China Aluminum Extrusions: Preliminary Affirmative CV Duty Determination

No Investigation of Currency Manipulation

While currency manipulation was alleged, the ITA has determined not to initiate an investigation of this allegation.

(See ITT’s Online Archives or 07/09/10 news, 10070915, for BP summary of Senator Grassley’s statement urging the Administration to bring a case against China’s currency manipulation at the World Trade Organization.)

CV Suspension of Liquidation

The ITA is directing U.S. Customs and Border Protection to suspend liquidation for CV purposes of all entries of aluminum extrusions from China with a time of entry on or after September 7, 2010.

CV Cash Deposit/Bond Instructions

The ITA is also directing CBP to require a CV duty cash deposit or bond for entries of subject merchandise from China with a time of entry on or after September 7, 2010, at the following CV duty rates:

¹These individual rates are for merchandise produced and exported by the individually investigated entities -- Zhongya Companies and Guang Ya Companies -- which are voluntary respondents.

²As the three mandatory respondents did not cooperate in the investigation resulting in the preliminary determination, their rates are the result of the application of adverse facts available (AFA). “All Others” also get the AFA rate, as the inclusion of the voluntary (self-selected) respondents in the derivation of the all-others rate could result in the distortion or manipulation of the all-others rate.

(Note that the AFA rate excludes net subsidy rates calculated for the voluntary respondents. The ITA states that in a prior CV investigation involving China, it calculated the all-others rate by simple-averaging the AFA rates of the non-cooperating, mandatory respondents with the rate calculated for the voluntary respondent. However, upon further examination, the ITA now determines that the potential for voluntary respondent’s net subsidy rates to distort or manipulate the all-others rate is too great, and thus this simple averaging approach is no longer appropriate.)

New Subsidy Allegations for the Two Voluntary Respondents

In July 2010, the petitioners submitted new subsidy allegations regarding the voluntary respondents Zhongya Companies and Guang Ya Companies, and the ITA initiated investigations of these new allegations on August 11, 2010. The ITA is asking interested parties to comment on whether it should include the additional alleged programs and the various programs self-reported by Zhongya and Guang Ya companies into the AFA rate calculated for the three non-cooperating, mandatory respondents.

ITA is Considering Scope Comments

The ITA states that it received several scope comments from interested parties. It is evaluating the comments submitted and will issue its decision regarding the scope of the CV and antidumping duty investigations in the preliminary determination of the companion AD investigation, which is due for signature on October 27, 2010.

Scope of the Investigation “To Date”

The merchandise covered by this investigation is aluminum extrusions which are shapes and forms, produced by an extrusion process, made from aluminum alloys having metallic elements corresponding to the alloy series designations published by The Aluminum Association commencing with the numbers 1, 3, and 6 (or proprietary equivalents or other certifying body equivalents).

Specifically, the subject merchandise made from aluminum alloy with an Aluminum Association series designation commencing with the number 1 contains not less than 99 percent aluminum by weight. The subject merchandise made from aluminum alloy with an Aluminum Association series designation commencing with the number 3 contains manganese as the major alloying element, with manganese accounting for not more than 3.0 percent of total materials by weight. The subject merchandise made from an aluminum alloy with an Aluminum Association series designation commencing with the number 6 contains magnesium and silicon as the major alloying elements, with magnesium accounting for at least 0.1 percent but not more than 2.0 percent of total materials by weight, and silicon accounting for at least 0.1 percent but not more than 3.0 percent of total materials by weight. The subject aluminum extrusions are properly identified by a four-digit alloy series without either a decimal point or leading letter. Illustrative examples from among the approximately 160 registered alloys that may characterize the subject merchandise are as follows: 1350, 3003, and 6060.

Aluminum extrusions are produced and imported in a wide variety of shapes and forms, including, but not limited to, hollow profiles, other solid profiles, pipes, tubes, bars, and rods. Aluminum extrusions that are drawn subsequent to extrusion (“drawn aluminum”) are also included in the scope.

