[Federal Register Volume 85, Number 53 (Wednesday, March 18, 2020)]
[Notices]
[Pages 15430-15433]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-05608]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-201-844]
Steel Concrete Reinforcing Bar From Mexico: Affirmative
Preliminary Determination of Circumvention of the Antidumping Duty
Order
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: We preliminarily determine that steel concrete reinforcing bar
(rebar) from Mexico that is bent on one or both ends and otherwise
meeting the description of in-scope merchandise--if produced and/or
exported by Deacero S.A.P.I. de C.V. (Deacero) to the United States--is
circumventing the antidumping duty order on rebar from Mexico.
DATES: Applicable March 18, 2020.
FOR FURTHER INFORMATION CONTACT: Jonathan Hall-Eastman, Office III,
Antidumping and Countervailing Duty Operations, International Trade
Administration, U.S. Department of Commerce, 1401 Constitution Avenue
NW, Washington, DC 20230; telephone: (202) 482-1468.
SUPPLEMENTARY INFORMATION:
Background
On September 15, 2014, the Department of Commerce (Commerce)
published antidumping duty (AD) Order on rebar from Mexico.\1\ On
October 18, 2019, in response to a request from the Rebar Trade Action
Coalition (the petitioner),\2\ Commerce initiated a circumvention
inquiry into whether imports of otherwise straight rebar bent on one or
both ends (also referred to as hooked rebar) that is produced and/or
exported to the United States by Deacero and otherwise meeting the
description of in-scope merchandise, constitutes merchandise ``altered
in form or appearance in minor respects'' from in-scope merchandise
that should be considered subject to AD Order on rebar from Mexico.\3\
Commerce also indicated that it would examine ``whether to apply the
results of this anti-circumvention inquiry to imports of similarly
situated other straight rebar bent at one or both ends from Mexico
regardless of producer or exporter.'' \4\ For a complete description of
the events that followed the initiation of this review, see the
Preliminary Decision Memorandum.\5\
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\1\ See Steel Concrete Reinforcing Bar from Mexico: Final
Determination of Sales at Less Than Fair Value and Final Affirmative
Determination of Critical Circumstances, 79 FR 54967 (September 15,
2014) (Order).
\2\ See Petitioner's Letter, ``Steel Concrete Reinforcing Bar
from Mexico: Request for Scope Ruling or, Alternatively, an Anti-
Circumvention Ruling,'' dated September 3, 2019.
\3\ See Steel Concrete Reinforcing Bar from Mexico: Initiation
of Anti-Circumvention Inquiry of Antidumping Duty Order; 84 FR 58132
(October 30, 2019), and accompanying Initiation Memorandum.
\4\ Id., Initiation Memorandum at 8-9.
\5\ See Memorandum, ``Affirmative Preliminary Decision
Memorandum of Circumvention Concerning Certain Hooked or Bent Steel
Concrete Reinforcing Bar Produced and/or Exported by Deacero
S.A.P.I. de C.V,'' dated concurrently with, and hereby adopted by,
this notice (Preliminary Decision Memorandum).
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Scope of the Order
The merchandise subject to this Order is steel concrete reinforcing
bar imported in either straight length or coil form (rebar) regardless
of metallurgy, length, diameter, or grade. The subject merchandise is
classifiable in the Harmonized Tariff Schedule of the United States
(HTSUS) primarily under item numbers 7213.10.0000, 7214.20.0000, and
7228.30.8010.
The subject merchandise may also enter under other HTSUS numbers
including 7215.90.1000, 7215.90.5000, 7221.00.0017, 7221.00.0018,
7221.00.0030, 7221.00.0045, 7222.11.0001, 7222.11.0057, 7222.11.0059,
7222.30.0001, 7227.20.0080, 7227.90.6085, 7228.20.1000, and
7228.60.6000. Specifically excluded are plain rounds (i.e., non-
deformed or smooth rebar). Also excluded from the scope is deformed
steel wire meeting ASTM A1064/A1064M with no bar markings (e.g., mill
mark, size or grade) and without being subject to an elongation test.
