Import Administration, International Trade Administration, Department of Commerce.
Shane Subler and Hermes Pinilla, AD/CVD Operations, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482–0189 and (202) 482–3477, respectively.
On March 1, 2012, the Department of Commerce (“Department”) received a countervailing duty (“CVD”) petition concerning imports of drawn stainless steel sinks from the People's Republic of China (“PRC”) filed in proper form by Elkay Manufacturing Company (“Petitioner”).
In accordance with section 702(b)(1) of the Tariff Act of 1930, as amended (“Act”), Petitioner alleges that producers/exporters of drawn stainless steel sinks from the PRC received countervailable subsidies within the meaning of sections 701 and 771(5) of the Act, and that imports from these producers/exporters materially injure, or threaten material injury to, an industry in the United States.
The Department finds that Petitioner filed the Petition on behalf of the domestic industry because Petitioner is an interested party, as defined in section 771(9)(C) of the Act, and has demonstrated sufficient industry support with respect to the investigation that it requests the Department to initiate (
The period of investigation is January 1, 2011, through December 31, 2011.
The products covered by the scope of this investigation are stainless steel sinks with single or multiple drawn bowls, with or without drain boards, whether finished or unfinished, regardless of type of finish, gauge, or grade of stainless steel (“Drawn Stainless Steel Sinks”). Mounting clips, fasteners, seals, and sound-deadening pads are also covered by the scope of the investigation if they are included within the sales price of the Drawn Stainless Steel Sinks.
Excluded from the scope of the investigation are stainless steel sinks with fabricated bowls. Fabricated bowls do not have seamless corners, but rather are made by notching and bending the stainless steel, and then welding and finishing the vertical corners to form the bowls. Stainless steel sinks with fabricated bowls may sometimes be referred to as “zero radius” or “near zero radius” sinks.
The products covered by the investigation are currently classified in the Harmonized Tariff Schedule of the United States (“HTSUS”) under statistical reporting number 7324.10.000. Although the HTSUS subheading is provided for convenience and customs purposes, the written description of the products under investigation is dispositive of its inclusion as subject merchandise.
During our review of the Petition, we discussed the scope with Petitioner to ensure that it is an accurate reflection of the products for which the domestic industry is seeking relief. As a result, the “Scope of Investigation” language has been modified from the language in the Petition to reflect these clarifications.
Moreover, as discussed in the preamble to the regulations (
All submissions to the Department must be filed electronically using Import Administration's Antidumping and Countervailing Duty Centralized Electronic Service System (“IA ACCESS”). An electronically filed document must be received successfully in its entirety by the Department's electronic records system, IA ACCESS, by the time and date set by the Department. Documents excepted from the electronic submission requirements must be filed manually (
Pursuant to section 702(b)(4)(A)(ii) of the Act, on March 5, 2012, the Department invited representatives of the Government of the PRC (“GOC”) for consultations with respect to the CVD petition. Those consultations were held on March 15, 2012.
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, the Department 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, or those producers whose collective output of a domestic like product constitutes a major proportion of the total domestic production of the product. Thus, to determine whether a petition has the requisite industry support, the statute directs the Department 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 the Department and the ITC must apply the same statutory definition regarding the domestic like product (section 771(10) of the Act), they do so for different purposes and pursuant to a separate and distinct authority. In addition, the Department'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.
Section 771(10) of the Act defines the domestic like product as “a product which is like, or in the absence of like, most similar in characteristics and uses with, the article subject to an investigation under this title.” Thus, the reference point from which the domestic like product analysis begins is “the article subject to an investigation” (
With regard to the domestic like product, Petitioner does not offer a definition of the domestic like product distinct from the scope of the investigation. Based on our analysis of the information submitted on the record, we have determined that drawn stainless steel sinks constitute a single domestic like product and we have analyzed industry support in terms of that domestic like product. For a discussion of the domestic like product analysis in this case,
In determining whether 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” section of this notice. To establish industry support, Petitioner provided its own 2011 production of the domestic like product, and compared this to the total production of the domestic like product for the entire domestic industry.
Our review of the data provided in the Petition, supplemental submission, and other information readily available to the Department indicates that Petitioner has established industry support.
The Department finds that Petitioner filed the Petition on behalf of the domestic industry because it is an interested party as defined in section 771(9)(C) of the Act and it has demonstrated sufficient industry support with respect to the CVD investigation that it is requesting the Department initiate.
Because the PRC is a “Subsidies Agreement Country” within the meaning of section 701(b) of the Act, section 701(a)(2) of the Act applies to this investigation. Accordingly, the ITC must determine whether imports of the subject merchandise from the PRC materially injure, or threaten material injury to, a U.S. industry.
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, Petitioner alleges that subject imports exceed the negligibility threshold provided for under section 771(24)(A) of the Act.
Petitioner contends that the industry's injured condition is illustrated by reduced market share; underselling and price depression or suppression; decline in financial performance; lost sales and revenue; and production, capacity, capacity utilization, shipment, and employment data.
