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[Federal Register Volume 89, Number 243 (Wednesday, December 18, 2024)]
[Notices]
[Pages 102864-102866]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-29911]

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-943, C-570-944]

Oil Country Tubular Goods From the People's Republic of China: 
Initiation of Circumvention Inquiry on the Antidumping and 
Countervailing Duty Orders

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.

SUMMARY: In response to a request from the Committee on Pipe and Tube 
Imports Subcommittee for OCTG (the CPTI OCTG Subcommittee) and the 
United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied 
Industrial and Service Workers International Union, AFL-CIO, CLC (USW) 
(collectively, the requestors), the U.S. Department of Commerce 
(Commerce) is initiating a country-wide circumvention inquiry to 
determine whether imports of seamless oil country tubular goods (OCTG) 
from the People's Republic of China (China) which are completed in 
Thailand from steel billets produced in China are circumventing the 
antidumping (AD) and countervailing duty (CVD) orders on OCTG from 
China.

DATES: Applicable December 18, 2024.

FOR FURTHER INFORMATION CONTACT: Barb Rawdon, AD/CVD Office of Policy, 
Enforcement and Compliance, International Trade Administration, U.S. 
Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 
20230; telephone: (202) 482-0474.

SUPPLEMENTARY INFORMATION:

Background

    On July 18, 2024, pursuant to section 781(b) of the Tariff Act of 
1930, as amended (the Act), and 19 CFR 351.226(i), the requestors \1\ 
filed a circumvention inquiry request alleging that OCTG completed in 
Thailand using steel billets manufactured in China, is circumventing 
the AD and CVD orders on OCTG from China \2\ and, accordingly, should 
be included within the scope of the Orders.\3\ On August 20, 2024, we 
extended the deadline to initiate this circumvention inquiry in 
accordance with 19 CFR 351.226(d)(1).\4\
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    \1\ The Requestors are the Committee on Pipe and Tube Imports 
Subcommittee for OCTG (CPTI OCTG Subcommittee) and the United Steel, 
Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial 
and Service Workers International Union, AFL-CIO, CLC (USW). The 
individual members of the CPTI OCTG Subcommittee are Axis Pipe and 
Tube, Benteler Steel & Tube Corporation, Borusan Mannesmann Pipe US 
Inc., PTC Liberty Tubulars LLC, Vallourec Star, and Welded Tube USA, 
Inc. See Requestors' Letter, ``Response to Second Request for 
Information,'' dated November 12, 2024 (Circumvention Request).
    \2\ See Certain Oil Country Tubular Goods from the People's 
Republic of China: Amended Final Determination of Sales at Less Than 
Fair Value and Antidumping Duty Order, 75 FR 28551 (May 21, 2010); 
see also Certain Oil Country Tubular Goods from the People's 
Republic of China: Amended Final Affirmative Countervailing Duty 
Determination and Countervailing Duty Order, 75 FR 3203 (January 20, 
2010) (collectively, Orders).
    \3\ See Requestor's Letter, ``Request for Circumvention 
Inquiry,'' dated July 18, 2024.
    \4\ See Memorandum, ``Extension of Time to Determine Whether to 
Initiate Circumvention Inquiry,'' dated August 20, 2024.
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    On September 6, 2023, we issued a supplemental (deficiency) 
questionnaire to the requestors, directing them to re-submit their 
inquiry requests and provide additional information.\5\ In our request 
for information, we clarified that we issued the request because we had 
found that the request to conduct the circumvention inquiry was 
insufficient for purposes of initiation, in accordance with 19 CFR 
351.226(d)(1). Additionally, we clarified that the 30-day time period 
for Commerce to consider whether to initiate on the requestors' 
circumvention inquiry will begin with the requestors' response to 
Commerce's September 6, 2024, letter.\6\ On September 25, 2024, the 
requestors filed their response.\7\ On October 23, 2024, Commerce 
issued a second supplemental questionnaire.\8\ In our request for 
information, we clarified that we issued the request because we had 
found that the request to conduct the circumvention inquiry was 
insufficient for purposes of initiation, in accordance with 19 CFR 
351.226(d)(1). Additionally, we clarified that the 30-day time period 
for Commerce to consider whether to initiate on the requestors' 
circumvention inquiry will begin with the requestors' response to 
Commerce's October 23, 2024, letter.\9\ On November 12, 2024, the 
requestors responded to Commerce's request for information.\10\ Thus, 
we consider the inquiry request to have been filed on November 12, 
2024.
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    \5\ See Commerce's Letter, ``Supplemental Questionnaire,'' dated 
September 6, 2024.
    \6\ Id.
    \7\ See Requestors' Letter, ``Request for Circumvention 
Inquiry,'' dated September 25, 2024.
    \8\ See Commerce's Letter, ``Supplemental Questionnaire,'' dated 
October 23, 2024.
    \9\ Id.
    \10\ See Circumvention Request.
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Scope of the Orders

