Department of Commerce Self-Initiates Scope and Circumvention Inquiries into Possible Circumvention of AD/CVD Orders on Quartz Surface Products from China
FOR IMMEDIATE RELEASE
February 2, 2022
Contact: Office of Public Affairs
WASHINGTON – Yesterday, the Department of Commerce announced the self-initiation of new inquiries into possible circumvention of the antidumping duty (AD) and countervailing duty (CVD) orders on quartz surface products from China. Commerce will examine whether quartz surface products or quartz surface product inputs from China are exported to Malaysia for minor processing and then exported to the United States.
Under U.S. law, Commerce may conduct a scope or circumvention inquiry when evidence suggests that merchandise subject to an existing AD/CVD order is completed or assembled in third countries from parts and components imported from the country subject to the order.
Typically, circumvention and scope inquiries are initiated in response to allegations filed by the domestic industry. However, Commerce’s regulations provide that these inquiries may be self-initiated when Commerce determines from available information that an inquiry is warranted.
This is the fourth-ever set of self-initiated inquiries based on Commerce’s own research and monitoring of trade patterns, but it is the first set of self-initiated inquiries to be undertaken under the modified AD/CVD regulations, which became effective November 4, 2021. The new regulations provide standalone rules governing circumvention inquiries and determinations as well as updated rules regarding the procedures and standards for scope inquiries and rulings.
Under the new regulations, Commerce will conduct the scope inquiry as a preliminary step. As part of the scope inquiry, Commerce will direct U.S. Customs and Border Protection (CBP) to continue the suspension of liquidation of entries of products subject to the scope inquiry that were already subject to the suspension of liquidation (if any), and to apply the cash deposit rate that would be applicable if the product were determined to be covered by the scope of the order.
Parties have been invited to submit one set of comments and factual information addressing the self-initiation of the scope inquiry. If the scope inquiry results in an affirmative finding, Commerce may rescind the circumvention inquiry. If the scope inquiry does not result in an affirmative finding, Commerce will pursue the circumvention inquiry. More information regarding the new regulations.
Evidence of potential circumvention activities includes a shift in trade patterns that took place following Commerce’s initiation of AD and CVD investigations of quartz surface products from China in May 2018. Comparing the 31-month periods before and after the investigations were initiated, U.S. imports of quartz surface products from Malaysia increased from zero to $116.1 million. During the same timeframe, Malaysian imports of potential quartz surface products inputs from China increased from $13.9 million to $104 million, an increase of 647.4%.
The Department of Commerce’s Enforcement and Compliance unit within the International Trade Administration is responsible for vigorously enforcing U.S. trade law and does so through an impartial, transparent process that abides by international rules and is based on factual evidence provided on the record.
About the International Trade Administration
The International Trade Administration (ITA) at the U.S. Department of Commerce is the premier resource for American companies competing in the global marketplace. ITA has more than 2,200 employees assisting U.S. exporters in more than 100 U.S. cities and 75 markets worldwide. For more information on ITA, visit www.trade.gov.