HTSUS numbers are provided for convenience and customs purposes;
however, the written description of the scope remains dispositive.
Scope of the Circumvention Inquiry
The merchandise subject to this circumvention inquiry consists of
otherwise straight steel concrete reinforcing bar bent on one or both
ends and otherwise meeting the description of in-scope merchandise
under the Order produced and/or exported by Deacero from Mexico to the
United States. The petitioner's December 27, 2019 filing stated that:
the issues present in this anti-circumvention inquiry are
limited to deterring circumvention of the order due to modification
of straight length with a hook or bend that is easily removable, has
no commercially relevant purpose, and is not designed to an industry
standard design for incorporation into a specific construction
project. Petitioner does not attempt to include all fabricated
products in the scope of the order as minor alterations and this
issue is not before the Department.\6\
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\6\ See Petitioner's Letter ``Steel Concrete Reinforcing Bar
from Mexico: Response to Deacero December 10, 2019 Comments,'' dated
December 27, 2019, at 2.
The petitioner's January 31, 2020 filing further noted that ``the
issue before the Department is whether Deacero's sales to (a particular
customer) circumvented the order.'' \7\ Unlike for Deacero, we
preliminarily find there is no evidence on the record of this inquiry
indicating that other Mexican producers are exporting hooked rebar to
the United States that did not have a connection to a specific,
identified construction project. Therefore, we have not applied our
preliminary affirmative finding to hooked rebar country-wide.\8\
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\7\ See Petitioner's Letter, ``Steel Concrete Reinforcing Bar
from Mexico: Response to Deacero's January 15, 2020 Comments,''
dated January 31, 2020, at 9.
\8\ For further information, see the Preliminary Decision
Memorandum.
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Statutory and Regulatory Framework
Section 781(c) of the Tariff Act of 1930, as amended (the Act),
which deals with minor alterations of merchandise, states that:
(1) In general: The class or kind of merchandise subject to (A)
an investigation under this title, (B) an antidumping duty order
issued under section 736, (C) a finding issued under the Antidumping
Act, 1921, or (D) a countervailing duty order issued under section
706 or section 303, shall include articles altered in form or
appearance in minor respects (including raw agricultural products
that have undergone minor processing), whether or not included in
the same tariff classification. (2) Exception. Paragraph (1) shall
not apply with respect to altered merchandise if the administering
authority determines that it would be unnecessary to consider the
altered merchandise within the scope of the investigation, order, or
finding.
As stated under 19 CFR 351.225(a), issues may arise as to whether a
particular product is included within the scope of an AD or
countervailing duty (CVD) order or a suspended investigation. Such
issues can arise
[[Page 15431]]
because the descriptions of subject merchandise contained in Commerce's
determinations must be written in general terms. At other times, a
domestic interested party may allege that a change to an imported
product or the place where the imported product is assembled
constitutes circumvention under section 781 of the Act. When such
issues arise, Commerce conducts circumvention inquiries that clarify
the scope of an order or suspended investigation with respect to
particular products. Pursuant to section 781(c) of the Act and 19 CFR
351.225(i), Commerce may include within the scope of an AD or CVD order
articles altered in form or appearance in minor respects.
While the statute is silent regarding what factors to consider in
determining whether alterations are properly considered ``minor,'' the
legislative history of this provision indicates that there are certain
factors which should be considered before reaching a circumvention
determination. Previous circumvention cases \9\ have relied on the
factors listed in the Senate Finance Committee report on the Omnibus
Trade and Competitiveness Act of 1988 (which amended the Act to include
the circumvention provisions contained in section 781 of the Act),
which states:
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\9\ See, e.g., Final Determination of Circumvention of the
Antidumping Order: Cut-to-Length Carbon Steel Plate From Canada, 66
FR 7617, 7618 (January 24, 2001)) (CTL Plate from Canada), and
accompanying Issues and Decision Memorandum (IDM) at Comment 4, in
which Commerce discusses its application of the factors discussed in
the Senate Finance Committee report; see also Final Results of Anti-
Circumvention Review of Antidumping Order: Corrosion-Resistant
Carbon Steel Flat Products From Japan, 68 FR 33676, 33677 (June 5,
2003); and Affirmative Final Determination of Circumvention of the
Antidumping Duty Order on Certain Cut-to-Length Carbon Steel Plate
From the People's Republic of China, 74 FR 40565, 40566 (August 12,
2009), and accompanying IDM.
