Thermoformed Molded Fiber Products From the People's Republic of China: Preliminary Affirmative Countervailing Duty Determination and Alignment of Final Determination With Final Antidumping Duty Determination

<NOTICE> DEPARTMENT OF COMMERCE <SUBAGY>International Trade Administration</SUBAGY> <DEPDOC>[C-570-183]</DEPDOC> <SUBJECT>Thermoformed Molded Fiber Products From the People's Republic of China: Preliminary Affirmative Countervailing Duty Determination and Alignment of Final Determination With Final Antidumping Duty Determination</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Enforcement and Compliance, International Trade Administration, Department of Commerce. <SUM> <HD SOURCE="HED">SUMMARY:</HD> The U.S. Department of Commerce (Commerce) preliminarily determines that countervailable subsidies are being provided to producers and exporters of thermoformed molded fiber products (molded fiber products) from the People's Republic of China (China). The period of investigation is January 1, 2023, through December 31, 2023. Interested parties are invited to comment on this preliminary determination. </SUM> <DATES> <HD SOURCE="HED">DATES:</HD> Applicable March 14, 2025. </DATES> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Allison Hollander or Ashley Cossaart, AD/CVD Operations, Office IX, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-2805 or (202) 482-0462, respectively. </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">Background</HD> This preliminary determination is issued in accordance with section 703(b) of the Tariff Act of 1930, as amended (the Act). On November 4, 2024, Commerce published the notice of initiation of this countervailing duty (CVD) investigation. <SU>1</SU> <FTREF/> On December 19, 2024, Commerce postponed the deadline for this preliminary determination until March 7, 2025. <SU>2</SU> <FTREF/> <FTNT> <SU>1</SU>   <E T="03">See Thermoformed Molded Fiber Products from the People's Republic of China and the Socialist Republic of Vietnam: Initiation of Countervailing Duty Investigations,</E> 89 FR 87556 (November 4, 2024) ( <E T="03">Initiation Notice</E> ); and <E T="03">Thermoformed Molded Fiber Products from the People's Republic of China and the Socialist Republic of Vietnam: Initiation of Countervailing Duty Investigations; Correction,</E> 89 FR 91321 (November 19, 2024) (correcting a typographical error in the Harmonized Tariff Schedule of the United States subheadings listed in the scope). </FTNT> <FTNT> <SU>2</SU>   <E T="03">See Thermoformed Molded Fiber Products from the People's Republic of China and the Socialist Republic of Vietnam: Postponement of Preliminary Determination in the Countervailing Duty Investigations,</E> 89 FR 103778 (December 19, 2024). </FTNT> For a complete description of the events that followed the initiation of this investigation, <E T="03">see</E> the Preliminary Decision Memorandum. <SU>3</SU> <FTREF/> A list of topics discussed in the Preliminary Decision Memorandum is included as Appendix II to this notice. The Preliminary Decision Memorandum is a public document and is on file electronically via Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS). ACCESS is available to registered users at <E T="03">https://access.trade.gov.</E> In addition, a complete version of the Preliminary Decision Memorandum can be accessed directly at <E T="03">https://access.trade.gov/public/FRNoticesListLayout.aspx.</E> <FTNT> <SU>3</SU>   <E T="03">See</E> Memorandum, “Decision Memorandum for the Preliminary Affirmative Determination of the Countervailing Duty Investigation of Thermoformed Molded Fiber Products from the People's Republic of China,” dated concurrently with, and hereby adopted by, this notice (Preliminary Decision Memorandum). </FTNT> <HD SOURCE="HD1">Scope of the Investigation</HD> The products covered by this investigation are molded fiber products from China. For a complete description of the scope of this investigation, <E T="03">see</E> Appendix I. <HD SOURCE="HD1">Scope Comments</HD> In accordance with the <E T="03">Preamble</E> to Commerce's regulations, <SU>4</SU> <FTREF/> the <E T="03">Initiation Notice</E> set aside a period of time for parties to raise issues regarding product coverage ( <E T="03">i.e.,</E> scope). <SU>5</SU> <FTREF/> Certain interested parties commented on the scope of the investigation as it appeared in the <E T="03">Initiation Notice.