1-Hydroxyethylidene-1, 1-Diphosphonic Acid From the People's Republic of China: Preliminary Affirmative Determination of Circumvention

<NOTICE> DEPARTMENT OF COMMERCE <SUBAGY>International Trade Administration</SUBAGY> <DEPDOC>[A-570-045, C-570-046]</DEPDOC> <SUBJECT>1-Hydroxyethylidene-1, 1-Diphosphonic Acid From the People's Republic of China: Preliminary Affirmative Determination of Circumvention</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 imports of 1-hydroxyethylidene-1, 1-diphosphonic acid, also referred to as hydroxyethylidenendiphosphonic acid, hydroxyethanediphosphonic acid, acetodiphosphonic acid, and etidronic acid, in solid or powder form (acidic solid HEDP) from the People's Republic of China (China) are circumventing the antidumping duty (AD) and countervailing duty (CVD) orders on 1-hydroxyethylidene-1, 1-diphosphonic acid (HEDP) from China. Interested parties are invited to comment on this preliminary determination. </SUM> <DATES> <HD SOURCE="HED">DATES:</HD> Applicable May 9, 2025. </DATES> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Charles Vannatta, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-4036. </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">Background</HD> On May 18, 2017, Commerce published in the <E T="04">Federal Register</E> the AD and CVD orders on HEDP from China. <SU>1</SU> <FTREF/> On November 13, 2024, Compass Chemical International LLC (Compass) requested that Commerce initiate a circumvention inquiry with regard to acidic solid HEDP that is exported to the United States from China. <SU>2</SU> <FTREF/> In its Circumvention Request, Compass alleged that acidic solid HEDP constitutes merchandise altered in form or appearance in such minor respects that it should be included within the scope of the <E T="03">Orders,</E> pursuant to section 781(c) of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.226(j). <SU>3</SU> <FTREF/> Compass requested that Commerce conduct this circumvention inquiry on a country-wide basis. <SU>4</SU> <FTREF/> <FTNT> <SU>1</SU>   <E T="03">See 1-Hydroxyethylidene-1, 1-Diphosphonic Acid from the People's Republic of China: Amended Final Determination of Sales at Less Than Fair Value, and Antidumping Duty Order,</E> 82 FR 22807 (May 18, 2017); <E T="03">see also 1-Hydroxyethylidene-1, 1-Diphosphonic Acid from the People's Republic of China: Countervailing Duty Order,</E> 82 FR 22809 (May 18, 2017) (collectively, <E T="03">Orders</E> ). </FTNT> <FTNT> <SU>2</SU>   <E T="03">See</E> Compass' Letter, “Request for an Anticircumvention Inquiry Pursuant to 19 U.S.C. 1677j(c); Response to Supplemental Questionnaire,” dated November 13, 2024 (Circumvention Request). </FTNT> <FTNT> <SU>3</SU>   <E T="03">Id.</E> </FTNT> <FTNT> <SU>4</SU>   <E T="03">Id.</E> at Attachment A at 30. </FTNT> On December 19, 2024, Commerce published in the <E T="04">Federal Register</E> a notice of initiation of this circumvention inquiry. <SU>5</SU> <FTREF/> In the <E T="03">Initiation Notice,</E> Commerce initiated the circumvention inquiry on the basis of the minor alterations allegation, pursuant to section 781(c) of the Act and 19 CFR 351.226(j). <SU>6</SU> <FTREF/> Commerce initiated this inquiry on a country-wide basis. <SU>7</SU> <FTREF/> For a complete description of events that followed the initiation of this inquiry, <E T="03">see</E> the Preliminary Decision Memorandum. <SU>8</SU> <FTREF/> <FTNT> <SU>5</SU>   <E T="03">See 1-Hydroxyethylidene-1, 1-Diphosphonic Acid From the People's Republic of China: Initiation of Circumvention Inquiry of the Antidumping and Countervailing Duty Orders,</E> 89 FR 103779 (December 19, 2024) ( <E T="03">Initiation Notice</E> ), and accompanying Initiation Checklist. </FTNT> <FTNT> <SU>6</SU>   <E T="03">Id.</E> </FTNT> <FTNT> <SU>7</SU>   <E T="03">Id.</E> </FTNT> <FTNT> <SU>8</SU>   <E T="03">See</E> Memorandum, “Circumvention Inquiry of the Antidumping Duty and Countervailing Duty Orders on 1-Hydroxyethylidene-1, 1-Diphosphonic Acid from the People's Republic of China: Preliminary Decision Memorandum,” dated concurrently with, and hereby adopted by, this notice (Preliminary Decision Memorandum). </FTNT> <HD SOURCE="HD1">Scope of the Orders</HD> The merchandise covered by the <E T="03">Orders</E> includes all grades of aqueous acidic (non-neutralized) concentrations of acidic HEDP from China. For a complete description of the scope of the <E T="03">Orders, see</E> the Preliminary Decision Memorandum. <HD SOURCE="HD1">Merchandise Subject to the Circumvention Inquiry</HD> This circumvention inquiry covers acidic solid HEDP