AD/CVD message 9226308 - Notice of preliminary determination of Vietnam-wide circumvention of countervailing duty order on cold-rolled steel flat products from the Republic of Korea (C-580-882) (C-552-002)

9226308
Aug 14, 2019
Active

Effective Date: Aug 02, 2018

Cite as: 84 FR 32875 • Cite date: Jul 10, 2019

Category: Countervailing • Type: Preliminary Determination • Sub type: AFF-Affirmative • Reference messages: 8172306 • Cases: C-552-002

1. On 07/10/2019, Commerce published in the Federal Register its notice of affirmative preliminary determination of Vietnam-wide circumvention of the antidumping duty (AD) and countervailing duty (CVD) orders on cold-rolled steel flat products (AD and CVD CRS Orders) from the Republic of Korea (Korea) (84 FR 32875) (Preliminary Determination). This message pertains to the CVD proceeding, separate cash deposit instructions will be issued for the companion AD CRS Order.

2. Scope of the countervailing duty order

The products covered by this order are certain cold-rolled (cold-reduced), flat-rolled steel products, whether or not annealed, painted, varnished, or coated with plastics or other non-metallic substances. The products covered do not include those that are clad, plated, or coated with metal. The products covered include coils that have a width or other lateral measurement (“width”) of 12.7 mm or greater, regardless of form of coil (e.g., in successively superimposed layers, spirally oscillating, etc.). The products covered also include products not in coils (e.g., in straight lengths) of a thickness less than 4.75 mm and a width that is 12.7 mm or greater and that measures at least 10 times the thickness. The products covered also include products not in coils (e.g., in straight lengths) of a thickness of 4.75 mm or more and a width exceeding 150 mm and measuring at least twice the thickness. The products described above may be rectangular, square, circular, or other shape and include products of either rectangular or non-rectangular cross-section where such cross-section is achieved subsequent to the rolling process, i.e., products which have been “worked after rolling” (e.g., products which have been beveled or rounded at the edges). For purposes of the width and thickness requirements referenced above:

(1) where the nominal and actual measurements vary, a product is within the scope if application of either the nominal or actual measurement would place it within the scope based on the definitions set forth above, and
(2) where the width and thickness vary for a specific product (e.g., the thickness of certain products with non-rectangular cross-section, the width of certain products with non-rectangular shape, etc.), the measurement at its greatest width or thickness applies.

Steel products included in the scope of the order are products in which: (1) iron predominates, by weight, over each of the other contained elements; (2) the carbon content is 2 percent or less, by weight; and (3) none of the elements listed below exceeds the quantity, by weight, respectively indicated:

• 2.50 percent of manganese, or
• 3.30 percent of silicon, or
• 1.50 percent of copper, or
• 1.50 percent of aluminum, or
• 1.25 percent of chromium, or
• 0.30 percent of cobalt, or
• 0.40 percent of lead, or
• 2.00 percent of nickel, or
• 0.30 percent of tungsten (also called wolfram), or
• 0.80 percent of molybdenum, or
• 0.10 percent of niobium (also called columbium), or
• 0.30 percent of vanadium, or
• 0.30 percent of zirconium

Unless specifically excluded, products are included in this scope regardless of levels of boron and titanium.

For example, specifically included in this scope are vacuum degassed, fully stabilized (commonly referred to as interstitial-free (IF)) steels, high strength low alloy (HSLA) steels, motor lamination steels, Advanced High Strength Steels (AHSS), and Ultra High Strength Steels (UHSS). IF steels are recognized as low carbon steels with micro-alloying levels of elements such as titanium and/or niobium added to stabilize carbon and nitrogen elements. HSLA steels are recognized as steels with micro-alloying levels of elements such as chromium, copper, niobium, titanium, vanadium, and molybdenum. Motor lamination steels contain micro-alloying levels of elements such as silicon and aluminum. AHSS and UHSS are considered high tensile strength and high elongation steels, although AHSS and UHSS are covered whether or not they are high tensile strength or high elongation steels.

Subject merchandise includes cold-rolled steel that has been further processed in a third country, including but not limited to annealing, tempering, painting, varnishing, trimming, cutting, punching, and/or slitting, or any other processing that would not otherwise remove the merchandise from the scope of the orders if performed in the country of manufacture of the cold-rolled steel.

