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China Steel Racks: New AD/CVD Investigations Deadlines & Scope

The Commerce Department issued notices in the Federal Register on its recently initiated antidumping and countervailing duty investigations on steel racks from China (A-570-088/C-570-089). The CV duty investigation covers entries Jan. 1, 2017, through Dec. 31, 2017. The AD duty investigation covers entries Oct. 1, 2017, through March 31, 2018.

The International Trade Commission will conduct a concurrent investigation to determine whether imports of dumped and illegally subsidized steel racks are injuring U.S. industry. If the ITC finds no injury in its preliminary injury determination, due Aug. 6, the investigations will immediately end. If Commerce finds dumping or illegal subsidization in the preliminary determinations of these investigations, currently due in September for CV duties and November for AD duties, it will set AD and/or CV duty cash deposit requirements for imports of merchandise subject to the investigation. If both Commerce and the ITC reach affirmative final determinations, Commerce will issue orders making duties permanent and beginning a process of annual administrative reviews to set final assessments of AD/CV duties on importers and potentially change AD/CV duty cash deposit rates.

If duties are imposed, Chinese producers and exporters who do not demonstrate independence from government control and request eligibility for a "separate rate" will be assigned the antidumping duty "China-wide rate," which can reach more than 200 percent for some products. Separate rate applications from Chinese producers and exporters will be available (here), and are due on or about Aug. 16.

AD/CVD Respondent Selection

Commerce will send quantity and value questionnaires to each potential respondent to the AD/CV duty investigations, and will base respondent selection in that investigation on the responses it receives. Chinese exporters that don't get a quantity and value questionnaire can still submit one. Quantity and value questionnaires have been posted on the Commerce website. Responses are due July 24.

Scope of the AD/CVD Investigations

The merchandise covered by this investigation is steel racks and parts thereof, assembled, to any extent, or unassembled, including but not limited to, vertical components (e.g., uprights, posts, or columns), horizontal or diagonal components (e.g., arms or beams), braces, frames, locking devices (i.e., end plates and beam connectors), and accessories (including, but not limited to, rails, skid channels, skid rails, drum/coil beds, fork clearance bars, pallet supports, column and post protectors, end row and end aisle protectors, corner guards, row spacers, and wall ties). Subject steel racks and parts thereof are made of steel, including, but not limited to, cold and/or hot-formed steel, regardless of the type of steel used to produce the components and may, or may not, include locking tabs, slots, or bolted, clamped or welded connections.

Steel rack components can be assembled into structures of various dimensions and configurations by welding, bolting, clipping, or with the use of devices such as clips, end plates and beam connectors, including, but not limited to the following configurations: 1) racks with upright frames perpendicular to the aisles that are independently adjustable, with positive locking beams parallel to the aisle spanning the upright frames with braces; and 2) cantilever racks with vertical components parallel to the aisle and cantilever beams or arms connected to the vertical components perpendicular to the aisle. Steel racks may be referred to as pallet racks, storage racks, stacker racks, retail racks, pick modules, selective racks, or cantilever racks and may incorporate moving components and be referred to as pallet-flow racks, carton-flow racks, pushback racks, movable-shelf racks, drive-in racks, and drive-through racks. While steel racks may be made to ANSI MH16.l or ANSI MH16.3 standards, all steel racks and parts thereof meeting the description set out herein are covered by the scope of this investigation, whether or not produced according to a particular standard.

The scope includes all steel racks and parts thereof meeting the description above, regardless of

(1) dimensions, weight, strength, gauge, or load rating

(2) vertical components or frame type (including structural, roll-form, or other)

(3) horizontal support or beam/brace type (including but not limited to structural, roll-form, slotted, unslotted, Z-beam, C-beam, L-beam, step beam, and cantilever beam)

(4) number of supports

(5) number of levels

(6) surface coating, if any (including but not limited to paint, epoxy, powder coating, zinc, or other metallic coatings)

(7) shape (including but not limited to rectangular, square, corner, and cantilever)

(8) the method by which the vertical and horizontal supports connect (including but not limited to locking tabs or slots, bolting, clamping, and welding)

(9) whether or not the steel rack has moving components (including but not limited to rails, wheels, rollers, tracks, channels, carts, and conveyors).

