[Federal Register Volume 87, Number 98 (Friday, May 20, 2022)]
[Notices]
[Pages 30869-30871]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-10933]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-570-144]


Freight Rail Coupler Systems and Certain Components Thereof From 
the People's Republic of China: Final Affirmative Countervailing Duty 
Determination

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

SUMMARY: The Department of Commerce (Commerce) determines that 
countervailable subsidies are being provided to producers and exporters 
of freight rail coupler systems and certain components thereof (freight 
rail couplers) from the People's Republic of China (China) during the 
period of investigation January 1, 2020, through December 31, 2020.

DATES: Applicable May 20, 2022.

FOR FURTHER INFORMATION CONTACT: Whitley Herndon, 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) 482-6274.

SUPPLEMENTARY INFORMATION:

Background

    The petitioner in this investigation is the Coalition of Freight 
Coupler Producers. In addition to the Government of China, the 
mandatory respondent in this investigation is Chongqing Tongyao 
Transportation Equipment Co. (Chongqing Tongyao).
    On March 7, 2022, Commerce published in the Federal Register the 
Preliminary Determination of this investigation.\1\ The deadline for 
the final determination of this investigation is May 16, 2022.
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    \1\ See Freight Rail Coupler Systems and Certain Components 
Thereof: Preliminary Affirmative Countervailing Duty Determination, 
87 FR 12662 (March 7, 2022) (Preliminary Determination), and 
accompanying Preliminary Decision Memorandum (PDM).
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    On April 11, 2022, we issued a post-preliminary decision memorandum 
addressing a scope issue raised in the context of this and the 
companion less-than-fair-value (LTFV) investigations, in which we 
preliminarily found that it was unnecessary to alter the scope stated 
in the Initiation Notice.\2\ We received case briefs addressing this 
preliminary scope decision from two importers of subject merchandise, 
Strato Inc. (Strato) and Wabtec Corporation (Wabtec), on April 18, 
2022,\3\ and rebuttal comments from the petitioner on April 22, 
2022.\4\
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    \2\ See Memorandum, ``Antidumping and Countervailing Duty 
Investigations of Freight Rail Coupler Systems and Certain 
Components Thereof from the People's Republic of China: Post-
Preliminary Scope Decision Memorandum,'' dated April 11, 2022 (Post-
Preliminary Scope Decision Memorandum); see also Freight Rail 
Coupler Systems and Certain Components Thereof from the People's 
Republic of China: Initiation of Countervailing Duty Investigation, 
86 FR 58878 (October 25, 2021) (Initiation Notice).
    \3\ See Strato's Letter, ``Strato Scope Case Brief''; and 
Wabtec's Letter, ``Case Brief On Post-Preliminary Scope Decision,'' 
both dated April 18, 2022.
    \4\ See Petitioner's Letter, ``Rebuttal Brief,'' dated April 25, 
2022.
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    We received no comments or case briefs addressing any of the other 
findings in the Preliminary Determination; therefore, there is no 
unpublished Issues and Decision Memorandum accompanying this notice.

Period of Investigation

    The period of investigation is January 1, 2020, through December 
31, 2020.

Scope of the Investigation

    The products covered by this investigation are freight rail coupler 
systems and certain components from China. For a complete description 
of the scope of this investigation, see the appendix.

Scope Comments

    In Commerce's Preliminary Determination,\5\ we set aside a period 
of time for parties to raise issues regarding product coverage (i.e., 
scope) in scope case briefs or other written comments on scope issues. 
As noted above, the petitioner and two interested parties, Strato and 
Wabtec, commented on the scope of the investigation as it appeared in 
the Initiation Notice,\6\ and Post-Preliminary Scope Decision 
Memorandum. For a summary of the product coverage comments and

[[Page 30870]]

rebuttal comments, and an analysis of all comments received, see the 
final scope memorandum, which will be issued prior to, or in 
conjunction with, the final determination in the companion LTFV 
investigation from China.\7\ For the reasons discussed in the final 
scope memorandum, Commerce is not modifying the scope language as it 
appeared in the Initiation Notice. See the final ``Scope of the 
Investigation'' in the appendix to this notice.
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    \5\ See Preliminary Determination, 87 FR at 12663.
    \6\ See Initiation Notice.
    \7\ The deadline for Commerce's final determination in the 
companion LTFV investigation of freight rail coupler systems and 
certain components from China is May 23, 2022.
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Analysis of Subsidy Programs--Adverse Facts Available (AFA)