All products that meet the written physical description, and in which the chemistry quantities do not exceed any one of the noted element levels listed above, are within the scope of the orders unless specifically excluded. The following products are outside of and/or specifically excluded from the scope of the orders:

· Ball bearing steels; {SEE FOOTNOTE 1}
· Tool steels; {SEE FOOTNOTE 2}
· Silico-manganese steel; {SEE FOOTNOTE 3}
· Grain-oriented electrical steels (GOES) as defined in the final determination of the U.S. Department of Commerce in Grain-Oriented Electrical Steel from Germany, Japan, and Poland. {SEE FOOTNOTE 4}
· Non-Oriented Electrical Steels (NOES), as defined in the antidumping orders issued by the U.S. Department of Commerce in Non-Oriented Electrical Steel from the People's Republic of China, Germany, Japan, the Republic of Korea, Sweden, and Taiwan. {SEE FOOTNOTE 5}

The products subject to the orders are currently classified in the Harmonized Tariff Schedule of the United States (HTSUS) under item numbers: 7209.15.0000, 7209.16.0030, 7209.16.0060, 7209.16.0070, 7209.16.0091, 7209.17.0030, 7209.17.0060, 7209.17.0070, 7209.17.0091, 7209.18.1530, 7209.18.1560, 7209.18.2510, 7209.18.2520, 7209.18.2580, 7209.18.6020, 7209.18.6090, 7209.25.0000, 7209.26.0000, 7209.27.0000, 7209.28.0000, 7209.90.0000, 7210.70.3000, 7211.23.1500, 7211.23.2000, 7211.23.3000, 7211.23.4500, 7211.23.6030, 7211.23.6060, 7211.23.6090, 7211.29.2030, 7211.29.2090, 7211.29.4500, 7211.29.6030, 7211.29.6080, 7211.90.0000, 7212.40.1000, 7212.40.5000, 7225.50.6000, 7225.50.8080, 7225.99.0090, 7226.92.5000, 7226.92.7050, and 7226.92.8050. The products subject to the orders may also enter under the following HTSUS numbers: 7210.90.9000, 7212.50.0000, 7215.10.0010, 7215.10.0080, 7215.50.0016, 7215.50.0018, 7215.50.0020, 7215.50.0061, 7215.50.0063, 7215.50.0065, 7215.50.0090, 7215.90.5000, 7217.10.1000, 7217.10.2000, 7217.10.3000, 7217.10.7000, 7217.90.1000, 7217.90.5030, 7217.90.5060, 7217.90.5090, 7225.19.0000, 7226.19.1000, 7226.19.9000, 7226.99.0180, 7228.50.5015, 7228.50.5040, 7228.50.5070, 7228.60.8000, and 7229.90.1000.

The HTSUS subheadings above are provided for convenience and U.S. Customs purposes only. The written description of the scope of the investigation is dispositive. {SEE FOOTNOTE 6}

FOOTNOTE 1: Ball bearing steels are defined as steels which contain, in addition to iron, each of the following elements by weight in the amount specified: (i) not less than 0.95 nor more than 1.13 percent of carbon; (ii) not less than 0.22 nor more than 0.48 percent of manganese; (iii) none, or not more than 0.03 percent of sulfur; (iv) none, or not more than 0.03 percent of phosphorus; (v) not less than 0.18 nor more than 0.37 percent of silicon; (vi) not less than 1.25 nor more than 1.65 percent of chromium; (vii) none, or not more than 0.28 percent of nickel; (viii) none, or not more than 0.38 percent of copper; and (ix) none, or not more than 0.09 percent of molybdenum.

FOOTNOTE 2: Tool steels are defined as steels which contain the following combinations of elements in the quantity by weight respectively indicated: (i) more than 1.2 percent carbon and more than 10.5 percent chromium; or (ii) not less than 0.3 percent carbon and 1.25 percent or more but less than 10.5 percent chromium; or (iii) not less than 0.85 percent carbon and 1 percent to 1.8 percent, inclusive, manganese; or (iv) 0.9 percent to 1.2 percent, inclusive, chromium and 0.9 percent to 1.4 percent, inclusive, molybdenum; or (v) not less than 0.5 percent carbon and not less than 3.5 percent molybdenum; or (vi) not less than 0.5 percent carbon and not less than 5.5 percent tungsten.

FOOTNOTE 3: Silico-manganese steel is defined as steels containing by weight: (i) not more than 0.7 percent of carbon; (ii) 0.5 percent or more but not more than 1.9 percent of manganese, and (iii) 0.6 percent or more but not more than 2.3 percent of silicon.

