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 Department of Commerce International Trade Administration [C-570-175]
 AGENCY: Enforcement and Compliance, International Trade Administration, Department of Commerce.
 SUMMARY: The U.S. Department of Commerce (Commerce) preliminarily determines that countervailable subsidies are being provided to producers and exporters of certain brake drums (brake drums) from the People's Republic of China (China). The period of investigation is January 1, 2023, through December 31, 2023. Interested parties are invited to comment on this preliminary determination.
 DATES: Applicable February 3, 2024.
 FOR FURTHER INFORMATION CONTACT: Nathan James or Olivia Woolverton, AD/CVD Operations, Office V, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-5305 or (202) 482-7452, respectively.


SUPPLEMENTARY INFORMATION: Background This preliminary determination is made in accordance with section 703(b) of the Tariff Act of 1930, as amended (the Act). Commerce published the notice of initiation of this countervailing duty (CVD) investigation on July 17, 2024.[1]
                    
                     On July 22, 2024, Commerce tolled certain deadlines in this administrative proceeding by seven 
                    ( print page 95745)
                    days.[2]
                    
                     On September 6, 2024, Commerce postponed the preliminary determination until November 25, 2024.[3] For a complete description of events that followed the initiation of this investigation, 
                    *see*
                     the Preliminary Decision Memorandum.[4]
                    
                     A list of topics discussed 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 
                    *https://access.trade.gov/​public/​FRNoticesListLayout.aspx.* Scope of the Investigation The products covered by this investigation are brake drums 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,[5]
                    
                     the 
                    *Initiation Notice*
                     set aside a period of time for parties to raise issues regarding product coverage (
                    *i.e.,*
                     scope).[6]
                    
                     Certain interested parties commented on the scope of the investigation as it appeared in the 
                    *Initiation Notice.*
                     Commerce intends to issue its preliminary decision regarding comments concerning the scope of the antidumping (AD) and CVD investigations in the preliminary determination of the companion AD investigations. We will incorporate the scope decisions from the AD investigations into the scope of the final CVD determination for this investigation after considering any relevant comments submitted in scope case and rebuttal briefs.[7] Methodology Commerce is conducting this investigation in accordance with section 701 of the Act. For each of the subsidy programs found to be countervailable, Commerce preliminarily determines that there is a subsidy, 
                    *i.e.,*
                     a financial contribution by an “authority” that gives rise to a benefit to the recipient, and that the subsidy is specific.[8]
                    
                     For a full description of the methodology underlying our preliminary determination, 
                    *see*
                     the Preliminary Decision Memorandum. Commerce notes that, in making these findings, it relied, in part, on facts available, and, because it finds that certain companies that failed to timely respond to Commerce's quantity and value (Q&V) questionnaire, as well as the Government of China, did not act to the best of their abilities to respond to Commerce's requests for information, it drew an adverse inference where appropriate in selecting from among the facts otherwise available.[9]
                    
                     For further information, 
                    *see*
                     the “Use of Facts Otherwise Available and Adverse Inferences” section in the Preliminary Decision Memorandum. Alignment In accordance with section 705(a)(1) of the Act and 19 CFR 351.210(b)(4), Commerce is aligning the final CVD determination in this investigation with the final determination in the concurrent AD investigation of brake drums from China, based on a request made by the petitioner.[10]
                    
                     Consequently, the final CVD determination will be issued on the same date as the final AD determination, which is currently scheduled to be issued no later than April 8, 2025, unless postponed.[11] All-Others Rate Sections 703(d) and 705(c)(5)(A) of the Act provide that, in the preliminary determination, Commerce shall determine an estimated all-others rate for companies not individually examined. This rate shall be an amount equal to the weighted average of the estimated subsidy rates established for those companies individually examined, excluding any rates that are zero, 
                    *de minimis,*
                     or based entirely under section 776 of the Act. In this investigation, Commerce preliminarily calculated total net subsidy rates for CAIEC Trailer Master Co., Ltd. (CAIEC Trailer) and Shandong ConMet Mechanical, Ltd. (Shandong ConMet) that are not zero, 
                    *de minimis,*
                     or based entirely on the facts otherwise available. Because Commerce calculated individual estimated countervailable subsidy rates for CAIEC Trailer and Shandong ConMet that are not zero, 
                    *de minimis,*
                     or based entirely on the facts otherwise available, we have preliminarily calculated the all-others rate using a weighted-average of the individual estimated subsidy rates calculated for the examined respondents using each company's publicly-ranged sales values.[12] Rate for Non-Responsive Companies Thirteen potential exporters and/or producers of brake drums from China did not timely respond to Commerce's Q&V questionnaire.[13]
                    
