Certain Passenger Vehicle and Light Truck Tires From the People’s Republic of China: Initiation of Antidumping Duty Investigation
Federal Information & News Dispatch, Inc. |
Citation: "79 FR 42292"
Document Number: "A-570-016"
"Notices"
DATES: Effective:
FOR FURTHER INFORMATION CONTACT:
SUPPLEMENTARY INFORMATION: On
FOOTNOTE 1 See "Petition for the Imposition of Antidumping Duties on Imports of Certain Passenger Vehicle and Light Truck Tires from
FOOTNOTE 2 See Letter to Petitioner, "Petitions for the Imposition of Antidumping and Countervailing Duties on Imports of Certain Passenger Vehicle and Light Truck Tires from
FOOTNOTE 3 See Letter from Petitioner "Certain Passenger Vehicle and Light Truck Tires from the People's Republic of China--Petitioner's Response to the Department's
FOOTNOTE 4 See Letter from Petitioner, "Certain Passenger Vehicle and Light Truck Tires from the People's Republic of China--Petitioner's Scope Clarification Request,"
FOOTNOTE 5 See Notice of Extension of the Deadline for Determining the Adequacy of the Antidumping and Countervailing Duty Petitions: Certain Passenger Vehicle and Light Truck Tires from
FOOTNOTE 6 See Notice of Clarification: Application of "Next Business Day" Rule for Administrative Determination Deadlines Pursuant to the Tariff Act of 1930, As Amended, 70 FR 24533 (
In accordance with section 732(b) of the Tariff Act of 1930, as amended (the Act), Petitioner alleges that imports of certain passenger tires from the PRC are being, or are likely to be, sold in
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)(D) of the Act, and has demonstrated sufficient industry support with respect to the initiation of the AD investigation that it is requesting. /7/
FOOTNOTE 7 See "Determination of Industry Support for the Petition" section, below. END FOOTNOTE
Period of Investigation
Because the Petition was filed on
FOOTNOTE 8 See 19 CFR 351.204(b)(1). END FOOTNOTE
Scope of the Investigation
The product covered by this investigation is certain passenger tires from the PRC. For a full description of the scope of the investigation, See the "Scope of the Investigation" at the Appendix of this notice.
Comments on the Scope of the Investigation
During our review of the Petition, the Department issued questions to, and received responses from, Petitioner pertaining to the proposed scope in order to ensure that the language of the scope is an accurate reflection of the products for which the domestic industry is seeking relief. /9/ As discussed in the Preamble to the Department's regulations, we are setting aside a period for interested parties to raise issues regarding product coverage (scope). /10/ The period for scope comments is intended to provide the Department with ample opportunity to consider all comments and to consult with parties prior to the issuance of the preliminary determination. If scope comments include factual information, /11/ all such factual information should be limited to public information. All such comments must be filed by
FOOTNOTE 9 See General Issues Supplemental Questionnaire; see also General Issues Supplement at 2-5 and Exhibits I-SQ-2 through I-SQ-6; Scope Supplement at 2-3 and Exhibit 1; see also Second Scope Supplement at 2 and Exhibit 1. END FOOTNOTE
FOOTNOTE 10 See Antidumping Duties; Countervailing Duties (Final Rule); 62 FR 27296, 27323 (
FOOTNOTE 11 See 19 CFR 351.102(b)(21). END FOOTNOTE
FOOTNOTE 12 As 20 days from the signature date will be
Filing Requirements
All submissions to the Department must be filed electronically using Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (IA ACCESS). An electronically filed document must be received successfully in its entirety by
FOOTNOTE 13 See 19 CFR 351.303(b)(1); see also Antidumping and Countervailing Duty Proceedings: Electronic Filing Procedures; Administrative Protective Order Procedures, 76 FR 39263 (
Comments on the Product Characteristics for the AD Questionnaire
The Department requests comments from interested parties regarding the appropriate physical characteristics of certain passenger tires to be reported in response to the Department's AD questionnaire. This information will be used to identify the key physical characteristics of the subject merchandise in order to report the relevant factors of production accurately, as well as to develop appropriate product-comparison criteria.