    For purposes of this final determination, we relied solely on facts 
available pursuant to section 776 of the Tariff Act of 1930, as amended 
(the Act), because neither the Government of China nor the selected 
mandatory respondent, Chongqing Tongyao, participated in this 
investigation. Furthermore, as stated in our Preliminary Determination, 
CRRC Corporation Limited, CRRC Qiqihar Co., Ltd., China Railway 
Materials Group Co., Ltd., Shaanxi Haiduo Railway Technology 
Development Co., Ltd., China Railway Materials Group Co., Ltd., and 
Shaanxi Haiduo Railway Technology Development Co., Ltd. (collectively, 
non-participating companies) also withheld necessary information that 
was requested of them by Commerce, failed to provide information within 
the deadlines established, and significantly impeded this proceeding by 
failing to respond to Commerce's quantity and value questionnaires. 
Therefore, because the mandatory respondent, the non-participating 
companies, and the Government of China did not cooperate to the best of 
their abilities in responding to our requests for information in this 
investigation, we drew adverse inferences in selecting from among the 
facts otherwise available, in accordance with sections 776(a)-(b) of 
the Act. Consistent with the Preliminary Determination,\8\ we continue 
to apply AFA to determine the appropriate subsidy rates for this 
investigation. No interested party submitted comments on the subsidy 
rates selected in the Preliminary Determination. Thus, we made no 
changes to the subsidy rates for the final determination. A detailed 
discussion of our application of AFA is provided in the Preliminary 
Determination.\9\
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    \8\ See Preliminary Determination PDM at 5-16.
    \9\ Id.
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All-Others Rate

    As discussed in the Preliminary Determination, Commerce based the 
selection of the all-others rate on the countervailable subsidy rate 
established for the mandatory respondent, in accordance with section 
703(d) of the Act.\10\ Consistent with section 705(c)(5)(A)(ii) of the 
Act, we made no changes to the selection of the all-others rate for 
this final determination.
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    \10\ See Preliminary Determination, 87 FR at 12663.
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Final Determination

    Commerce determines that the following estimated countervailable 
subsidy rates exist:

------------------------------------------------------------------------
                                                           Subsidy rate
                         Company                           (ad valorem)
                                                             (percent)
------------------------------------------------------------------------
Chongqing Tongyao Transportation Equipment Co...........          265.99
CRRC Corporation Limited................................          265.99
CRRC Qiqihar Co., Ltd...................................          265.99
China Railway Materials Group Co., Ltd..................          265.99
Shaanxi Haiduo Railway Technology Development Co., Ltd..          265.99
All Others..............................................          265.99
------------------------------------------------------------------------

Disclosure

    The subsidy rate calculations in the Preliminary Determination were 
based on AFA.\11\ As noted above, there are no changes to the 
calculations for this final determination. Thus, no additional 
disclosure is necessary.
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    \11\ Id., 87 FR at 12662-63.
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Continuation of Suspension of Liquidation

    In accordance with section 705(c)(4)(A) of the Act, Commerce 
intends to instruct U.S. U.S. Customs and Border Protection (CBP) to 
continue to suspend the liquidation of all appropriate entries of 
subject merchandise, as described in the appendix of this notice, 
entered, or withdrawn from warehouse, for consumption on or after March 
7, 2022, which is the date of publication of the affirmative 
Preliminary Determination in the Federal Register, at the cash deposit 
rates indicated above. These suspension of liquidation instructions 
will remain in effect until further notice.
    If the U.S. International Trade Commission (ITC) issues a final 
affirmative injury determination, we intend to issue a countervailing 
duty order, continue to require a cash deposit of estimated 
countervailing duties for such entries of subject merchandise in the 
amounts indicated above, in accordance with section 706(a) of the Act. 
If the ITC determines that material injury, or threat of material 
injury, does not exist, this proceeding will be terminated, and all 
estimated duties deposited as a result of the suspension of liquidation 
will be refunded or canceled.

ITC Notification

    In accordance with section 705(d) of the Act, we intend to notify 
the ITC of our final affirmative determination that countervailable 
subsidies are being provided to producers and exporters of freight rail 
couplers from China. Because the final determination in this proceeding 
is affirmative, in accordance with section 705(b) of the Act, the ITC 
will make its final determination as to whether the domestic industry 
in the United States is materially injured, or threatened with material 
injury, by reason of imports of freight rail couplers from China no 
later than 45 days after our final determination.
    If the ITC determines that material injury or threat of material 
injury does not exist, this proceeding will be terminated and all cash 
deposits will be refunded or canceled, as Commerce determines to be 
appropriate. If the ITC determines that such injury does exist, 
Commerce intends to issue a countervailing duty order directing CBP to 
assess, upon further instruction by Commerce, countervailing duties on 
all imports of the subject merchandise that are entered, or withdrawn 
from warehouse, for consumption on or after the effective date of the 
suspension of liquidation, as discussed above in the ``Continuation of 
Suspension of Liquidation'' section.