                     We find that, by not timely responding to the Q&V questionnaire, these companies withheld requested information and significantly impeded this proceeding. Thus, in reaching our preliminary determination, pursuant to sections 776(a)(2)(A) and (C) of the Act, we are basing the subsidy rate for the non-responsive companies on facts otherwise available. We further preliminarily determine that an adverse inference is warranted, pursuant to section 776(b) of the Act. By failing to submit responses to Commerce's Q&V questionnaire, the non-responsive companies did not cooperate to the best of their abilities in this investigation. Accordingly, we preliminarily find that an adverse inference is warranted to ensure that the non-responsive companies will not obtain a more favorable result than had they fully complied with our request for information. For more information on 
                    ( print page 95746)
                    the application of adverse facts available to the non-responsive companies, 
                    *see*
                     “Use of Facts Otherwise Available and Adverse Inferences” in the Preliminary Determination Memorandum. Preliminary Determination Commerce preliminarily determines that the following estimated countervailable subsidy rates exist: Company
Subsidy rate (percent 
                            *ad valorem*)CAIEC Trailer Master Co., Ltd./Trailer Master CVS Inc 14
41.51Shandong ConMet Mechanical, Ltd./Weifang ConMet Mechanical Products Co., Ltd.15
6.76Guangzhou Joyhand Import & Export Co
* 303.07Hebei Iruijin Auto Parts Co., Ltd
* 303.07Henan Broad Top Metal Work, Llc
* 303.07Henan Valiant Braking System Co
* 303.07HTS (Tianjin) Supply Chain Co., Ltd
* 303.07Panasia CVS (HK), Ltd
* 303.07Raw King Brake Parts Co., Ltd
* 303.07Tianjin Textile Group Import and Export Inc
* 303.07Xiamen Tinmy Industrial Co., Ltd
* 303.07Xingtai Xunchiyoute Auto Parts Co
* 303.07Yancheng Terbon Auto Parts Co
* 303.07Yantai Hongtian Autoparts Co., Ltd
* 303.07Zhejiang Firsd Group Co., Ltd
* 303.07All Others
16.17* Rate based on facts available with adverse inferences.
 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). Consistent with 19 CFR 351.224(e), Commerce will analyze and, if appropriate, correct any timely allegations of significant ministerial errors by amending the preliminary determination. However, consistent with 19 CFR 351.224(d), Commerce will not consider incomplete allegations that do not address the significance standard under 19 CFR 351.224(g) following the preliminary determination. Instead, Commerce will address such allegations in the final determination together with issues raised in the case briefs or other written comments. Suspension of Liquidation In accordance with section 703(d)(1)(B) and (d)(2) of the Act, Commerce will direct U.S. Customs and Border Protection (CBP) to suspend liquidation of entries of subject merchandise as described in the scope of the investigation entered, or withdrawn from warehouse, for consumption on or after the date of publication of this notice in the 
                    **Federal Register**
                    . Further, pursuant to 19 CFR 351.205(d), Commerce will instruct CBP to require a cash deposit equal to the rates indicated above. Verification As provided in section 782(i)(1) of the Act, Commerce intends to verify the information relied upon in making its final determination. Public Comment All interested parties will have the opportunity to submit scope case and rebuttal briefs on the preliminary decision regarding the scope of the AD and CVD investigations. The deadlines to submit scope case and rebuttal briefs will be provided in the preliminary scope decision memorandum. For all scope case and rebuttal briefs, parties must file identical documents simultaneously on the records of the ongoing AD and CVD brake drums investigations. No new factual information or business proprietary information may be included in either scope case or rebuttal briefs. Case briefs or other written comments on non-scope issues may be submitted to the Assistant Secretary for Enforcement and Compliance no later than seven days after the date on which the last verification report is issued in this investigation. Rebuttal briefs, limited to issues raised in the case briefs, may be filed not later than five days after the date for filing case briefs.[16]
                    
