U.S. Department of Commerce Initiates Antidumping Duty and Countervailing Duty Investigations of Imports of Vertical Shaft Engines From China
For Immediate Release
February 5, 2020
Contact: Office of Public Affairs
WASHINGTON – U.S. Secretary of Commerce Wilbur Ross today announced the initiation of new antidumping duty (AD) and countervailing duty (CVD) investigations to determine whether vertical shaft engines between 225cc and 999cc and parts thereof (vertical shaft engines) from China are being dumped in the United States, and to determine if producers in China are receiving unfair subsidies.
These AD and CVD investigations were initiated based on petitions filed by the Coalition of American Vertical Engine Producers, whose members are Kohler Co. (Kohler, Wisc.) and Briggs & Stratton Corporation (Wauwatosa, Wisc.).
In the AD investigations, Commerce will determine whether imports of vertical shaft engines from China are being dumped in the U.S. market at less than fair value. The alleged dumping margins range from 324.73 percent to 637.73 percent for China.
In the CVD investigation, Commerce will determine whether Chinese producers of vertical shaft engines are receiving unfair government subsidies.
There are 22 subsidy programs alleged for China, including preferential loans, tax subsidies, export subsidies, various grants, and the provision of aluminum for less than adequate remuneration.
If Commerce makes affirmative findings in these investigations, and if the U.S. International Trade Commission (ITC) determines that dumped and/or unfairly subsidized U.S. imports of vertical shaft engines from China materially injure, or threaten material injury to, the U.S. industry, Commerce will impose duties on those imports in the amount of dumping and/or unfair subsidization found to exist.
In 2018, imports of vertical shaft engines from China were valued at $53 million.
Click here for a fact sheet on these initiations.
During Commerce’s investigations into whether vertical shaft engines from China are being dumped and/or unfairly subsidized, the ITC will conduct its own investigations into whether the U.S. industry and its workforce are being injured by such imports. The ITC will make its preliminary determinations on or before March 2. If the ITC preliminarily determines that a reasonable indication of material injury or threat of material injury exists, Commerce’s investigations will continue. Preliminary determinations by Commerce in these cases will then be scheduled for April 9 for the CVD investigation, and June 23 for the AD investigations, but these dates may be extended.
If Commerce preliminarily determines that dumping and/or unfair subsidization is occurring, then it will instruct U.S. Customs and Border Protection to start collecting cash deposits from all U.S. companies importing vertical shaft engines from China.
Final determinations by Commerce in these cases are scheduled for June 23 for the CVD investigation, and September 8 for the AD investigations, but these dates may be extended. If Commerce finds that products are not being dumped or unfairly subsidized, or the ITC finds that there is no injury to the U.S. industry, the investigations will be terminated, and no duties will be applied.
The strict enforcement of U.S. trade law is a primary focus of the Trump administration. Since the beginning of the current Administration, Commerce has initiated 200 new AD and CVD investigations – a 170 percent increase from the comparable period in the previous administration.
The AD and CVD laws provide American businesses and workers with an internationally accepted mechanism to seek relief from the harmful effects of unfair pricing and unfair subsidization of imports into the United States. Commerce currently maintains 516 antidumping and countervailing duty orders which provide relief to American companies and industries impacted by unfair trade.
The U.S. Department of Commerce’s Enforcement and Compliance unit within the International Trade Administration is responsible for vigorously enforcing U.S. trade laws and does so through an impartial, transparent process that abides by international rules and is based on factual evidence provided on the record.
Foreign companies that price their products in the U.S. market below the cost of production or below prices in their home markets are subject to AD duties. Foreign companies that receive financial assistance from foreign governments that benefits the production of goods from those companies, and is limited to specific enterprises or industries, or is contingent either upon export performance or upon the use of domestic goods over imported goods, are subject to CVD duties.