SUPPLEMENTARY INFORMATION:

Background

On April 10, 2020, Commerce published the Preliminary Determination  ^[1] of circumvention of the antidumping duty order on HFC blends from China with respect to certain HFC blends containing HFC components from India and China that are blended in India prior to importation into the United States.^[2] We invited parties to comment on the Preliminary Determination. Gujarat Fluorochemicals Ltd. (GFL), SRF Limited (SRF), and Kivlan ^[3] filed case briefs, and the HFC Coalition (the petitioners) filed a rebuttal brief.

We notified the U.S. International Trade Commission (ITC) of our preliminary determination in accordance with section 781(e) of the Tariff Act of 1930, as amended (the Act).^[4] We received a request for consultations from the ITC and held the consultations on June 11, 2020.^[5] On July 6, 2020, the ITC notified Commerce that the ITC did not take a position on whether an affirmative circumvention finding for hydrofluorocarbon (HFC) blends produced in India, in whole or in part, from HFC components from China would raise a serious injury issue.^[6]

A summary of the events that occurred since Commerce published the Preliminary Determination, as well as a full discussion of the issues raised by the parties for this final determination, may be found in the Issues and Decision Memorandum.^[7] The Issues and 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 http://access.trade.gov. In addition, a complete version of the Issues and Decision Memorandum can be accessed directly at http://enforcement.tade.gov.frn/​. The signed and electronic versions of the Issues and Decision Memorandum are identical in content.

Commerce conducted this anti-circumvention inquiry in accordance with section 781(b) of the Act.

Scope of the Order

The products subject to the Order are HFC blends. HFC blends covered by the scope are R-404A, a zeotropic mixture consisting of 52 percent 1,1,1 Trifluoroethane, 44 percent Pentafluoroethane, and 4 percent 1,1,1,2-Tetrafluoroethane; R-407A, a zeotropic mixture of 20 percent Difluoromethane, 40 percent Pentafluoroethane, and 40 percent 1,1,1,2-Tetrafluoroethane; R-407C, a zeotropic mixture of 23 percent Difluoromethane, 25 percent Pentafluoroethane, and 52 percent 1,1,1,2-Tetrafluoroethane; R-410A, a zeotropic mixture of 50 percent Difluoromethane and 50 percent Pentafluoroethane; and R-507A, an azeotropic mixture of 50 percent Pentafluoroethane and 50 percent 1,1,1-Trifluoroethane also known as R-507. The foregoing percentages are nominal percentages by weight. Actual percentages of single component refrigerants by weight may vary by plus or minus two percent points from the nominal percentage identified above.^[8]

Any blend that includes an HFC component other than R-32, R-125, R-143a, or R-134a is excluded from the scope of the Order.

Excluded from the Order are blends of refrigerant chemicals that include products other than HFCs, such as blends including chlorofluorocarbons (CFCs), hydrochlorofluorocarbons (HCFCs), hydrocarbons (HCs), or hydrofluoroolefins (HFOs).

Also excluded from the Order are patented HFC blends, including, but not limited to, ISCEON® blends, including MO99^TM (R-438A), MO79 (R-422A), MO59 (R-417A), MO49Plus^TM (R-437A) and MO29^TM (R-4 22D), Genetron® Performax^TM LT (R-407F), Choice® R-421A, and Choice® R-421B.

HFC blends covered by the scope of the Order are currently classified in the Harmonized Tariff Schedule of the United States (HTSUS) at subheadings 3824.78.0020 and 3824.78.0050. Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the scope is dispositive.^[9]

Merchandise Subject to the Anti-Circumvention Inquiry

This anti-circumvention inquiry covers HFC blends R-404A, R-407A, R-407C, R-410A, and R-507A/R-507 produced in India using one or more HFC components of Chinese origin.^[10]

Final Scope Ruling and Final Determination

In the Preliminary Determination, we determined, pursuant to 19 CFR 351.225(k), that, because the scope only covers HFC blends produced in China and the R-410A blend produced and exported by GFL is produced in India, the R-410A blend produced by GFL is not covered by the scope of the Order. We further found that a circumvention analysis and determination is warranted. We then determined that certain HFC blends containing HFC components from India and China that are blended in India prior to importation into the United States (Indian blends) are circumventing the ( printed page 61932) Order. Specifically, we determined that imports of Indian blends are finished in India and sold in the United States pursuant to the statutory and regulatory criteria laid out in section 781(b) of the Act and 19 CFR 351.225(h). We based our Preliminary Determination upon record evidence submitted by the respondents, the petitioners, and U.S. Customs and Border Protection (CBP). For a complete discussion of the evidence which led to our preliminary determination, see the Preliminary Determination.