produced in China and exported to the United States. A complete description of the merchandise subject to the circumvention inquiry is contained in the Preliminary Decision Memorandum. <HD SOURCE="HD1">Methodology</HD> Commerce is conducting this circumvention inquiry pursuant to section 781(c) of the Act and 19 CFR 351.226(j). For a complete description of the methodology underlying the preliminary determination, <E T="03">see</E> the Preliminary Decision Memorandum. A list of topics discussed in the Preliminary Decision Memorandum is attached as an appendix 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> <HD SOURCE="HD1">Preliminary Affirmative Determination of Circumvention</HD> As detailed in the Preliminary Decision Memorandum, we preliminarily determine that acidic solid HEDP is being produced in China and exported to the United States, and that the sale of acidic solid HEDP in the United States is circumventing the <E T="03">Orders.</E> Further, we preliminarily determine that acidic solid HEDP constitutes merchandise altered in form or appearance in such minor respects that it should be included within the scope of the <E T="03">Orders,</E> pursuant to section 781(c) of the Act and 19 CFR 351.226(j). We make this determination on a country-wide basis. As a result, we preliminarily determine that it is appropriate to include this merchandise within the <E T="03">Orders,</E> and to instruct U.S. Customs and Border Protection (CBP) to suspend liquidation of entries of acidic solid HEDP produced in China and exported to the United States, and to require cash deposits of estimated antidumping and countervailing duties. <HD SOURCE="HD1">Use of Adverse Facts Available (AFA)</HD> Pursuant to section 776(a) of the Act, if necessary information is not available on the record, or an interested party withholds requested information, fails to provide requested information by the deadline or in the form and manner requested, or significantly impedes a proceeding, Commerce shall use the facts otherwise available in reaching the applicable determination. Moreover, pursuant to section 776(b) of the Act, Commerce may use inferences adverse to the interests of an interested party in selecting from among the facts otherwise available if the party fails to cooperate by not acting to the best of its ability to provide requested information. Commerce requested quantity and value (Q&V) information from twelve companies: Dalian Sinobio Chemistry Co., Ltd. (Dalian Sinobio), Henan Qingshuiyuan Technology Co, Ltd. (Henan Qingshuiyuan), Jiangsu Yao's Environmental Protection Technology Co., Ltd. (Jiangsu Yao), Jiyuan Qingyuan Water Treatment Co. (Jiyuan Qingyuan), Juancheng Kangtai, KCC Industrial Enterprise Limited (KCC Industrial), Nantong Uniphos Chemicals Co., Ltd. (Nantong Uniphos), Plastix Company Ltd. (Plastix), Shandong Dongyue Chemical (Shandong Dongyue), Shandong Green Technologies Import Export Co., Ltd. (Green Technologies), Shandong Taihe Chemicals Co., Ltd. (Taihe Chemicals), and Shandong Taihe Water Treatment Technologies Co., Ltd (Taihe Water Treatment). <SU>9</SU> <FTREF/> In the Q&V Questionnaire, <SU>10</SU> <FTREF/> Commerce explained that failure to respond may result in the determination that the company failed to cooperate by not acting to the best of its ability to comply with the request for information, and Commerce may use an inference that is adverse to the company's interests in selecting from the facts otherwise available, in accordance with section 776(b) of the Act. <SU>11</SU> <FTREF/> Commerce received a timely response to the Q&V Questionnaire from Plastix, which explained that it was a Taiwanese, third-country exporter of acidic solid HEDP, but did not produce or export acidic solid HEDP from China. <SU>12</SU> <FTREF/> Dalian Sinobio, Henan Qingshuiyuan, Jiangsu Yao, Jiyuan Qingyuan, Juancheng Kangtai, KCC Industrial, Nantong Uniphos, Shandong Dongyue, Green Technologies, Taihe Chemicals, and Taihe Water Treatment (collectively, the Eleven Non-Responsive Companies) failed to respond to Commerce's Q&V Questionnaire. <FTNT> <SU>9</SU>   <E T="03">See</E> Commerce's Letter, “Quantity and Value Questionnaire for Chinese Producers, Exporters, or U.S. Importers,” dated January 21, 2025 (Q&V Questionnaire); <E T="03">see also</E> Memorandum, “Issuance of Quantity and Value Questionnaire,” dated January 22, 2025. </FTNT> <FTNT> <SU>10</SU>   <E T="03">See</E> Q&V Questionnaire. </FTNT> <FTNT> <S ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 17k characters. 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