China Freight Rail Coupler Systems: 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 freight rail coupler systems from China (A-570-143/C-570-144). The CV duty investigation covers entries Jan. 1 - Dec. 31, 2020. The AD duty investigation covers entries Jan. 1 - June 30, 2021.

The International Trade Commission will conduct a concurrent investigation to determine whether imports of dumped and illegally subsidized snow throwers from China are injuring U.S. industry. If the ITC finds no injury in its preliminary injury determination, due Nov. 15, the investigations will immediately end. If Commerce finds dumping or illegal subsidization in the preliminary determinations of these investigations, due in December for CV duties and March 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 an AD and/or CV duty order 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 that 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% for some products. Separate rate applications from Chinese producers and exporters will be available (here), and are due on or about Nov. 24.

AD/CVD Respondent Selection

For both its AD and CV duty investigations, Commerce will send quantity and value questionnaires to each potential respondent, and will base respondent selection on the responses it receives. Exporters that don't get a quantity and value questionnaire can submit one using the forms that will be made available on theCommerce website. Responses are due Nov. 2.

Scope of the AD/CVD Investigations

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.

Comments on the scope of these investigations are due by Nov. 8.

Investigations Timetable

These deadlines may, and usually are, extended. The Commerce Department fact sheet on the initiation of these investigations is (here). See (Ref:[2110040037]) for a summary of the petition requesting these investigations.