Interested parties may provide any information or comments that they believe are relevant to the development of an accurate list of physical characteristics. Specifically, interested parties may provide comments as to which characteristics are appropriate to use as: (1) General product characteristics and (2) product-comparison criteria. We note that it is not always appropriate to use all product characteristics as product-comparison criteria. We base product-comparison criteria on meaningful commercial differences among products. In other words, while there may be some physical product characteristics utilized by manufacturers to describe certain passenger tires, it may be that only a select few product characteristics take into account commercially meaningful physical characteristics. In addition, interested parties may comment on the order in which the physical characteristics should be used in matching products. Generally, the Department attempts to list the most important physical characteristics first and the least important characteristics last.
In order to consider the suggestions of interested parties in developing and issuing the AD questionnaire, we must receive comments on product characteristics no later than
Determination of Industry Support for the Petition
Section 732(b)(1) of the Act requires that a petition be filed on behalf of the domestic industry. Section 732(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 732(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. 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
FOOTNOTE 14 See section 771(10) of the Act. END FOOTNOTE
FOOTNOTE 15
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" (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, Petitioner does not offer a definition of domestic like product distinct from the scope of the investigation. Based on our analysis of the information submitted on the record, we determine that certain passenger vehicle and light truck tires, as defined in the scope of the investigation, constitute a single domestic like product and we analyzed industry support in terms of that domestic like product. /16/
FOOTNOTE 16 See Antidumping Duty Investigation Initiation Checklist: Certain Passenger Vehicle and Light Truck Tires from
On
FOOTNOTE 17 See Letter, "Request to Poll the Domestic Industry to Determine Petitioner Standing: Certain Passenger Vehicle and Light Truck Tires from
FOOTNOTE 18 See Letter from Petitioner, "Certain Passenger Vehicle and Light Truck Tires from the People's Republic of China--Petitioner's Response to CCCMC and CRIA's Request to Poll the Industry,"
FOOTNOTE 19 See Memorandum, "Antidumping Duty Investigation of 1,1,1,2-Tetrafluoroethane from
On
FOOTNOTE 20 See Notice of Extension of the Deadline for Determining the Adequacy of the Antidumping Duty and Countervailing Duty Petitions: Certain Passenger Vehicle and Light Truck Tires from
On
FOOTNOTE 21 See Memorandum, "Certain Passenger Vehicle and Light Truck Tires from
FOOTNOTE 22 For a detailed discussion of the responses received, See AD Initiation Checklist at Attachment II. The polling questionnaire and questionnaire responses are on file electronically via IA ACCESS and can also be accessed through the CRU. END FOOTNOTE
FOOTNOTE 23 See Letter from Petitioner, "Certain Passenger Vehicle and Light Truck Tires from the People's Republic of China--Petitioner's Comments on Polling Responses,"
Our analysis of the data we received in the polling questionnaire responses indicates that the domestic producers and workers that support the Petition account for at least 25 percent of the total production of the domestic like product and 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, the Department determines that the industry support requirements of section 732(c)(4)(A) of the Act have been met. Therefore, the Department determines that Petitioner filed this Petition on behalf of the domestic industry in accordance with section 732(b)(1) of the Act because it is an interested party as defined in section 771(9)(D) of the Act and it demonstrated sufficient industry support with respect to the AD investigation that it is requesting the Department initiate. /25/
FOOTNOTE 24 See AD Initiation Checklist, at Attachment II. END FOOTNOTE
FOOTNOTE 25 Id. END FOOTNOTE
Allegations and Evidence of Material Injury and Causation
Petitioner alleges that the U.S. industry producing the domestic like product is being materially injured, or is threatened with material injury, by reason of the imports of the subject merchandise sold at less than normal value (NV). In addition, Petitioner alleges that subject imports exceed the negligibility threshold provided for under section 771(24)(A) of the Act. /26/
FOOTNOTE 26 See Volume I of the Petition at
Petitioner contends that the industry's injured condition is illustrated by reduced market share; underselling and price depression or suppression; lost sales and revenues; direct replacement of domestic shipments by subject imports; decline in shipments, reduced sales volumes, and production curtailments; decline in capacity utilization and reduced capacity allocated to U.S. production of certain passenger tires; decline in employment; adverse impact on union contract negotiations; and adverse impact on financial performance. /27/ We assessed the allegations and supporting evidence regarding material injury, threat of material injury, and causation, and we determined that these allegations are properly supported by adequate evidence and meet the statutory requirements for initiation. /28/
FOOTNOTE 27 See Volume I of the Petition, at
FOOTNOTE 28 See AD Initiation Checklist at Attachment III, Analysis of Allegations and Evidence of Material Injury and Causation for the Antidumping and Countervailing Duty Petitions Covering Certain Passenger Vehicle and Light Truck Tires from
Allegation of Sales at Less Than Fair Value
The following is a description of the allegation of sales at less than fair value upon which the Department based its decision to initiate an investigation of imports of certain passenger tires from the PRC. The sources of data for the deductions and adjustments relating to U.S. price and NV are discussed in greater detail in the AD Initiation Checklist.
