The products covered by this investigation are forged steel 
fluid end blocks (fluid end blocks), whether in finished or 
unfinished form, and which are typically used in the manufacture or 
service of hydraulic pumps.
    The term ``forged'' is an industry term used to describe the 
grain texture of steel resulting from the application of localized 
compressive force. Illustrative forging standards include, but are 
not limited to, American Society for Testing and Materials (ASTM) 
specifications A668 and A788.
    For purposes of this investigation, the term ``steel'' denotes 
metal containing the following chemical elements, by weight: (i) 
Iron greater than or equal to 60 percent; (ii) nickel less than or 
equal to 8.5 percent; (iii) copper less than or equal to 6 percent; 
(iv) chromium greater than or equal to 0.4 percent, but less than or 
equal to 20 percent; and (v) molybdenum greater than or equal to 
0.15 percent, but less than or equal to 3 percent. Illustrative 
steel standards include, but are not limited to, American Iron and 
Steel Institute (AISI) or Society of Automotive Engineers (SAE) 
grades 4130, 4135, 4140, 4320, 4330, 4340, 8630, 15-5, 17-4, F6NM, 
F22, F60, and XM25, as well as modified varieties of these grades.
    The products covered by this investigation are: (1) Cut-to-
length fluid end blocks with an actual height (measured from its 
highest point) of 8 inches (203.2 mm) to 40 inches (1,016.0 mm), an 
actual width (measured from its widest point) of 8 inches (203.2 mm) 
to 40 inches (1,016.0 mm), and an actual length (measured from its 
longest point) of 11 inches (279.4 mm) to 75 inches (1,905.0 mm); 
and (2) strings of fluid end blocks with an actual height (measured 
from its highest point) of 8 inches (203.2 mm) to 40 inches (1,016.0 
mm), an actual width (measured from its widest point) of 8 inches 
(203.2 mm) to 40 inches (1,016.0 mm), and an actual length (measured 
from its longest point) up to 360 inches (9,144.0 mm).
    The products included in the scope of this investigation have a 
tensile strength of at least 70 KSI (measured in accordance with 
ASTM A370) and a hardness of at least 140 HBW (measured in 
accordance with ASTM E10).
    A fluid end block may be imported in finished condition (i.e., 
ready for incorporation into a pump fluid end assembly without 
further finishing operations) or unfinished condition (i.e., forged 
but still requiring one or more finishing operations before it is 
ready for incorporation into a pump fluid end assembly). Such 
finishing operations may include: (1) Heat treating; (2) milling one 
or more flat surfaces; (3) contour machining to custom shapes or 
dimensions; (4) drilling or boring holes; (5) threading holes; and/
or (6) painting, varnishing, or coating.
    Excluded from the scope of this investigation are fluid end 
block assemblies

[[Page 31457]]

which (1) include (a) plungers and related housings, adapters, 
gaskets, seals, and packing nuts, (b) valves and related seats, 
springs, seals, and cover nuts, and (c) a discharge flange and 
related seals, and (2) are otherwise ready to be mated with the 
``power end'' of a hydraulic pump without the need for installation 
of any plunger, valve, or discharge flange components, or any other 
further manufacturing operations.
    The products included in the scope of this investigation may 
enter under Harmonized Tariff Schedule of the United States (HTSUS) 
subheadings 7218.91.0030, 7218.99.0030, 7224.90.0015, 7224.90.0045, 
7326.19.0010, 7326.90.8688, or 8413.91.9055. While these HTSUS 
subheadings are provided for convenience and customs purposes, the 
written description of the scope of the investigation is 
dispositive.

Appendix II

List of Topics Discussed in the Preliminary Decision Memorandum

I. Summary
II. Background
III. Scope Comments
IV. Scope of the Investigation
V. Use of Facts Otherwise Available and Adverse Inferences
VI. Subsidies Valuation
VII. Analysis of Programs
VIII. Programs Preliminarily Determined to Be Not Used during the 
POI
IX. Programs for Which Additional Information is Necessary
X. Conclusion

[FR Doc. 2020-11206 Filed 5-22-20; 8:45 am]
BILLING CODE 3510-DS-P