    The merchandise covered by the scope of the Orders is OCTG, which 
are hollow steel products of circular cross-section, including oil well 
casing and tubing, of iron (other than cast iron) or steel (both carbon 
and alloy), whether seamless or welded, regardless of end finish. For a 
full description of the scope of the Orders, see the Circumvention 
Initiation Checklist.\11\
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    \11\ See Initiation Checklist, ``OCTG Completed in Thailand 
Circumvention Initiation Checklist,'' dated concurrently with, and 
hereby adopted by, this notice (Circumvention Initiation Checklist) 
at Attachment I.
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Merchandise Subject to the Circumvention Inquiry

    The circumvention inquiry covers seamless OCTG completed in 
Thailand using Chinese-produced steel billets, and subsequently 
exported from Thailand to the United States.

Initiation of Circumvention Inquiry

    Section 351.226(d) of Commerce's regulations states that if 
Commerce determines that a request for a circumvention inquiry 
satisfies the

[[Page 102865]]

requirements of 19 CFR 351.226(c), then Commerce ``will accept the 
request and initiate a circumvention inquiry.'' Section 351.226(c)(1) 
of Commerce's regulations, in turn, requires that each circumvention 
inquiry request allege ``that the elements necessary for a 
circumvention determination under section 781 of the Act exist'' and be 
``accompanied by information reasonably available to the interested 
party supporting these allegations.'' The requestors alleged 
circumvention pursuant to section 781(b) of the Act (merchandise 
completed or assembled in other foreign countries).
    Section 781(b)(1) of the Act provides that Commerce may find 
circumvention of an order when merchandise of the same class or kind 
subject to the order is completed or assembled in a foreign country 
other than the country to which the order applies. In conducting a 
circumvention inquiry, under section 781(b)(1) of the Act, Commerce 
relies on the following criteria: (A) merchandise imported into the 
United States is of the same class or kind as any merchandise produced 
in a foreign country that is the subject of an AD or CVD order; (B) 
before importation into the United States, such imported merchandise is 
completed or assembled in another foreign country from merchandise 
which is subject to the order or is produced in the foreign country 
that is subject to the order; (C) the process of assembly or completion 
in the foreign country referred to in section (B) is minor or 
insignificant; (D) the value of the merchandise produced in the foreign 
country to which the AD or CVD order applies is a significant portion 
of the total value of the merchandise exported to the United States; 
and (E) the administering authority determines that action is 
appropriate to prevent evasion of such order.
    In determining whether the process of assembly or completion in a 
foreign country is minor or insignificant under section 781(b)(1)(C) of 
the Act, section 781(b)(2) of the Act directs Commerce to consider: (A) 
the level of investment in the foreign country; (B) the level of 
research and development in the foreign country; (C) the nature of the 
production process in the foreign country; (D) the extent of production 
facilities in the foreign country; and (E) whether or not the value of 
processing performed in the foreign country represents a small 
proportion of the value of the merchandise imported into the United 
States. However, no single factor, by itself, controls Commerce's 
determination of whether the process of assembly or completion in a 
foreign country is minor or insignificant.\12\ Accordingly, Commerce 
will evaluate each of these five factors as they exist in the foreign 
country, depending on the particular circumvention scenario.
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    \12\ See Statement of Administrative Action Accompanying the 
Uruguay Round Agreements Act, H.R. Doc. 103-316, Vol. 1 (1994), at 
893.
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    In addition, section 781(b)(3) of the Act sets forth additional 
factors to consider in determining whether to include merchandise 
assembled or completed in a foreign country within the scope of an AD 
or CVD order. Specifically, Commerce shall take into account such 
factors as: (A) the pattern of trade, including sourcing patterns; (B) 
whether the manufacturer or exporter of the merchandise that was 
shipped to the foreign country is affiliated with the person who, in 
the foreign country, uses the merchandise to complete or assemble the 
merchandise which is subsequently imported into the United States; and 
(C) whether imports of the merchandise into the foreign country have 
increased after the initiation of the investigation that resulted in 
the issuance of such order.