Section 702(b)(1) of the Act requires the Department to initiate a CVD proceeding whenever an interested party files a petition on behalf of an industry that: (1) Alleges the elements necessary for an imposition of a duty under section 701(a) of the Act; and (2) is accompanied by information reasonably available to the petitioner(s) supporting the allegations. The Department has examined the Petition on drawn stainless steel sinks from the PRC and finds that it complies with the requirements of section 702(b) of the Act. Therefore, in accordance with section 702(b) of the Act, we are initiating a CVD investigation to determine whether manufacturers, producers, or exporters of drawn stainless steel sinks in the PRC receive countervailable subsidies. For a discussion of evidence supporting our initiation determination,
We are including in our investigation the following programs alleged in the Petition to have provided countervailable subsidies to producers and exporters of the subject merchandise in the PRC:
1. The State Key Technology Renovation Fund.
2. “Famous Brands” Awards.
3. Grants to Cover Legal Fees in Trade Remedy Cases.
4. Special Fund for Energy Saving Technology Reform.
5. The Clean Production Technology Fund.
6. Grants for Listing Shares.
7. Export Assistance Grants.
8. Guangdong Province Science and Technology Bureau Project Fund (aka Guangdong Industry, Research, University Cooperating Fund).
9. Export Rebate for Mechanic, Electronic, and High-tech Products.
10. Funds for Outward Expansion of Industries in Guangdong Province.
11. Fund for Small and Medium Enterprises (“SME”) Bank-enterprise Cooperation Projects.
12. Special Fund for Fostering Stable Growth of Foreign Trade.
13. Local Government Deposits Into Bank Accounts.
1. Policy Loans.
2. Preferential Export Financing.
3. Treasury Bond Loans or Grants.
4. Preferential Loans for State-owned Enterprises (“SOEs”).
1. “Two Free, Three Half” Program.
2. Provincial Tax Exemptions and Reductions for “Productive” Foreign Invested. Enterprises (“FIEs”).
3. Tax Reductions for FIEs Purchasing Chinese-made Equipment.
4. Tax Reductions for FIEs in Designated Geographic Locations.
5. Tax Reductions for Technology- or Knowledge-intensive FIEs
6. Tax Reductions for FIEs that are also High or New Technology Enterprises (“HNTEs”).
7. Tax Reductions for HNTEs Involved in Designated Projects.
8. Tax Offsets for Research and Development at FIEs.
9. Tax Credits for Domestically Owned Companies Purchasing Chinese-made Equipment.
10. Tax Reductions for Export-oriented FIEs.
11. Tax Refunds for Reinvestment of FIE Profits in Export-Oriented Enterprises.
12. Tax Reduction for High-tech Industries in Guangdong Province.
1. Import Tariff and Value Added Tax (“VAT”) Exemptions for FIEs and Certain Domestic Enterprises Using Imported Equipment in Encouraged Industries.
2. VAT Rebates on FIE Purchases of Domestically Produced Equipment.
3. City Tax and Surcharge Exemptions for FIEs.
4. Exemptions from Administrative Charges for Companies in Industrial Zones.
5. Export Subsidies Characterized as “VAT Rebates”.
6. VAT and Import Duty Exemptions on Imported Material.
7. VAT Rebates on Domestically Produced Equipment.
1. Land to SOEs.
2. Lands to Companies Located in Industrial or Other Special Economic Zones.
3. Electricity.
4. Stainless Steel Coils.
1. Exemptions from Land Development Fees.
2. Land Purchase Grants.
3. Grants to Hire Post-doctoral Workers.
4. Financial Subsidies: Interest Subsidies, Preferential Loans, and Lowered Interest Rates.
5. Tax Reductions or Exemptions.
We are not including in our investigation the following programs alleged to benefit producers and exporters of the subject merchandise in the PRC:
1. Tax Exemptions and Reductions for Enterprises That Utilize Recycled Materials.
2. The State Science and Technology Support Scheme.
3. Provincial Loan Discount Special Fund for SMEs.
4. Tax Preferences Available to Companies That Operate at a Small Profit.
For further information explaining why the Department is not investigating these programs,
For this investigation, the Department expects to select respondents based on U.S. Customs and Border Protection (“CBP”) data for U.S. imports during the period of investigation. We intend to make our decision regarding respondent selection within 20 days of publication of this
In accordance with section 702(b)(4)(A)(i) of the Act and 19 CFR 351.202(f), a copy of the public version of the Petition has been provided to the representatives of the GOC. Because of the particularly large number of producers/exporters identified at Exhibit I–2 of the Petition, the Department considers the service of the public version of the Petition to the foreign producers/exporters satisfied by the delivery of the public version to the GOC, consistent with 19 CFR 351.203(c)(2).
We have notified the ITC of our initiation, as required by section 702(d) of the Act.
The ITC will preliminarily determine, within 45 days after the date on which the Petition is filed, whether there is a reasonable indication that imports of subsidized drawn stainless steel sinks from the PRC are causing material injury, or threatening to cause material injury, to a U.S. industry.
Interested parties must submit applications for disclosure under protective orders in accordance with 19 CFR 351.305. On January 22, 2008, the Department published
Any party submitting factual information in an AD or CVD proceeding must certify to the accuracy and completeness of that information.
This notice is issued and published pursuant to section 777(i) of the Act.