U.S. Department of Commerce initiates circumvention inquiry

Today, the U.S. Department of Commerce announced the self-initiation of an inquiry into possible circumvention of antidumping duty (AD) and countervailing duty (CVD) orders on stainless steel sheet and strip (stainless sheet and strip) from China. The possible circumvention involves stainless steel flat-rolled products from China that are completed in Vietnam and then exported to the United States.

Under U.S. law, Commerce may conduct a circumvention inquiry when evidence suggests that merchandise subject to an existing AD/CVD order is completed or assembled in third countries from parts and components imported from the country subject to the order. 

Typically, circumvention inquiries are initiated in response to allegations filed by the domestic industry. However, Commerce’s regulations provide that these inquiries may be self-initiated when Commerce determines from available information that an inquiry is warranted. This is the seventh circumvention inquiry self-initiated by Commerce based on its own monitoring of trade patterns – a new trade enforcement tool created by the Trump administration.

If Commerce preliminarily determines that circumvention is occurring, Commerce will instruct U.S. Customs and Border Protection to suspend liquidation and begin collecting cash deposits on imports of stainless sheet and strip completed in Vietnam using Chinese-origin stainless steel flat-rolled inputs and/or Chinese-origin stainless sheet and strip further processed in Vietnam. For products found to be circumventing the AD and CVD orders, or subject to their scope, duties will be imposed on future imports and on any unliquidated entries from the date of initiation of the circumvention inquiry.

Commerce is also self-initiating a concurrent scope inquiry to determine if stainless sheet and strip from Vietnam is within the scope of the AD/CVD orders on stainless sheet and strip from China. The orders’ scope language states that the orders include stainless sheet and strip that has undergone certain types of minor processing in third countries.

Shipments of stainless sheet and strip from Vietnam to the United States increased in value by $122 million (180.4 percent) comparing import data from the 40-month periods before and after the initiations of the original AD/CVD investigations on Chinese stainless sheet and strip on March 3, 2016.

The strict enforcement of U.S. trade law is a primary focus of the Trump administration. Since the beginning of the current administration, Commerce has initiated 27 new circumvention inquiries – this is a 125 percent increase from the number of circumvention initiations 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.

Source: U.S. Department of Commerce, Photo: Fotolia