Aluminum extrusions are produced and imported with a variety of finishes (both coatings and surface treatments), and types of fabrication. The types of coatings and treatments applied to subject aluminum extrusions include, but are not limited to, extrusions that are mill finished (i.e., without any coating or further finishing), brushed, buffed, polished, anodized (including bright-dip anodized), liquid painted, or powder coated. Aluminum extrusions may also be fabricated, i.e., prepared for assembly. Such operations would include, but are not limited to, extrusions that are cut-to-length, machined, drilled, punched, notched, bent, stretched, knurled, swedged, mitered, chamfered, threaded, and spun. The subject merchandise includes aluminum extrusions that are finished (coated, painted, etc.), fabricated, or any combination thereof.

Subject aluminum extrusions may be described at the time of importation as parts for final finished products that are assembled after importation, including, but not limited to, window frames, door frames, solar panels, curtain walls, or furniture. Such parts that otherwise meet the definition of aluminum extrusions are included in the scope. The scope includes aluminum extrusions that are attached (e.g., by welding or fasteners) to form subassemblies, i.e., partially assembled merchandise.

Subject extrusions may be identified with reference to their end use, such as heat sinks, door thresholds, or carpet trim. Such goods are subject merchandise if they otherwise meet the scope definition, regardless of whether they are finished products and ready for use at the time of importation.

Exclusions. The following aluminum extrusion products are excluded: Aluminum extrusions made from aluminum alloy with an Aluminum Association series designations commencing with the number 2 and containing in excess of 1.5 percent copper by weight; aluminum extrusions made from aluminum alloy with an Aluminum Association series designation commencing with the number 5 and containing in excess of 1.0 percent magnesium by weight; and aluminum extrusions made from aluminum alloy with an Aluminum Association series designation commencing with the number 7 and containing in excess of 2.0 percent zinc by weight.

The scope also excludes finished merchandise containing aluminum extrusions as parts that are fully and permanently assembled and completed at the time of entry, such as finished windows with glass, doors, picture frames, and solar panels. The scope also excludes finished goods containing aluminum extrusions that are entered unassembled in a “kit.” A kit is understood to mean a packaged combination of parts that contains, at the time of importation, all of the necessary parts to fully assemble a final finished good.

The scope also excludes aluminum alloy sheet or plates produced by other than the extrusion process, such as aluminum products produced by a method of casting. Cast aluminum products are properly identified by four digits with a decimal point between the third and fourth digit. A letter may also precede the four digits. The following Aluminum Association designations are representative of aluminum alloys for casting: 208.0, 295.0, 308.0, 355.0, C355.0, 356.0, A356.0, A357.0, 360.0, 366.0, 380.0, A380.0, 413.0, 443.0, 514.0, 518.1, and 712.0. The scope also excludes pure, unwrought aluminum in any form.

Tariff numbers. Imports of the subject merchandise are provided for under the following Harmonized Tariff Schedule numbers: 7604.21.0000, 7604.29.1000, 7604.29.3010, 7604.29.3050, 7604.29.5030, 7604.29.5060, 7608.20.0030, and 7608.20.0090. The subject merchandise entered as parts of other aluminum products may be classifiable under the following additional Chapter 76 subheadings: 7610.10, 7610.90, 7615.19, 7615.20, and 7616.99 as well as under other HTS chapters. While HTS subheadings are provided for convenience and customs purposes, the written description of the scope in this proceeding is dispositive.

(See ITT’s Online Archives or 09/01/10 news, 10090119, for BP summary of the ITA’s fact sheet on this preliminary CV determination.

See ITT’s Online Archives or 04/27/10 news, 10042716, for BP summary of the ITA’s initiation of this CV duty investigation and the companion AD duty investigation.)

ITA contact -- Eric Greynolds (202) 482-6071

(FR Pub 09/07/10, ITA Case No. C-570-968)

The ITA’s memorandum on the currency undervaluation allegation is available here.