                     Interested parties who submit case briefs or rebuttal briefs in this proceeding must submit: (1) a table of contents listing each issue; and (2) a table of authorities.[17] As provided under 19 CFR 351.309(c)(2) and (d)(2), in prior proceedings we have encouraged interested parties to provide an executive summary of their briefs that should be limited to five pages total, including footnotes. In this investigation, we instead request that interested parties provide at the beginning of their briefs a public, executive summary for each issue raised in their briefs.[18]
                    
                     Further, we request that interested parties limit their executive summary of each issue to no more than 450 words, not including citations. We intend to use the executive summaries as the basis of the comment summaries included in the issues and decision memorandum that will accompany the final determination in this investigation. We request that interested parties include footnotes for relevant citations in the executive summary of each issue. Note that Commerce has amended certain of its requirements pertaining to the service of documents in 19 CFR 351.303(f).[19] 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 via ACCESS 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 and whether any participant is a foreign national, and a list of the issues to be discussed. Oral presentations at the hearing will be limited to issues raised in the briefs. If a request for a hearing is made, parties will be notified of the time and date for the hearing.[20]
                    
                     Parties should confirm by telephone the date, time, and location of the hearing two days before the scheduled date. U.S. International Trade Commission Notification In accordance with section 703(f) of the Act, Commerce will notify the U.S. International Trade Commission (ITC) of its determination. If the final determination is affirmative, the ITC will determine before the later of 120 days after the date of this preliminary 
                    ( print page 95747)
                    determination or 45 days after the final determination whether imports of brake drums from China 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 703(f) and 777(i)(1) of the Act, and 19 CFR 351.205(c). Dated: November 25, 2024. Abdelali Elouaradia, Deputy Assistant Secretary for Enforcement and Compliance.
 Appendix I Scope of the Investigation The products covered by this investigation are certain brake drums made of gray cast iron, whether finished or unfinished, with an actual or nominal inside diameter of 14.75 inches or more but not over 16.6 inches, weighing more than 50 pounds. Unfinished brake drums are those which have undergone some turning or machining but are not ready for installation. Subject brake drums are included within the scope whether imported individually or with non-subject merchandise (for example, a hub), whether assembled or unassembled, or if joined with non-subject merchandise. When a subject drum is imported together with non-subject merchandise, such as, but not limited to, a drum-hub assembly, only the subject drum is covered by the scope. Subject merchandise also includes finished and unfinished brake drums that are further processed in a third country or in the United States, including, but not limited to, assembly or any other processing that would not otherwise remove the merchandise from the scope of the investigation if performed in the country of manufacture of the subject brake drums. The inclusion, attachment, joining, or assembly of non-subject merchandise with subject drums either in the country of manufacture of the subject drum or in a third country does not remove the subject drum from the scope. Specifically excluded is merchandise covered by the scope of the antidumping and countervailing duty orders on certain chassis and subassemblies thereof from the People's Republic of China. 
                        *See Certain Chassis and Subassemblies Thereof from the People's Republic of China: Antidumping Duty Order,*86 FR 36093 (July 8, 2021) and 
                        *Certain Chassis and Subassemblies Thereof from the People's Republic of China: Countervailing Duty Order and Amended Final Affirmative Countervailing Duty Determination,*86 FR 24844 (May 10, 2021). The scope also excludes composite brake drums that contain more than 40 percent steel by weight. The merchandise covered by this investigation is classifiable under Harmonized Tariff Schedule of the United States (HTSUS) subheading 8708.30.5020. The merchandise covered by the investigation may be classifiable under HTSUS subheading 8708.30.5090 when entered as part of an assembly. Subject merchandise may also enter under HTSUS subheading 8716.90.5060. Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the merchandise covered by this investigation is dispositive. Appendix II List of Topics Discussed in the Preliminary Decision Memorandum I. Summary II. Background III. Injury Test IV. Analysis of China's Financial System V. Diversification of China's Economy VI. Use of Facts Available and Adverse Inferences VII. Subsidies Valuation VIII. Benchmarks and Interest Rates IX. Analysis of Programs X. Recommendation


# Footnotes

1.
    