FOOTNOTE 4: See Grain-Oriented Electrical Steel from Germany, Japan, and Poland: Final Determinations of Sales at Less Than Fair Value and Certain Final Affirmative Determination of Critical Circumstances, 79 FR 42501, 42503 (July 22, 2014). This determination defines grain-oriented electrical steel as “a flat-rolled alloy steel product containing by weight at least 0.6 percent but not more than 6 percent of silicon, not more than 0.08 percent of carbon, not more than 1.0 percent of aluminum, and no other element in an amount that would give the steel the characteristics of another alloy steel, in coils or in straight lengths.”

FOOTNOTE 5: See Non-Oriented Electrical Steel from the People's Republic of China, Germany, Japan, the Republic of Korea, Sweden, and Taiwan: Antidumping Duty Orders, 79 FR 71741, 71741-42 (December 3, 2014). The orders define NOES as “cold-rolled, flat-rolled, alloy steel products, whether or not in coils, regardless of width, having an actual thickness of 0.20 mm or more, in which the core loss is substantially equal in any direction of magnetization in the plane of the material. The term ‘substantially equal' means that the cross grain direction of core loss is no more than 1.5 times the straight grain direction (i.e., the rolling direction) of core loss. NOES has a magnetic permeability that does not exceed 1.65 Tesla when tested at a field of 800 A/m (equivalent to 10 Oersteds) along (i.e., parallel to) the rolling direction of the sheet (i.e., B800 value). NOES contains by weight more than 1.00 percent of silicon but less than 3.5 percent of silicon, not more than 0.08 percent of carbon, and not more than 1.5 percent of aluminum. NOES has a surface oxide coating, to which an insulation coating may be applied.”

FOOTNOTE 6: See AD and CVD CRS Orders.

3. Scope of the anti-circumvention inquiry

This anti-circumvention inquiry covers CRS produced in the Socialist Republic of Vietnam (Vietnam) from hot-rolled steel (HRS) substrate produced in Korea and subsequently exported to the United States from Vietnam. CRS produced in Vietnam using HRS substrate manufactured in Vietnam or any country other than Korea is not covered by the scope of this anti-circumvention inquiry.

As a result of this anti-circumvention inquiry and the prior anti-circumvention inquiry (related to the CVD order on CRS from China, C-570-030, C-552-997) on this same merchandise produced in Vietnam from Chinese substrate (see message 8172306, dated 06/21/2018), importers and exporters of CRS from Vietnam are required to fill out and maintain certain certifications regarding the imported merchandise that is not made with Chinese substrate in order to be exempt from the Chinese Order. The same requirement now applies where with respect to the substrate not being from Korea in order for the goods to be exempt from the Korean order.

For shipments of CRS from Vietnam entered, or withdrawn from warehouse, for consumption on or after 08/02/2018, the following hierarchy applies:

3a. In the situation where both the importer and exporter have not certified that the HRS substrate is not of Chinese origin, regardless of other certifications, the Chinese Order on CRS applies.

3b. In the situation where both the importer and exporter have certified that the HRS substrate are not of Chinese origin, but both have not certified that the HRS substrate are not of Korean origin, then the Korean CRS Order applies.

3c. In the situation where both the importer and exporter have certified that the HRS are not of Chinese or Korean origin, then neither of these CRS Orders apply.

4. Suspension of Liquidation

4a. In the situation where the Chinese AD CRS Order applies:
See message 8172306, dated 06/21/2018.

4b. In the situation where the Korean AD CRS Order applies:
CBP shall suspend liquidation of unliquidated entries (and entries for which liquidation has not become final) of CRS produced in Vietnam using Korean-origin HRS substrate that were entered, or withdrawn from warehouse, for consumption on or after 08/02/2018 under case number C-552-002.

If the Korean-origin HRS substrate used in the production of CRS in Vietnam was supplied by a Korean manufacturer with a company-specific rate, the importer, producer, or exporter may request establishment of a third-country case number specific to the Korean supplier for such imports. For such imports, CBP shall require an CVD cash deposit equal to that Korean manufacturer's and/or exporter's company-specific rate. Such requests from an importer, producer, or exporter should be filed on the record of the proceeding in E&C's electronic record system ACCESS. CBP may also request establishment of a third-country case number. Requests for establishment of company-specific third-country case numbers from CBP should be submitted through the ACE AD/CVD Portal Inquiry System.

If the Korean HRS substrate supplier does not have its own company-specific rate, such entries should be entered under case number C-552-002-000 and CBP shall require a cash deposit equal to 3.89 percent of the entered value.

4c. For unliquidated entries (and entries for which liquidation has not become final) of merchandise covered by paragraphs 4a-4b, entered, or withdrawn from warehouse, for consumption during the period 08/02/2018 (the date of initiation of this anticircumvention inquiry) through 07/18/2019, importers should file a Post Summary Correction with CBP, in accordance with CBP's regulations, regarding conversion of such entries from non-CVD type entries to CVD-type entries and report those entries using the appropriate third-country case number.