</E> Commerce intends to issue its preliminary decision regarding comments concerning the scope of the less-than-fair-value (LTFV) and CVD investigations in the preliminary determination of the companion LTFV investigations. We will incorporate the scope decisions from the LTFV investigations into the scope of the final CVD determination for this investigation after considering any relevant comments submitted in scope case and rebuttal briefs. <SU>6</SU> <FTREF/> <FTNT> <SU>4</SU>   <E T="03">See Antidumping Duties; Countervailing Duties, Final Rule,</E> 62 FR 27296, 27323 (May 19, 1997) ( <E T="03">Preamble</E> ). </FTNT> <FTNT> <SU>5</SU>   <E T="03">See Initiation Notic</E> e, 89 FR at 65852. </FTNT> <FTNT> <SU>6</SU>  The deadline for interested parties to submit scope case and rebuttal briefs will be established in the preliminary scope decision memorandum. </FTNT> <HD SOURCE="HD1">Methodology</HD> Commerce is conducting this investigation in accordance with section 701 of the Act. For each of the subsidy programs found countervailable, Commerce preliminarily determines that there is a subsidy, <E T="03">i.e.,</E> a financial contribution by an “authority” that gives rise to a benefit to the recipient, and that the subsidy is specific. <SU>7</SU> <FTREF/> For a full description of the methodology underlying our preliminary determination, <E T="03">see</E> the Preliminary Decision Memorandum. <FTNT> <SU>7</SU>   <E T="03">See</E> sections 771(5)(B) and (D) of the Act regarding financial contribution; section 771(5)(E) of the Act regarding benefit; and section 771(5A) of the Act regarding specificity. </FTNT> Commerce notes that, in making these findings, it relied, in part, on facts available and, because it finds that one or more respondents did not act to the best of their ability to respond to Commerce's requests for information, it drew an adverse inference where appropriate in selecting from among the facts otherwise available. <SU>8</SU> <FTREF/> For further information, <E T="03">see</E> the “Use of Facts Otherwise Available and Adverse Inferences” section in the Preliminary Decision Memorandum. <FTNT> <SU>8</SU>   <E T="03">See</E> sections 776(a) and (b) of the Act. </FTNT> <HD SOURCE="HD1">Alignment</HD> In accordance with section 705(a)(1) of the Act and 19 CFR 351.210(b)(4), Commerce is aligning the final countervailing duty (CVD) determination in this investigation with the final determination in the companion LTFV investigation of molded fiber products from China based on a request made by the petitioners. <SU>9</SU> <FTREF/> Consequently, the final CVD determination will be issued on the same date as the final LTFV determination, which is currently scheduled to be issued no later than July 21, 2025, unless postponed. <FTNT> <SU>9</SU>  The petitioners are: Genera, Tellus Products, LLC, and the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO. <E T="03">See</E> Petitioners' Letter, “Petitioners' Request for Alignment of the Countervailing Duty Investigations with the Concurrent Antidumping Duty Investigations,” dated February 24, 2025. </FTNT> <HD SOURCE="HD1">Rate for Non-Responsive Companies</HD> One potential exporter and/or producer of molded fiber products from China did not respond to Commerce's quantity and value (Q&V) questionnaire ( <E T="03">i.e.,</E> the non-responsive company). <SU>10</SU> <FTREF/> We find that, by not responding to the Q&V questionnaire, this company withheld requested information and significantly impeded this proceeding. Thus, in reaching our preliminary determination, pursuant to sections 776(a)(2)(A) and (C) of the Act, we are basing the CVD subsidy rate for the non-responsive company on facts otherwise available. <FTNT> <SU>10</SU>  The non-responsive company is Shaoneng Group Guangdong Luzhou Paper Mould Packing Products Co., Ltd. </FTNT> We further preliminarily determine that an adverse inference is warranted, pursuant to section 776(b) of the Act. By failing to submit a response to Commerce's Q&V questionnaire, the non-responsive company did not cooperate to the best of their ability in this investigation. For more information on the application of AFA to the non-responsive company, <E T="03">see</E> “Use of Facts Otherwise Available and Adverse Inferences” in the Preliminary Decision Memorandum. <HD SOURCE="HD1">All-Others Rate</HD> Sections 703(d) and 705(c)(5)(A) of the Act provide that in the preliminary determination, Commerce shall determine an estimated all-others rate for companies not individually examined. This rate shall be an amount equal to the weighted average of the estimated subsidy rates established for those companies individually examined, excluding any zero and <E T="03">de minimis</E> rates and any rates based entirely under section 776 of the Act. In this investigation, Commerce preliminarily calculated individual estimated countervailable subsidy rates for Guangxi Firstpak Environmental Technology Co., Ltd. (Firstpak) and Zhejiang Zhongxin Environmental Protection Technology Group Co., Ltd. (Zhejiang Zhongxin) that are not zero, <E T="03">de minimis,</E> or based entirely on the facts otherwise available. Commerce calculated the all-others rate using a weig ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 23k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━