[Federal Register Volume 85, Number 204 (Wednesday, October 21, 2020)]
[Notices]
[Pages 66932-66935]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-23269]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-124]
Certain Vertical Shaft Engines Between 99cc and Up to 225cc, and
Parts Thereof, From the People's Republic of China: Preliminary
Affirmative Determination of Sales at Less Than Fair Value, and
Preliminary Affirmative Determination of Critical Circumstances, in
Part
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (Commerce) preliminarily determines
that certain vertical shaft engines between 99cc and up to 225cc, and
parts thereof (small vertical engines) from the People's Republic of
China (China) are being, or are likely to be, sold in the United States
at less than fair value (LTFV). The period of investigation is July 1,
2019 through December 31, 2019. Interested parties are invited to
comment on this preliminary determination.
DATES: Applicable October 21, 2020.
FOR FURTHER INFORMATION CONTACT: Benjamin A. Luberda or Whitley
Herndon, AD/CVD Operations, Office II, Enforcement and Compliance,
International Trade Administration, U.S. Department of Commerce, 1401
Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-2185
or (202) 482-6274, respectively.
SUPPLEMENTARY INFORMATION:
Background
This preliminary determination is made in accordance with section
733(b) of the Tariff Act of 1930, as amended (the Act). Commerce
published the notice of initiation of this investigation on April 7,
2020.\1\ On August 5, 2020, Commerce postponed the preliminary
determination of this investigation and the revised deadline is now
October 14, 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 included 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 http://enforcement.trade.gov/frn/. The signed
and the electronic versions of the Preliminary Decision Memorandum are
identical in content.
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\1\ See Certain Vertical Shaft Engines Between 99cc and Up To
225cc, and Parts Thereof from the People's Republic of China:
Initiation of Less-Than-Fair-Value Investigation, 85 FR 20670 (April
14, 2020) (Initiation Notice).
\2\ See Certain Vertical Shaft Engines Between 99cc and Up To
225cc, and Parts Thereof from the People's Republic of China:
Postponement of Preliminary Determination in the Less-Than-Fair-
Value Investigation, 85 FR 47357 (August 5, 2020).
\3\ See Memorandum, ``Decision Memorandum for the Preliminary
Determination in the Less-Than-Fair-Value Investigation of Certain
Vertical Shaft Engines Between 99cc and Up To 225cc, and Parts
Thereof, from the People's Republic of China'' 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 small vertical engines
from China. 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 (scope).\5\ Certain interested
parties commented on the scope of the
[[Page 66933]]
investigation as it appeared in the Initiation Notice, as well as
additional language proposed by Briggs & Stratton Corporation (the
petitioner).\6\ For a summary of the product coverage comments and
rebuttal responses submitted to the record for this investigation, and
accompanying discussion and analysis of all comments timely received,
see the Preliminary Scope Decision Memorandum.\7\ Commerce has
preliminarily modified the scope language that appeared in the
Initiation Notice. See the revised scope in Appendix I to this notice.
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\4\ See Antidumping Duties; Countervailing Duties, Final Rule,
62 FR 27296, 27323 (May 19, 1997).
\5\ See Initiation Notice.
\6\ See Petitioner's Letter, ``Small Vertical Shaft Engines
Between 99cc and Up To 225cc, and Parts Thereof, from the People's
Republic of China: Petitioner's Additional Comments on Scope,''
dated June 18, 2020.
\7\ See Memorandum, ``Antidumping and Countervailing Duty
Investigations of Certain Vertical Shaft Engines Between 99cc and Up
To 225cc, and Parts Thereof from the People's Republic of China:
Scope Comments Decision Memorandum for the Preliminary
Determination,'' dated August 17, 2020 (Preliminary Scope Decision
Memorandum).
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Methodology
Commerce is conducting this investigation in accordance with
section 731 of the Act. Commerce has calculated export price in
accordance with section 772(a) of the Act. Commerce has calculated
constructed export price in accordance with section 772(b) of the Act.
Because China is a non-market economy, within the meaning of section
771(18) of the Act, Commerce has calculated normal value (NV) in
accordance with section 773(c) of the Act. Furthermore, pursuant to
section 776(a) and (b) of the Act, Commerce has preliminarily relied
upon the facts otherwise available, with adverse inferences, in
determining the estimated weighted-average dumping margin for the
China-wide entity. For a full description of the methodology underlying
Commerce's preliminary determination, see the Preliminary Decision
Memorandum.