Export Price
Petitioner based export price (EP) on import data obtained from the
FOOTNOTE 29 See Volume II of the Petition at II-6 through II-7; AD Supplement at Exhibit II-SQ-16; and AD Initiation Checklist. END FOOTNOTE
Normal Value
Petitioner states that the Department has treated the PRC as a non-market economy (NME) country in every proceeding in which the PRC has been involved. /30/ The presumption of NME status for the PRC has not been revoked by the Department and, therefore, in accordance with section 771(18)(C)(i) of the Act, remains in effect for purposes of the initiation of this investigation. Accordingly, the NV of the product for the investigation is appropriately based on factors of production (FOPs) valued in a surrogate market-economy country in accordance with section 773(c) of the Act. In the course of this investigation, all parties will have the opportunity to provide relevant information related to the issues of the PRC's NME status and granting of separate rates to individual exporters.
FOOTNOTE 30 See Volume II of the Petition at II-2. END FOOTNOTE
Petitioner contends that
FOOTNOTE 31 Id. at II-2 through II-6 and Exhibits II-1 through II-4. END FOOTNOTE
FOOTNOTE 32 See AD Initiation Checklist. END FOOTNOTE
FOOTNOTE 33 See 19 CFR 351.301(c)(3)(i). Note that this is the revised regulation published on
Petitioner calculated NV using the Department's NME methodology as required by 19 CFR 351.202(b)(7)(i)(C) and 19 CFR 351.408. As Petitioner is a union representing workers in the domestic industry producing certain passenger tires and is not a domestic producer, Petitioner contends it does not have access to the proprietary information on the factors of production necessary to make certain passenger tires. Therefore, Petitioner based NV on publicly available information regarding the standard direct materials used to manufacture certain passenger tires from a number of publications. /34/ Petitioner asserts that the publicly available raw material models it provided are representative, to the best of its knowledge, of the average makeup of certain passenger tires. /35/ Using this information, Petitioner calculated the average percentage of total tire weight represented by each direct material for passenger car tires and for light truck tires. The information regarding the percentages of direct materials used to make a subject tire were applied to the average tire weight for each of the ten HTSUS categories of certain passenger tires obtained from the Imports database to calculate the average amount of each direct material used in the manufacture of the subject merchandise. /36/
FOOTNOTE 34 See Volume II of the Petition at II-8 through II-10 and Exhibits II-10 through II-21; see also AD Supplement at 3-5. END FOOTNOTE
FOOTNOTE 35 Id. END FOOTNOTE
FOOTNOTE 36 Id. END FOOTNOTE
Petitioner valued the FOPs using reasonably available, public surrogate country data, specifically, Thai import data from the Global Trade Atlas (GTA) for the period
FOOTNOTE 37 See Volume II of the Petition at II-10 and Exhibit II-23. END FOOTNOTE
FOOTNOTE 38 Id. at II-10 through II-11. END FOOTNOTE
FOOTNOTE 39 Id. at Exhibit II-23. END FOOTNOTE
FOOTNOTE 40 Id. at Exhibit II-24. END FOOTNOTE
Petitioner calculated the average labor hours required to make one tire using the employment and production information from the financial statements of three PRC tire manufacturers (
FOOTNOTE 41 Id. at II-14 and Exhibits II-25 through II-26; see also AD Supplement at 5-9 and Exhibits II-SQ-3, II-SQ-5, and II-SQ-6. END FOOTNOTE
FOOTNOTE 42 See Volume II of the Petition at II-14 through II-15 and Exhibits II-27, II-32, and II-33; see also AD Supplement at 10 and Exhibit II-SQ-12. END FOOTNOTE
Petitioner calculated financial ratios (i.e., factory overhead expenses, selling, general, and administrative expenses, and profit) based on the 2013 year-end financial statements of
FOOTNOTE 43 See Volume II of the Petition at II-15 through II-16 and Exhibits II-29 and II-30; see also AD Supplement at 10-13 and Exhibits II-SQ-13 through II-SQ-17. END FOOTNOTE