                         
                        *See Certain Brake Drums from the People's Republic of China and the Republic of Türkiye: Initiation of Countervailing Duty Investigations,*89 FR 58106 (July 17, 2024) (
                        *Initiation Notice*). Back to Citation
 2.
    
                         
                        *See*
                         Memorandum, “Tolling of Deadlines for Antidumping and Countervailing Duty Proceedings,” dated July 22, 2024. Back to Citation
 3.
    
                         
                        *See Certain Brake Drums from the People's Republic of China and the Republic of Türkiye: Postponement of Preliminary Determinations in the Countervailing Duty Investigations,*89 FR 72827 (September 6, 2024). Back to Citation
 4.
    
                         
                        *See*
                         Memorandum, “Decision Memorandum for the Preliminary Affirmative Determination of the Countervailing Duty Investigation of Certain Brake Drums from the People's Republic of China,” dated concurrently with, and hereby adopted by, this notice (Preliminary Decision Memorandum). Back to Citation
 5.
    
                         
                        *See Antidumping Duties; Countervailing Duties, Final Rule,*62 FR 27296, 27323 (May 19, 1997) (
                        *Preamble*). Back to Citation
 6.
    
                         
                        *See Initiation Notice,*
                         89 FR at 58109. Back to Citation
 7.
    
                         The deadline for interested parties to submit scope case and rebuttal briefs will be established in the preliminary scope decision memorandum. Back to Citation
 8.
    
                         
                        *See*
                         sections 771(5)(B) and (D) of the Act regarding financial contribution; section 771(5)(E) of the Act regarding benefit; and section 771(5A) of the Act regarding specificity. Back to Citation
 9.
    
                         
                        *See*
                         sections 776(a) and (b) of the Act. Back to Citation
 10.
    
                         
                        *See*
                         Petitioner's Letter, “Request to Align Final Antidumping and Countervailing Duty Determination,” dated November 7, 2024. Back to Citation
 11.
    
                         
                        *See Certain Brake Drums from the Republic of Türkiye and the People's Republic of China: Postponement of Preliminary Determinations in the Less-Than-Fair-Value Investigations,*89 FR 91675 (November 20, 2024). Back to Citation
 12.
    
                         
                        *See*
                         Memorandum, “Calculation of Subsidy Rate for All Others,” dated concurrently with this notice. Back to Citation
 13.
    
                         These companies are: (1) Guangzhou Joyhand Import & Export Co.; (2) Hebei Iruijin Auto Parts Co., Ltd.; (3) Henan Broad Top Metal Work, Llc.; (4) Henan Valiant Braking System Co.; (5) HTS (Tianjin) Supply Chain Co., Ltd.; (6) Panasia CVS (HK), Ltd.; (7) Raw King Brake Parts Co., Ltd.; (8) Tianjin Textile Group Import and Export Inc.; (9) Xiamen Tinmy Industrial Co., Ltd.; (10) Xingtai Xunchiyoute Auto Parts Co.; (11) Yancheng Terbon Auto Parts Co.; (12) Yantai Hongtian Autoparts Co., Ltd.; and (13) Zhejiang Firsd Group Co., Ltd. Back to Citation
 14.
    
                         Commerce found CAIEC Trailer Master Co., Ltd. and Trailer Master CVS Inc to be cross-owned entities. 15.
    
                         Commerce found Shandong ConMet Mechanical, Ltd. and Weifang ConMet Mechanical Products Co., Ltd. to be cross-owned entities. Back to Citation
 16.
    
                         
                        *See*19 CFR 351.309(d); 
                        *see also Administrative Protective Order, Service, and Other Procedures in Antidumping and Countervailing Duty Proceedings,*88 FR 67069, 67077 (September 29, 2023) (
                        *APO and Service Final Rule*). Back to Citation
 17.
    
                         
                        *See*19 CFR 351.309(c)(2) and (d)(2). Back to Citation
 18.
    
                         We use the term “issue” here to describe an argument that Commerce would normally address in a comment of the Issues and Decision Memorandum. Back to Citation
 19.
    
                         
                        *See APO and Service Final Rule,*
                         88 FR at 67069. Back to Citation
 20.
    
                         
                        *See*19 CFR 351.310(d). Back to Citation


[FR Doc. 2024-28238 Filed 12-2-24; 8:45 am] BILLING CODE 3510-DS-P