Preliminary Affirmative Determination of Critical Circumstances, in
Part
In accordance with section 733(e) of the Act and 19 CFR 351.206,
Commerce preliminarily determines that critical circumstances exist
with respect to imports of small vertical engines from China for
Chongqing Zongshen General Power Machine Co., Ltd./Chongqing Dajiang
Power Equipment Co., Ltd./Chongqing Zongshen Power Machinery Co., Ltd
(collectively, the Zongshen Companies),\8\ and the China-wide entity,
but do not exist for Chongqing Kohler Engines Ltd. (Chongqing Kohler)
and the separate-rate companies. For a full description of the
methodology and results of Commerce's critical circumstances analysis,
see the Preliminary Decision Memorandum.
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\8\ Commerce preliminarily determines that Chongqing Zongshen
General Power Machine Co., Ltd./Chongqing Dajiang Power Equipment
Co., Ltd./Chongqing Zongshen Power Machinery Co., Ltd. should be
treated as a single entity. See Memorandum, ``Whether to Collapse
Chongqing Zongshen General Power Machine Co., Ltd. and Two
Affiliates in the Less-Than-Fair-Value Investigation of Certain
Vertical Shaft Engines Between 99cc and Up To 225cc, and Parts
Thereof, from the People's Republic of China,'' dated October 14,
2020.
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Combination Rates
In the Initiation Notice,\9\ Commerce stated that it would
calculate producer/exporter combination rates for the respondents that
are eligible for a separate rate in this investigation. Policy Bulletin
05.1 describes this practice.\10\
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\9\ See Initiation Notice, 85 FR 20674.
\10\ See Enforcement and Compliance's Policy Bulletin No. 05.1
regarding, ``Separate-Rates Practice and Application of Combination
Rates in Antidumping Investigations involving Non-Market Economy
Countries,'' (April 5, 2005) (Policy Bulletin 05.1), available on
Commerce's website at http://enforcement.trade.gov/policy/bull05-1.pdf.
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Separate Rates
In addition to the mandatory respondents Chongqing Kohler and the
Zongshen Companies, we have preliminarily granted certain non-
individually examined respondents a separate rate. Also, we have
preliminarily denied a separate rate to Loncin Motor Co., Ltd., and are
treating it as part of the China-wide entity. See the Preliminary
Decision Memorandum for details.
In calculating the rate for non-individually examined separate rate
respondents in a non-market economy antidumping duty (AD)
investigation, Commerce normally looks to section 735(c)(5)(A) of the
Act, which pertains to the calculation of the all-others rate in a
market economy AD investigation. Pursuant to section 735(c)(5)(A) of
the Act, normally this rate shall be an amount equal to the weighted
average of the estimated AD rates established for those companies
individually examined, excluding zero and de minimis rates and any
rates based entirely under section 776 of the Act. Pursuant to the
guidance in section 735(c)(5)(A) of the Act, we based the separate rate
respondents' dumping margin on the dumping margins that we calculated
for the mandatory respondents Chongqing Kohler and the Zongshen
Companies. See the table in the ``Preliminary Determination'' section
of this notice.
Preliminary Determination
Commerce preliminarily determines that the following estimated
weighted-average dumping margins exist:
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Estimated Cash deposit rate
weighted-average (adjusted for
Producer Exporter dumping margin subsidy offsets)
(percent) (percent)
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Chongqing Kohler Engines Ltd............... Chongqing Kohler Engines Ltd. 374.31 363.77
Chongqing Zongshen General Power Machine Chongqing Zongshen General 316.88 305.12
Co., Ltd./Chongqing Dajiang Power Power Machine Co., Ltd./
Equipment Co., Ltd./Chongqing Zongshen Chongqing Dajiang Power
Power Machinery Co., Ltd. Equipment Co., Ltd./
Chongqing Zongshen Power
Machinery Co., Ltd.
Producers Supplying the Non-Individually- Non-Individually-Examined 342.88 331.73
Examined Exporters Receiving Separate Exporters Receiving Separate
Rates (see Appendix III). Rates (see Appendix III).
China-Wide Entity.......................... ............................. 541.75 530.60
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Suspension of Liquidation
In accordance with section 733(d)(2) of the Act, Commerce will
direct U.S. Customs and Border Protection (CBP) to suspend liquidation
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,
as discussed below. Further, pursuant to section 733(d)(1)(B) of the
Act and 19 CFR 351.205(d), Commerce will instruct CBP to require a cash
deposit equal to the weighted average amount by which NV exceeds U.S.
price, as indicated in the chart above as follows: (1) For the
producer/exporter combinations listed in the table above, the cash
deposit rate is equal to the estimated weighted-average dumping margin
listed for that combination in the table; (2) for all combinations of
Chinese producers/exporters of merchandise
[[Page 66934]]
under consideration that have not established eligibility for their own
separate rates, the cash deposit rate will be equal to the estimated
weighted-average dumping margin established for the China-wide entity;
and (3) for all third-county exporters of merchandise under
consideration not listed in the table above, the cash deposit rate is
the cash deposit rate applicable to the Chinese producer/exporter
combination (or the China-wide entity) that supplied that third-country
exporter.