Subject merchandise includes merchandise matching the above description that has been finished or packaged in a third country. Finishing includes, but is not limited to, coating, painting or assembly, including attaching the merchandise to another product, or any other finishing or assembly operation that would not remove the merchandise from the scope of the investigation if performed in the country of manufacture of the steel racks and parts thereof. Packaging includes packaging the merchandise with or without another product or any other packaging operation that would not remove the merchandise from the scope of the investigation if performed in the country of manufacture of the steel racks and parts thereof.

Steel racks and parts thereof are included in the scope of this investigation whether or not imported attached to, or included with, other parts or accessories such as wire decking, nuts and bolts. If steel racks and parts thereof are imported attached to, or included with, such nonsubject merchandise, only the steel racks and parts thereof are included in the scope.

The scope of this investigation does not cover: 1) decks, i.e., shelving that sits on or fits into the horizontal supports to provide the horizontal storage surface of the steel racks; 2) wire shelving units, i.e., shelves made from wire that incorporate both a wire deck and wire horizontal supports (taking the place of the horizontal beams and braces) into a single piece with tubular collars that slide over the posts and onto plastic sleeves snapped on the posts to create a finished unit; 3) pins, nuts, bolts, washers and clips used as connecting devices; and 4) non-steel components.

Specifically excluded from the scope of this investigation are any products covered by Commerce’s existing antidumping and countervailing duty orders on boltless steel shelving units prepackaged for sale from the People’s Republic of China. See Boltless Steel Shelving Units Prepackaged for Sale From the People’s Republic of China: Antidumping Duty Order, 80 Fed. Reg. 63,741 (October 21, 2017); Boltless Steel Shelving Units Prepackaged for Sale From the People’s Republic of China: Amended Final Affirmative Countervailing Duty Determination and Countervailing Duty Order, 80 Fed. Reg. 63,745 (October 21, 2017). Also excluded from the scope of this investigation are bulk-packed parts or components of boltless steel shelving units that were specifically excluded from the scope of the Boltless Steel Shelving Orders because such bulk-packed parts or components do not contain the steel vertical supports (i.e., uprights and posts) and steel horizontal supports (i.e., beams, braces) packaged together for assembly into a completed boltless steel shelving unit.

Merchandise covered by this investigation is currently classified in the Harmonized Tariff Schedule of the United States (HTSUS) under the following subheadings: 7326.90.8688, 9403.20.0080 and 9403.90.8041. Subject merchandise may also enter under subheadings 7308.90.3000, 7308.90.6000, 7308.90.9590 and 9403.20.0090. The HTSUS subheadings are provided for convenience and U.S. Customs purposes only. The written description of the scope is dispositive.

Comments on the scope of these investigations are due by July 30.

Investigations Timetable

EventCV DutyAD Duty
Petitions filed06/20/1806/20/18
DOC initiation date07/10/1807/10/18
ITC prelim determinations*08/06/1808/06/18
DOC prelim determinations†09/13/1811/27/18
DOC final determinations†11/27/1802/11/19
ITC final determinations‡01/11/1903/28/19
Issuance of orders+01/18/1904/03/19

*If the ITC makes a negative determination of injury, the investigations are terminated.

†These deadlines may be extended under the governing statute.

‡This will take place only in the event of Commerce Department final affirmative determinations.

+This will take place only in the event of Commerce and ITC final affirmative determinations.

The Commerce Department fact sheet on the initiation of these investigations is (here). See 1806220015 for a summary of the petition requesting these investigations.

(Federal Register 07/17/18)