{i{time} n applying this provision, the Commerce Department
should apply practical measurements regarding minor alterations, so
that circumvention can be dealt with effectively, even where such
alterations to an article technically transform it into a
differently designated article. The Commerce Department should
consider such criteria as the overall physical characteristics of
the merchandise, the expectations of the ultimate users, the use of
the merchandise, the channels of marketing and the cost of any
modification relative to the total value of the imported
products.\10\
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\10\ See Omnibus Trade Act of 1987, Report of the Senate Finance
Committee, S. Rep. No. 71, 100th Cong., 1st Sess. 100 (1987).
In the case of an allegation of a ``minor alteration'' under
section 781(c) of the Act, it is Commerce's practice to look at the
five factors listed in the Senate Finance Committee report to determine
if circumvention exists in a particular case.\11\
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\11\ See, e.g., CTL Plate from Canada IDM at Comment 4.
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Preliminary Determination
We preliminarily determine that hooked rebar and straight rebar are
not significantly dissimilar in terms of overall physical
characteristics of the merchandise, the expectations of the ultimate
users, the use of the merchandise, channels of marketing, and the
timing and circumstances under which Deacero exported the hooked rebar.
We also preliminarily determine that, based on the information
submitted by Deacero, there is a significant dissimilarity in
production costs between the hooked rebar and straight rebar. Because
we find that hooked rebar and straight rebar are not significantly
dissimilar as regards the first four criteria, and based on the timing
and circumstances under which Deacero exported the hooked rebar, we
preliminarily determine that the hooked rebar at issue produced and/or
exported by Deacero constitutes merchandise ``altered in form or
appearance in minor respects'' from in-scope merchandise, within the
meaning of section 781(c)(1) of the Act.\12\
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\12\ For additional information, see the Preliminary Decision
Memorandum.
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Also, we preliminarily determine there is no evidence on the record
of this inquiry indicating that other Mexican producers and exporters
of hooked rebar to the United States are circumventing the AD Order on
rebar from Mexico. Further, unlike Aluminum Extrusions,\13\ where
Commerce applied a circumvention finding country-wide, there are no
arguments or information on the record that demonstrates the need for
Commerce to extend our preliminary findings to all Mexican
producers.\14\
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\13\ See Aluminum Extrusions from the People's Republic of
China: Final Affirmative Determination of Circumvention of the
Antidumping Duty and Countervailing Duty Orders, and Partial
Rescission, 84 FR 39805 (August 12, 2019) (Aluminum Extrusions), and
accompanying IDM at 18.
\14\ For additional information, see the Preliminary Decision
Memorandum.
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Suspension of Liquidation
In accordance with section 351.225(l)(2) of Commerce's regulations,
we will direct U.S. Customs and Border Protection (CBP) to suspend
liquidation of otherwise straight steel concrete reinforcing bar bent
on one or both ends and otherwise meeting the description of in-scope
merchandise under the Order that is produced and/or exported to the
United States by Deacero that are entered, or withdrawn from warehouse,
for consumption on or after October 18, 2019, the date of the
initiation of this inquiry. Pursuant to 19 CFR 351.225(l)(2), we will
also instruct CBP to require a cash deposit of estimated duties equal
to the AD rate in effect for Deacero for each unliquidated entry of
otherwise straight steel concrete reinforcing bar bent on one or both
ends and otherwise meeting the description of in-scope merchandise
under the Order that is produced and/or exported to the United States
by Deacero on or after October 18, 2019.\15\ The suspension of
liquidation instructions will remain in effect until further notice.