Section 733(e)(2) of the Act provides that, given an affirmative
determination of critical circumstances, any suspension of liquidation
shall apply to unliquidated entries of merchandise entered, or
withdrawn from warehouse, for consumption on or after the later of (a)
the date which is 90 days before the date on which the suspension of
liquidation was first ordered, or (b) the date on which notice of
initiation of the investigation was published. Commerce preliminarily
finds that critical circumstances exist for imports of subject
merchandise from the Zongshen Companies and the China-wide entity. In
accordance with section 733(e)(2)(A) of the Act, the suspension of
liquidation shall apply to all unliquidated entries of merchandise from
the Zongshen Companies and the China-wide entity that were entered, or
withdrawn from warehouse, for consumption on or after the date that is
90 days before the publication of this notice.
To determine the cash deposit rate, Commerce normally adjusts the
estimated weighted-average dumping margin by the amount of domestic
subsidy pass-through and export subsidies determined in a companion
countervailing duty (CVD) proceeding when CVD provisional measures are
in effect. Accordingly, where Commerce has made a preliminary
affirmative determination for domestic subsidy pass-through or export
subsidies, Commerce has offset the calculated estimated weighted-
average dumping margin by the appropriate rate(s). Any such adjusted
rates may be found in the Preliminary Determination section's chart of
estimated weighted-average dumping margins above.
Should provisional measures in the companion CVD investigation
expire prior to the expiration of provisional measures in this LTFV
investigation, Commerce will direct CBP to begin collecting cash
deposits at a rate equal to the estimated weighted-average dumping
margins calculated in this preliminary determination unadjusted for the
passed-through domestic subsidies or for export subsidies at the time
the CVD provisional measures expire.
These suspension of liquidation instructions will remain in effect
until further notice.
Disclosure
Commerce intends to disclose to interested parties the calculations
performed in connection with this preliminary determination within five
days of its public announcement or, if there is no public announcement,
within five days of the date of publication of this notice in
accordance with 19 CFR 351.224(b).
Verification
Commerce is currently unable to conduct on-site verification of the
information relied upon in making its final determination in this
investigation. Accordingly, we intend to take additional steps in lieu
of on-site verification. Commerce will notify interested parties of any
additional documentation or information required.
Public Comment
Case briefs or other written comments may be submitted to the
Assistant Secretary for Enforcement and Compliance. Interested parties
will be notified of the timeline for the submission of case briefs and
written comments at a later date. Rebuttal briefs, limited to issues
raised in case briefs, may be submitted no later than seven days after
the deadline for case briefs.\11\ Commerce has modified certain of its
requirements for serving documents containing business proprietary
information until further notice.\12\ 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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\11\ See 19 CFR 351.309; see also 19 CFR 351.303 (for general
filing requirements).
\12\ See Temporary Rule Modifying AD/CVD Service Requirements
Due to COVID-19; Extension of Effective Period, 85 FR 41363 (July
10, 2020).
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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 a date and time to be
determined. Parties should confirm by telephone the date, time, and
location of the hearing two days before the scheduled date.
Final Determination
Section 735(a)(1) of the Act and 19 CFR 351.210(b)(1) provide that
Commerce will issue the final determination within 75 days after the
date of its preliminary determination. Accordingly, Commerce will make
its final determination no later than 75 days after the signature date
of this preliminary determination.
International Trade Commission Notification
In accordance with section 733(f) of the Act, Commerce will notify
the International Trade Commission (ITC) of its preliminary
determination of sales at LTFV. If the final determination is
affirmative, the ITC will determine before the later of 120 days after
the date of this preliminary determination or 45 days after the final
determination whether imports of the subject merchandise are materially
injuring, or threaten material injury to, the U.S. industry.
Notification to Interested Parties
This determination is issued and published in accordance with
sections 733(f) and 777(i)(1) of the Act and 19 CFR 351.205(c).
Dated: October 14, 2020.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.