Interested parties submitted comments regarding our Preliminary Determination, and we discuss those comments in the “Discussion of the Issues” section of the Issues and Decision Memorandum. Our final affirmative determination of circumvention remains unchanged from the Preliminary Determination. Accordingly, we determine, pursuant to section 781(b) of the Act, that imports of Indian blends are circumventing the Order. However, we did make certain changes to the certification requirements, as set forth in Appendix II.

Methodology

Commerce is conducting this anti-circumvention inquiry in accordance with section 781(b) of the Act. Given that China is a non-market economy, within the meaning of section 771(18) of the Act, Commerce calculated the value of certain merchandise using factors of production and market economy values, as discussed in section 773(c) of the Act. Further, because Coolmate Refrigerant Pvt. Ltd. did not cooperate to the best of its ability in responding to Commerce's requests for information, we have based parts of our final determination on the facts available with adverse inferences, as set forth in the Preliminary Decision Memorandum, pursuant to sections 776(a) and (b) of the Act. See the Preliminary Decision Memorandum for a full description of the methodology. We have continued to apply this methodology for our final determination.

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties in this inquiry are addressed in the Issues and Decision Memorandum. A list of the issues raised is attached to this notice as Appendix I.

Based on our analysis of the comments received, we have made no changes to the findings in the Preliminary Determination. However, we did make certain changes to the certification requirements, as set forth in Appendix II.

Final Affirmative Determination of Circumvention

We determine that exports to the United States of certain HFC blends containing HFC components from India and China that are blended in India prior to importation into the United States, as described in the “Merchandise Subject to the Anti-Circumvention Inquiry” section, are circumventing the Order. We therefore find it appropriate to determine that this merchandise falls within the Order and to instruct CBP to continue to suspend liquidation of any entries of Indian blends.

Continuation of Suspension of Liquidation

As a result of this determination, and consistent with 19 CFR 351.225(l)(3), we intend to direct CBP to continue to suspend liquidation and to require a cash deposit of estimated antidumping duties at the applicable rate on unliquidated entries of merchandise subject to this inquiry that are entered, or withdrawn from warehouse, for consumption on or after June 18, 2019, the date of initiation of this anti-circumvention inquiry.^[11] The suspension of liquidation and cash deposit instructions will remain in effect until further notice.

HFC blends R-404A, R-407A, R-407C, R-410A, and R-507A/R-507 produced in India entirely from non-Chinese HFC components are not subject to this inquiry. Therefore, cash deposits are not required for such merchandise. However, imports of such merchandise are subject to the certification requirements, and cash deposits may be required, if the certification requirements are not satisfied. Accordingly if an importer imports HFC blends R-404A, R-407A, R-407C, R-410A, and R-507A/R-507 produced in India and claims that the HFC blend was produced entirely from non-Chinese components, in order not to be subject to AD requirements, the importer and exporter are required to meet the certification and documentation requirements described in Appendices II, III, and IV. The party that made the sale to the United States should fill out the exporter certification.

In order to prevent evasion, Commerce will instruct CBP that, in the situation where the parties have not maintained the requisite certification regarding the origin of the HFC components for an entry, CBP should suspend the entry and collect cash deposits at the AD rate established for the China-wide entity (216.37 percent) pursuant to the Order.