4c. Entries suspended under the CRS orders from China or Korea (including the appropriate third-country case numbers) will be liquidated pursuant to applicable administrative reviews of the relevant CVD order on CRS or through the automatic liquidation process.

5. Certification Requirements

5a. Eligibility for the Certification Regarding non-Korean Origin

(i) Except for the companies listed in paragraph 5a(ii), importers and exporters of CRS from Vietnam are eligible for the certification process detailed below and in the Preliminary Determination (84 FR 32875).

(ii) The companies listed below are currently not eligible to certify that their CRS is not made from Korean HRS substrate. Note: These companies may be eligible to certify that their CRS is not made from Chinese HRS substrate.

190 Steel Pipe Co., Ltd.;
Central Vietnam Metal Corp.;
Dai Thien Loc Corporation;
Formosa Ha Tinh Corporation;
Hoa Phat Group;
Hoa Phat Steel Pipe Co.;
Hoa Sen Group;
POSCO E&C;
POSCO SS Vina;
POSCO VST;
VSC-POSCO Steel Corporation;
Prima Commodities Co.;
Southern Steel Sheet Co., Ltd.;
Tan Thanh Quyen Steel Co.;
Thai Nguyen Iron and Steel Corp.;
Thong Nhat Flat Steel;
Ton Dong A Corp.;
Van Loi Co. Ltd.;
Vietnam Germany Steel JSC;
Vietnam Steel Corp.;
Vietnam Steel Pipe;
Vina Kyoei Steel Ltd.;
Vina One Steel Manufacturing;
Vinda Iron & Steel Co. Ltd.;
VNSTEEL – Phu My Steel Co.

5b. Certification Requirements for Importers and Exporters Certifying that the Merchandise is Produced from non-Korean-Origin HRS Substrate:

(i) For entries of cold-rolled steel flat products from Vietnam entered, or withdrawn from warehouse, for consumption on or after 08/02/2018 for which the importer claims that the CRS was not produced from Korean-origin HRS substrate, the importer and exporter are required to meet the certification and documentation requirements detailed in the certifications below in order for no cash deposit to be required on such entries.

(ii) The exporter is further required to provide the importer a copy of the exporter certification and the importer is required to maintain a copy of the exporter certification.

(iii) The importer and third-country exporter are also required to maintain sufficient documentation (as indicated in the certifications) supporting their certifications. The importer and exporter are required to maintain the certifications 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.

(iv) Although the importer will not be required to submit the certifications or supporting documentation to CBP as part of the entry process, the importer and the exporter will be required to present the certifications and supporting documentation to Commerce and/or CBP, as applicable, upon request by the respective agency.

(v) Agents of the importer, such as brokers, are not permitted to make this certification. Where the importer uses a broker to facilitate the entry process, it should obtain the entry number and date of entry from the broker.

(vi) The exporter certification should be completed by the party selling the merchandise manufactured in Vietnam to the United States, which is not necessarily the producer of the product.

(vii) The claims made in the importer and exporter certifications and any supporting documentation are subject to verification by Commerce and/or CBP.

5c. Certification Timing Requirements for Importers and Exporters

(i) For subject merchandise (1) shipped and/or (2) entered, or withdrawn from warehouse, for consumption during the period 08/02/2018 through 07/18/2019, for which certifications are required, importers and exporters each have the option to complete a blanket certification covering multiple entries, individual certifications for each entry, or a combination thereof. Importer and Exporter certifications for these entries should be completed, signed, and dated no later than 08/09/2019 (within 30 days of publication of the preliminary determination).

Accordingly, the relevant bullet in the certification should be edited to reflect that the certification was completed within this time frame. For example, in the importer certification the bullet that reads: “This certification was completed at or prior to the time of entry,” could be edited as follows: “The shipments/products referenced herein entered before 07/18/2019. This certification was completed on mm/dd/yyyy, within 30 days of the Federal Register notice publication.”

Similarly, the bullet in the exporter certification that reads “This certification was completed at or prior to the time of shipment,” could be edited as follows: “The shipments/products referenced herein shipped before 07/18/2019. This certification was completed on mm/dd/yyyy, within 30 days of the Federal Register notice publication.”

Additionally, the exporter must provide the importer a copy of the exporter certification within 30 days of the Preliminary Determination publication.

