CBP Announces EAPA Investigation on Forged Steel Fittings, Imposes Interim Measures
CBP found sufficient evidence to initiate an Enforce and Protect Act investigation on whether YVC USA evaded antidumping and countervailing duty orders on Chinese-origin forged steel fittings that were transshipped through Sri Lanka without declaring the merchandise, according to a notice released Jan. 24. CBP also imposed interim measures on the company.
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The notice follows a Sept. 6, 2022, filing by Flatlands Holdings alleging that two exporters in Sri Lanka, Mass Steel and EFL Global Freeport, imported forged steel fittings into Sri Lanka from China before exporting it to the U.S. The Sri Lanka data in the filing showed that for some shipments by Chinese transshipment company Kingtrans Container Line, the volume, product description and Harmonized Tariff Schedule numbers of merchandise listed EFL as the shipper and YVC as the consignee. Flatlands also alleged that Kingtrans openly advertises sending Chinese-made products to South and Southeast Asia for transshipment to the U.S., with older versions of its website listing Sri Lanka and Malaysia.
Flatlands alleged that neither EFL nor Mass Steel had the capacity to produce the volume of forged steel fittings that YVC received from them. The allegation included a Google Maps photo of Mass Steel's street address and said the structure seen is too small to be a forged steel fittings manufacturing facility. EFL’s website describes the company as a provider of transportation and logistics services rather than a manufacturer.
CBP said the allegation reasonably suggested that YVC engaged in evasion of AD/CVD by transshipment through Sri Lanka. The agency's Trade Remedy Law Enforcement Directorate initiated the investigation on Oct. 13, 2022. In its responses to CBP questionnaires, EFL provided documentation that, according to CBP, indicated it imported Chinese-origin forged steel fittings transshipped by Kingtrans into the U.S. but declared it as Sri Lankan-origin for at least one shipment.
In YVC's questionnaire responses, the company left out information regarding Mass Steel's management and didn't explain Mass Steel's supposed manufacturing capabilities or processes, CBP said. This contributed to a reasonable suspicion that Mass Steel, YVC’s supplier, may not have produced the forged steel fittings imported by YVC in at least three entries, CBP said.
Based on the totality of the evidence, CBP found reasonable suspicion of evasion and imposed interim measures on YVC's imports of forged steel fittings. CBP will suspend liquidation of each unliquidated entry entered on or after Oct. 13, 2022, the date the investigation was initiated. CBP will also extend the period for liquidating each unliquidated entry that entered before Oct. 13 and may take additional measures as the commissioner determines necessary, including requiring a single transaction bond or additional security or the posting of a cash deposit for such covered merchandise.