Further, for this final determination, we continue to determine that the following company is not eligible for the certification process: Coolmate Refrigerant Pvt. Ltd. Accordingly, exporters of HFC blends from India produced and/or exported by this ineligible company are similarly ineligible for the certification process with regard to imports of HFC blends produced by or sourced from this company. Additionally, exporters are not eligible to certify shipments of merchandise produced by the above-listed company. Accordingly, CBP shall suspend the entry and collect cash deposits for entries of merchandise produced and/or exported by Coolmate Refrigerant Pvt. Ltd. at the AD rate established for the China-wide entity (216.37 percent), pursuant to the Order.

Notification Regarding Administrative Protective Order

This notice also serves as a reminder to parties subject to the administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.

Notification to Interested Parties

We are issuing and publishing this notice in accordance with section 781(b) of the Act and 19 CFR 351.225(h).

Appendix I

List of Topics Discussed in the Issues and Decision Memorandum

I. Summary

II. Background

III. Merchandise Subject to the Anti-Circumvention Inquiry

IV. Scope of the Order

V. Discussion of the Issues

Comment 1: Whether Commerce's Initiation and Preliminary Determination Were Lawful with Respect to the ITC's Negative Injury Determination

Comment 2: Whether to Use Surrogate Values to Value Chinese-Origin Material Inputs

Comment 3: Whether the Production Process in India is Minor or Insignificant and Whether the Value of Further ( printed page 61933) Processing in India Represents a Small Portion of the Value of U.S. Merchandise

Comment 4: Validity of the 12 Month Look-Back Provision of the Certification Requirements

Comment 5: Whether the Final Determination Should Be Retroactive to the Date of Initiation

VI. Recommendation

Appendix II

Certification Requirements

If an importer imports HFC blends ( i.e., R-404A, R-407A, R-407C, R-410A, and R-507A/R-507) from India and claims that the HFC blends were not produced from Chinese components ( i.e., Chinese origin R-32, R-125, R-134a, and/or R-143a), the importer is required to complete and maintain the importer certification attached hereto as Appendix III and all supporting documentation. Where the importer uses a broker to facilitate the entry process, it should obtain the entry number from the broker. Agents of the importer, such as brokers, however, are not permitted to make this certification on behalf of the importer.

The exporter is required to complete and maintain the exporter certification, attached as Appendix IV, and is further required to provide the importer a copy of that certification and all supporting documentation. As explained below, shipments made within one year of purchase of Chinese blends or components are not eligible for the certification process.

For shipments and/or entries on or after June 18, 2019, through April 30, 2020, for which certifications are required, importers and exporters should have completed the required certification no later than 30 days after the publication of the Preliminary Determination in the Federal Register . Accordingly, where appropriate, the relevant bullet in the certification should reflect that the certification was completed within the time frame specified above. For example, the bullet in the importer certification that reads: “This certification was completed at or prior to the time of Entry,” could be edited as follows: “The imports referenced herein entered before May 1, 2020. This certification was completed on mm/dd/yyyy, within 30 days of the Federal Register notice publication of the preliminary determination of circumvention.” Similarly, the bullet in the exporter certification that reads, “This certification was completed at or prior to the time of shipment,” could be edited as follows: “The shipments/products referenced herein shipped before May 1, 2020. This certification was completed on mm/dd/yyyy, within 30 days of the Federal Register notice publication of the preliminary determination of circumvention.” For such entries/shipments, importers and exporters each have the option to complete a blanket certification covering multiple entries/shipments, individual certifications for each entry/shipment, or a combination thereof.

For shipments and/or entries on or after May 1, 2020, for which certifications are required, importers should complete the required certification at or prior to the date of entry and exporters should complete the required certification and provide it to the importer at or prior to the date of shipment.

The importer and Indian exporter are also required to maintain sufficient documentation supporting their certifications. The importer will not be required to submit the certifications or supporting documentation to U.S. Customs and Border Protection (CBP) as part of the entry process at this time. However, the importer and the exporter will be required to present the certifications and supporting documentation, to Commerce and/or CBP, as applicable, upon request by the respective agency. Additionally, the claims made in the certifications and any supporting documentation are subject to verification by Commerce and/or CBP. The importer and exporter are required to maintain the certifications (the importer must retain both certifications) and supporting documentation for the later of (1) a period of five years from the date of entry or (2) a period of three years after the conclusion of any litigation in United States courts regarding such entries.