(ii) For subject merchandise entered, or withdrawn from warehouse, for consumption on or after
07/19/2019:
-- the importer certification must be completed, signed, and dated by the time of filing of the entry summary for the relevant importation; and
-- the exporter certification must be completed, signed, dated and provided to the importer by the time of shipment of the relevant entries.

(iii) For unliquidated entries (and entries for which liquidation has not become final) of merchandise entered as non-AD/CVD type entries (e.g., type 01) that were (1) shipped and/or entered, or withdrawn from warehouse, for consumption during the period 08/02/2018 through 07/18/2019, for which certifications are required, importers should file a Post Summary Correction with U.S. Customs and Border Protection (CBP) in accordance with CBP's regulations, regarding conversion of such entries to AD/CVD type (i.e., types 03, 06, 34 and 38) entries and report those AD/CVD type entries using the third country case number C-552-002. Similarly, the importer should pay cash deposits on those entries consistent with the regulations governing post summary corrections that require payment of additional duties.

6. Certifications

6a. IMPORTER CERTIFICATION

I hereby certify that:

• My name is {INSERT COMPANY OFFICIAL'S NAME HERE} and I am an official of {INSERT NAME OF IMPORTING COMPANY};
• I have direct personal knowledge of the facts regarding the importation into the Customs territory of the United States of the cold-rolled steel flat products produced in Vietnam that entered under entry number(s) {INSERT ENTRY NUMBER(S)} and are covered by this certification. “Direct personal knowledge” refers to facts the certifying party is expected to have in its own records. For example, the importer should have “direct personal knowledge” of the importation of the product (e.g., the name of the exporter) in its records;
• I have personal knowledge of the facts regarding the production of the imported products covered by this certification. “Personal knowledge” includes facts obtained from another party, (e.g., correspondence received by the importer (or exporter) from the producer regarding the source of the input used to produce the imported products);
• These cold-rolled steel flat products produced in Vietnam do not contain hot-rolled steel substrate produced in Korea:
• I understand that {INSERT NAME OF IMPORTING COMPANY} 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, productions 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 {INSERT NAME OF IMPORTING COMPANY}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 {INSERT NAME OF IMPORTING COMPANY} is required to maintain a copy of the exporter's certification 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;
• I understand that {INSERT NAME OF IMPORTING COMPANY}is required to maintain and provide a copy of the exporter's certification and supporting records, upon request, to CBP and/or 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 certification and/or failure to substantiate the claims made herein will result in:
o suspension of liquidation of all unliquidated entries (and entries for which liquidation has not become final) for which these requirements were not met and
o the requirement that the importer post applicable countervailing duty (CVD) cash deposits equal to the rates as determined by Commerce;
• 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; and
• 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 material false statements to the U.S. government.

Signature
_______________________
NAME OF COMPANY OFFICIAL

_______________________
TITLE

_______________________
DATE

6b. EXPORTER CERTIFICATION

I hereby certify that:

• My name is {INSERT COMPANY OFFICIAL'S NAME HERE} and I am an official of {INSERT NAME OF EXPORTING COMPANY};
• I have direct personal knowledge of the facts regarding the production and exportation of the cold-rolled steel flat products that were sold to the United States under invoice number(s) INSERT INVOICE NUMBER(S). “Direct personal knowledge” refers to facts the certifying party is expected to have in its own books and records. For example, an exporter should have “direct personal knowledge” of the producer's identity and location.
• These cold-rolled steel flat products produced in Vietnam do not contain hot-rolled steel substrate produced in Korea:
• I understand that {INSERT NAME OF EXPORTING COMPANY} 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, productions 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 {INSERT NAME OF EXPORTING COMPANY} must provide this Exporter Certification to the U.S. importer by the time of shipment;
• I understand that {INSERT NAME OF EXPORTING COMPANY} is required to provide a copy of 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 certification and/or failure to substantiate the claims made herein will result in:
o suspension of all unliquidated entries (and entries for which liquidation has not become final) for which these requirements were not met and
o the requirement that the importer post applicable countervailing duty (CVD) cash deposits equal to the rates as determined by Commerce;
• This certification was completed at or prior to the time of shipment;
• 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 material false statements to the U.S. government.

Signature
_______________________
NAME OF COMPANY OFFICIAL

_______________________
TITLE

_______________________
DATE

7. If there are any questions by the importing public regarding this message, please contact the
Call Center for the Office of AD/CVD Operations, Enforcement and Compliance, International
Trade Administration, U.S. Department of Commerce at (202) 482-0984. CBP ports should submit their inquiries through authorized CBP channels only. (This message was generated by OVI:VC.)

8. There are no restrictions on the release of this information.

Alexander Amdur