Appendix I
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, whether mounted or
unmounted, primarily for walk-behind lawn mowers. Engines meeting
this physical description may also be for other non-hand-held
outdoor power equipment, including but not limited to, pressure
washers. The subject engines are spark ignition, single-cylinder,
air cooled, internal combustion engines with vertical power take off
shafts with a minimum displacement of 99 cubic centimeters (cc) and
a maximum displacement of up to, but not including, 225cc.
Typically, engines with displacements of this size generate gross
power of between 1.95 kilowatts (kw) to 4.75 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
[[Page 66935]]
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.
Certain small vertical shaft engines, whether or not mounted on
non-hand-held outdoor power equipment, including but not limited to
walk-behind lawn mowers and pressure washers, are included in the
scope. However, if a subject engine is imported mounted on such
equipment, only the engine is covered by the scope. Subject
merchandise includes certain small vertical shaft engines produced
in the subject country whether mounted on outdoor power equipment in
the subject country or in a third country. Subject engines are
covered whether or not they are accompanied by other parts.
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 a sump, carburetor spacer, 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 coils) for synchronizing with the
engine 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.
Specifically excluded from the scope of the investigation are
``Commercial'' or ``Heavy Commercial'' engines under 40 CFR 1054.107
and 1054.135 that have (1) a displacement of 160 cc or greater, (2)
a cast iron cylinder liner, (3) an automatic compression release,
and (4) a muffler with at least three chambers and volume greater
than 400 cc.
The engines subject to this investigation are predominantly
classified in the Harmonized Tariff Schedule of the United States
(HTSUS) at subheading 8407.90.1010. The engine subassemblies that
are subject to this investigation enter under HTSUS 8409.91.9990.
The mounted engines that are subject to this investigation enter
under HTSUS 8433.11.0050, 8433.11.0060, and 8424.30.9000. Engines
subject to this investigation may also enter under HTSUS
8407.90.1020, 8407.90.9040, and 8407.90.9060. The HTSUS subheadings
are provided for convenience and customs purposes only, and the
written description of the merchandise under investigation is
dispositive.
Appendix II
List of Topics Discussed in the Preliminary Decision Memorandum
I. Summary
II. Background
III. Period of Investigation
IV. Scope Comments
V. Scope of the Investigation
VI. Discussion of the Methodology
VII. Currency Conversion
VIII. Adjustment Under Section 777(A)(f) of the Act
IX. Adjustments to Cash Deposit Rates for Export Subsidies
X. ITC Notification
XI. Recommendation
Appendix III
List of Separate Rate Companies
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Exporter Producer
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Producers supplying the non-
Non-individually-examined exporters individually-examined exporters
receiving separate rates receiving separate rates
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Changzhou Kawasaki and Kwang Yang Changzhou Kawasaki and Kwang
Engine Co., Ltd. Yang Engine Co., Ltd.
Chongqing Chen Hui Electric Machinery CHONGQING AM PRIDE POWER &
Co., Ltd. MACHINERY CO., LTD.
Chongqing Chen Hui Electric Machinery Chongqing Kohler Motors Co.,
Co., Ltd. Ltd.
Chongqing HWASDAN Power Technology Co., Chongqing HWASDAN Power
Ltd. Technology Co., Ltd.
Chongqing Rato Technology Co., Ltd..... Chongqing Rato Technology Co.,
Ltd.
CHONGQING SENCI IMPORT&EXPORT TRADE CHONGQING AM PRIDE POWER &
CO., LTD. MACHINERY CO., LTD.
CHONGQING SENCI IMPORT&EXPORT TRADE Chongqing Zongshen General
CO., LTD. Power Machines Co., Ltd.
Jialing-Honda Motors Co., Ltd.......... Jialing-Honda Motos Co., Ltd.
Wenling Qianjiang Imp. & Exp. Co., Ltd. Chongqing Rato Technology Co.,
Ltd.
Wenling Qianjiang Imp. & Exp. Co., Ltd. QIANJIANG GROUP WENLING
JENNFENG INDUSTRY INC.
Zhejiang Amerisun Technology Co., Ltd.. CHONGQING DINKING POWER
MACHINERY CO., LTD.
Zhejiang Amerisun Technology Co., Ltd.. Chongqing Rato Technology Co.,
Ltd.
Zhejiang Amerisun Technology Co., Ltd.. LONCIN MOTOR CO., LTD.
Zhejiang Amerisun Technology Co., Ltd.. Zhejiang Dobest Power Tools
Co., Ltd.
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[FR Doc. 2020-23269 Filed 10-20-20; 8:45 am]
BILLING CODE 3510-DS-P