FOOTNOTE 44 See AD Initiation Checklist under the "Adjustments to Normal Value" section. END FOOTNOTE
Fair Value Comparisons
Based on the data provided by Petitioner, there is reason to believe that imports of certain passenger tires from the PRC are being, or are likely to be, sold in
FOOTNOTE 45 See AD Supplement at Exhibit II-SQ-17 (chart titled "Weighted average labor rate; original
Initiation of AD Investigation
Based on our examination of the Petition on certain passenger tires from the PRC, the Department finds that the Petition meets the requirements of section 732 of the Act. Therefore, we are initiating an AD investigation to determine whether imports of certain passenger tires from the PRC are being, or likely to be, sold in
Respondent Selection
In accordance with our standard practice for respondent selection in AD investigations involving NME countries, we intend to issue quantity and value questionnaires to each potential respondent named in the Petition, /46/ and will base respondent selection on the responses received. In addition, the Department will post the quantity and value questionnaire along with the filing instructions on the Enforcement and Compliance Web site (http://trade.gov/enforcement/news.asp). Exporters and producers of certain passenger tires from the PRC that do not receive quantity and value questionnaires via mail may still submit a quantity and value response, and can obtain a copy from the Enforcement and Compliance Web site. The quantity and value questionnaire must be submitted by all PRC exporters/producers no later than
FOOTNOTE 46 See Volume I of the Petition at
Separate Rates
In order to obtain separate rate status in an NME AD investigation, exporters and producers must submit a separate rate application. /47/ The specific requirements for submitting the separate rate application in the PRC investigation are outlined in detail in the application itself, which will be available on the Department's Web site at http://trade.gov/enforcement/news.asp on the date of publication of this initiation notice in the
FOOTNOTE 47 See Policy Bulletin 05.1: Separate-Rates Practice and Application of Combination Rates in Antidumping Investigation involving Non-Market Economy Countries (
Use of Combination Rates
The Department will calculate combination rates for certain respondents that are eligible for a separate rate in an NME investigation. The Separate Rates and Combination Rates Bulletin states:
{w}hile continuing the practice of assigning separate rates only to exporters, all separate rates that the Department will now assign in its NME investigations will be specific to those producers that supplied the exporter during the period of investigation. Note, however, that one rate is calculated for the exporter and all of the producers which supplied subject merchandise to it during the period of investigation. This practice applies both to mandatory respondents receiving an individually calculated separate rate as well as the pool of non-investigated firms receiving the weighted-average of the individually calculated rates. This practice is referred to as the application of "combination rates" because such rates apply to specific combinations of exporters and one or more producers. The cash-deposit rate assigned to an exporter will apply only to merchandise both exported by the firm in question and produced by a firm that supplied the exporter during the period of investigation. /48/
FOOTNOTE 48 See Separate Rates and Combination Rates Bulletin at 6 (emphasis added). END FOOTNOTE
Distribution of Copies of the Petition
In accordance with section 732(b)(3)(A) of the Act, and 19 CFR 351.202(f), copies of the public version of the Petition have been provided to the Government of the PRC. Because of the particularly large number of producers/exporters identified in the Petition, the Department considers the service of the public version of the Petition to the foreign producers/exporters to be satisfied by the provision of the public version of the Petition to the Government of the PRC, consistent with 19 CFR 351.203(c)(2).