In the situation where no certification is provided for an entry, and the AD China HFC blends order potentially applies to that entry, Commerce intends to instruct CBP to suspend the entry and collect cash deposits at the AD rate established for the China-wide entity (216.37 percent).

Appendix III

Importer Certification

I hereby certify that:

• My name is {IMPORTING COMPANY OFFICIAL'S NAME} and I am an official of {NAME OF IMPORTING COMPANY}, located at {ADDRESS of IMPORTING COMPANY};
• I have direct personal knowledge of the facts regarding the importation into the Customs territory of the United States of the hydrofluorocarbon (HFC) blends (i.e., R-404A, R-407A, R-407C, R-410A, and/or R-507A/R-507) produced in India that entered under the entry number(s) identified below, and which are covered by this certification. “Direct personal knowledge” refers to facts the certifying party is expected to have in its own records. For example, the importer should have direct personal knowledge of the importation of the product ( e.g., the name of the exporter) in its records.
• The HFC blends covered by this certification were exported by {NAME OF EXPORTING COMPANY}, located at {ADDRESS OF EXPORTING COMPANY}.

If the importer is acting on behalf of the first U.S. customer, complete this paragraph:

• The HFC blends covered by this certification were imported by {NAME OF IMPORTING COMPANY} on behalf of {NAME OF U.S. CUSTOMER}, located at {ADDRESS OF U.S. CUSTOMER}.
• The HFC blends covered by this certification were shipped to {NAME OF PARTY TO WHOM MERCHANDISE WAS FIRST SHIPPED IN THE UNITED STATES}, located at {ADDRESS OF SHIPMENT}.
• I have personal knowledge of the facts regarding the production of the imported products covered by this certification. “Personal knowledge” includes facts obtained from another party, (e.g., correspondence received by the importer (or exporter) from the producer regarding the source of the inputs used to produce the imported products);
• The HFC blends covered by this certification were produced by {NAME OF PRODUCING COMPANY}, located at {ADDRESS OF PRODUCING COMPANY};for each additional company, repeat: {NAME OF PRODUCING COMPANY}, located at {ADDRESS OF PRODUCING COMPANY}.
• The HFC blends covered by this certification do not contain HFC components (i.e., R-32, R-125, R-134a, and/or R-143a) produced in the People's Republic of China (China);
• This certification applies to the following entries:

{Repeat this block as many times as necessary}

• I understand that {NAME OF IMPORTING COMPANY} is required to maintain a copy of this certification and sufficient documentation supporting this certification (i.e., documents maintained in the normal course of business, or documents obtained by the certifying party, for example, product data sheets, chemical testing specifications, productions records, invoices, etc.) for the later of (1) a period of five years from the date of entry or (2) a period of three years after the conclusion of any litigation in the United States courts regarding such entries;
• I understand that {NAME OF IMPORTING COMPANY}is required to provide this certification and supporting records, upon request, to U.S. Customs and Border Protection (CBP) and/or the Department of Commerce (Commerce);
• I understand that {NAME OF IMPORTING COMPANY} is required to maintain a copy of the exporter's certification (attesting to the production and/or export of the imported merchandise identified above), and any supporting records provided by the exporter to the importer, for the later of (1) a period of five years from the date of entry or (2) a period of three years after the conclusion of any litigation in United States courts regarding such entries;
• I understand that {NAME OF IMPORTING COMPANY}is required to ( printed page 61934) maintain, and upon request, provide a copy of the exporter's certification and any supporting records provided by the exporter to the importer, to CBP and/or Commerce;
• I understand that the claims made herein, and the substantiating documentation, are subject to verification by CBP and/or Commerce;
• I understand that failure to maintain the required certifications, and/or failure to substantiate the claims made herein, and/or failure to allow CBP and/or Commerce to verify the claims made herein, may result in ade facto determination that all entries to which this certification applies are within the scope if the antidumping duty (AD) order on HFC blends from China. I understand that such a finding will result in:

○ Suspension of liquidation of all unliquidated entries (and entries for which liquidation has not become final) for which these requirements were not met;

○ The requirement that the importer post applicable AD cash deposits equal to the rates as determined by Commerce; and

○ The revocation of {NAME OF IMPORTING COMPANY}'s privilege to certify future imports of HFC blends from India as not manufactured using HFC blends and/or components from China.