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\15\ See Steel Concrete Reinforcing Bar from Mexico: Final
Results of Antidumping Duty Administrative Review; 2016-2017, 84 FR
35599 (July 24, 2019).
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Hooked rebar produced and/or exported by Deacero that has been sold
in connection with a specific, identified construction project and
produced according to an engineer's structural design, consistent with
industry standards, is not subject to this inquiry. However, imports of
such merchandise are subject to certification requirements, and cash
deposits may be required if the certification requirements are not
satisfied. Accordingly, if an importer imports hooked rebar from Mexico
produced and/or exported by Deacero and claims that the hooked rebar
has been sold in connection with a specific, identified construction
project and produced according to an engineer's structural design,
consistent with industry standards, the importer is required to meet
the certification and documentation requirements described in
Appendices II and III, in order for cash deposits pursuant to the
Mexico rebar order not to be required.
Public Comment
Interested parties are invited to comment on this preliminary
determination of circumvention and may submit case briefs and/or
written comments within 20 days of the publication of this notice.\16\
Interested parties may file rebuttal briefs limited to issues raised in
the case briefs no later than 10 days after the date on which the case
briefs are due.\17\ Interested parties may request a hearing within 20
days of the publication of this notice. Interested parties will be
notified by Commerce of the location and time of any hearing, if one is
requested.
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\16\ See 19 CFR 351.225(f)(3).
\17\ Id.
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Notification to Interested Parties
This affirmative preliminary circumvention determination is in
[[Page 15432]]
accordance with section 781(c) of the Act and 19 CFR 351.225.
Dated: February 28, 2020.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.
Appendix I
List of Topics Discussed in the Preliminary Decision Memorandum
I. Summary
II. Background
III. Scope of the Order
IV. Statutory and Regulatory Framework
V. Analysis
A. Whether the Hooked Rebar at Issue Constitutes Merchandise Altered
in Form or Appearance in Minor Respects
B. Certification Language
VI. Recommendation
Appendix II
Certification Requirements
If an importer imports otherwise straight rebar bent on one or
both ends (hooked rebar) from Mexico produced and/or exported by
Deacero and claims that the hooked rebar has been sold in connection
with specific, identified construction project and produced
according to an engineer's structural design, consistent with
industry standards, the importer is required to complete and
maintain the importer certification attached hereto as Appendix III
and all supporting documentation. Where the importer uses a broker
to facilitate the entry process, the importer should obtain the
entry number from the broker. Agents of the importer, such as
brokers, however, are not permitted to make this certification on
behalf of the importer.
For shipments and/or entries from October 18, 2019 through March
29, 2020, if a certification is required, importers should complete
the required certification within 30 days of the publication of this
notice in the Federal Register. Accordingly, where appropriate, the
relevant bullet in the certification should be edited to reflect
that the certification was completed within the time frame specified
above. For example, the bullet in the importer certification that
reads: ``This certification was completed at or prior to the time of
entry,'' could be edited as follows: ``The imports referenced herein
entered before March 30, 2020. This certification was completed on
mm/dd/yyyy, within 30 days of the Federal Register notice
publication of the preliminary determination of circumvention.'' For
such entries/shipments, importers have the option to complete a
blanket certification covering multiple entries/shipments,
individual certifications for each entry/shipment, or a combination
thereof.
For shipments and/or entries on or after March 30, 2020, if a
certification is required, importers should complete the
certification at or prior to the date of entry.
The importer is also required to maintain sufficient
documentation supporting its certifications. The importer will not
be required to submit the certifications or supporting documentation
to U.S. Customs and Border Protection (CBP) as part of the entry
process at this time. However, the importer will be required to
present the certifications and supporting documentation to Commerce
and/or CBP, as applicable, upon request by the respective agency.
Additionally, the claims made in the certifications and any
supporting documentation are subject to verification by Commerce
and/or CBP. The importer is required to maintain the certification
and supporting documentation for the later of: (1) A period of five
years from the date of entry, or (2) a period of three years after
the conclusion of any litigation in United States courts regarding
such entries.