Analysis

    Based on our analysis of the requestors' circumvention inquiry 
request, we determine that they have satisfied the criteria under 19 
CFR 351.226(c), and thus, pursuant to 19 CFR 351.226(d)(1)(iii), we are 
initiating the requested circumvention inquiry. For a full discussion 
of the basis for our decision to initiate this circumvention inquiry, 
see the Circumvention Initiation Checklist. As explained in the 
Circumvention Initiation Checklist, the information provided by the 
requestors warrants initiating this circumvention inquiry on a country-
wide basis. Commerce has taken this approach in prior circumvention 
inquiries, where the facts warranted initiation on a country-wide 
basis.\13\
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    \13\ See, e.g., Hydrofluorocarbon Blends from the People's 
Republic of China: Initiation of Circumvention Inquiry on the 
Antidumping Duty Order, 88 FR 74150 (October 30, 2023).
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    Consistent with the approach in the prior circumvention inquiries 
that we initiated on a country-wide basis, Commerce intends to issue 
questionnaires to solicit information from producers and exporters in 
Thailand concerning their shipments of OCTG made from Chinese-origin 
steel billets to the United States.

Respondent Selection

    Commerce intends to base respondent selection on responses to 
quantity and value (Q&V) questionnaires. Commerce intends to identify 
the companies to which it will issue the Q&V questionnaire, in part, 
based on U.S. Customs and Border Protection (CBP) data. Parties to 
which Commerce does not issue the Q&V questionnaire may also respond to 
the Q&V questionnaire, which will be available on Enforcement and 
Compliance's Antidumping and Countervailing Duty Centralized Electronic 
Service System (ACCESS), before the applicable deadline. ACCESS is 
available to registered users at https://access.trade.gov.
    Commerce intends to place the CBP data on the record via ACCESS 
within five days of the publication of this initiation notice. Comments 
regarding the CBP data and respondent selection should be submitted 
within seven days after placement of the CBP data on the record of the 
inquiry.
    Commerce intends to establish a schedule for questionnaire 
responses after Commerce selects respondents. A company's failure to 
completely respond to Commerce's requests for information may result in 
the application of facts available, pursuant to section 776(a) of the 
Act, which may include adverse inferences, pursuant to section 776(b) 
of the Act.

Suspension of Liquidation

    Pursuant to 19 CFR 351.226(l)(1), Commerce will notify CBP of this 
initiation and direct CBP to continue the suspension of liquidation of 
entries of products subject to the circumvention inquiry that were 
already subject to the suspension of liquidation under the Orders and 
to apply the cash deposit rates that would be applicable if the 
products were determined to be covered by the scope of the Orders. 
Should Commerce issue affirmative preliminary or final circumvention 
determinations, Commerce will follow the suspension of liquidation 
rules under 19 CFR 351.226(l)(2)-(4).

Notification to Interested Parties

    In accordance with 19 CFR 351.226(d) and section 781(b) of the Act, 
Commerce determines that the requestors' request for a circumvention 
inquiry satisfies the requirements of 19 CFR 351.226(c). Accordingly, 
Commerce is notifying all interested parties of the initiation of this 
circumvention inquiry to determine whether OCTG from China, which is 
completed in Thailand from steel billets produced in China, is 
circumventing the Orders. In addition, we have included a description 
of the products that are the subject to this inquiry and an explanation 
of Commerce's decision to initiate this inquiry as provided in the 
accompanying Circumvention Initiation

[[Page 102866]]

Checklist.\14\ In accordance with 19 CFR 351.226(e)(1), Commerce 
intends to issue its preliminary circumvention determination no later 
than 150 days from the date of publication of the notice of initiation 
of this circumvention inquiry in the Federal Register.
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    \14\ See Circumvention Initiation Checklist at 13.
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    This notice is published in accordance with section 781(b) of the 
Act, and 19 CFR 351.226(d)(1)(iii).

    Dated: December 12, 2024.
Abdelali Elouaradia,
Deputy Assistant Secretary for Enforcement and Compliance.
[FR Doc. 2024-29911 Filed 12-17-24; 8:45 am]
BILLING CODE 3510-DS-P
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