• I understand that agents of the importer, such as brokers, are not permitted to make this certification;
• This certification was completed at or prior to the time of Entry; and
• I am aware that U.S. law (including, but not limited to,18 U.S.C. Section 1001) imposes criminal sanctions on individuals who knowingly and willfully make materially false statements to the U.S. government.

Signature

NAME OF COMPANY OFFICIAL

TITLE

DATE

Appendix IV

Exporter Certification

I hereby certify that:

• My name is {COMPANY OFFICIAL'S NAME} and I am an official of {NAME OF EXPORTING COMPANY}, located at {ADDRESS OF EXPORTING COMPANY};
• I have direct personal knowledge of the facts regarding the production and exportation of the hydrofluorocarbon (HFC) blends (i.e., R-404A, R-407A, R-407C, R-410A, and/or R-507A/R-507) identified below. “Direct personal knowledge” refers to facts the certifying party is expected to have in its own books and records. For example, an exporter should have direct personal knowledge of the producer's identity and location.
• The HFC blends, and the individual components thereof, covered this certification were produced by {NAME OF PRODUCING COMPANY}, located at {ADDRESS OF PRODUCING COMPANY};for each additional company, repeat: {NAME OF PRODUCING COMPANY}, located at {ADDRESS OF PRODUCING COMPANY}.
• The HFC blends produced in India do not contain HFC components (i.e., R-32, R-125, R-134a, and/or R-143a) produced in the People's Republic of China (China);
• This certification applies to the following sales:

{Repeat this block as many times as necessary}

• The HFC blends covered by this certification were sold to {NAME OF U.S. CUSTOMER}, located at {ADDRESS OF U.S. CUSTOMER}.
• The HFC blends covered by this certification were shipped to {NAME OF PARTY TO WHOM MERCHANDISE WAS SHIPPED}, located at {ADDRESS OF SHIPMENT}.
• I understand that {NAME OF EXPORTING COMPANY} is required to maintain a copy of this certification and sufficient documentation supporting this certification (i.e., documents maintained in the normal course of business, or documents obtained by the certifying party, for example, product data sheets, chemical testing specifications, productions records, invoices, etc.) for the later of (1) a period of five years from the date of entry or (2) a period of three years after the conclusion of any litigation in the United States courts regarding such entries;
• I understand that {NAME OF EXPORTING COMPANY} must provide this Exporter Certification to the U.S. importer by the time of shipment;
• I understand that {NAME OF EXPORTING COMPANY} is required to provide a copy of this certification and supporting records, upon request, to U.S. Customs and Border Protection (CBP) and/or the Department of Commerce (Commerce);
• I understand that the claims made herein, and the substantiating documentation are subject to verification by CBP and/or Commerce;
• I understand that failure to maintain the required certifications, and/or failure to substantiate the claims made herein, and/or failure to allow CBP and/or Commerce to verify the claims made herein, may result in ade facto determination that all sales to which this certification applies are within the scope of the antidumping duty (AD) order on HFC blends from China. I understand that such finding will result in:

○ Suspension of all unliquidated entries (and entries for which liquidation has not become final) for which these requirements were not met;

○ The requirement that the importer post applicable AD cash deposits equal to the rates as determined by Commerce; and

○ The revocation of {NAME OF EXPORTING COMPANY}'s privilege to certify future exports of HFC blends from India as not manufactured using HFC blends and/or components from China.

• This certification was completed at or prior to the time of shipment; and
• I am aware that U.S. law (including, but not limited to,18 U.S.C. Section 1001) imposes criminal sanctions on individuals who knowingly and willfully make materially false statements to the U.S. government.

Signature

NAME OF COMPANY OFFICIAL

TITLE

DATE

85 FR 61930