Notification Regarding Administrative Protective Order (APO)

    In the event that the ITC issues a final negative injury 
determination, this notice will serve as the only reminder to parties 
subject to an APO of their responsibility concerning the destruction of 
proprietary information disclosed under APO in accordance with 19 CFR 
351.305(a)(3). Timely written notification of the return/destruction of 
APO materials or conversion to judicial protective order is hereby 
requested. Failure to comply with the regulations and terms of an APO 
is a violation which is subject to sanction.

Notification to Interested Parties

    This determination is issued and published pursuant to sections 
705(d) and 777(i) of the Act, and 19 CFR 351.210(c).


[[Page 30871]]


    Dated: May 16, 2022.
Lisa W. Wang,
Assistant Secretary for Enforcement and Compliance.

Appendix

Scope of the Investigation

    The scope of this investigation covers freight rail car coupler 
systems and certain components thereof. Freight rail car coupler 
systems are composed of, at minimum, four main components (knuckles, 
coupler bodies, coupler yokes, and follower blocks, as specified 
below) but may also include other items (e.g., coupler locks, lock 
lift assemblies, knuckle pins, knuckle throwers, and rotors). The 
components covered by the investigation include: (1) E coupler 
bodies; (2) E/F coupler bodies; (3) F coupler bodies; (4) E yokes; 
(5) F yokes; (6) E knuckles; (7) F knuckles; (8) E type follower 
blocks; and (9) F type follower blocks, as set forth by the 
Association of American Railroads (AAR). The freight rail coupler 
components are included within the scope of the investigation when 
imported individually, or in some combination thereof, such as in 
the form of a coupler fit (a coupler body and knuckle assembled 
together), independent from a coupler system.
    Subject freight rail car coupler systems and components are 
included within the scope whether finished or unfinished, whether 
imported individually or with other subject or non-subject 
components, whether assembled or unassembled, whether mounted or 
unmounted, or if joined with non-subject merchandise, such as other 
non-subject system parts or a completed rail car. Finishing 
includes, but is not limited to, arc washing, welding, grinding, 
shot blasting, heat treatment, machining, and assembly of various 
components. When a subject coupler system or subject components are 
mounted on or to other non-subject merchandise, such as a rail car, 
only the coupler system or subject components are covered by the 
scope.
    The finished products covered by the scope of this investigation 
meet or exceed the AAR specifications of M-211, ``Foundry and 
Product Approval Requirements for the Manufacture of Couplers, 
Coupler Yokes, Knuckles, Follower Blocks, and Coupler Parts'' or AAR 
M-215 ``Coupling Systems,'' or other equivalent domestic or 
international standards (including any revisions to the 
standard(s)).
    The country of origin for subject coupler systems and 
components, whether fully assembled, unfinished or finished, or 
attached to a rail car, is the country where the subject coupler 
components were cast or forged. Subject merchandise includes coupler 
components as defined above that have been further processed or 
further assembled, including those coupler components attached to a 
rail car in third countries. Further processing includes, but is not 
limited to, arc washing, welding, grinding, shot blasting, heat 
treatment, painting, coating, priming, machining, and assembly of 
various components. The inclusion, attachment, joining, or assembly 
of non-subject components with subject components or coupler systems 
either in the country of manufacture of the in-scope product or in a 
third country does not remove the subject components or coupler 
systems from the scope.
    The coupler systems that are the subject of this investigation 
are currently classifiable in the Harmonized Tariff Schedule of the 
United States (HTSUS) statistical reporting number 8607.30.1000. 
Unfinished subject merchandise may also enter under HTSUS 
statistical reporting number 7326.90.8688. Subject merchandise 
attached to finished rail cars may also enter under HTSUS 
statistical reporting numbers 8606.10.0000, 8606.30.0000, 
8606.91.0000, 8606.92.0000, 8606.99.0130, 8606.99.0160, or under 
subheading 9803.00.5000 if imported as an Instrument of 
International Traffic. These HTSUS subheadings are provided for 
convenience and customs purposes only; the written description of 
the scope of the investigation is dispositive.

[FR Doc. 2022-10933 Filed 5-19-22; 8:45 am]
BILLING CODE 3510-DS-P