ITC Notification
We notified the ITC of our initiation, as required by section 732(d) of the Act.
Preliminary Determination by the ITC
The ITC will preliminarily determine, within 25 days after the date on which the ITC receives notice from the Department of initiation of the investigation, whether there is a reasonable indication that imports of certain passenger tires from the PRC are materially injuring, or threatening material injury to, a U.S. industry. /49/ A negative ITC determination will result in the investigation being terminated. /50/ Otherwise, this investigation will proceed according to statutory and regulatory time limits.
FOOTNOTE 49 See section 733(a) of the Act. END FOOTNOTE
FOOTNOTE 50 Id. END FOOTNOTE
Submission of Factual Information
On
Extension of Time Limits
On
FOOTNOTE 51 See 78 FR 57790 (
Certification Requirements
Any party submitting factual information in an AD or CVD proceeding must certify to the accuracy and completeness of that information. /52/ Parties are hereby reminded that the Department issued a final rule with respect to certification requirements, effective
FOOTNOTE 52 See section 782(b) of the Act. END FOOTNOTE
FOOTNOTE 53 See Certification of Factual Information To Import Administration During Antidumping and Countervailing Duty Proceedings, 78 FR 42678 (
Notification to Interested Parties
Interested parties must submit applications for disclosure under administrative protective order (APO) in accordance with 19 CFR 351.305(b). Instructions for filing such applications may be found on the Department's Web site at http://enforcement.trade.gov/apo/index.html.
This notice is issued and published pursuant to section 777(i) of the Act and 19 CFR 351.203(c).
Dated:
Assistant Secretary for Enforcement and Compliance.
Appendix--Scope of the Investigation
The scope of this investigation is passenger vehicle and light truck tires. Passenger vehicle and light truck tires are new pneumatic tires, of rubber, with a passenger vehicle or light truck size designation. Tires covered by this investigation may be tube-type, tubeless, radial, or non-radial, and they may be intended for sale to original equipment manufacturers or the replacement market.
Subject tires have, at the time of importation, the symbol "DOT" on the sidewall, certifying that the tire conforms to applicable motor vehicle safety standards. Subject tires may also have the following prefixes or suffix in their tire size designation, which also appears on the sidewall of the tire:
Prefix designations:
P--Identifies a tire intended primarily for service on passenger cars.
LT--Identifies a tire intended primarily for service on light trucks.
Suffix letter designations:
LT--Identifies light truck tires for service on trucks, buses, trailers, and multipurpose passenger vehicles used in nominal highway service.
All tires with a "P" or "LT" prefix, and all tires with an "LT" suffix in their sidewall markings are covered by this investigation regardless of their intended use.
In addition, all tires that lack a "P" or "LT" prefix or suffix in their sidewall markings, as well as all tires that include any other prefix or suffix in their sidewall markings, are included in the scope, regardless of their intended use, as long as the tire is of a size that is among the numerical size designations listed in the passenger car section or light truck section of the Tire and Rim Association Year Book, as updated annually.
Passenger vehicle and light truck tires, whether or not attached to wheels or rims, are included in the scope. However, if a subject tire is imported attached to a wheel or rim, only the tire is covered by the scope.
Specifically excluded from the scope of this investigation are the following types of tires: (1) Racing car tires, defined as tires for use exclusively on a race track; such tires do not bear the symbol "DOT" on the sidewall; (2) new pneumatic tires, of rubber, of a size that is not listed in the passenger car section or light truck section of the Tire and Rim Association Year Book; (3) pneumatic tires, of rubber, that are not new, including recycled and retreaded tires; and (4) non-pneumatic tires, such as solid rubber tires.
The products covered by the investigation are currently classified under the following Harmonized Tariff Schedule of
[FR Doc. 2014-17111 Filed 7-18-14;
BILLING CODE 3510-DS-P
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