Regulations Improving and Strengthening the Enforcement of Trade Remedies Through the Administration of the Antidumping and Countervailing Duty Laws

<RULE> DEPARTMENT OF COMMERCE <SUBAGY>International Trade Administration</SUBAGY> <CFR>19 CFR Part 351</CFR> <DEPDOC>[Docket No. 240307-0075]</DEPDOC> <RIN>RIN 0625-AB23</RIN> <SUBJECT>Regulations Improving and Strengthening the Enforcement of Trade Remedies Through the Administration of the Antidumping and Countervailing Duty Laws</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Enforcement and Compliance, International Trade Administration, Department of Commerce. <HD SOURCE="HED">ACTION:</HD> Final rule. <SUM> <HD SOURCE="HED">SUMMARY:</HD> Pursuant to its authority under the Tariff Act of 1930, as amended (the Act), the U.S. Department of Commerce (Commerce) is amending its regulations to enhance, improve and strengthen its enforcement and administration of the antidumping duty (AD) and countervailing duty (CVD) laws. Specifically, Commerce is revising some of its procedures, codifying certain areas of its practice, and enhancing certain areas of its methodologies and analyses to address price and cost distortions, as well as certain countervailable subsidies, in different capacities. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> These amendments are effective April 24, 2024. </EFFDATE> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Scott McBride, Associate Deputy Chief Counsel, at (202) 482-6292, Ian McInerney, Attorney, at (202) 482-2327, Hendricks Valenzuela, Attorney, at (202) 482-3558, or Ariela Garvett, Senior Advisor, at <E T="03">Ariela.Garvett@trade.gov</E> . </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">General Background</HD> On May 9, 2023, Commerce proposed amendments to its existing regulations, 19 CFR part 351, to improve, strengthen and enhance its enforcement of the AD and CVD laws. <SU>1</SU> <FTREF/> Relevant to this final rule are the AD/CVD statutory and regulatory provisions in general, as well as those pertaining to filing requirements, scope, circumvention, and covered merchandise inquiries, the use of new factual information, the CVD facts available hierarchy, surrogate value and CVD benchmark selections, particular market situations (PMS), and certain types of countervailable subsidies, which we summarize below. <FTNT> <SU>1</SU>   <E T="03">See Regulations Improving and Strengthening the Enforcement of Trade Remedies Through the Administration of the Antidumping and Countervailing Duty Laws,</E> 88 FR 29850 (May 9, 2023) ( <E T="03">Proposed Rule</E> ). </FTNT> Title VII of the Act vests Commerce with authority to administer the AD/CVD laws. In particular, section 731 of the Act directs Commerce to impose an AD order on merchandise entering the United States when it determines that a producer or exporter is selling a class or kind of foreign merchandise into the United States at less than fair value ( <E T="03">i.e.,</E> dumping), and the U.S. International Trade Commission (ITC) finds material injury or threat of material injury to that industry in the United States. Section 701 of the Act directs Commerce to impose a CVD order when it determines that a government of a country, or any public entity within the territory of a country, is providing, directly or indirectly, a countervailable subsidy with respect to the manufacture, production, or export of a class or kind of merchandise that is imported into the United States, and when the ITC finds that material injury or threat of material injury to that industry in the United States. <SU>2</SU> <FTREF/> <FTNT> <SU>2</SU>  A countervailable subsidy is further defined under section 771(5)(B) of the Act as existing when: a government or any public entity within the territory of a country provides a financial contribution; provides any form of income or price support; or makes a payment to a funding mechanism to provide a financial contribution, or entrusts or directs a private entity to make a financial contribution, if providing the contribution would normally be vested in the government and the practice does not differ in substance from practices normally followed by governments; and a benefit is thereby conferred. To be countervailable, a subsidy must be specific within the meaning of section 771(5A) of the Act. </FTNT> On September 20, 2021, Commerce revised its scope regulations (19 CFR 351.225) and issued new circumvention (19 CFR 351.226) and covered merchandise (19 CFR 351.227) regulations. <E T="03">See Scope and Circumvention Final Rule,</E> 86 FR 52300 (September 20, 2021) ( <E T="03">Scope and Circumvention Final Rule</E> ). <E T="03">See also Scope and Circumvention Proposed Rule,</E> 85 FR 49472 (August 13, 2020) ( <E T="03">Scope and Circumvention Proposed Rule</E> ). These revised and new regulations became effective November 4, 2021. On September 29, 2023, after publication of the May 2023 <E T="03">Proposed Rule,</E> Commerce identified some technical issues in