In the situation where no certification is provided for an
entry, Commerce intends to instruct CBP to suspend liquidation of
the entry and collect cash deposits at the rate applicable to
Deacero.
Appendix III
Importer Certification
I hereby certify that:
My name is {IMPORTING COMPANY OFFICIAL'S NAME{time}
and I am an official of {IMPORTING COMPANY{time} ;
I have direct personal knowledge of the facts regarding
the importation into the Customs territory of the United States of
the otherwise straight rebar bent on one or both ends (hooked rebar)
from Mexico produced and/or exported by Deacero S.A.P.I. (Deacero)
that entered under entry number(s), identified below, and which are
covered by this certification. ``Direct personal knowledge'' for
purposes of this certification refers to facts in records maintained
by the importing company in the normal course of its business.
The hooked rebar covered by this certification was
produced and/or exported by Deacero.
If the importer is acting on behalf of the first U.S. customer,
complete this paragraph:
The hooked rebar from Mexico produced and/or exported
by Deacero covered by this certification was imported by {NAME OF
IMPORTING COMPANY{time} on behalf of {NAME OF U.S. CUSTOMER{time} ,
located at {ADDRESS OF U.S. CUSTOMER{time} .
The hooked rebar from Mexico produced and/or exported
by Deacero covered by this certification was shipped to {NAME OF
PARTY TO WHOM MERCHANDISE WAS FIRST SHIPPED IN THE UNITED
STATES{time} , located at {ADDRESS OF SHIPMENT{time} .
I have personal knowledge of the facts regarding the
production of hooked rebar from Mexico produced and/or exported by
Deacero identified below. ``Personal knowledge'' includes facts
obtained from another party (e.g., correspondence received by the
importer from the producer regarding the country of manufacture of
the imported products).
The hooked rebar from Mexico was produced and/or
exported by Deacero.
The imports of hooked rebar have been sold in
connection with a specific, identified construction project and
produced according to an engineer's structural design, consistent
with industry standards.
This certification applies to the following entries:
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Entry summary line Invoice line item
Producer Entry summary No. item No. Invoice No. No.
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I understand that {NAME OF IMPORTING COMPANY{time} is
required to maintain a copy of this certification and sufficient
documentation supporting this certification (i.e., documents
maintained in the normal course of business, or documents obtained
by the certifying party, for example, mill certificates, production
records, invoices, etc.) for the later of (1) a period of five years
from the date of entry or (2) a period of three years after the
conclusion of any litigation in the United States courts regarding
such entries.
I understand that {NAME OF IMPORTING COMPANY{time} is
required to provide this certification and supporting records, upon
request, to U.S. Customs and Border Protection (CBP) and/or the
Department of Commerce (Commerce).
I understand that the claims made herein, and the
substantiating documentation, are subject to verification by CBP
and/or Commerce.
I understand that failure to maintain the required
certifications, and/or failure to substantiate the claims made
herein, and/or failure to allow CBP and/or Commerce to verify the
claims made herein, may result in a determination that all entries
to which this certification applies are within the scope of the
antidumping duty order on steel concrete reinforcing bar from
Mexico. I understand that such finding could result in:
[cir] Suspension of liquidation of all unliquidated entries (and
entries for which liquidation has not become final) for which these
requirements were not met;
[cir] the requirement that the importer post applicable
antidumping duty cash deposits (as appropriate) equal to the rates
determined by Commerce; and
[cir] the revocation of {NAME OF IMPORTING COMPANY{time} 's
privilege to certify future imports of steel concrete reinforcing
bar from Mexico.
[[Page 15433]]
I understand that agents of the importer, such as
brokers, are not permitted to make this certification.
This certification was completed at or prior to the
time of entry.
I am aware that U.S. law (including, but not limited
to, 18 U.S.C. 1001) imposes criminal sanctions on individuals who
knowingly and willfully make materially false statements to the U.S.
government.
Signature
NAME OF COMPANY OFFICIAL
TITLE
DATE
[FR Doc. 2020-05608 Filed 3-17-20; 8:45 am]
BILLING CODE 3510-DS-P