U.S. Department of Commerce Announces Preliminary Rulings in Self-Initiated Circumvention Inquiries Regarding Corrosion-Resistant Steel Products
For Immediate Release
February 10, 2020
Contact: Office of Public Affairs
Phone: 202-482-3809
WASHINGTON – Today, the U.S. Department of Commerce announced affirmative preliminary circumvention rulings involving imports of certain corrosion-resistant steel products (CORE) made with substrate from the People’s Republic of China (China) and Taiwan.
Commerce preliminarily determined that Chinese steel substrate shipped to Costa Rica, Malaysia, and the United Arab Emirates (UAE) for minor processing, and then exported to the United States as CORE, is circumventing the antidumping duty (AD) and countervailing duty (CVD) orders on CORE from China.
Similarly, Commerce preliminarily determined that Taiwanese steel substrate shipped to Malaysia for minor processing, and then exported to the United States as CORE, is circumventing the AD order on CORE from Taiwan.
Commerce also announced negative preliminary circumvention rulings regarding CORE exported from Guatemala and South Africa, finding that this is not made with Chinese substrate.
Accordingly, Commerce will instruct U.S. Customs and Border Protection (CBP) to collect AD and CVD cash deposits on imports of CORE completed in Costa Rica, Malaysia, and the UAE using China-origin substrate, as well as imports of CORE completed in Malaysia using Taiwan-origin substrate.
The cash deposit rates will be equal to the rates previously established for CORE from China and Taiwan, as applicable. Suspension of liquidation and cash deposit requirements will apply to unliquidated entries on or after August 12, 2019 (the date on which Commerce initiated these circumvention inquiries).
Today’s rulings stem from Commerce’s August 2019 decision to self-initiate these circumvention inquiries. This was the first time that Commerce has self-initiated circumvention inquiries based on its own monitoring of trade patterns, in this case involving the existing AD/CVD orders on CORE. It was also the first self-initiation of multi-country circumvention inquiries.
Under U.S. law, circumvention exists when imported merchandise is of the same class or kind as merchandise subject to an AD/CVD order; it is completed or assembled in a third country from parts and components from the country subject to the AD/CVD order; the process of completion or assembly in the third country is minor or insignificant; and a significant portion of the total value of the imported merchandise is attributable to the country subject to the AD/CVD order.
Shipments of CORE from Costa Rica, Guatemala, Malaysia, South Africa, and the UAE to the United States increased in value by 29,210 percent, 35,944 percent, 151,216 percent, 629 percent, and 5,571 percent, respectively, comparing import data from the 45-month period before and after the initiations of the original AD/CVD investigations on Chinese and Taiwanese CORE.
The strict enforcement of U.S. trade law is a primary focus of the Trump administration. To date, the Trump administration has issued 39 preliminary or final affirmative determinations in circumvention inquiries – this is a 200 percent increase from the number of such determinations made during the comparable period in the previous administration.
The U.S. 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.