those scope, circumvention, and covered merchandise referral regulations, and amended those regulations to address those issues. <SU>3</SU> <FTREF/> We have incorporated those changes into these final revised regulations. <FTNT> <SU>3</SU>   <E T="03">See Administrative Protective Order, Service, and Other Procedures in Antidumping and Countervailing Duty Proceedings,</E> 88 FR 67069, 67077-78 (September 29, 2023) ( <E T="03">APO and Service Final Rule</E> ). </FTNT> As we explained throughout the preamble to the <E T="03">Proposed Rule,</E> the purpose of these modifications and additions to our regulations is to improve, strengthen and enhance the enforcement and administration of the AD/CVD laws, make such enforcement and administration more efficient, and to address factors which distort costs and prices—factors that make the “playing field” less “level” for domestic interested parties and can contribute to unfair trade. In order to achieve the purpose of those regulations, Commerce may at times need to request further documentation from interested parties that clarifies the record to better understand the facts of a particular case. Other times, Commerce may need to extend the deadline to issue a determination so that its decision is fully informed and complete. To address unfair trade adequately and appropriately, Commerce may need to remove unnecessary restrictions in its regulations to address updated challenges, like the agency's withdrawal of the prohibitive transnational subsidies regulation. Commerce recognizes that in the year 2024, there are complexities and challenges in international trade which did not exist, or did not exist in the same manner or to the same degree, when previous regulations were issued. Accordingly, Commerce has determined that revisions and updates to Commerce's trade remedy regulations are warranted. Section 516A(b)(2) of the Act provides a definition of Commerce's administrative record in AD/CVD proceedings and § 351.104(a)(1) describes in greater detail the information contained on the official record. Nonetheless, interested parties sometimes make the mistake of merely citing sources, or placing Uniform Resource Locator (URL) website information, or hyperlinks, in their submissions to Commerce, and then later presuming the information contained at the source documents is considered part of the record. This becomes a problem, for example, when parties submit their case briefs and rebuttal briefs on the record pursuant to § 351.309 and quote from, or otherwise rely on, information or data derived from the cited sources that were never submitted on the official record. Commerce therefore proposed adding clarification on this point to § 351.104(a)(1) in the <E T="03">Proposed Rule.</E> <SU>4</SU> <FTREF/> Commerce also proposed listing documents which do not need to be placed on the record, but can merely be cited, in the <E T="03">Proposed Rule.</E> <SU>5</SU> <FTREF/> We received a large number of comments on these proposals, and as we describe in greater detail below, we have revised § 351.104 to provide greater clarity on these issues. <SU>6</SU> <FTREF/> <FTNT> <SU>4</SU>   <E T="03">See Proposed Rule,</E> 88 FR 29852-53. </FTNT> <FTNT> <SU>5</SU>   <E T="03">Id.</E> </FTNT> <FTNT> <SU>6</SU>  Commerce also proposed a change to § 351.301(c)(4), which deals with the use of record information as well. However, the comments Commerce received were overwhelmingly opposed to such a change. Accordingly, Commerce is not making a change to the existing provision as proposed. </FTNT> In the <E T="03">Proposed Rule,</E> Commerce proposed language to be added to the regulations addressing scope, circumvention, and covered merchandise inquiries pertaining to filing deadlines, clarification requests, merchandise not yet imported but commercially-produced and sold, extensions of time, regulatory restrictions covering new factual information, and scope clarifications. <SU>7</SU> <FTREF/> Commerce subsequently received comments from several interested parties on each of its suggestions. In response to those comments, for the reasons we explain below, Commerce has made certain modifications to its final regulations—primarily on the language pertaining to scope clarifications. <FTNT> <SU>7</SU> <E T="03">See Proposed Rule,</E> 88 FR 29853-57. </FTNT> There are times when interested parties seek to file Notices of Subsequent Authority with Commerce, in which a party argues in a given segment of a proceeding that a new Federal court or Commerce decision supports, contradicts, or undermines particular arguments before the agency. However, Commerce's current regulations do not address the timing for submitting Notices of Subsequent Authority, responsive comments to a Notice of Subsequent Authority, and new factual information regarding the filing of a Notice of Subsequent Authority, nor the cont ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 594k characters. 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